How does the decision-maker use the scenario analysis?

Q: Distinguish between quantitative and qualitative factors in decision making.

A: Qualitative Factor:Qualitative factors are those factors which cannot be expressed in the financial…

Q: Is Evaluating Design Alternatives essential to achieve the goals?

A: Design alternative is referred as when the underlying project, product is designed in different…

Q: Explain the types of risk?

A: Introduction: There is a risk involved in any company decision, and in personal life decisions. In…

Q: Define the Base Case and the Proposed Alternatives?

A: The base case is the output expected from the basic assumption made by the project team. The basic…

Q: Discuss some ways the company could estimatethe project’s risk, and then explain how risk mightbe…

A: Answer: Company can estimate its project’s risk in the following ways: Important risk factors to be…

Q: What is the best-case scenario?

A: When companies are uncertain about the details of a project such as costs, inflows, interest rate…

Q: What is Scenario Analysis?

A: Scenario analysis is an important step in the financial modelling. This is used to show the possible…

Q: How does the external analysis affect other components of the strategic management process?

A: Setting objectives, examining the competitive environment, studying the internal organization,…

Q: What are the basic criteria for selecting a forecasting model?

A: The process that is used to anticipate the demand for the product or service of the business is…

Q: How should managers estimate and interpretcost information?

A: Cost: It refers to the economic value incurred by a company to produce a product or deliver a…

Q: What detail would a decision maker require to analyse a dilemma with the expected value? What…

A: Settling on choices is surely the main undertaking of an administrator and it is regularly an…

Q: Why do we need stress testing and scenario analysis?

A: A stress test or scenario analysis is used to determine and analysis the outcome of a financial…

Q: What are Required Assumptions and Decision Frameworks for replacement analysis?

A: Replacement analysis:   It is an analysis tool in capital budgeting decisions. An asset life tends…

Q: analysis needed

A: Risk Analysis is a process that helps you identify and manage potential problems that could…

Q: What techniques can be used to analyze real options?

A: A choice accessible to the organization's managers related to the investment opportunities is known…

Q: How do you explain or interpret predictive model information?

A: Meaning- Predictive Model As the name suggest, where with the help of historical figures or even…

Q: What role does MAD play in evaluating a forecasting model?

A: MAD refers to mean absolute deviation. It is also known as average absolute deviation which is the…

Q: Explain the qualitative factors in decision making.

A: Qualitative factors are a result of definite actions that are complicated or impossible to…

Q: What is risk and give examples

A: While making investment decisions risk and return should be taken into consideration.

Q: What is a strategic plan?

A: The question is based on the concept of Accounting Theory.

Q: How does Incremental Analysis assist Management in decision making?

A: The financial information needed for decision-making is analyzed using incremental analysis or…

Q: Is a good strategic plan detail-oriented?

A:

Q: Compare judgmental, time series, and causal forecasting models.

A: Judgmental models are the subjective criteria in which gauges are based on master ideas. Individuals…

Q: Which of the investment constraints is expected to have the most impact on your decision process?…

A: Investment constraints: These are the conditions that limit or restrict an investor's investment…

Q: Briefly explain the decision-makers emphasis and the decision-models emphasis of decision usefulness…

A: Accounting is the process of recording, analyzing, summarizing, and interpreting the financial…

Q: What are the two keys in short-term decision making?

A: Definition:   Differential analysis: Differential analysis refers to the analysis of differential…

Q: Explain the Trade-Off between Risk and Reward?

A: The trade-off means to lose one thing to achieve another thing. For example An organization is…

Q: Explain what is meant by the term decision model.

A: Every business has to take important decisions now and then. A proper understanding of the situation…

Q: How can you tell the difference between planning and control decisions

A: The difference between planning and control decisions will be shown:

Q: What does a project’s stand-alone risk reflect?

A: Stand alone risks are risks that are associated with a particular asset or a project. Companies when…

Q: What are the methods of describing Project Risk?

A: The project risk is an unpredictable occurrence or situation that has an effect on at least one…

Q: Define scenario analysis

A: Scenario means a situation or circumstance which is influenced by various factors. Various if and…

Q: Please use an example to explain the opportunity-cost concept and why it is used in decision-making.

A: Opportunity Cost - It is the value of best alternative when a particular decision was made by higher…

Q: What are the two stages in risk assessment?

A: Risk assessment is the process which involves analysis & identification of events that can have…

Q: Distinguish planning decisions from control decisions?

A: Decision Making: Management of the business has to make good decisions for the growth and success of…

Q: What steps would be involved?

A: Arbitrage is the strategy applied by the investor to take the benefit of mispricing, at various…

Q: What makes information relevant to decision making?

A: The information that is essential to occur in the future and is different from the identified…

Q: What is the decision rule for ARR?

A: Accounting rate of return refers to rate of profit earned on an investment. The ARR is computed by…

Q: What is a feasibility study?

A: Feasibility study is a scientific program. Venture achievement proportion  is decided by Project…

Q: Describe the procedure to obtain the best-case NPW with scenario analysis?

A: Scenario analysis is a technique to break down and survey potential events that may happen later on…

Q: What purposes does the systems project proposal serve? How are these evaluated and prioritized? Is…

A:

Q: What advantage does scenario analysis have over sensitivityanalysis?

A: In finance, we are required to analyze the change in value of one variable over the change in the…

Q: isk with practical example

A: Political risk Political risk is the risk an investment's returns could suffer as a result of…

Q: Why is Scenario Analysis useful?

A: Scenario Analysis is a process where various (more than one) input changes are made at the same time…

Q: What is a strategy map?

A: The strategy map:The strategy map is a valuable tool that graphically demonstrates the cause and…

Q: For any given distribution of outcomes and probabilities, describe how preferences over risk affect…

A: An outcome is a potential result of an experiment in probability theory. The likelihood of an event…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.