Financial and economic analysis

Cost-benefit analysis is a method of comparing different alternatives by systematically evaluating their advantages and disadvantages. It can be used to compare completed or future courses of action or to assess the value versus cost of a decision, project, or policy. The method is widely used in trade, policy, business decision-making, and project investment.

Cost-benefit analysis has 2 (two) main applications:

    1. To determine whether an investment (or other decision) is a good one, establish whether and by how much the benefits outweigh the costs.

    2. To serve as a basis for comparing several investments (or other solutions), comparing the total expected costs with the anticipated benefits of each.