... before a project loses money. All three analyses help an organization or individual understand the risks involved in a project. The goal of this paper is to analyze the risks associated with the investment decision made in the Capital Budgeting simulation. In the Capital Budgeting simulation, Eichner's major goals for Silicon Arts Inc. (SAI) are to increase market share and keep pace with technology. The two proposals prepared by the task force are to expand into existing Digital Imaging market in order to increase market shares or enter the wireless communications market. The first step in the analysis is to examine the probable future scenarios that will affect the operating cash flow figures of the two proposals. The first analysis led to a NPV of 12,383 for Dig-image and 12,348 for W-Comm. IRR were 29.90% for Dig-image and 30.20% for W-Comm. At this point, there is a major risk ...

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