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Principles of Cost Benefit Analysis

      

Principles of Cost Benefit Analysis

  

Answers


Faith
i) Common unit of measurement of Benefits and costs-usually money
ii) CBA valuations should represent consumers or produces valuations as revealed by there actual behaviour- benefits and costs should reflect preferences revealed by choices which have been made. For e.g. if a dual coverage way is constructed improvements in transportation frequently involve saving time and reduction of loss of lives to accidents
E.g. how do we measure the value of life and that of terms based from this dual coverage? There can only be estimated as people sometimes take risks.
iii) CBA involves a particular study area impacts of a project i.e. defined for a particular study are, be it a city, region, state or the world
iv) Benefits are usually measured by market choices:-
People normally purchase at market they reveal that the things they vary each at least as beneficial to them as the money they relinquish
v) The analysis of a project should involve a comparison of a with VS without
vi) Double counting of Benefits or costs must be avoided
viii) Decision criteria for project should be specified e.g.
NPV positive-Accept
NPV negative- Reject
NPV Zero-Indifferent

Titany answered the question on November 15, 2021 at 08:29


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