Sensitivity analysis

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    alizaidi
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    Hi
    I cant understand Sensitivity analysis since we dont have any OT lectures for this topic. Can u plz breifly explain what is the topic all about??

    Secondly how it can be tested as a written question?? Are we expected to know it in detail? How many marks can it be asked for in the exam??


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    John Moffat
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    Many decisions have to be based on estimates of the figures, and the estimates are only estimates and therefore the actual figures could turn out to be different.

    The sensitivity of a figure is the %’age change that there would have to be before the decision changed. The lower the %’age, the more worried you would be that you might have made the wrong decision.

    It can be tested in a written part by asking you what we mean by sensitivity.
    If it is asked in a written part, then you will not really be expected to be able to say much more than I have written above. I would be surprised if it were for more than about 5 marks.


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    alizaidi
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    Thanx, now i wont be spending my time in reading its advantages and disadvantages and other details :)

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