Decision Tree AnalysisRisk-free 3400

7.00% 0.101500 16000.30 0.60

10000.30

10000.35

-1200 500 6000.60 0.40

3500.25

6000.10

-700 -1000.20 0.50

-7000.40

Decision Tree Analysis(P) (NPV)

Joint Probability Formula Branch NPV of each branch

0.03 =$D$11*G9 1 $3,171.56

0.18 =$D$11*G11 2 $1,599.37

0.09 =$D$11*G13 3 $1,075.31

0.21 =$D$18*G16 4 $140.73

0.24 =$D$18*G18 5 ($208.65)

0.15 =$D$18*G20 6 ($427.01)

0.02 =$D$25*G23 7 ($1,330.14)

0.1 =$D$25*G25 8 ($1,941.55)

0.08 =$D$25*G27 9 ($2,465.61)

1.10 =SUM(I9:I27)

Decision Tree Analysis(P) x (NPV) (P) x [(NPV - NPV-bar)^2]

$95.15 $306,112.25

$287.89 $473,640.83

$96.78 $108,519.52

$29.55 $5,613.58

($50.08) $8,292.17

($64.05) $24,511.24

($26.60) $34,184.51

($194.15) $368,171.93

($197.25) $477,398.91

-22.77 1344.04Expected NPV Standard Deviation

'NPV-bar'