A behavioral approach that evaluates the impact on the firm's return of simultaneous changes in a number of project variables is called
A) sensitivity analysis.
B) simulation analysis.
C) none of the above.
D) scenario analysis.

Question

Quizplus · Accepted Answer

Scenario analysis evaluates the impact on the firm's return of simultaneous changes in a number of project variables. Sensitivity analysis examines how changes in a single input variable affect the firm's return, and simulation analysis involves using a model to generate multiple possible outcomes based on various inputs. Therefore, the best choice for this question is D) scenario analysis.

A Behavioral Approach That Evaluates the Impact on the Firm's