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what are the drawbacks of sensitivity analysis, scenario analysis and break-even analysis? are they reliable in open...

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Finance

what are the drawbacks of sensitivity analysis, scenario analysisand break-even analysis?
are they reliable in open market conditons?

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4.2 Ratings (837 Votes)
Sensitivity analysis is an analysis of the effects of changes in variables like sales costs etc on a project The primary drawback of sensitivity analysis is that the underlying variables are assumed to be independent This however is not so the case in the real world and so the changes of the underlying variable can    See Answer
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what are the drawbacks of sensitivity analysis, scenario analysisand break-even analysis?are they reliable in open market conditons?

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