ECONOMICS
COST BENEFIT ANALYSIS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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increased expenses
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increased efficiency
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money for giving employee benefits
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money for giving employees wages
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Detailed explanation-1: -A cost-effectiveness ratio is the net cost divided by changes in health outcomes. Examples include cost per case of disease prevented or cost per death averted. However, if the net costs are negative (which means a more effective intervention is less costly), the results are reported as net cost savings.
Detailed explanation-2: -Cost efficiency is the act of saving money by changing a product or process to work in a better way. This is done to improve the organization’s bottom line by decreasing procurement costs and improving efficiencies across the board.
Detailed explanation-3: -Costs are broadly classified into four types: fixed cost, variable cost, direct cost, and indirect cost.
Detailed explanation-4: -Cost effectiveness relates to value of the outcome compared to the expenditures. Cost efficiency analyzes how a provider uses available resources to supply goods and services. This paper describes how basic business principles of benefit/cost analysis can be used to determine cost effectiveness.