Because international capital budgeting is so difficult, time consuming, expensive, and uncertain, firms generally forego any type of additional sensitivity analysis after completing a base-case scenario.

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Quizplus · Accepted Answer

It is not true that firms generally forego any type of additional sensitivity analysis after completing a base-case scenario. In fact, sensitivity analysis is often used to test the robustness of the base-case scenario and assess the impact of different variables and assumptions on the project's outcomes. While it can be challenging and costly, sensitivity analysis is a common practice in international capital budgeting to manage risk and uncertainty.

Because International Capital Budgeting Is So Difficult, Time Consuming, Expensive