Home » Tags » Sensitivity analysis

Sensitivity analysis

Assessing the Influence of Operating Leverage on Financial Risk

November 28, 2023

What impact does Operating Leverage have on a company's financial risk?

Operating leverage directly impacts financial risk, as it increases a company's exposure to sales fluctuations, potentially leading to higher financial instability and default risks, especially if fixed costs are high relative to variable costs.

Tags : Operating Leverage , Financial Risk , Sensitivity Analysis

Assessing Risk Sensitivity in Investment Decisions

December 11, 2023

What is the role of sensitivity analysis in capital budgeting?

Sensitivity analysis evaluates how changes in variables like interest rates, sales volume, or costs impact project outcomes. It aids in assessing project robustness against uncertainties, offering insights into potential risks and guiding decision-making.

Tags : Sensitivity Analysis , Capital Budgeting , Risk Evaluation

Tags

financial statements (138) interest rates (123) credit cards (118) financial reporting (110) financial crises (106) capital markets (103) equity risk premium (100) volcker rule (97) market economy (92) economic recessions (90) financial planning (86) inflation effects (86) budget deficits (79) fisher effect (78) risk management (75) unemployment rate (75) real estate investing (75) financial analysis (69) Operating Leverage (66) equity capital (65) income inequality (62) ponzi schemes (60) risk mitigation (57) Microfinance (54) credit scores (52) behavioral finance (52) Noncurrent Assets (50) Solvency Ratio (50) Noncurrent Liabilities (50) Laffer Curve (49) Technological Unemployment (49) unsecured bonds (49) global clearing banks (48) debt to asset ratio (48) taxation (48) economic indicators (48) economic growth (48) Economic Rent (46) risk assessment (45) debt restructuring (44) convertible bonds (44) financial health (43) Efficiency Ratio (42) economic impact (41) Capital Budgeting (40) capital gains taxes (39) dupont analysis (39) accrual accounting (39) Foreign Exchange Market (38) balance sheet (37) investment strategies (37) Breakeven Point (37) credit derivatives (37) monetary policy (36) inflation (36) capital gains (35) financial stability (34) retirement planning (33) income statement (33) Financial Performance (32) financial engineering (31) Cost Accounting (31) investment decisions (30) investment strategy (29) Accounting Cycle (29) Profitability Ratios (27) gdp (27) strategy integration (26) trading strategies (25) Current Assets (24) pet insurance review (24) capital gains tax (24) decision making (24) investment impact (24) innovation (24) activity ratios (23) regulatory changes (23) Cost Structures (23) creditworthiness (23) financial goals (23)