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Sir John,
In calculating MIRR (MMC June 2011) for PVr do we use the NPV of ONLY the positive cash inflows from the project and for PVi the NPV of the (initial usually) capital invested?
Also in Black Scholes, for real options, the Pa value sometimes is taken to be the NPV of the project (including the capital investment) but sometimes NPV for Pa calculation purpose is taken to be only the positive cash inflows of the entire project.
Could you please clarify this ?
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Past paper Question Tisa ( june 2012) for MIRR & MMC (June 2011) where Pa used only cash inflows (NPV) Vs Digunder Dec 2007 where Pa used net NPV as well as the Pe amount for Pa.
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