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Cost effectiveness analysis is used in place of benefit cost analysis when benefits

  • A.cannot credibly be expressed in money
  • B.exceed the costs by a wide margin
  • C.accrue entirely to the sponsoring agency
  • D.are received in the first year only

Answer: A

Where the outcome is lives saved or examinations passed, the analysis compares cost per unit of outcome rather than forcing a monetary value onto it. It can rank alternatives delivering the same kind of outcome but cannot say whether any is worth doing.

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