QUESTION 28 The kind of analysis that consists of rerunning the model to determine the effect on the output variables of changes in the input variables is __________.   a. scenario analysis   b. probabilitistic analysis   c. simulation   d. sensitivity analysis

Q: Which Variable Is most critical in Sensitivity Analysis?

A: Sensitivity analysis helps to analyze the project by considering different variables. It helps…

Q: Explain the term sensitivity analysis

A: Sensitivity Analysis is a tool used in financial modeling to study how independent variable values…

Q: How is sensitivity analysis used to cope with uncertainty in decision making?

A:

Q: Which of the following is not a cause of mistakes in model building? Choices:   A.Sub-optimal…

A: There are numerous mistakes in planning stage of model building. Unclear vision, lack of resources,…

Q: What are the different variables in sensitivity analysis?

A: Answer: Under a given set of expectations, a sensitivity analysis describes the way different values…

Q: What detail would a decision maker require to analyse a dilemma with the expected value? What…

A: Settling on choices is surely the main undertaking of an administrator and it is regularly an…

Q: What is a scenario analysis? What is it designed to show, and how does it differ froma sensitivity…

A: Scenario analysis is the technique of analyzing the portfolio to find out the expected value of…

Q: Which one is not an advantage of the sensitivity analysis? A. To make contingency plans B. To adjust…

A: Some important factors are changeable and unpredictable in future like interest rates, cashflows,…

Q: An analysis of what happens to the estimate of net present value when only one input variable is…

A: Net Present Value: It is the present worth of future cash flows and the initial cost of the project.…

Q: Which method of forecasting is most widely used? a. Regression analysis. b. Exponential smoothing.…

A: Regression analysis method of forecasting is the most widely used method of forecasting....

Q: What are the two primary factors that are difficult to estimate in sensitivity analysis?

A: Answer: Sensitivity analysis is commonly used in determining the interactions in a system or even a…

Q: What role does MAD play in evaluating a forecasting model?

A: MAD refers to mean absolute deviation. It is also known as average absolute deviation which is the…

Q: How does the use of scenarios differ from sensitivity analysis?

A: Sensitivity analysis and scenario analysis are the assessment techniques that are used in investment…

Q: Multiple Choice What happened? What is happening? Why did it happen? What are the root causes of…

A: The net income is the income that is received by the sale of goods and services after deducting all…

Q: How can sensitivity analysis be incorporated in DCF analysis?

A:

Q: How is the ERC (efficient response coefficient) determined and which role analyst forecasts play in…

A: The earnings response coefficient, or ERC, is a calculated ratio between stock returns and the…

Q: What is Sensitivity Analysis and why is it useful?

A: The sensitivity analysis is utilized to comprehend the impact of a lot of autonomous factors on some…

Q: the strengths o

A: Strengths of  scientific approach  Researchers employing survey methods to collect data enjoy a…

Q: Differentiate between sensitivity analysis and scenario analysis.What advantage does scenario…

A: Differentiate between sensitivity analysis and scenario analysis: Scenario analysis involves…

Q: Sensitivity analysis is the analysis of the effect of parameter changes on the optimal solution.…

A: Sensitivity analysis is done to understand changes in a target variable when changes are made in…

Q: What is a sensitivity analysis, and how does it work? Can you provide an illustration of this?

A: Here is the Answer

Q: What do you mean by sensitivity analysis?What are the setting and the constraints of the sensitivity…

A: Sensitivity analysis is an analysis in finance, which used to help in an evaluation of that how an…

Q: Differentiate between applied and actual FOH with two examples, support your response with…

A: Overhead are those expenses which are not directly consumed to make a product or render service but…

Q: Explain the relationship between WACC and EVA! demonstrate by providing a complete analysis and…

A: Formula: EVA = Net Operating profit margin(NOPAT) -(Capital employed* WACC)

Q: What are some strengths and weaknesses of sensitivity analysis and scenario analysis?

A: Sensitivity Analysis determines how the dependent variable changes when the independent variable…

Q: When we work with the breakeven point, how important is it to understand what a decision variable…

A: The question is related to Marginal Costing. The break-even point is that level of sales at which…

Q: 9. Which one is not an advantage of the sensitivity analysis? A. To make contingency plans B. To…

A: Sensitivity analysis determines how different values of an independent variable affect a particular…

Q: If an information provides feedback about previous evaluations, it is said to have: a. Relevant…

A: Confirmatory value arises where the information provides feedback that confirms or changes past or…

Q: what does the sensitivity analysis look like?

A: Sensitivity analysis:Sensitivity analysis is a process of evaluating how various values of an…

Q: t is objective?...

A: Objective vs subjective trading: Most traders follow either an essentially objective or subjective…

Q: What advantage does scenario analysis have over sensitivityanalysis?

A: In finance, we are required to analyze the change in value of one variable over the change in the…

Q: The inputs to a model may have different roles. Among the choices, which should be excluded?…

A: Inputs are main variables for decision making in any model. Inputs influence the output amd the…

Q: The audit risk model consists of: AR = IR x CR x DR.  The detection risk is the dependent variable.…

A: Level of Detection Risk is dependent on levels of Inherent Risk and level of Control Risk. There is…

Q: Q1- What is a probability impact matrix? Q2- how to make a risk assessment matrix? Q3- how to use…

A: Probability impact matrix is 2 dimensional graphic risk assessment tool based on chances on…

Q: Which of the following is NOT an advantage of using sensitivity analysis?

A: Which of the following is NOT an advantage of using sensitivity analysis? A  It identifies the…

Q: How is the process of the NPW measure implemented with the decision rule?

A: As an organization expands, it needs to take important decisions that involve immense capital…

Q: 1 Which of tha following statements is NOT a characteristie of quantitative research? A The results…

A: Quantitative research seems to be the process of collecting and analyzing numerical data. It might…

Q: What is a sensitivity analysis?

A: Sensitivity analysis:Sensitivity analysis ascertains the manner in which the different values of an…

Q: Define the term Sensitivity Analysis?

A: Sensitivity analysis is a financial modelling tool which aims to analyze the change in output…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.