1. What is the difference between scenario analysis and sensitivity analysis? How might you use each during the capital budgeting process?
2. What is the concept of operating leverage? Describe a scenario where a high degree of operating leverage would be positive for a company and one in which it would be negative.
3. Rise Above This has sales per share of $20.63 that is expected to grow at 6 percent per year. The PS ratio is 1.99 times. What is the projected stock price in 7 years?