Sensitivity Analysis Is the Form of Risk Analysis

question 76

Multiple Choice

Sensitivity analysis is the form of risk analysis

• A) that examines the relationship between total firm cash flows and the NPV of a particular project.
• B) that examines the volatility of NPV.
• C) that examines the impact of key variables such as sales or costs in various combinations.
• D) that examines the impact of key variables such as sales or costs one at a time.

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Definitions:

Duress

Compulsion, force, or undue pressure exerted upon a person to coerce them into performing an act against their will.

Threatens

Expresses an intention to cause pain, injury, damage, or other hostile action against someone in retribution for something done or not done.

Sell

The act of transferring ownership of a good or service to another party in exchange for money or other compensation.

Offers More

Implies providing additional benefits or proposals beyond the initial offer.