To ascertain whether the accuracy of the variable cost estimate for a project will have much effect on the final outcome of the project,you should probably conduct _____ analysis.
A) leverage
B) scenario
C) break-even
D) sensitivity
E) cash flow

Question

Quizplus · Accepted Answer

Sensitivity analysis is used to determine how a change in a variable will affect the outcome of a project or decision. By conducting sensitivity analysis on the variable cost estimate, the project team can determine how changes in the estimate will impact the final outcome of the project. This analysis can help the team make informed decisions about the level of accuracy needed for the variable cost estimate, and can aid in developing contingency plans.

To Ascertain Whether the Accuracy of the Variable Cost Estimate