What is sensitivity or what-if analysis?

What is sensitivity or what-if analysis?

• A. Only applicable to deterministic models
• B. It replaces the need for sensitivity analysis
• C. Exploring how changes in inputs affect outputs to guide robust decisions
• D. Fixing all inputs and observing outputs

Answer: (C)

Sensitivity or what-if analysis is about exploring how changes in inputs affect outputs to guide robust decisions. By systematically varying inputs, you learn which factors have the biggest impact and how results move under different scenarios. You can do one-at-a-time changes or multiple changes together to map the range of possible outcomes, including probabilistic ranges to see the distribution of results. It's not about fixing all inputs and watching outputs, and it applies to both deterministic and stochastic models.

Sensitivity or what-if analysis is about exploring how changes in inputs affect outputs to guide robust decisions. By systematically varying inputs, you learn which factors have the biggest impact and how results move under different scenarios. You can do one-at-a-time changes or multiple changes together to map the range of possible outcomes, including probabilistic ranges to see the distribution of results. It's not about fixing all inputs and watching outputs, and it applies to both deterministic and stochastic models.