Resources for self-study:
Sources:
(1) Definition of CBA
http://www.britannica.com/EBchecked/topic/139466/cost-benefit-analysis
(2) Introduction to CBA
http://www.sjsu.edu/faculty/watkins/cba.htm
(3) Critical Thinking: Read the section on "Learning the Elements & Standards of Critical Thinking" in the link below:
http://http://www.criticalthinking.org/starting/high_school.cfm/
(4) Webquest link on problem based learning on CBA: http://zunal.com/webquest.php?w=50298
Questions for comments:
(1) Based on the framework given in critical thinking, what are the 8 elements of thoughts
(2) From the paper "Introduction to CBA", discuss the various stages that are involved in CBA of any projects, giving illustrations and examples.
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Chipettes
ReplyDeleteKey question author is addressing: Why use the CBA?
In this world, resources are limited(recall principle of scarcity- unlimited human wants). We have to apply CBA to any project so as to determine if it's beneficial or a waste of resources in the long run. We have to use a common basis to compare, and use shadow pricing for things we can't put a price on. Only when we give the costs/benefits monetary values are we able to determine if the costs outweigh benefits or vice versa.
skammers
ReplyDelete8) The main point(s) of view presented in this article is (are)
We have to weigh the positive and negative impacts by placing a monetary value upon them. CBA determines if the project is worthwhile. The money values are determined by Consumer and Producer choices (Demand and Supply). We got to take into account Inflation. When discounted value of benefits exceeds the discounted value of costs, ie net benefits are positve, the project is worthwhile.
Jackson 5
ReplyDelete7a)If we take this line of reasoning (of the author) seriously, the implications (or consequences that are likely to follow) are
Only projects which have a benefit/cost ratio of greater than one and the internal rate of return being greater than the cost of capital would be carried out.
7b) If we fail to take this line of reasoning seriously, the implications are
Decisions to carry out projects may not be critically evaluated. Hidden costs may be missed out. As such, this may result in a negative net benefit incurred.