Glossary
Cost Benefit Analysis
contents
A Cost Benefit Analysis (CBA) weighs the pros and cons of a decision. It calculates the expected costs (financial and non-financial) associated with a project or action, and compares them to the anticipated benefits. It’s like putting a price tag on both sides of the equation. A positive CBA, where benefits outweigh costs, suggests the decision may be worthwhile. Conversely, a negative CBA indicates potential drawbacks. This helps businesses make informed choices by understanding the true value of a decision.