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One board member wants to make sure that a complete risk analysis, including sensitivity and scenario analyses, is performed before the proposal is sent to the board. Perform a sensitivity analysis. What management information is provided by the sensitivity analysis? Perform a scenario analysis. What management information is provided by the scenario analysis? Why is the expected NPV obtained in the scenario analysis different from the base case NPV?

One board member wants to make sure that a complete risk analysis, including sensitivity and scenario analyses, is performed before the proposal is sent to the board. Perform a sensitivity analysis. What management information is provided by the sensitivity analysis? Perform a scenario analysis. What management information is provided by the scenario analysis? Why is the expected NPV obtained in the scenario analysis different from the base case NPV?

Business/Professional Ethics Directors/Executives/Acct
Business/Professional Ethics Directors/Executives/Acct
8th Edition
ISBN:9781337485913
Author:BROOKS
Publisher:BROOKS
Chapter7: Managing Ethics Risks & Opportunities
Section: Chapter Questions
Problem 1Q
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One board member wants to make sure that a complete risk analysis, including sensitivity and scenario analyses, is performed before the proposal is sent to the board. Perform a sensitivity analysis. What management information is provided by the sensitivity analysis? Perform a scenario analysis. What management information is provided by the scenario analysis? Why is the expected NPV obtained in the scenario analysis different from the base case NPV?
Transcribed Image Text:One board member wants to make sure that a complete risk analysis, including sensitivity and scenario analyses, is performed before the proposal is sent to the board. Perform a sensitivity analysis. What management information is provided by the sensitivity analysis? Perform a scenario analysis. What management information is provided by the scenario analysis? Why is the expected NPV obtained in the scenario analysis different from the base case NPV?
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