Last edited 12 Jan 2021

Sensitivity analysis

The Green Book, Central Government Guidance On Appraisal And Evaluation, Published by HM Treasury in 2018, suggests that sensitivity analysis: ‘…involves exploring the sensitivity of expected outcomes of an intervention to potential changes in key input variables. It can be used to test the impact of changes in assumptions and should be clearly presented in the results of appraisal.’

Guide to developing the project business case, Better business cases: for better outcomes, published by HM Treasury in 2018, defines sensitivity analysis as: ‘Analysis of the effects on an appraisal of varying the projected values of important variables.’

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