Business A-Level
sensitivity analysis
What sensitivity analysis means in Business A-Level, as defined for AQA.
Definition of sensitivity analysis
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Reference: AQA
Testing how far the conclusion moves if the estimate is wrong by a tenth, for example showing that payback stretches past the useful life of the machine.
Topics that use sensitivity analysis
- Analysing financial performance (AQA A-Level)
Related terms
- break-even output
- cash flow forecast
- contribution per unit
- contribution squeeze
- credit terms
- data reliability
- forecast risk
- gross profit margin
Using sensitivity analysis in the exam
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