Sensitivity analysis is a method to analyze uncertainty and project risk by. o Assigning probability distributions to uncertainties in cash flows and assessing the expected values of an output variable such as net present value. o Using a risk-adjusted discount rate to account for uncertainty in a project cash flow. Determining how much an output variable (e.g., net present value, IRR) changes when one or more input variables change. Creating a 95% confidence interval for each output metric