Question: 18 3 points A company is using sensitivity analysis to analyse the risk of a two year investment opportunity. The following cash flow model
18 3 points A company is using sensitivity analysis to analyse the risk of a two year investment opportunity. The following cash flow model is available: Year 1 Capital expenditure (30,000) Revenue E 60,000 60,000 The relevant discount rate used is 16% and the net present value of the project has been calculated as (6,599. Is this project sensitive to changes in revenue? The project is not sensitive to changes in revenue. The project is sensitive at both the 5% level and the 10% level. The project is sensitive at the 5% level, but not at the 10% level The project is sensitive at the 10% level, but not at the 5% level. Previous Costs E 37.200 37,200 Net cash flow E (30,000) 22.000 22.800 Next
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