Week 4 Quiz CH 6

Week 4 Quiz CH 6 - Chapter 6 Quiz Review 1 Once a base case...

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Unformatted text preview: Chapter 6 Quiz Review 1. Once a base case has been specified, the next step in analysis often involves nothing more sophisticated than varying one of the inputs to determine how the key outputs change. Assessing the change in output associated with a given change in inputs is called ___________ (Multiple Choice)? a. Optimization analysis b. Breakeven analysis c. Risk analysis d. What-if analysis 2. During what-if analysis, we repeatedly change input and observe the resulting change in outputs. This can get confusing unless we keep a record of the results in some organized fashion. One simple solution to this problem is _______ (Multiple Choice)? a. Varying parameters b. Varying decision variables c. Benchmarking d. None of these 3. Instead of asking “what will our market share be?” ask, “how high does our market share have to get before we turn a profit?” The trick is to look for a cutoff level for a parameter – that is, a target value for the parameter at which some particularly interesting event occurs, such as reach zero profits or making a 15 percent return on vested...
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