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WorksheetsQuantitative Risk Analysis Worksheet Questions
Total questions: 138
Worksheet time: 1hrs 9mins
The expected scenario is the one where
The values of the variables are considered to have the highest probability of occurrence
All variables take the value with the highest probability of occurrence
All variables take the maximum value
All variables take the minimum value
The pessimistic scenario is the one where
All variables take the maximum value
All variables take values in a state unfavorable to the project
All variables take the minimum value
All variables take values in a state favorable to the project
The worst-case scenario is the one where
All variables take the maximum value
All variables take values that make the project outcome the highest
All variables take the minimum value
All variables take values that make the project outcome the lowest
The output result of each simulation analysis run is
The results of the simulation runs are the same
They differ, and the deviation of the results is inversely related to the number of calculations declared
They differ, and the deviation of the results is not related to the number of calculations declared
They differ, and the deviation of the results is positively related to the number of calculations declared
Which quantitative risk analysis technique identifies the main variables of the project
All of the above are incorrect
Scenario analysis
Decision tree analysis
Simulation analysis
When analyzing risk using simulation, if the output variable is IRR and errors occur during simulation, the reason is
Due to unreasonable declaration of probability distribution of input variables
All of the above are correct
The method of estimating project cash flows is unreasonable
There are cash flows for which IRR cannot be calculated
The key variables of the project are
All of the above are incorrect
Variables that, when changed, significantly affect the project result
Variables that, when changed, insignificantly affect the project result
Variables that, when changed, do not affect the project result
When analyzing risk using simulation, the result of the first run with 10,000 trials gives the probability of NPV ≥ 0 as 80%. The result of the second run with 10,000 trials gives the probability of NPV ≥ 0 as 75%. The difference exists because
In each trial, variables are assigned a different distribution
In each trial, variables are assigned a different value
The project’s cash flow calculation method is incorrect
The simulation operation is incorrect
Which quantitative risk analysis technique shows the sensitivity of project performance to the project’s key variables
Decision tree analysis
Simulation analysis
All of the above are incorrect
Scenario analysis
Which quantitative risk analysis technique shows the probability of NPV > 0
Scenario analysis
Decision tree model
Simulation analysis
Sensitivity analysis
When assessing risk using Monte Carlo simulation
It is not necessary to declare the probability distribution for all variables
Only non-key variables need probability distribution declaration
All project variables must be declared with a probability distribution
Only key risk variables must be declared with a probability distribution
The best-case scenario is the one where
All variables take values that make the project outcome the highest
All variables take the minimum value
All variables take values that make the project outcome the lowest
All variables take the maximum value
Which quantitative risk analysis technique examines the correlation of input variables
One-way sensitivity analysis
Decision tree model
Simulation analysis
Two-way sensitivity analysis
The data used in sensitivity analysis is
Data expressed according to the analyst’s subjective opinion
Historical data of the variable and the analyst’s subjective opinion
Forecast data
Historical data of the variable
Which quantitative risk analysis technique shows the direction of change in project results when an input variable changes
Probability analysis
Sensitivity analysis
All of the above are correct
Scenario analysis
The optimistic scenario is the one where
All variables take the maximum value
All variables take values in a state unfavorable to the project
All variables take values in a state favorable to the project
All variables take the minimum value
When analyzing risk using simulation, the deviation of the output variable between two runs with 1,000 trials and with 100,000 trials is
The deviation with 1,000 trials will be larger
The two deviations are equal
It cannot be determined
The deviation with 1,000 trials will be smaller
If using scenario analysis, identify the case in which the project will be selected
NPV > 0 in any scenario
NPV > 0 in the expected scenario
NPV > 0 in the worst-case scenario
NPV > 0 in the best-case scenario
The correlation of variables can be considered in the analysis method of
Two-way sensitivity
One-way sensitivity
Scenario analysis
All of the above are correct
One-way sensitivity analysis is the technique of analyzing the change of
A single input variable on the project outcome
All of the above are incorrect
Each input variable on the project outcome
Multiple input variables simultaneously on the project outcome
Two-way sensitivity analysis will give
One result about the project performance
Two results about the project performance
The number of project performance results depending on the appraiser’s needs
All of the above are incorrect
The simulation analysis technique belongs to which type of analysis method
All of the above are correct
Deterministic model
Certain model
Probabilistic model
In simulation analysis, the values of variables are assigned
Each time, a different value
Once only according to the variable’s probability distribution
All of the above are incorrect
Each time, the same value
Scenario analysis is a technique that analyzes project results when considering the change of
One input variable
All of the above are correct
Two input variables
