Following an in-depth review of a scenario analysis for a potential capital investments after-tax cash...

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Accounting

Following an in-depth review of a scenario analysis for a potential capital investments after-tax cash flows, your junior analyst has provided you with the information in the table below. Use the information in the table to make a decision on this investment (i.e., reject or accept). Calculate and discuss your recommendation. Also discuss how confident you are about your decision. Assume that the junior analyst has provided a correct and accurate analysis.

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Worst-Case Scenario Base-Case Scenario Best-Case Scenario Probability 10% 70% 20% NPV $500,000 $100,000 $250,000

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