Eagle Airlines.docx - Introduction Giannis Hatjistelios president of Eagle Airlines is considering to invest on a Piper Chieftain airplane Taking into

Eagle Airlines.docx - Introduction Giannis Hatjistelios...

This preview shows page 1 - 2 out of 6 pages.

Introduction Giannis Hatjistelios, president of Eagle Airlines is considering to invest on a Piper Chieftain airplane. Taking into consideration the data provided from his past experience and competition analysis we will examine the possible results of the 3 Methodologies: Scenario Analysis, Sensitivity and Monte Carlo Analysis. With the implementation of Risk Analysis using the mentioned Methodologies above we will be able to examine the sensitivity of uncertain parameters, calculate the possible expected Annual Cash Flows from the use of the New Aircraft and recommend risk medication strategies that could be followed by Eagle Airlines in order to manage successfully the associated risk of the investment. Question a What is the range of possible values for the annual cashflow? Base your answers on the optimistic and pessimistic scenarios? In order to examine how the below uncertain parameters could affect the expected Cash Flow of the investment we used the Scenario Analysis. The following three scenarios (Base, Optimistic, and Pessimistic) were used for the calculation of the Annual Cash Flow. The Annual Cash Flow of the Pessimistic, Base and Optimistic Scenario is -€39.040, €46.184 and €273.180 respectively. It can be observed that there is a wide range between Pessimistic and Optimistic Scenario equal to €312.22 and as a result high variability between the Annual Cash Flow. Consequently, we shall proceed with further investigation and Risk Analysis.
Image of page 1
Image of page 2

You've reached the end of your free preview.

Want to read all 6 pages?

  • Fall '15
  • Dr. Kotsias

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes