Word Count : 1161

---

Capital investment decisions in construction projects involve substantial financial commitments, long project durations, uncertain costs, changing market conditions, and risks associated with time, demand, technology, and financing. A construction manager therefore needs systematic techniques to assess how uncertainty can affect the financial viability of a project. Sensitivity analysis and decision-tree analysis are two important methods used for evaluating capital risks. While sensitivity analysis examines how changes in individual variables influence project outcomes, decision-tree analysis evaluates alternative decisions under different possible future conditions and assigns probabilities to those conditions. Sensitivity analysis is a technique used to determine the effect of changes in important project variables on measures such as Net Present Value (NPV), Internal Rate of Return (IRR), payback period, profitability, or total project cost. In construction management, the estimated values of project costs and revenues are rarely certain. The cost of land, labour, cement, steel, equipment, transportation, financing, and maintenance may change during the project. Similarly, construction delays can increase expenditure and postpone revenue generation. Sensitivity analysis helps managers understand how vulnerable a project is to such changes. The basic procedure involves first preparing a base-case financial evaluation using estimated values for investment ______ _________ ___ ___ ______ ___.
___ ________ ________ _________ _____ _________.
________ ___ ______ __________ ___ ____ _______ ______.
____ ________ __________ _____ _____ _________ _____.
________ _____ ____ __________ ___ ____ _________ _____ _____ _____.
__________ _______ _____ _____ ____ _________ __________.
______ __________ _________ ____ _____ _____ _________ __________ __________ ____ _________.
_________ ______ ______ ____ __________ __________ __________.
____ ________ _________ _______ ______.
____ _____ ________ ___ ________ ______ ____ ________ __________ __________ _________.
________ _______ _______ ________ _____ __________.
______ ______ _____ ______ _____ _______ ______ __________ _____ _____ ____.
__________ __________ ___ ___ _____ _____ ______.
_______ ____ ______ ______ _______ __________ ________ _____ __________.
_________ ________ _____ ________ ______ _______ ___ ____ ___ ______.
___ __________ ______ ________ _______ ______ _________ _________ ____ ___.
_______ _________ ______ __________ _________ _______ ____ _________ _________ ______ ___.
___ ___ _______ ____ _________ _____ _________ _______ ______.
_______ _________ ___ ____ ___ __________.
_______ ________ ___ ______ ______.
______ _________ ___ __________ _______.
________ __________ ___ __________ ______ _______ __________ ____ ______ _________ ______ _________.
_____ __________ ________ ________ _____ ______ _______ _________ ____.
_____ ____ _______ ____ _________ ________ ______ _________ ________ _______ ________ _______.
______ ________ ________ ______ ______.
_______ _______ ________ _______ __________ ______.
______ ____ ______ ________ _______.
______ __________ ____ ________ ___ ______ ______ ____ __________ ______.
___ _____ _________ ___ _____.
_____ _________ ______ ____ ________ __________ __________ __________.
___ ___ __________ __________ ___ ____.
__________ ______ _________ ________ _____ ______ _____.
____ _______ ____ _____ _________ ________ __________ __________.
_________ _____ ________ ______ _____ ___ ___ __________ ________.
_____ ________ _____ _________ ______ _________.
_______ ______ _______ __________ _____ ___ ______ ____ ________ _____.
_____ ____ ______ _____ ______ ____ ___ ______ _______ _______.
______ _______ _____ _________ __________ _________ _______ _________ _________.
______ _____ ________ ________ __________ ________.
______ ________ _____ _______ _________.
____ ____ _____ ___ _________ ______.
______ __________ ___ ________ ______ ___.
___ ________ ____ __________ _____ __________ _____ ____ _________ _______.
________ __________ ___ ________ ________.
______ ____ __________ ________ ________ ___ ___ _______ _____ __________.
_______ ___ ______ ______ __________.
_________ ____ __________ ______ _______ _____ _____ ________ _________ __________ _______ _______.
______ _________ ________ _________ _______ ________ ____ _________ _______ __________.
