Consider the following statement by a project analyst: "I analyzed my project using scenarios for the
base case, best case, and worst case. I computed break-evens and degrees of operating leverage. I
did sensitivity analysis and simulation analysis. I computed NPV, IRR, payback, AAR, and PI. In the
end, I have over a hundred different estimates and am more confused than ever. I would have been
better off just sticking with my ﬁrst estimate and going by my gut reaction.
Critique this statement.

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The Answer of Consider the following statement by a project analyst: "I analyzed my project using scenarios for the
base case, best case, and worst case. I computed break-evens and degrees of operating leverage. I
did sensitivity analysis and simulation analysis. I computed NPV, IRR, payback, AAR, and PI. In the
end, I have over a hundred different estimates and am more confused than ever. I would have been
better off just sticking with my ﬁrst estimate and going by my gut reaction.
Critique this statement.

Consider the Following Statement by a Project Analyst: "I Analyzed