Business-7646380 - Standard net present value is the...

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Define contingent net present value (NPV). Outline and explain the differences between standard and contingent NPV. Solution: Contingent net present value means the net present value of the project which depends upon the happening and non-happening of certain events. This means that in a project if the net present value of the project depends upon a certain event each such NPV will be regarded as contingent net present value.
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Unformatted text preview: Standard net present value is the difference between the present value of cash inflow and the cash outflow discounted at the weighted average cost of capital. There is a very slight difference between the contingent net present value and the standard net present value in the sense that contingent net present value will arise only if a chance of an event is uncertain....
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