Which technique considers a project's NPV when a number of variables have been changed simultaneously?
A) Scenario analysis
B) Probability analysis
C) Discount- rate analysis
D) Sensitivity analysis

Question

Quizplus · Accepted Answer

Scenario analysis considers a range of possible scenarios with multiple variables changed simultaneously to see how it affects the NPV of a project. Probability analysis considers the probability of different outcomes based on the variables. Discount-rate analysis calculates the impact of changing the discount rate on NPV. Sensitivity analysis looks at how changes in individual variables affect the NPV.

Which Technique Considers a Project's NPV When a Number of Variables