What detail would a decision maker require to analyse a dilemma with the expected value? What choices are open if the probabilities of the natural states are uncertain to the decision-maker? Can you ask about how in such a situation you might use sensitivity analysis?

Q: What are the benefits and Flaws of Payback Screening?

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: Can any one suggest me to check the relationship between human rationality in investment decision…

A: All investment choices are inalienably logical since one's hard-earned cash is being invested.…

Q: An analyst wanting to assess the downside risk of an alternative investment and is considering the…

A: Downside risk is a statistical measure that defines the probability of potential loss from a fall in…

Q: Which of the following would not result in exposure to nonsampling risk?a. Measuring the…

A: Sampling: Sampling allows an individual to obtain information about the population of interest in a…

Q: What is the risk of Incorrect Rejection?

A: Risk of incorrect acceptance of internal control reliability and risk of incorrect acceptance of…

Q: Is a method of screening out in certain situations an unacceptable investment alternative?

A: Capital budgeting is the technique that is used in business to determine the best investment…

Q: How do simulation analysis and scenario analysis differ in the way theytreat very bad and very good…

A: The process to evaluate different probable events and their outcomes that is end result of a project…

Q: Describe the Sensitivity Analysis for Mutually Exclusive Alternatives?

A: Sensitivity analysis portrays how various values of an independent factor under a given arrangement…

Q: Why do we need stress testing and scenario analysis?

A: A stress test or scenario analysis is used to determine and analysis the outcome of a financial…

Q: “CVP analysis is both simple and simplistic. If you want realistic analysis to underpin your…

A: CVP analysis refers to the cost-volume-profit analysis which describes the change in the operating…

Q: What techniques can be used to analyze real options?

A: A choice accessible to the organization's managers related to the investment opportunities is known…

Q: a. Which process would you use if you use an optimistic decision-making criterion? b. Which process…

A: CVP Analysis stands for Cost Volume Profit. CVP Analysis is used to consider the various figures…

Q: definition of political risk and how mitigate it?

A: Political risk are risk arising due to political parties of countries with change in government…

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: Why is the additional risk not taken without expected additional return?

A: The risk-return tradeoff takes note of that the potential return increments with an expansion in…

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: What alternatives are available to Wilkinson and Walker to deal with this situation, and what are…

A: Introduction: When a person or organization becomes insolvent, it is unable to meet its financial…

Q: How are Sensitivty Analysis and Scenario Analysis different in details?

A: Sensitivity analysis is the evaluation of the impact on the project when there may be a few…

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 the risk of Incorrect Acceptance?

A: Risk of incorrect acceptance: The risk that the sample selected by the auditor may show that there…

Q: What controls would you implement to

A: Internal Control system: Internal control system can be defined as the set of policies and…

Q: When we perform sensitivity analysis for mutually exclusive alternatives, itmay be more effective to…

A: Net present worth is acknowledged as the current worth or value of a project which is adjusted as…

Q: What do we mean by fundamental risk, and why may such risk allow behavioral biases to persist for…

A: Answer: Meaning: Fundamental risk is nothing but the loss arising out of situation which affects a…

Q: This is is used to check the effect on the recommendations of a model if the estimates turn out to…

A: solution: concept In a what if analysis we try to answer the question of what if What if the value…

Q: What is the purpose of NPV analysis? Be sure to discuss the concepts of risk and return in your

A: Net present value NPV is used quite extensively in capital budgeting decisions whether to accept or…

Q: George wants to calculate risk using risk assessment matrix ,should he assess for the worst credible…

A: Risk assessment matrix is a method used for finding the risk. This method prioritizes the risk by…

Q: payback period, NPV, and IRR always lead to the same decision? Why or why not? If not, which one…

A: Step 1   One of the most essential choices a business owner or management will ever make is capital…

Q: Discuss the following statement: “A project may not be very riskyin spite of its high sensitivity to…

A: Sensitivity analysis is defined as the percentage change in one variable with respect to percentage…

Q: What does a project’s stand-alone risk reflect?

A: Stand alone risks are risks that are associated with a particular asset or a project. Companies when…

Q: What is shared risk? Use an example to explain the shared risk happen and who will involved?

A: Risk means the uncertainty of happening of an event. When the risk is higher than the uncertainty of…

Q: Explain if the operational risk is considered a risk or uncertainty? Why? If it is a risk, how can…

A: Operational Loss:   The risk involved in failures of Man, Machine, Material, and Methods during…

Q: Why is EBITDA controversial?

A: Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is a metric used to assess…

Q: How can we determine whether the project under consideration is of normal risk?

A: Introduction: Risk is nothing but the variation in real returns obtained as opposed to expected…

Q: oncepts of “Relevance” and “Representational Faithfulness”

A: SOLUTION:- Relevance means the potential of information or facts to make a distinction in decision.…

Q: What do you mean by null hypothesis, how to test the hypothesis give the best examples?

A: In common parlance, hypothesis is an assumption regarding anything and that assumption is based on…

Q: Are you agree with the phrase (sentence): "In the following case, a risky person may prefer project…

A: formula  Expected NPV  = Net Present Value × Probability  Standard deviation is a measure of risk.…

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: What is Roll’s critique of CAPM tests?

A: Capital asset pricing model is a model that is used to estimate the expected return on an asset. In…

Q: t is objective?...

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

Q: Why is Scenario Analysis useful?

A: Scenario Analysis is a process where various (more than one) input changes are made at the same time…

Q: How will management know if one of the hypotheses underlying the balanced scorecard is false?

A: The best way to sort out if the speculation is valid or bogus is by trying it. All the speculation…

Q: What is a goingconcern problem? What factors can contribute to such aproblem?

A: Given: To analyse about the going concern problem and its factors contribution as follows,