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Error when forecasting can seriously impact on an investment appraisal. Describe the Sensitivity Analysis approach, and explain its potential advantages. Compare it with a Scenario
Error when forecasting can seriously impact on an investment appraisal. Describe the Sensitivity Analysis approach, and explain its potential advantages. Compare it with a Scenario Analysis, and consider if it offers any advantages. An application of Real Options and Decision Trees can, in some circumstances, improve an investment appraisal decision. Describe this approach, and suggest some circumstances when it should be employed.
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