- 15 Marks
PSAF – MAY 2019 – L2 – Q5 – Performance Measurement in the Public Sector
Explain cost-benefit analysis, its evaluation methods, and justify its preference as a public project appraisal technique.
Question
The cost-benefit analysis (CBA) has been described as the most popular technique for investment project appraisal in the public sector, especially in the developing world.
Required:
a. Describe the term cost-benefit analysis (CBA). (5 Marks)
b. Identify and explain the two methods usually adopted in the evaluation of projects under CBA. (4 Marks)
c. Justify the preference for CBA as a public project appraisal technique. (6 Marks)
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