“Cash Flow Estimation and Risk Analysis” Please respond to the following:
(1) If a firm decides to structure a project so that expenditures may be made in stages rather than all at the beginning, predict the manner in which this would affect the project’s risk and expected NPV. Support your position with one (1) real-world example of such an effect.
- (2) From the scenario, take a position for or against TFC’s decision to expand to the West Coast. Provide a rationale for your response in which you cite at least two (2) capital budgeting techniques (e.g., NPV, IRR, Payback Period, etc.) that you used to arrive at your decision.