The difference between sensitivity analysis and scenario analysis is
A)sensitivity analysis is a method for evaluating risk while scenario analysis is not.
B)sensitivity analysis is based on regression analysis while scenario analysis is not.
C)sensitivity analysis examines the impact on the overall results of a change in one variable while scenario analysis examines the impacts on overall results of changes in several variables at the same time.
D)None of the above

Question

Quizplus · Accepted Answer

Sensitivity analysis focuses on the impact of a change in one variable while holding all other variables constant, while scenario analysis considers how changes in multiple variables may impact overall results. Therefore, C accurately differentiates between the two methods. A and B are not accurate statements about the differentiating factor between sensitivity and scenario analysis.

The Difference Between Sensitivity Analysis and Scenario Analysis Is