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The chief limitation of cost effectiveness analysis is that it cannot say whether

  • A.the alternatives deliver the same kind of outcome
  • B.the project is worth undertaking at all
  • C.one alternative costs less than another
  • D.the outcomes have been measured correctly

Answer: B

Correct answer: the project is worth undertaking at all

Cost effectiveness compares alternatives on cost per unit of outcome and can say which is the cheapest way to achieve something, which is valuable where the benefit resists monetary valuation. What it cannot say is whether the outcome is worth its cost, because that comparison requires both sides in the same units.

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