The Total NPV of a New Plant Is Equal to the NPV

question 42

True/False

The total NPV of a new plant is equal to the NPV of the new plant plus the change in the present value of existing plants due to the impact of the new plant.

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Definitions:

Events Of Interest

Specific outcomes or occurrences within a statistical experiment that are relevant to the research question or objective.

Randomly

In a manner that occurs without a predictable pattern, enabling each member of a set to have an equal chance of selection.

Poisson Probability Distribution

A discrete frequency distribution which gives the probability of a number of independent events occurring in a fixed period of time or space if these events happen with a known constant mean rate and independently of the time since the last event.

Continuous Probability Distribution

A function that describes the likelihood of any outcome within a continuous range of outcomes occurring.