A similar sensitivity analysis is performed for cost of debt estimates. Again, Partnerships BC uses a percentage range around the base cost of debt. The results of this analysis are typically illustrated in a table that compares the impact of a change in the cost of debt on the ASP, and on the corresponding quantitative value for money. Figure 10 below shows the results of this analysis based on + / - one per cent range around the base cost of debt.
Figure 10: Cost of Debt Sensitivity Analysis
Sensitivity | Actual Interest Rate | 1st Year ASP ($m) | |
Base Case | 6% | 65 | 68 |
+1% | 7% | 34 | 71 |
-1% | 5% | 93 | 65 |