Conducting scenario analysis helps managers see the:
A)impact of an individual variable on the outcome of a project.
B)potential range of outcomes from a proposed project.
C)changes in long-term debt over the course of a proposed project.
D)possible range of market prices for their ﬁrm's stock over the life of a project.
E)allocation distribution of funds for capital projects under conditions of hard rationing.

Question

Quizplus · Accepted Answer

Scenario analysis helps managers to identify and evaluate the potential range of outcomes and their probabilities from a proposed project. It assesses the impact of various variables on the project outcome and helps managers to make informed decisions. Therefore, option B is the correct answer. Options A, C, D, and E are incorrect as they do not accurately describe the purpose of scenario analysis.

Conducting Scenario Analysis Helps Managers See The