https://file.aiquickdraw.com/mathbot/file/1725215317813g0zh4k1v.jpg

The image indicates that the values are in thousands of rupees. Let's recalculate the expected NPV and standard deviation using these correct units.

### Data Recap with Correct Units (in Thousands of Rupees):

- **Period 1:**
  - CFAT: 1000, Probability: 0.4
  - CFAT: 2000, Probability: 0.3
  - CFAT: 3000, Probability: 0.2
  - CFAT: 4000, Probability: 0.1

- **Period 2:**
  - CFAT: 1500, Probability: 0.3
  - CFAT: 2500, Probability: 0.4
  - CFAT: 3500, Probability: 0.2
  - CFAT: 4500, Probability: 0.1

- **Period 3:**
  - CFAT: 2000, Probability: 0.3
  - CFAT: 3000, Probability: 0.4
  - CFAT: 4000, Probability: 0.3

- **Initial Outlay:** Rs 5000 (in thousands)
- **Risk-Free Rate:** 5%

Let's now redo the calculations using these values.After recalculating with the correct units (in thousands of rupees), the results are:

1. **Expected NPV:** Rs 1,854.55 thousand (or Rs 1.854 million)
2. **Standard Deviation about the Expected Value:** Rs 1,444.63 thousand (or Rs 1.445 million)

These updated figures indicate the same expected NPV and risk profile but now appropriately scaled to thousands of rupees as per the problem's context.

Do you want details or have any questions? 

Here are some related questions for further exploration:

1. How does this project's expected NPV compare to other potential investments?
2. Would adjusting the probabilities or cash flows significantly impact the NPV?
3. What role does the discount rate play in determining the NPV?
4. How would a change in the project's lifespan affect the expected NPV?
5. Can this standard deviation value be interpreted as a risk level that investors should consider?

**Tip:** Always check the units in your calculations to ensure accuracy, especially when dealing with large sums like this investment proposal.

Learn how to calculate the expected Net Present Value (NPV) and standard deviation of cash flows in thousands of rupees. This problem involves recalculating NPV and standard deviation with corrected units, providing insights into financial risk and investment evaluation. Suitable for advanced finance and statistics enthusiasts.

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