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:

Reform Period

A time frame in which significant changes are made to social, political, or economic institutions and practices.

New Deal

A series of programs, public work projects, financial reforms, and regulations enacted by President Franklin D. Roosevelt in the United States during the 1930s, aimed at recovering from the Great Depression.

Progressive Era

A period of widespread social activism and political reform in the United States from the 1890s to the 1920s, aimed at addressing issues stemming from industrialization, urbanization, and corruption.