Which of the following techniques gives an estimate of capital budgeting project risk in terms of the standard deviation of a project's NPV or IRR?

A) Computer simulation
B) Sensitivity/scenario analysis
C) Decision tree analysis
D) Both a and c
E) All of the above

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values deviate from the mean.

Capital Budgeting

The procedure a company follows to assess possible significant projects or investments.

NPV

Net Present Value; a method used in capital budgeting to evaluate the profitability of an investment or project by discounting all expected future cash flows to their present value using a specific discount rate.