ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A sensitivity analysis is a probability method used in management and business to determine how uncertainty affects your decisions, costs and profits. In a project management CBA, sensitivity analysis is used to determine the benefit-cost ratio of probable scenarios.

Detailed explanation-2: -Generally speaking, cost-benefit analysis involves tallying up all costs of a project or decision and subtracting that amount from the total projected benefits of the project or decision. (Sometimes, this value is represented as a ratio.)

Detailed explanation-3: -The process by which business decisions are analysed is known as cost analysis and sometimes as benefit and cost accounting, which are systematic processes by which private costs, benefits, returns, profits, and the effectiveness of any company’s decision or project are measured and analysed.

Detailed explanation-4: -A social cost and benefit analysis helps to compare different alternatives for a project in an integrated manner. This is not just a financial consideration. After all, an SCBA also identifies other, non-financial effects. For example, when it comes to the effects on accessibility, the environment and the economy.

Detailed explanation-5: -During your analysis, you assign monetary values to the costs and benefits of a decision-then subtract costs from benefits to determine net gains. This helps you estimate the full economic benefit (or lack thereof) of your choice so you can decide if it’s a good idea to pursue.