Which of the Following Best Describes Cost-Effectiveness Evaluation

question 54

Multiple Choice

Which of the following best describes cost-effectiveness evaluation?

• A) Attempts to evaluate beneficial consequences in nonmonetary terms
• B) Determines the costs to operate a current system
• C) Assigns dollar values to the costs and benefits of a system
• D) Determines whether a system will fully recover its costs

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Definitions:

Estimated Residual Value

The anticipated market value of an asset at the end of its useful life, used in calculating depreciation.

Double-Declining-Balance

A method of accelerated depreciation which doubles the normal depreciation rate, reducing the value of an asset more quickly.

Depreciation Expense

Systematically spreading the expense of a physical asset over its duration of utility.

Units-of-Activity Method

A depreciation method where the expense is based on the number of units produced or the use of the asset, rather than the passage of time.