______ ________ _______ ____ _________ __________ _________ _________.
___ _____ _____ ____ ___ ________ _________.
____ _________ _______ ________ ___ _________ ___ ____ _________ _________ __________.
____ ______ __________ ____ ____ _____ ________ ____ ______.
____ ____ __________ _____ ________ ______ ______ ______ ___ ___ ____ _____.
___ ____ ______ __________ _____ _________ __________ _________ ______ ____.
_____ _______ ____ _______ ___ _______ __________ _____ _________ __________ ________ __________.
______ ______ ____ ________ _________ ______ _____ _______ _______ _____.
____ _________ _________ _______ ________ _______ ________ ___ __________ _________ ___.
____ _______ _______ _______ _____ _____ ________.
________ ______ ______ _________ __________ ______ ______ __________ ______ _________.
____ ____ ________ ____ _______.
___ _________ ____ __________ ____ ________ __________ __________ ___.
____ ________ _____ ______ __________ __________ _______ __________ _________ ________ __________ ___.
_________ _________ _________ _____ ____ ______ _________ ____ ______ __________ ______ ___.
_________ ____ _______ ___ _________ __________ ______ _______ __________ _____ _________ ____.
____ ___ ______ ________ __________ _____ ____ __________ _____ _____ ________ _________.
_________ _____ _________ ____ _______.
_________ _________ _________ ______ ___ __________ _________ _____ ____ _________ _____.
_____ ______ __________ ______ ______ ________ ________ ______.
_________ ____ _______ ________ _____ ___.
______ _____ _____ ________ ________.
_________ _________ ________ _________ ___ _______ _________ _____ __________ __________.
____ _____ __________ ______ _______ ________ ________ __________ _______ ___.
_________ ___ _______ _____ ________ ______ __________ ________ _________.
____ ___ _________ _____ _______.
____ ______ __________ ________ ________ ___ __________ _______ _____ _________ _________.
_________ ___ _________ ________ ________ _____ _________ ______ _______ ______ ____.
____ ________ _______ _____ ______ ____ ________ _________ ___ ____.
_______ ______ _____ ________ ______ ___ _________ _____ _____ ____.
___ ____ _________ ____ __________ _____ _________ _________ _________ _____.
________ _________ _________ _______ _______ _______ _______ __________ _____.
______ _________ _______ ___ __________.
___ ______ ___ ________ _______ __________ __________ ______ _____.
____ ___ ___ ____ _________ ______ _____ ___ ____ _______ _________.
___ ___ __________ _________ ________ __________ ___ ____ ________.
__________ _____ ___ _______ _________ ___ _________.
__________ ___ ________ ______ ___ ___ _______ ____ __________ ___.
______ _______ _______ ______ ___ _____ _____ _______ _______ ______.
________ ________ ________ _____ __________.
_________ _____ ____ ______ ____ ______ _____ __________ ___ ___ _______ __________.
__________ ________ ____ _______ _____ __________ ____ ________ ____ ______.
___ _________ _______ __________ _________ __________ _________ ____ _________.
___ _______ ___ __________ _______ _____ __________ ______.
______ ____ _____ ________ _______ ________ ____ _____ __________ ________ ___.
______ ___ ___ _______ _________ __________ _________.
__________ ______ _____ ________ ___ ______.
_____ _____ ________ _____ ______ ______ ___ _______ _______ _________.
__________ __________ ______ _____ ________ ________ _________ ______.
_______ ______ _______ _________ ___.
________ ____ ___ ________ ______ ______.
________ ____ __________ ________ ____ ___ _______ __________ ________.
____ _________ __________ ___ _____ __________.
_____ ______ _____ _____ __________.
______ ___ _________ ____ __________ ______ _______ _________.
__________ _______ ___ _________ ____ ______ _____ _________ _____ ____ _____.
_______ _______ ___ ____ _______ ____ ___ ____ _____ ______ ___.
________ ___ ______ ______ _________ __________ ___ ____ _________ ______.
____ ________ _____ ____ ___ ______.
_________ ________ ____ ___ _________ ____ _________ _______ ____.
____ ___ _______ __________ ___ ______ __________.
___ _____ ________ ________ ___ ______ _______ __________ ___ _______ __________.
__________ ___ _____ _______ _______ ___ ________ ___ __________ ____.
__________ __________ ______ _________ ________ ____ _____ _______ _________.
____ ____ ________ ____ ____.
___ ______ _______ _______ _________ ______.
___ ______ ______ ____ ____ ______.
___ _________ _____.
Get Full Answer on WhatsApp