A set of input variables
Which quantitative risk analysis technique considers and processes input variables according to a probability distribution function
Simulation analysis
Scenario analysis
Decision tree model
Sensitivity analysis
Which quantitative risk analysis technique does not allow the consideration of correlations between input variables
Two-way sensitivity analysis
All of the above are correct
One-way sensitivity analysis
Decision tree analysis
In each scenario, the maximum number of variables analyzed is
Equal to the number of input variables declared in the parameters
Two variables
Depending on the analyst’s subjective opinion
Three variables
Scenario analysis divides the variation of key risk variables
According to different probability distributions and finds project results
Into groups with the same directional impact on performance and finds results when each group changes
According to different time milestones and finds project results
Into different scenarios and finds the corresponding results
One-way sensitivity analysis aims to identify
The set of output variables important to project results
The output variable important to project results
The input variable important to project results
The set of input variables important to project results
If using scenario analysis, identify the case in which the project will be rejected
Worst-case scenario NPV = -200
Good scenario NPV = 100
Expected scenario NPV = 100
Best-case scenario NPV = -300
Sensitivity analysis belongs to which type of analysis method
All of the above are correct
Deterministic model
Uncertain mode
Probabilistic model
The method where the analyst subjectively assigns specific values to each input variable and finds the output from a pre-calculated financial model is
Uncertain model
All of the above are correct
Probabilistic model
Deterministic model
Sensitivity analysis is a technique based on the assumption that
All input parameters change and the resulting change of output parameters is found
More than two input parameters change and the resulting change of output parameters is found
One input parameter changes and the resulting change of output parameters is found
One or two input parameters change to find the resulting change of output parameters
The purpose of quantitative risk analysis of a project is
To assess the feasibility of the project based on the change of input factors
To evaluate sensitive variables affecting project results
To propose contingency plans for the project against possible risks
All of the above are correct
Scenario analysis belongs to which type of analysis method
Deterministic model
All of the above are correct
Uncertain model
Probabilistic model
How many scenarios can an analyst create when analyzing project risk
Two scenarios
Unlimited number of scenarios
Three scenarios
Only one scenario
Which risk analysis technique can help us identify the probability distribution of the project outcome variable
Case analysis
Simulation analysis
One-way sensitivity analysis
Two-way sensitivity analysis
The optimal number of calculations performed in simulation analysis is
1,000,000 times
10,000 times
100,000 times
Unlimited
Two-way sensitivity analysis is the technique of analyzing the change of
All of the above are incorrect
Maximum two input variables
Minimum two input variables
Two input variables at the same time
Private investment projects are aimed at the objective of
Economic benefits
Financial benefits
All of the above are correct
Social benefits
A project aimed at improving and enhancing the quality of products, goods, or services is
Expansion investment project
All of the above are correct
Intensive investment project
Independent investment project
Project liquidation is carried out in which case
The investor is forced to terminate operations
The investor goes bankrupt
The investment project has reached the end of its lifespan
All of the above are correct
A project is considered feasible when
The project can be implemented
The project must bring financial and/or socio-economic efficiency
All of the above are correct
The project must fully comply with legal regulations
Which of the following is a characteristic of an investment project
It must describe the uniqueness of the project’s product
It must identify the necessary human resources for the project
It must identify potential risks that may occur
All of the above are correct
Economic analysis is the analysis of
The project’s contribution to economic growth
The ability to meet the basic needs of the economy
The distribution of income in the economy
All of the above are correct
Technical analysis is the analysis of the aspect of
Construction and equipment installation of the project
All of the above are correct
Environmental impacts of the project
Materials and inputs of the project
Which of the following is a capital use requirement of the project
Dividend distribution
Financial investment
Investment in other enterprises
Debt repayment
An investment project is usually implemented within a period of
Indeterminate end time
It can be short or relatively long
Short
Relatively long
Choose the correct statement
All projects, regardless of investment scale, only require one step of feasibility study
Depending on the scale and nature of the project, the competent authority may decide to conduct one-step feasibility study or two-step pre-feasibility and feasibility study
All projects, regardless of scale, must undergo two steps of pre-feasibility and feasibility study
Large-scale projects require two steps, while smaller-scale projects only require one step
Which of the following statements is correct
The definition of a project does not mention investment scale
The total investment capital of a project is usually very large
The investment scale of a project is usually not determined in advance
None of the above is correct
The objective of project implementation must be identified in which stage of the project cycle
Investment opportunity study
Pre-feasibility study
Feasibility study
Project implementation
