BASELINE SCENARIO Meaning and
Definition
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Baseline scenario refers to a specific set of assumptions or conditions that serve as a starting point or reference point for comparing future projections, forecasts, or scenarios. It is commonly used in various fields such as economics, finance, and project management to establish a benchmark against which progress or changes can be measured. The baseline scenario represents the current state or status quo and provides a basis for assessing the impact of potential interventions, policies, or actions.
In economics, the baseline scenario often represents the "business as usual" scenario, assuming no major changes or disruptions to the current economic conditions. This allows economists and policymakers to analyze the effect of new policies, changes in market conditions, or other factors on the economy.
In project management, the baseline scenario is typically the initial plan or schedule that outlines the expected outcomes, timelines, and resource allocations. It serves as a reference point for tracking progress and evaluating deviations or variations from the original plan.
The baseline scenario can also be used in financial analysis to estimate future performance or evaluate investment opportunities. By establishing a baseline scenario, analysts can compare the projected returns or outcomes of different investment strategies or actions.
Overall, the baseline scenario serves as a starting point for analysis and decision-making, providing a reference against which potential changes, risks, or improvements can be assessed. It helps in understanding the potential impact of various factors and aids in making informed choices and predictions.
Etymology of BASELINE SCENARIO
The term "baseline scenario" does not have a specific etymology as it is a combination of two separate words: "baseline" and "scenario".
The word "baseline" originated from the combination of the words "base" and "line" in the early 19th century. "Base" refers to the starting point or foundation of something, while "line" denotes a continuous mark or boundary. In the context of a baseline scenario, the term "baseline" suggests the starting point or reference framework against which other scenarios are compared.
The word "scenario" comes from the Italian word "scenari" meaning "stage set", which was derived from the Latin word "scenarius" meaning "pertaining to a stage". It was initially used in the context of theater and gradually evolved to refer to a written outline or description of an imagined or potential situation.
