Question 1 (SO 1, AC 1)
Define cost/benefit analysis
Question 2 (SO 1, AC 2)
Identify and explain the different components of a cost benefit analysis
Question 3 (SO 4, AC 2)
Explain the implications of late delivery on time and cost of a project
Cost/benefit analysis is a systematic process used to compare the costs of a project or decision to the benefits expected from it. It is a tool used by organizations to evaluate the potential risks and rewards of a particular course of action.
The components of a cost/benefit analysis include:
1. Identifying the costs involved in a project, such as initial investments, ongoing expenses, and maintenance costs.
2. Identifying the benefits, which can include increased revenue, cost savings, improved efficiency, or other positive outcomes.
3. Quantifying and assigning a monetary value to both the costs and benefits.
4. Comparing the total costs to the total benefits to determine if the project is economically viable.
5. Considering non-monetary factors that may impact the decision, such as environmental impact, social factors, or ethical considerations.
Late delivery can have significant implications on the time and cost of a project. When a project is delayed, it can impact the timeline for completion, resulting in increased costs due to extended labor, equipment rentals, or other expenses. It can also lead to penalties for missing deadlines or lost revenue opportunities if the project is not completed on time. Additionally, delays can affect other projects that are dependent on the timely completion of the current project, creating a ripple effect throughout the organization. Therefore, it is important for organizations to carefully manage project timelines to avoid the negative impacts of late delivery.