Financial analysis of a project is the analysis of the financial efficiency for
All of the above are correct
Shareholders
Banks
Investors
Market analysis is the analysis of
Labor market
All of the above are correct
Input product market of the project
Output product market of the project
Which of the following activities is a project investment activity
Has a start and end date
Performed only once
All of the above are correct
Creates a specific product
Project implementation includes the work of
Project operation
Design and construction
All of the above are correct
Project preparation
The initial investment capital of the project may take the form of
Financial assets, tangible assets, and intangible assets
All of the above are correct
Cash capital and loans
Fixed capital and working capital
The project analysis framework includes the aspects of
Market - technical - human resources - finance - economy
Market - technical - human resources
Market - technical - human resources - finance
Market - technical - human resources - finance - economy - society
Which of the following statements indicates two independent projects
Accepting one project means having to forgo another project
Accepting or rejecting one project leads to accepting or rejecting another project
Accepting or rejecting one project does not affect the other
None of the statements indicates two independent projects
The objective of a project can be
Improving product quality
Modernizing production lines
All of the above are correct
Expanding market share
Which of the following statements is NOT correct
Investment project appraisal helps investors reduce mistakes in decision-making
Investment project appraisal helps investors determine the capital structure of the project
Investment project appraisal helps investors control risks
Investment project appraisal helps investors make investment decisions to achieve maximum profit
For private investment projects, the basis for the competent state agency to grant licenses, permits, or support and incentives is
All of the above are correct
Financial analysis
Market analysis
Technical analysis
The reason a company may terminate a current project and start a new replacement project is
The company's investment strategy has changed
The new project has a higher return than the previous one
All of the above are correct
Consumer preferences have changed
For public investment projects, the basis for the government to decide investment is
Financial efficiency
All of the above are correct
Economic and social efficiency
Feasibility in terms of market, technology, and management
A project is considered feasible when it
Must be feasible from all appraisal perspectives
All of the above are correct
Must ensure legality, scientific basis, and practicality
Must be feasible in all research aspects
For a project to be implementable, it must achieve efficiency in terms of
Economic
Financial
Social
All of the above aspects
When deciding whether to invest in a project under consideration, what mistake do investors often make
Accepting a bad project and rejecting a good one
Overlooking a project within the investor's financial capacity
All of the above are correct
Accepting a project beyond the investor’s financial capacity
At which stage of the project cycle does the investor participate in the appraisal
Operation stage
Feasibility study
Pre-feasibility study
All stages of the project cycle
A project can be appraised from which perspectives
Social
Financial
All of the above are correct
Economic
Re-examining financial, economic, and social criteria is conducted at which appraisal stage
Detailed design
Pre-feasibility study
Feasibility study
Project operation
What measures should the government take when a project is not financially effective for the investor but benefits the economy
All of the above are correct
Tax reduction
Providing investment incentives
Subsidies
The role of project appraisal is
To save resources of the economy
To avoid implementing inefficient projects while not missing valuable investment opportunities
To perform audit and inspection functions throughout the project's life
All of the above are correct
Which price is used in financial analysis or appraisal of a project
Shadow price
Market price
Actual price
Economic price
Biased estimates that reduce the project's benefits while overestimating costs are made at which appraisal stage
Investment opportunity study
Feasibility study
Pre-feasibility study
Project operation
What measures should the government take when a project is financially effective for the investor but does not benefit the economy
Subsidies
Remove price ceiling regulations
Increase taxes
All of the above are correct
Investors, banks, and shareholders appraise a project from which perspective
Income distribution
Basic needs
Economic
Financial
What measures should the government take when a project is neither financially effective for the investor nor beneficial for the economy
Tax reduction
Set price ceiling regulations
No subsidies
The government does not need to take any measures
Increasing the accuracy of the project's key variables is performed at which appraisal stage
Investment opportunity study
Project operation
Pre-feasibility study
Feasibility study
Government agencies appraise a project from which perspective
All of the above are correct
Income distribution
Economic
Basic needs
Choose the correct statement
The content of project appraisal is based on each research and analysis content of the project
All of the above are correct
Appraising the market, technology, human resources, and project management as the basis for financial appraisal
Project appraisal aims to clarify feasibility in all relevant aspects
Industry analysis includes
All of the above are correct
Industry life cycle
Key success factors
Opportunities and level of competition
Appraising the competitiveness of the project's products in terms of
Product design
Product quality
All of the above are correct
Product price
When appraising the competitiveness of the project in terms of price, the appraiser should compare the expected selling price of the product with
