Scenario: A company must decide whether to invest $100 million in developing and implementing a new enterprise system in the face of considerable…
This is a real option problem in Finance. Answer required within next six hours. Request excel be used to show work.
It has three parts. Part one Evaluate using conventional NPV analysis requires six answers. Part two Evaluate using the real option approach (all cash flows are after tax) requires four answers. Part three Comparison Critical Capabilities requires answers to five answers and three parts to 1. breakeven probability 2. Critical probability of success and 3. Go / No Go Probability.
I have attached the Word file here.