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Different techniques for analyzing project risk require different input variables and assumptions. The procedure in which a set of key elements affecting the expected value
Different techniques for analyzing project risk require different input variables and assumptions.
The procedure in which a set of key elements affecting the expected value are changed to study the effect on the expected value is called
analysis.
Diana is a risk analyst. She is conducting a sensitivity 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.
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, Diana 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:
Complete the missing information in Diana'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. please answer all if you are not sure about the answers please double check and answer all of the questions
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