Question: Cost-Benefit Analysis (CBA) is an evaluation technique used to compare the total costs of a program or project with its benefits, which are reduced to

Cost-Benefit Analysis (CBA) is an evaluation technique used to compare the total costs of a program or project with its benefits, which are reduced to a common metric, usually a monetary unit. Other characteristics of CBA are:

A.

Later benefits are less valuable than early benefits.

B.

The DCF is used to compare outflows (costs) to inflows (benefits), which gives us net present value (NPV).

C.

CBA forces people involved in a project to reduce proposed benefits to a monetary unit.

D.

All answers are correct.

E.

The net benefit is usually the summation of all the benefits minus the costs, all reduced to a present value.

F.

One of the most widely used techniques in CBA is discounted cash flow (DCF).

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!