Economic Analysis should be updated when which factor changes?

Economic Analysis should be updated when which factor changes?

• A. When schedules change
• B. When budgets change
• C. Assumptions change
• D. When personnel change

Answer: (C)

Economic analysis relies on the assumptions you use about the future. When those assumptions change—such as projected costs, benefits, discount rate, inflation, growth, or other economic conditions—the outcomes of the analysis can shift significantly, so the analysis must be updated to reflect the new expectations. While changes in schedules, budgets, or personnel can alter timing or amounts in a model, the primary reason to refresh the analysis is a change in the underlying assumptions that drive all the projections.

Economic analysis relies on the assumptions you use about the future. When those assumptions change—such as projected costs, benefits, discount rate, inflation, growth, or other economic conditions—the outcomes of the analysis can shift significantly, so the analysis must be updated to reflect the new expectations.

While changes in schedules, budgets, or personnel can alter timing or amounts in a model, the primary reason to refresh the analysis is a change in the underlying assumptions that drive all the projections.