Which of the Following Is Correct About Scenario Analyses

question 63

Multiple Choice

Which of the following is correct about scenario analyses?

• A) The objective of the process is to forecast the future.
• B) The scenario building team identifies the driving forces and "critical certainties" in a decision and prioritizes them.
• C) By anticipating the future and recognizing the warning signs of turbulence ahead, managers can develop more effective strategies.
• D) The process extrapolates from past data to build scenarios for guiding decision making.
• E) Managers develop best-case, worst-case, and most likely scenarios to guide decision making.

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Definitions:

Profits and Losses

Financial outcomes of a business's operations where profits represent the excess of revenues over expenses and losses reflect the opposite.

Distribution of Income

The way in which the total income earned in an economy is divided among its citizens or factors of production.

Resource Reallocation

The process of redistributing resources from less productive to more productive uses to increase overall efficiency or to meet strategic objectives.

Society's View

The collective opinions, attitudes, and values of a community or population towards various issues, concepts, or entities.