Difference between revisions of "Scenario analysis"
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According to [[Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition)]], | According to [[Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition)]], | ||
:[[Scenario analysis]]. A shorter version of simulation analysis that uses only a few outcomes. Often the outcomes are for three scenarios: optimistic, pessimistic, and most likely. | :[[Scenario analysis]]. A shorter version of simulation analysis that uses only a few outcomes. Often the outcomes are for three scenarios: optimistic, pessimistic, and most likely. | ||
| + | According to [[Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition)]], | ||
| + | :[[Scenario analysis]]. A risk analysis technique in which “bad” and “good” sets of financial circumstances are compared with a most likely, or base-case, situation. | ||
==Related concepts== | ==Related concepts== | ||
Revision as of 04:20, 2 November 2019
Scenario analysis is a shorter version of simulation analysis that uses only a few outcomes. Often the outcomes are for three scenarios: optimistic, pessimistic, and most likely.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Scenario analysis. A shorter version of simulation analysis that uses only a few outcomes. Often the outcomes are for three scenarios: optimistic, pessimistic, and most likely.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Scenario analysis. A risk analysis technique in which “bad” and “good” sets of financial circumstances are compared with a most likely, or base-case, situation.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
