Cost-Benefit Analysis in Decision Making
A Grade 12 Social Studies worksheet exploring the principles and application of cost-benefit analysis in economic and social decision-making.
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Cost-Benefit Analysis in Decision Making
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Read each question carefully and provide thoughtful answers based on your understanding of Cost-Benefit Analysis. Use complete sentences and examples where appropriate.
1. Which of the following best describes the primary goal of a Cost-Benefit Analysis (CBA)?
To minimize all costs associated with a project.
To identify the project with the highest financial profit.
To determine if the benefits of a decision outweigh its costs.
To ensure equitable distribution of resources among stakeholders.
2. When conducting a CBA, 'opportunity cost' refers to:
The direct financial expenses of a project.
The value of the next best alternative foregone.
Externalities that negatively impact society.
The total revenue generated by a successful project.
3. A Cost-Benefit Analysis attempts to quantify both the direct and costs and benefits of a decision.
4. The process of assigning monetary values to non-market goods and services in a CBA is often referred to as .
5. When the total benefits of a project exceed its total costs, the project is generally considered to be .
6. Explain the difference between tangible and intangible costs/benefits in the context of a Cost-Benefit Analysis. Provide an example of each.
7. Discuss one major criticism or limitation of using Cost-Benefit Analysis for public policy decisions.
8. All costs and benefits in a CBA can be easily assigned a precise monetary value.
True
False
9. Imagine your local government is considering building a new public park. Conduct a brief Cost-Benefit Analysis for this project, identifying at least three potential costs and three potential benefits. Explain how a CBA would help the government make an informed decision.