1) The sensitivity graph of a project is presented below: 70 60 Present Worth ('000 $) 50 40 30 SV 20 10 MARR B) SV C) FC D) VC E) O&M Base O&M FC VC -20% -15% -10% -5% 0% 5% 10% 15% 20% Deviation What is the most sensitive input of the project? A) MARR

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter17: Long-term Investment Analysis
Section: Chapter Questions
Problem 10E
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1) The sensitivity graph of a project is presented below:
70
60
Present Worth ('000 $)
50
40
30 SV
20
10
MARR
-20% -15% -10% -5%
C) FC
D) VC
E) O&M
Base
Deviation
What is the most sensitive input of the project?
A) MARR
B) SV
O&M
FC
VC
0% 5% 10% 15% 20%
Transcribed Image Text:1) The sensitivity graph of a project is presented below: 70 60 Present Worth ('000 $) 50 40 30 SV 20 10 MARR -20% -15% -10% -5% C) FC D) VC E) O&M Base Deviation What is the most sensitive input of the project? A) MARR B) SV O&M FC VC 0% 5% 10% 15% 20%
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