To ascertain whether the accuracy of the variable cost estimate for a project will have much effect on the ﬁnal outcome of the project, you should probably conduct _____ analysis.
A)leverage
B)scenario
C)break-even
D)sensitivity
E)cash ﬂow

Question

Quizplus · Accepted Answer

Sensitivity analysis is used to determine the impact of changes in one variable on the overall outcome of the project. In this case, the variable is the accuracy of the variable cost estimate. Conducting a sensitivity analysis will help determine if small changes in the estimate have a significant impact on the final outcome of the project.

To Ascertain Whether the Accuracy of the Variable Cost Estimate