Asked by Bailey Hembree on Jun 06, 2024
Verified
Scenario and sensitivity analysis are helpful in determining which variables are most important to the success of a project and determining their relative importance.
Scenario Analysis
A method used in finance to analyze the different possible outcomes of a decision given varying sets of assumptions.
Sensitivity Analysis
A financial modeling tool used to determine how different values of an independent variable will impact a particular dependent variable under a given set of assumptions.
- Distinguish between different types of analysis including scenario, sensitivity, and simulation analyses in evaluating project variables.
Verified Answer
SH
Souhail HamdyJun 12, 2024
Final Answer :
True
Explanation :
Scenario and sensitivity analysis allow for the identification of critical project variables and their impact on the overall outcome, making it easier to prioritize project activities and resources.
Learning Objectives
- Distinguish between different types of analysis including scenario, sensitivity, and simulation analyses in evaluating project variables.
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