Benefit-Cost Ratio
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- Benefit-Cost Ratio (BCR)
- Once a CBA is done, the resulting BCR is calculated as the total benefits divided by the total costs. The BCR will be a unitless number, like "0.26", or "4.25". The bigger the BCR, the more cost-effective the project is. If the BCR is greater than 1.0, then the benefits outweigh the costs, and the project is cost-effective. If the BCR is less than one, then the costs outweigh the benefits, and the project is not cost-effective.
