The concept of sensitivity analysis in corporate finance refers to a technique used by businesses exposed to currency risk to test the resilience of a company or a business line to a range of variables in different likely scenarios.The main objective of this exercise is to assess the potential impact of variations in elements that are strategic for the business, like exchange rates, interest rates, oil or commodity prices.For instance, a eurozone business that gets 40% of its yearly turnover by selling their products in British pound in the UK market should be interested in assessing the potential impact on their margins of the variations on the EURGBP exchange rate.With that objective, the company could study the volatility ranges of the EURGBP in the last five years and identify the:smallest variation;average variation;largest variation.With those three numbers create three different models to analyse how sensitive is that business line to the different likely scenarios on the euro-pound exchange rate.