What are some examples of variable consideration? What are the two approaches for estimating variable consideration?

Q: What is sensitivity analysis? Explain.

A: Financial models refer to the summary or brief of a company's performance, on the basis of the…

Q: Which Variable Is most critical in Sensitivity Analysis?

A: Sensitivity analysis helps to analyze the project by considering different variables. It helps…

Q: How do the Internal-Rate-of-Return Criterion relate to the PW Analysis?

A: Capital budgeting:   It is the process in which the business uses to determine which proposed fixed…

Q: What is variance analysis? Explain?

A: Variance Analysis: Variance analysis is the process of ascertaining the deviations between actual…

Q: What is the incremental analysis?

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Q: Define Sharpe’s reward to variability ratio

A: Answer: Nobel Laureate William Sharpe developed a risk-adjusted efficiency indicator for mutual…

Q: How to Estimate the  Variable Consideration?

A: Revenue:   It is the income generated by the business over their regular business operations.

Q: What are the different variables in sensitivity analysis?

A: Answer: Under a given set of expectations, a sensitivity analysis describes the way different values…

Q: Describe the Sensitivity Analysis for Mutually Exclusive Alternatives?

A: Sensitivity analysis portrays how various values of an independent factor under a given arrangement…

Q: Define the term PW criterion?

A: Present worth is a systematic identicalness technique where cash flows of a task are limited at…

Q: Describe the Sensitivity Analysis method performed for Mutually Exclusive Alternatives?

A: Sensitivity analysis is a financial model that decides how target factors are influenced by changes…

Q: An analysis of what happens to the estimate of net present value when only one input variable is…

A: Net Present Value: It is the present worth of future cash flows and the initial cost of the project.…

Q: What alternative approaches can be used to estimate variable consideration?

A: The alternative approaches that can be used to estimate variable consideration are: Expected value…

Q: What is the meaningful total variance for performance evaluation purposes?

A: Flexible budget: A flexible budget is a budget prepared by the company for effective evaluation of…

Q: Define variable consideration.

A: Variable considerations: Contracts having a degree of variability in the specified transaction…

Q: What is the Internal-Rate-of-Return Criterion?

A: Internal rate of return (IRR): The internal rate of return (IRR) is a measure utilized in capital…

Q: A variable which can assume any value within a given range is a. Discrete variable O b. Quantitative…

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Q: Assume that only the specified parameters (that is, variables) change in a sensitivity analysis. The…

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Q: Describe how to estimate variable consideration.

A: Revenue: It is the income generated by the business over their regular business operations.

Q: What types of variables are commonly used in a CRA Z-score model? Define the ratios and explain how…

A: CRA-Z model helps in finding the organisation's default and it eases to measure the control of the…

Q: Would you expect an abandonment option to increase or decrease a project’sexpected NPV and risk (as…

A: Net present value (NPV) is the contrast between the present value of money inflows over some…

Q: What is a spending variance and what does it mean?

A: A variance means difference between actual and budgeted amounts. A spending variance is difference…

Q: How is the ERC (efficient response coefficient) determined and which role analyst forecasts play in…

A: The earnings response coefficient, or ERC, is a calculated ratio between stock returns and the…

Q: Explain the coefficient of variation?a

A: The coefficient of variation (CV) may be a statistical measure of the scattering of information that…

Q: Describe the Internal-Rate-of-Return Criterion?

A: Internal rate of return (IRR) is defined as the rate of discount at which the NPV of human capital…

Q: “Multicollinearity exists when the dependent variable and the independent variable are highly…

A: Multicollinearity:  Multicollinearity refers to a condition where two or more explanatory variables…

Q: Differentiate between sensitivity analysis and scenario analysis.What advantage does scenario…

A: Differentiate between sensitivity analysis and scenario analysis: Scenario analysis involves…

Q: Sensitivity analysis is the analysis of the effect of parameter changes on the optimal solution.…

A: Sensitivity analysis is done to understand changes in a target variable when changes are made in…

Q: When we perform sensitivity analysis for mutually exclusive alternatives, itmay be more effective to…

A: Net present worth is acknowledged as the current worth or value of a project which is adjusted as…

Q: Can someone give an example of Mean-Variance analysis?

A: Example for mean-variance analysis:

Q: How can we use the PW criterion to compare the alternatives to minimize expenditures?

A: The full form of PW is present worth. Present worth is known as the present value of the investment…

Q: Differentiate between variance analysis and sensitivity analysis

A: Managers of small businesses can benefit from both variance and sensitivity analyses when trying to…

Q: Give an example of a Sensitivity Analysis performed for Mutually Exclusive Alternatives?

A: Mutually exclusive alternatives are those alternatives out of which only one can be selected at a…

Q: Can someone give an example or scenario of mean-variance analysis?

A: Introduction: Mean-variance analysis is a method used by investors to make investment decisions on…

Q: Present the internal rate of return criterion and its strengths and weaknesses.

A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only…

Q: What are the differences and similarities between the Sharpe and Treynor measures?

A: Each asset or portfolio has a separate level of return and associated risk in response to the…

Q: What are some strengths and weaknesses of sensitivity analysis and scenario analysis?

A: Sensitivity Analysis determines how the dependent variable changes when the independent variable…

Q: In what circumstances is the compressed adjustedpresent value (APV) model useful, and how wouldit be…

A: The question is based on the concept of adjusted present value (APV). APV uses net present value…

Q: What is the geometric-gradient-series present-worth factor?

A: Present worth: It is the present value of future cash flows. The gradient is a change occurring in…

Q: What are some pros and cons of computing an expected return using a user-specified model versus…

A: Expected Return: As opposed to observed returns that are measured at the end of a given period, the…

Q: Write an alternative way to derive the geometric-gradient-series present-worth?

A: Geometric-gradient-series present worth is derived with the help of the following formula: g is…

Q: How can we determine the mean and variance of the NPW on the basis of the three NPW estimates?

A: Identify the Rate, project life. Then Identify the cash flows. Compute the Present worth and net…

Q: Explain Variation on the Preferred IRR and IRR Lookback?

A: The internal rate of return (IRR) is the measure used in the financial analysis of an investment…