All of the above are correct
Wholesale price if the project sells through distribution system
Retail price on the market if the project sells directly to consumers
Import price if the project substitutes imported goods
The marketing strategy of the project is developed based on
All of the above are correct
Potential market
Human and financial resources
The project's production program
Competitor analysis includes
All of the above are correct
What are the competitors' weaknesses
What are the strongest possible reactions from competitors
What plans or actions competitors intend to take
The marketing strategy of the project includes
All of the above are correct
After-sales services
Delivery methods
Sales methods
The marketing strategy of the project is developed in order to
Save sales costs
Attract users' attention to the project's products
All of the above are correct
Achieve the project's objectives
Customer analysis in market analysis must answer the question
Who makes the purchase decision and who participates in the decision
All of the above are correct
Why do customers buy that product
Which products customers buy on the market
The project's target market can be
All of the above are correct
Domestic market
Export market
Market for import-substitute goods
Appraising the current supply and demand situation of the project's products in the market will help the appraiser know
The project's target market
The project's market share potential
All of the above are correct
Market capacity
One of the contents of market appraisal is
Customers and market segmentation
All of the above are correct
Competitors
The project's target market
Forecasting the project's sales volume or revenue is based on
Market demand
Plant capacity
All of the above are correct
Marketing strategy
Customers in market analysis include
Customers buying project products
Customers buying substitute products
All of the above are correct
Customers buying competing products
Market appraisal is the basis for choosing
All of the above are correct
Production plan
Investment scale
Technology equipment and project location
The project can distribute goods through
All of the above forms
Retailers
Wholesalers
Directly to consumers
Forecasting the supply volume of the project's products on the market is based on
Industry analysis reports of professional organizations
Statistics from ministries
All of the above are correct
Reports from associations
Market segmentation is based on
Distinct customer behavior
The project's business strategy
The project's marketing strategy
All of the above are correct
When appraising the competitiveness of the project's products in the export market, the appraiser must consider
Standards of importing countries
Whether quotas or technical barriers are imposed
Competitors in the intended export market
All of the above are correct
Market segmentation must meet the requirement
All of the above are correct
Segments must be clearly different from each other
Segment size must be large enough
Customer behavior in the segment should be as similar as possible
Market appraisal is carried out
Before the technical aspect
After the management and human resource aspect
All of the above are correct
After the financial aspect
Packaging costs depend on
All of the above are correct
The project's product policy
Means of transporting products
Requirements for finished product preservation
Which of the following products are considered project inputs
Packaging
Chemicals
Additives
All of the above are correct
When appraising input factors for the project, the appraiser must identify risks that the project may face in purchasing these inputs. Such risks include
Changes in the project's marketing strategy for the target market
The labor market not meeting the project's demand
Too many input suppliers for the project
Unreliable estimation of raw material demand for production
Raw materials and input utilities for the project may include
All of the above are correct
Electricity, water, transport, and telecommunications
Fuel and packaging
Maintenance and repair
If there is a change in raw materials in the project design but the quality is equivalent to the initially selected materials, this will affect
Project implementation schedule
Market feasibility of the project
Technology selection of the project
Labor wages of the project
The project's input material needs are determined based on
The project's production capacity
The project's location
The project's technology choice
All of the above are correct
A project that uses a lot of water must be carefully analyzed for
Water source quality
Water demand for production and living
Wastewater treatment costs
All of the above are correct
Spare parts must be identified in terms of
List of necessary spare parts
All of the above are correct
Required quantity
Available suppliers
Technical appraisal is carried out
Before the market aspect
Before the management and human resources aspect
All of the above are correct
After the financial aspect
When using large quantities of solid and liquid fuels, the most important concern is
Environmental protection technology
Fuel demand
Fuel supply sources
Fuel costs
The appraiser must consider the suitability of raw materials with
The plant's expected production capacity
Labor qualifications
All of the above are correct
Local cultural customs
Appraising production input materials provides the basis for
Selection of machinery, equipment, and technology
All of the above are correct
Organizing the production apparatus
Forecasting demand for output products
A mining project must be evaluated in detail for
Geographical location
Ore quality
All of the above are correct
Mine reserves
Minimizing the risk of raw material supply can be done by
All of the above are correct
Diversifying suppliers
Building long-term relationships and signing long-term supply contracts with suppliers
Selecting technology that can use multiple raw material sources
The requirement for appraising technology and project input factors is to collect information on
