Question

When quantifiable costs and other measures, as well as various qualitative factors, must be considered as parts of a complete evaluation, which tool is most useful?

1) Cost-benefit analysis
2) SWOT analysis
3) Decision tree analysis
4) Pareto analysis

Answer 1

A cost-benefit analysis is the most useful tool when considering quantifiable costs and qualitative factors in an evaluation. It helps decision-makers weigh the benefits against the costs and make informed choices.

Step-by-step explanation:

A cost-benefit analysis is the most useful tool when quantifiable costs and other measures, as well as various qualitative factors, must be considered as parts of a complete evaluation. Cost-benefit analysis is a systematic approach that compares the costs of an action or decision with the benefits it brings.

For example, let's say a company is considering investing in a new production line. They would analyze the costs involved in purchasing and setting up the new equipment, as well as any additional labor or maintenance costs. On the other side of the analysis, they would measure the benefits such as increased production capacity, improved efficiency, and potential revenue growth.

This tool helps decision-makers weigh the pros and cons of different options and make informed choices that maximize benefits while minimizing costs.