In previous chapters, we calculated NPV based on a project's forecast cash ﬂows. When doing what-if analysis, this initial estimate is called the ______________.
A) Initial analysis.
B) First go-around.
C) Base case.
D) Initial projection.
E) Best case scenario.

Question

Quizplus · Accepted Answer

The base case is the initial estimate or projection used as a starting point for what-if analysis. It represents the most likely or expected scenario for the project. Therefore, C is the best choice. A, B, D, and E are not commonly used terms in finance for the initial estimate in what-if analysis.

In Previous Chapters, We Calculated NPV Based on a Project's