Prompt:You are leading atraining session in your workplace on conducting a Sensitivity Analysis as atool for Capital Budgeting.Instructions:Prepare aPowerPoint presentation on this topic. In 5-7...

Sensitivity Analysis as a tool for capital budgeting
Sensitivity Analysis as a tool for capital budgeting
Sensitivity Analysis
Determination of the effect on the target variable based on the changes in various variables
How can a change in decision affect the result
Sensitivity analysis is a tool which is used by analysts and other people to determine the change in the target variables based on the changes done in other variables. Like if the target variable is the value of a firm, that can be affected by a change in the sales assumption or a change in the discount rate which is used to determine the value of the firm.
Also, sensitivity analysis is used to determine the change in the result with a change in the decision that has been made.
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Qualitative Steps
The qualitative steps which are necessary in conducting a sensitivity analysis are:
Determine the factors that can effect the target varibles
Determine the changes that can occur because of the...