Sensitivity analysis can be used to evaluate the uncertainty of:

Question

Quizplus · Accepted Answer

Sensitivity analysis is a technique that analyzes how different values of an independent variable in a model affect a certain dependent variable. Each of the options given (expected cash flows, expected useful life, and expected salvage value) are independent variables in various financial models, and using sensitivity analysis can help evaluate the uncertainty and potential impact of changes to each of these variables. Therefore, all of the options are correct.

Sensitivity Analysis Can Be Used to Evaluate the Uncertainty Of