Problem:
NPV or IRR investment decision process, why include manager intuition?
$1 Million NPV project, what does this mean?
For what kinds of investments would terminal value account for a substantial fraction of the total project NPV, and for what kinds of investments would terminal value be relatively unimportant?
Suppose an analyst makes a mistake and calculates the NPV or an investment project by discounting the project's contribution to net income each year rather than by discounting its cash flow. Would you expect the NPV based on net income to be higher or lower than the NPV calculated using cash flows?