4. 28. Sensitivity analysis [LO 11.1] In Problem 27, suppose you are confident about your own projections,

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4. 28.

Sensitivity analysis [LO 11.1] In Problem 27, suppose you are confident about your own projections, but you are a little unsure about Melbourne's actual machine screw requirement. What is the sensitivity of the project OCF to changes in the quantity supplied? What about the sensitivity of NPV to changes in quantity supplied? Given the sensitivity number you calculated, is there some minimum level of output below which you would not want to operate? Why?

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Fundamentals Of Corporate Finance

ISBN: 9781743768051

8th Edition

Authors: Stephen A. Ross, Rowan Trayler, Charles Koh, Gerhard Hambusch, Kristoffer Glover, Randolph W. Westerfield, Bradford D. Jordan

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