Site MapHelpFeedbackRisk Analysis, Real Options, and Capital Budgeting
Risk Analysis, Real Options, and Capital Budgeting


Premium content available for purchase is identified in the left-hand Navigation Menu by the asterisk (*) which precedes the content name. Premium Content on this OLC includes:
    1. Narrated Lectures (Chapter Content)
    2. iPod Content (Chapter Content)
7.1Sensitivity Analysis, Scenario Analysis, and Break-Even Analysis206
Sensitivity Analysis and Scenario Analysis206
Break-Even Analysis210
7.2Monte Carlo Simulation214
Step 1: Specify the Basic Model214
Step 2: Specify a Distribution for Each Variable in the Model214
Step 3: The Computer Draws One Outcome217
Step 4: Repeat the Procedure217
Step 5: Calculate NPV218
7.3Real Options218
The Option to Expand219
The Option to Abandon220
Timing Options222
7.4Decision Trees223
Summary and Conclusions225
Concept Questions225
Questions and Problems226
Mini Case: Bunyan Lumber, LLC232










Ross: Corporate Finance 9eOnline Learning Center

Home > Chapter 7