An Analysis That Breaks the NPV Calculation into Its Component

question 13

Multiple Choice

An analysis that breaks the NPV calculation into its component assumptions and shows how the NPV varies as one of the underlying assumptions is changed is called:

• A)scenario analysis.
• B)IRR analysis.
• C)accounting break-even analysis.
• D)sensitivity analysis.

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Definitions:

Carrying Capacity

The maximum population size of a species that an environment can sustain indefinitely, given the food, habitat, water, and other necessities available in the environment.

Sustainable Rate

Refers to the level of extraction or use of resources that can be maintained without depleting the resource or harming the environment.

Environmental Resistance

Factors in the environment that limit the growth, abundance, or distribution of organisms or populations.

Intraspecific Competition

A form of competition where individuals of the same species compete for the same resources in an ecosystem, such as food, space, or mates.