The Difference Between Scenario Analysis and Sensitivity Analysis Is That

question 62

Multiple Choice

The difference between scenario analysis and sensitivity analysis is that

• A) scenario analysis is based upon the IRR and sensitivity analysis is based upon NPV.
• B) only sensitivity analysis allows us to change our estimated inputs of our NPV analysis.
• C) scenario analysis considers the effect on NPV of changing multiple project parameters.
• D) only scenario analysis breaks the NPV calculation into its component assumptions.

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Definitions:

Virtual Team

A group of individuals who work together from different geographical locations, often using digital communication technology to collaborate on projects or tasks.

External Visibility

The extent to which an organization or individual is seen or recognized outside its immediate context or environment.

Information Technology

The study or use of systems (especially computers and telecommunications) for storing, retrieving, and sending information.

Physical Structure

The tangible, architectural layout and design of a building or space which can influence behavior and operations within an organization.