Definitions

cost analysis

cost-benefit analysis

In governmental planning and budgeting, the attempt to measure the social benefits of a proposed project in monetary terms and compare them with its costs. The procedure was first proposed in 1844 by Arsène-Jules-Étienne-Juvénal Dupuit (1804–66). It was not seriously applied until the 1936 U.S. Flood Control Act, which required that the benefits of flood-control projects exceed their costs. A cost-benefit ratio is determined by dividing the projected benefits of a program by the projected costs. A wide range of variables, including nonquantitative ones such as quality of life, are often considered because the value of the benefits may be indirect or projected far into the future.

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Life cycle cost analysis can refer to:

  • Life cycle assessment - refers to the investigation and valuation of the environmental impacts of a given product or service caused or necessitated by its existence.
  • Whole-life cost - refers to the total cost of ownership over the life of an asset. Also commonly referred to as "cradle to grave" or "womb to tomb".
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