Risk Analysis Using - Payback Period -Sensitive Analysis

1. PRESENTED BY:
Hemalatha G S
1st M.Com
Risk Analysis Using - Payback Period -
Sensitive Analysis
Under the guidance of
Sundar B. N.
Asst. Prof. & Course Co-ordinator
GFGCW, PG Studies in Commerce
Holenarasipura

2. Contents
.Introduction
.Meaning
.Advantages
.Disadvantages
.Conclusion
.Bibliography

3. Introduction
The payback is time taken to recover an
investment's initial investment . It is the
number of year's to repay the initial
investment made for a project . The
payback period would be we the as a tool
in capital budgeting to compare projects
and calculate the period in year to get back
the initial investment , the project is usasly
chosen with the lowest number of years .

4. Meaning:
The payback period is the
amount of there that it take
to recover your cost in a
project

5. Definition's
* The payback period is the
amount of time that it take to
recover your corts in a project

6. Advantage
*it is very simple. It is easy to
understand and apply
* it is cort effective.
* The payback period measures the
direct relationship between annual
cash inflows from proposal and the next
investment required

7. Disadvantage
*The payback period entirely ignores the
cash inflows that occur after the payback
period
*The payback period also ignores salvage
volue and total economic life of.
Average net annual
cash inflow
Payback Period =
cort of project (invest
)
--------------------------------
----

8. Sensitivity analysis
Sensitivity analysis is the method
wide to find out how independent
variable volues will affect a
particular dependent variable
under a particular set of
assumptions

9. Sensitive analysis type's
Primarily there are two types of sensitivity
analysis, which are.
* Local sensitivity analysis
* Global sensitivity analysis

10. Conclusion
*The payback period is the time it take as
investment to generate enough cash flow to
payback the full amount of the investment
* The payback period formula for even
payments involves only two variables the initial
investment amount and the net cash flow of the
investment
*Sensitivity analysis is a useful tool that assists
decision_makers with more than just a solution to
a problem. It gives a reasonable in sight into the
problems consideration

11. Bibliography:
* http://www.slideshare-
Net/mobile/subhashrohits/payback_perio
d -timevolue
* https: //clear tax .in/g/terms/payback-
period.
* https://clear tax ; in /g/terms/sensitivity
analysis

12. Thanks