cba1 - Engineering Risk Benefit Analysis 1.155, 2.943,...

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CBA 1. Background and Fundamental Premises 1 Engineering Risk Benefit Analysis 1.155, 2.943, 3.577, 6.938, 10.816, 13.621, 16.862, 22.82, ESD.72 CBA 1. Background and Fundamental Premises George E. Apostolakis Massachusetts Institute of Technology Spring 2007
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CBA 1. Background and Fundamental Premises 2 Basic Premise of Cost-Benefit Analysis Express all costs and benefits of a project in terms of dollars. This may be a challenge for non-monetary costs and benefits in public projects. Since many of these are in the future, find the present value (worth). Use a figure of merit, such as the Present Worth, to make decisions. A widely used method by private and public entities.
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CBA 1. Background and Fundamental Premises 3 The Time Value of Money (CBA 2): Cash Flows (1) Compare alternative courses of action by considering the money consequences of each and its timing. A 1 : Initial Investment: $32,000 Net Annual Benefit: $9,000 A 2 : Initial Investment: $25,000 Net Annual Benefit: $6,000 Planning Horizon: 10 years
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CBA 1. Background and Fundamental Premises
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cba1 - Engineering Risk Benefit Analysis 1.155, 2.943,...

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