Question: PART 3A: Use the Excel cells from Part 1 above to run a sensitivity analysis on revenue growth. Recall from above the high case has
| PART 3A: Use the Excel cells from Part 1 above to run a sensitivity analysis on revenue growth. Recall from above the high case has 8% revenue growth, base case is 5% and low case is 2%. Re-calculate NPV, IRR and Payback period for the high and low case and correctly fill out this table. | |||||||
| Sensitivity Analysis Table | Growth (%) | NPV ($'s) | IRR (%) | Payback | |||
| Low Growth | 2% | 527,634.86 | 11.27% | 4.26 | |||
| Base Case (from part 1A) | 5% | 536,312.48 | 12.67% | 4.20 | |||
| High Growth | 8% | 545,320.32 | 14.07% | 4.14 | |||
As the firm's CFO, how would you explain the sensitivity analysis on revenue growth? What insights do you see?
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
