# Compute the VaR from NPV (Net present value)? [closed]

A client is evaluating an investment in Indochina requiring an initial expenditure (period 0) of 10,000, and which then in periods 1 and 2 gives a benefit V1 and V2. Assume that the discount rate to evaluate this project is r = 10% (This rate is a known value and not a random variable). If the benefits follow the following distribution:

What is the Value at Risk (VaR) of the NPV from such investment?

## closed as off-topic by Bob Jansen♦Apr 5 at 6:10

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• $NPV=V1/1.1+V2/1.1^2$ So NPV is normally distributed. – Alex C Apr 5 at 2:31
• What about the VaR? – FranklinBoggo Apr 5 at 2:32
• The VaR of a normal variable with known mean and variance is not too difficult to calculate. – Alex C Apr 5 at 2:33
• Apologies, I am just introducing myself to working with multiple random variables – FranklinBoggo Apr 5 at 2:34
• Yes but asking homework problems without showing attempts to solve is not a well-regarded approach to learning – James Spencer-Lavan Apr 5 at 4:55