ECONOMICS
COST BENEFIT ANALYSIS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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costs are not allowed to be higher than 1mio.$
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costs need to be greater than costs
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benefits need to be greater than costs
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benefits are always measured in $
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Detailed explanation-1: -The cost benefit principle is a fundamental concept in economics that suggests action should only be taken if the benefits derived from it are greater than the costs. This highlights the trade-offs involved in any decision making process.
Detailed explanation-2: -The cost benefit principle holds that the cost of providing information via the financial statements should not exceed its utility to readers. The essential point is that some financial information is too expensive to produce.
Detailed explanation-3: -What is the Cost-Benefit Principle? The cost-benefit principle states that the cost of providing financial information in financial statements should not be greater than the benefit of this information to users.
Detailed explanation-4: -A cost-benefit analysis requires substantial research across all types of costs. This means considering unpredictable costs and understanding expense types and characteristics.
Detailed explanation-5: -Cost-benefit analysis allows an individual or organization to evaluate a decision or potential project free of biases. As such, it offers an agnostic and evidence-based evaluation of your options, which can help your business become more data-driven and logical.