Which One of the Following Statements Concerning Scenario Analysis of a Proposed

question 235

Multiple Choice

Which one of the following statements concerning scenario analysis of a proposed project is correct?

• A) The worst case scenario determines the net present value of a project given that a natural disaster occurs.
• B) Scenario analysis assures a firm that the actual results of a project will lie within the range of returns as computed under the best and the worst case scenarios.
• C) Scenario analysis provides a clear signal to management to either accept or reject a project.
• D) Scenario analysis only provides management with a glimpse of the possible range of outcomes that could result should a project be accepted.
• E) When the base case scenario results in a positive net present value, management can be assured that the proposed project will meet or exceed their expectations.

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Definitions:

Predict

To declare or indicate a future event or outcome based on observation, experience, or scientific reasoning.

Unconditional Positive Regard

A term in psychology that expresses accepting and supporting a person regardless of what they say or do, especially used in client-centered therapy.

Empathetically Listen

The act of listening with empathy, which involves fully understanding and being sensitive to the feelings and thoughts of another person.

Sobbing Uncontrollably

The act of crying with short, quick breaths, typically as a result of acute emotional distress, grief, or pain.