Cost-benefit analysis Ch 3

Question 1

Cost-benefit analysis (CBA)

Answer 1

a tool for policy analysis that attempts to monetize all the costs and benefits of alternative proposed actions to determine the net benefit.

Question 2

Proposed action

Answer 2

projects or programs that involve a current commitment with consequences stretching over time.

Question 3

Discounting

Answer 3

a technique employed to add and compare costs and benefits that occur at different points in time. It assigns less weight to future costs and benefits relative to current costs and benefits.

Question 4

Multi-criteria analysis

Answer 4

uses the preferences of decision-makers to resolve situations where the options get ranked based on the various criteria that are considered relevant.

Question 5

Deliberative polling

Answer 5

involves running an opinion poll and then asking respondents to attend a meeting at which they will collectively consider the issues, by hearing and questioning expert witnesses and debating among themselves. At the end of the process, the participants are asked to again respond to the original survey instrument.

Question 6

Physical project

Answer 6

Specify the inputs and outputs the project will entail over time

Question 7

Net benefits

Answer 7

total benefits minus total cost

Question 8

Benefit-cost ratio

Answer 8

ratio of benefits to cost, or the amount of benefits produced per dollar of costs