________ Considers the Effect of Changing Multiple Parameters Simultaneously

question 8

Multiple Choice

________ considers the effect of changing multiple parameters simultaneously.

• A) Break-even analysis
• B) Scenario analysis
• C) Sensitivity analysis
• D) Cost benefit analysis

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Definitions:

Net Present Value (NPV)

The difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of an investment or project.

Cash Inflows

Money or other forms of financial assets that enter a company, typically from sales, investments, financing, and other business activities.

Depreciation Value

The reduction in value of an asset over time due to wear and tear or obsolescence.

Internal Rate of Return (IRR)

The yield rate at which all of a project's cash flows' net present value becomes null.