Answer (C) is correct.
Sensitivity analysis determines how a result varies with changes in a
given variable or parameter in a mathematical decision model. For
example, in a present value analysis, a manager might first calculate the
net present value or internal rate of return assuming that a new asset has
a 10-year life. The NPV or IRR can then be recalculated using a 5-year
life to determine how sensitive the result is to the change in the