With the aid of computer software, managers can vary assumptions regarding selling prices, costs, and volume and can immediately see the effects of each change on the break-even point and profit.Such an analysis is called:
A) "what if" or sensitivity analysis.
B) vary the data analysis.
C) computer-aided analysis.
D) data gathering.

Question

Quizplus · Accepted Answer

The analysis described in the statement is a "what if" or sensitivity analysis, which is used to determine the impact of changing assumptions on the break-even point and profit.

With the Aid of Computer Software, Managers Can Vary Assumptions