Benefit-Cost Ratio Method

Question 1

is a systematic method of assessing the desirability of government projects or policies when it is important to take a long-term view of future effects
and a broad view of possible side effects.

Answer 1

Benefit-Cost analysis

Question 2

defined as the favorable
consequences of the project to the public

Answer 2

Project benefits

Question 3

represent the monetary
disbursement(s) required of the government

Answer 3

Project costs

Question 4

generally used to represent the
negative consequences of a project to the public

Answer 4

Disbenefits

Question 5

is applied to a governmental project that is expected to earn direct revenue sufficient to repay its cost in a specified period of time.

Answer 5

Self-liquidating project

Question 6

If B/C ratio (=>) 1.00

Answer 6

Conditionally accept
the alternative

Question 7

If B/C ratio (<) 1.00

Answer 7

conditionally reject the
alternative

Question 8

If B/C ratio “close” to 1.00

Answer 8

then intangible factors may sway the decision to accept or reject