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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Sensitivity analysis
Hi Sir,
Please could you help me to answer the following, which two statements are correct in sensitivity analysis?
A) it can be used to gain insight into which assumptions or variables in a situation are critical
B) it provides info on the basis of which decisions can be made but it doesn’t point to the correct decision directly
C) As well as identifying how far a variable needs to change, sensitivity analysis looks at the probability of such change
D) it not only assumes that variables can change independently, it also allows to change more than one variable at a time
To me it is A B and C…
Thanks
Leo
C is not correct because although it measures the effect of a change (as in A) it doesn’t tell us how likely it is that there will be a change (i.e. it does not give the probability of it changing).
Thank you
You are welcome 🙂