5. Sensitivity and scenario analysis Different techniques for analyzing project is require different input variables and assumptions Spese you are using the sensitivity analysis technique to evaluate project risk. You would change in the model to evaluate the effect of the input factors on the expected valut Martine is a risk analyst. She is conducting a sentivity analysis to evaluate the riskiness of a new project that her company is considering investing in her risk analysis report includes the sensitivity curve shown on the graph BC Base Case CHANGES IN SELLING PRICE Percent This curve implies that the project is very sensitive to changes in the price of the product. The project's NPV is likely to become negative if the price for which the product can be sold decreases by Along with the sensitivity analysis, Martina is including a scenario analysis for the project in her report, giving the probability of the project generating a negative NPV. Her report includes the following information about the scenario analysis: Data Collected Outcome Pessimistic Most likely Optimistic NPV - $5.62 million $7.94 million $16.45 million Probability (P) 0.35 0.30 0.35 0.4 0.6 0.8 1.0 Probability Data for z 0.03 0.06 0.09 0.3336 0.3228 0.3121 0.2546 0.2451 0.2033 0.1949 0.1867 0.1515 0.1446 0.1379 Complete the missing information in Martina's report: The expected net present value of the project is Standard deviation of the net present value (the NPV of the project is likely to vary by) million