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A Sensitivity Graph Shows % Deviation of the Variable from Expectation

Question 42

Multiple Choice

A sensitivity graph shows % deviation of the variable from expectation on the x- axis and NPV on the y- axis. Variables may be represented by straight lines on the graph. Which variable will have the largest negative effect on NPV?


A) Large upward gradient
B) Small downward gradient
C) Large downward gradient
D) Small upward gradient

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