This analysis demonstrates financial viability of a Madrasah building project using capital budgeting and simulation methods, indicating potential returns.
This study evaluates the financial feasibility of constructing a new Madrasah Tsanawiyah building at PPNI Foundation in East Lampung, Indonesia, using capital budgeting methods and Monte Carlo simulation. The research applies Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period (PBP), and Profitability Index (PI) to assess project viability. Sensitivity analysis identifies the most influential variables, while Monte Carlo simulation measures probabilistic risks. Findings indicate an NPV of IDR 18.57 billion, an IRR of 19.89%, a PI of 1.288, and a PBP of 5.23 years, confirming project feasibility. Sensitivity analysis highlights WACC, donation fee growth, and enrollment fee changes as key factors. The results guide strategic decisions and risk mitigation in educational infrastructure investments.
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Sari et al. (2025) studied this question.
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