Sensitivity analysis is required because _______.
A)payoffs and probabilities are estimates
B)most decision will affect employees
C)expected payoffs are sensitive to the time value of money
D)it's the second step in the decision model
E)with the passage of time, small decisions get bigger

Question

Quizplus · Accepted Answer

Sensitivity analysis is required because payoffs and probabilities used in decision making are often estimates, which means they cannot be precise. Therefore, sensitivity analysis allows decision-makers to test the robustness of their decisions under different assumptions and scenarios.

Sensitivity Analysis Is Required Because _______