ASC ASC Sensitivity and Scenario Analysis 1

Question 1

In ARGUS, a sensitivity analysis is primarily used to:

Accepted Answer

Measure how changes in key assumptions affect investment returns

Answer

Sensitivity analysis tests how variations in inputs like cap rate, rent growth, or vacancy affect output metrics such as IRR and NPV.

Question 2

Which output metric is most commonly tested in an ARGUS sensitivity analysis?

Accepted Answer

IRR or NPV

Answer

IRR and NPV are the primary return metrics analyzed in sensitivity tables to understand investment risk across a range of assumptions.

Question 3

In ARGUS, a scenario differs from a simple sensitivity analysis in that:

Accepted Answer

Scenarios allow multiple assumptions to change simultaneously under named conditions

Answer

Unlike single-variable sensitivity analysis, scenarios bundle multiple assumption changes into named cases (e.g., downside, upside) run simultaneously.

Question 4

What is a base case in ARGUS scenario modeling?

Accepted Answer

The most likely expected outcome used as the benchmark

Answer

The base case represents the most probable set of assumptions and serves as the reference point for comparing upside and downside scenarios.

Question 5

In ARGUS sensitivity analysis, varying the exit cap rate primarily affects:

Accepted Answer

The reversion (sale) value of the property

Answer

The exit cap rate is applied to the terminal NOI to determine the property's sale price, making it a critical driver of reversion value.

(ASC) Argus Software Certification Practice Test

(ASC) Argus Software Certification Practice Test

ASC ASC Sensitivity and Scenario Analysis 1