Use the Information Below to Answer the Following Question(s)

question 147

Multiple Choice

Use the information below to answer the following question(s) .Wet Water Company drills residential and commercial wells.The company is in the process of analyzing the purchase of a new drill.Information on the proposal is provided below:
Note: Other than the initial investment, cash flows are end of period.The working capital is returned at the end of the investment period.
-A "what-if" technique that examines how a result will change if the original predicted data are not achieved, or if an underlying assumption changes, is called

• A)sensitivity analysis.
• B)net present value analysis.
• C)internal rate of return analysis.
• D)adjusted rate of return analysis.
• E)payback method.

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Definitions:

Fabricating Department

A specialized part of manufacturing where products are assembled, shaped, or otherwise fabricated from raw materials.

Net Profit

The amount of money left over after all operating expenses, taxes, and costs have been subtracted from total revenue.

Binding Constraint

A limitation or restriction within an optimization problem that holds equality at the optimal solution; it actively influences the solution of the problem.

Cell Value

The specific data or content stored in an individual cell in a spreadsheet or table.