﻿﻿﻿﻿
 Sensitive Analysis Infographics
﻿﻿﻿﻿ Sensitive analysis in finance is the part of capital budgeting decisions. In sensitive analysis, we study  uncertainty  in different variable factors of business. We also analyze its effect on our different decision models. Suppose, if our investment budget increases 20% due to unknown factors, we see in sensitive analysis, what will be its affect on our NPV. It is simple example of sensitive analysis but there are many other factors like output, sales and profit which are observed for analysis its effect on on our decision models. We can use mathematical tools, excel, statistics for sensitive analysis.

Sensitive analysis in finance is also useful technique to measure uncertainty  due to errors of measurement, absence of information and poor understanding. In finance, inputs are sources of fund and out may be production, sales and profit after utilization of fund. Sensitive analysis is totally associate input and output. One side, it optimize the resources distribution by using best alternative and other side, it also detects important criteria of output.

Related : Cs Accounting Notes

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Accounting Education: Sensitive Analysis in Finance
Sensitive Analysis in Finance
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Accounting Education
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