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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Sensitivity
Hi
need to ask that in sensitivity analysis question if there is tax involved then do we need to take the after tax PV of all cash flows involved e.g. Revenue, variable cost and fixed cost etc for calculating the sensitivity of these cash flows?
Yes – because if (for example) the revenue changes then the profit will change by the same amount and therefore the tax will also change.
Thanks got it!
You are welcome 🙂