What benefit can monte carlo simulation add to joe and micks


Assignment

1. Based on the base case scenario and the two alternative downside possibilities, is this invest- ment economically attractive?

2. What benefit can Monte Carlo simulation add to Joe and Mick's understanding of the eco- nomic benefits of the Little Judson Prospect?

3. Incorporate uncertainties into the spreadsheet using Crystal Ball. What do the Monte Carlo results reveal? What is the probability that the NPV will be greater than zero? How sensitive is the NPV to the different inputs?

4. Think about the proper discount rate-should it be adjusted now that much of the risk has been modeled explicitly with Crystal Ball? Should Mick invest?

Format your assignment according to the following formatting requirements:

1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.

2. The response also include a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.

3. Also Include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.

Attachment:- Little-Judson-Prospect.rar

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