This report provides a comprehensive overview of corporate financial management, focusing on various analytical techniques used in capital budgeting and financial decision-making. It begins with an introduction highlighting the importance of analysis in business and the tools available for this purpose. The report then delves into four key analytical methods: sensitivity analysis, scenario analysis, break-even analysis, and simulation analysis. Sensitivity analysis is explored as a tool for assessing the impact of variable changes on net present value (NPV) and internal rate of return (IRR), considering its merits and demerits. Scenario analysis is discussed as a method to evaluate investments under different potential situations, comparing expected risk and return, alongside its advantages and disadvantages. Break-even analysis is examined as a means to determine the point where revenues equal expenses, aiding in sales and profit decisions, with a discussion on its merits and demerits. Finally, simulation analysis is presented as a technique to address business risks and uncertainties. The report concludes by summarizing the application and importance of these techniques in corporate financial management.
![[object Object]](/_next/static/media/star-bottom.7253800d.svg)
