Florida Keys Hospital
Traditional Project Analysis;
1- To give the board of directors a better feel for the impact of inflation on the outpatientsurgery center, prepare a two-variable sensitivity analysis using inflation rate of chargesand inflation rate on costs.
2- Conduct a sensitivity analysis. As part of your analysis, create a table and a graph that shows the sensitivity of NPV to procedures per day, average charges, and salvage value. Assume that each variable can deviate from its base case by ±10, ±20, and ±30 percent. Discuss the advantages and disadvantages of sensitivity analysis.