Solutions
Scenario Analysis What-if Analysis: Different variables change and have different values
Sensitivity Analysis What-if Analysis: Change one variable, making it have different
values.
Simulation Analysis What-if Analysis: Combination of Scenario and Sensitivity Analysis.
There is no simple decision rule.
Operating Leverage The degree to which a business or project relies on fixed costs
Soft Capital Rationing Exists if business has a project with positive net present value but
does not have the funds to take on the project
Hard Capital Rationing Exists if business cannot raise financing for any project under any
circumstance.