If Sensitivity Analysis Concludes That the Largest Impact on Profits

question 26

Multiple Choice

If sensitivity analysis concludes that the largest impact on profits would come from changes in the sales level,then:

• A) fixed costs should be traded for variable costs.
• B) variable costs should be traded for fixed costs.
• C) the project should not be undertaken.
• D) additional marketing analysis may be beneficial before proceeding.

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Definitions:

Electrical Energy

The form of energy resulting from the flow of electric charge, widely used for domestic, commercial, and industrial applications.

Torque

A measure of the force that can cause an object to rotate about an axis.

Mechanical Work

The transfer of energy from one object to another to cause movement against a force.

Full-load Torque

The torque a motor generates at its rated power and voltage to maintain its rated speed under full-load conditions.