Sensitivity analysis is described as a "What-if"

analysis because it:

A Asks what happened in the past Correct Answer Incorrect Answer

B Tests the impact of changing one variable while keeping others constant Correct Answer Incorrect Answer

C Guarantees the viability of a project Correct Answer Incorrect Answer

D Replaces the need for a Balance Sheet Correct Answer Incorrect Answer

E Defines the legal framework of accounting Correct Answer Incorrect Answer

Solution

It is a modeling technique that determines how different values of an independent variable affect a specific output under given assumptions. By changing one or more key input variables, it allows analysts to ask and answer questions such as "What if XYZ happens?" to evaluate potential risks, opportunities, or outcomes.

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HPCL CA

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