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What is the difference between stress testing and what if analysis please? I also seem to get stuck on these stress test questions – what things should I look for that make it more obvious if something is a stress test?
thanks 🙂
What-if lets you try out different assumptions eg about sales volume, tax rates, inflation, sales prices.
That is used in stress testing, but the assumptions tried out are more pessimistic. Eg if sales volume drops 10%? what will our cash position be? What if we lose a major customers? What if raw material prices rise 20%.
I don’t know what you mean about ‘these stress-testing questions’.
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