After determining the key assumptions, Scenario Analysis examines all possible combinations to develops a picture of profit's overall risk.
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Risk Detective automatically looks at every
possible combination of the key selected assumptions.
For those complex problems, you can define which particular combinations to examine through a decision tree, shown graphically to the left. With a decision tree, you can create downstream decisions or asymmetric uncertainties. |
| This scenario chart is the result of measuring profit across every combination of assumptions, and represents a picture of profit's overall risk. In this example, profit ranges from ($25) to $200. The expected value (vertical bar) represents the probability weighted average of all possible scenarios. This chart shows there is a 5% chance of losing money. |  |
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