Technical and technological resources used in the project
Land-use planning and plans
Production norms of project products
All of the above are correct
To select appropriate technology, the appraiser must consider
Future technology trends
All of the above are correct
Requirements of raw materials and impacts on ecology and environment
Socio-economic conditions and the economy’s capacity to absorb technology
Necessary utilities can only be determined
After selecting the location and technology equipment of the project
Before selecting the location and technology equipment of the project
Not related to location and technology equipment selection
All of the above are correct
One of the contents of technical appraisal is
Appraising technology equipment and project location
All of the above are correct
Appraising environmental impacts of the project
Appraising raw materials and input utilities
Data on livestock and forestry raw materials are collected from
Local authorities
Livestock associations
The Ministry of Agriculture
All of the above are correct
When appraising project input materials, the appraiser must consider
Raw material quality
All of the above are correct
Raw material sources and supply capacity
Raw material prices
The objective of preparing intermediate calculation tables in the process of project cash flow planning is to
Establish the project's cash flow
Estimate the project's working capital
Assess the project's debt repayment ability
Calculate annual income tax
Consider the following items: i/ Project preparation costs; ii/ Workers’ wages during production; iii/ Depreciation expenses; iv/ Cash inflows from sales; v/ Project construction costs. Which of these items are NOT recorded in the project’s cash inflows and outflows
i, iii
i, ii, iii, v
ii, iii, v
iii, iv, v
The timing of project cash flows is
Beginning of the period
End of the period
Any time during the period
All of the above are incorrect
Why should the project cash flow be divided at the completion of construction
To facilitate the identification of annual cash inflows and outflows
To separate investment cash flow and operating cash flow
Both A and B are correct
Both A and B are incorrect
The purpose of cash flow planning is to determine
Identify funding needs and financing sources for the project
All of the above are correct
The project's debt repayment ability and payback period
The project's financial efficiency
Characteristics of project cash flow include
Shows the actual cash held or deficit faced by project investors
Ignores timing of cash inflows
Excludes investment outflows
Is based solely on accounting profit
If EBIT is earnings before interest and tax; NOPAT is net operating profit after tax; EAT is earnings after tax; Dep is depreciation expenses; Int is interest expenses; TS is tax shield from borrowing; and ΔWC is change in working capital, which of the following formulas determines operating cash flow (without tax shield) from interest
NOPAT + Dep - ΔWC
EBIT*(1-t%) + Dep + TS + Int - ΔWC
EAT + Dep + Int - ΔWC
All of the above are incorrect
Equity capital contribution to the project is recorded in which cash flow
Financing cash flow
Operating cash flow
Investment cash flow
All of the above are incorrect
Liquidation of the project's fixed assets is included in
All of the above are incorrect
Operating cash flow
Investment cash flow
Financing cash flow
The working capital requirement during the project's operating phase is the working capital requirement
Average to maintain normal operations
All of the above are correct
Maximum to maintain normal operations
Minimum to maintain normal operations
The period of project cash flows is usually
Day
Month
Year
Quarter
Cash flow from which perspective can be prepared by the direct method
Net cash flow from the Equity perspective (EPV)
Net cash flow from the Total Investment perspective (TIPV)
All of the above are correct
Net cash flow from the All Equity perspective (AEPV)
Cash flow from which perspective can be prepared by the indirect method
Net cash flow from the All Equity perspective (AEPV)
Net cash flow from the Equity perspective (EPV)
All of the above are correct
Net cash flow from the Total Investment perspective (TIPV)
Which of the following is a financial appraisal perspective
All of the above are correct
Equity perspective (EPV)
All Equity perspective (AEPV)
Total Investment perspective (TIPV)
Incremental cash flow is understood as
The investor's cash flow in the case of a replacement project compared to the case without replacement
The investor's cash flow in the case of a new project compared to the case without a new project
The investor's cash flow in the case of an expansion project compared to the case without expansion
All of the above are correct
The salvage value of workshops and equipment is determined based on
Residual value at the end of the last operating year if market value cannot be determined
Residual value at the beginning of the liquidation year if market value cannot be determined
All of the above are correct
Market value in the liquidation year as estimated by experts if market value can be determined
Which of the following statements is NOT correct in project cash flow planning
Includes impacts that increase or reduce cash flow of other projects
Calculates incremental cash flow of the project
Includes opportunity costs
Includes sunk costs
Characteristics of profit flow
Accurately measures the project's debt repayment ability
Actual profit earned by investors
Nominal profit recorded in accounting books
All of the above are correct
If EBIT is earnings before interest and tax; NOPAT is net operating profit after tax; EAT is earnings after tax; Dep is depreciation expenses; Int is interest expenses; TS is tax shield from borrowing; and ΔWC is change in working capital, which of the following formulas determines operating cash flow (with tax shield) from interest
EAT + Dep + Int - ΔWC
NOPAT + Dep - ΔWC
EBIT*(1-t%) + Dep + TS + Int - ΔWC
All of the above are incorrect
