A Project Has an Expected NPV of $50,000 with a Standard

question 6

Multiple Choice

A project has an expected NPV of $50,000 with a standard deviation of the NPV of $20,000. Assume that NPV is normally distributed. What is the probability that the project will have a net present value greater than $60,000?

• A) 1915%
• B) 69.15%
• C) 0.13%
• D) 30.85%

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Definitions:

Sales

The transactions or activities involved in selling goods or services in exchange for money or other compensation.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Bar Chart

A graphical representation of data using bars of varying heights or lengths to show comparisons among categories.

House Calls

Visits made by professionals, such as doctors or technicians, to a person's home to provide services.