Question

1. Can we use benefit-cost analysis to choose among alternatives in allocating funds for building projects?

2. Is the net-investment test the only way to accurately predict project borrowing?

need the answer without plagarism

Answer 1

Answer

1. A benefit-cost analysis is a process that measures the benefits of a decision minus cost associated with making that decision. Benefit-cost analysis is a systematic process in which decisions relating to proposals are analyzed to determine whether the benefits outweigh the costs, and by what margin. In terms of proposed developments, by evaluating all the potential costs, and comparing these with possible revenues and other benefits that might derive from a new building, a developer can assess whether a proposal is financially worthwhile or whether an alternative is needed.

2. Their many methods to predict a project. We can use the Net Present Value (NPV) method to predict a project borrowing accurately. NPV is the difference between the present value of cash inflows and the present value of cash outflows over a period of time. NPV is used in investment planning to analyze the profitability of a projected investment or project.