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Suppose a project has three risk variables: a, b, and c. You know the distribution for each of the variable (a,b, and c respectively). You
Suppose a project has three risk variables: a, b, and c. You know the distribution for each of the variable (a,b, and c respectively). You know these variables are uncorrelated.
-Explain how you would conduct a sensitivity analysis of the project.
-Explain why a Monte Carlo analysis would be preferred to a sensitivity analysis.
-Describe how you would conduct one simulation of the Monte Carlo analysis.
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