Stated assumption
Brainteasers & GuesstimatesAn assumption said out loud with a value, a reason and the direction it moves the answer, so the interviewer can correct it.
Also written: stating assumptions, state your assumptions
Every number produced under time pressure rests on something assumed. A stated assumption is one made visible: not just the value, but why that value and which way the conclusion moves if it is wrong. Those three parts are what make it usable by the person listening.
The reason this matters is mechanical rather than stylistic. An interviewer cannot correct what they cannot see. Give them a number with no reasoning behind it and their only options are to accept it or to stop the case, whereas a stated assumption lets them hand you the real figure and watch what you do with it.
Keep the values round. 70% survives being carried through four steps of mental arithmetic, whereas 68.4% invites a question about where the 0.4 came from and creates errors that then have to be found. Precision that you do not have costs credibility rather than buying it.
The common failure comes after the assumption, not during it. Candidates state one and then defend it when challenged. The assumption is disposable and the structure is not, so the move that scores is to take the correction and say what it changes. Interviewers frequently supply a different number for exactly that reason.
Worked example
Weak: cash conversion is about 70%, so free cash flow is roughly €98m.
Strong: I will assume around 70% of EBITDA converts to cash after capex and working capital, because the business is asset light, so on €140m of EBITDA that is roughly €98m. If it is more capital intensive than I am reading it, that number falls and the leverage the buyer can carry falls with it.
The arithmetic is identical. The second version can be corrected, and correction is what the interviewer is trying to do.