Cost Benefit Analysis and the City’s Water Dilemma
Introduction
This memorandum focuses on describing the value of cost benefit analysis. It does so by applying the first four steps of the U.S. Army Cost Benefit Analysis Guide as they relate to the city’s need to increase its water treatment capacity. The purpose of this memorandum is not to take the faculty of judgment away from any council member but rather to show how cost benefit analysis can facilitate the judgment process and provide support for pursuing the best possible opportunity at this time.
Step 1: Define the Problem / Opportunity; Describe the Background
Every problem is an opportunity. The problem that the city faces is with respect to its need to upgrade or update its water treatment plant which is more than 40 years old and costly to maintain. With the large automaker set to come to the unincorporated area of the county, the need to service the increased demand will put severe strain on the treatment plant. The problem is: what to do?
This problem can be framed as an opportunity. In fact, it is possible that this problem presents us with several different opportunities. The best way to decide which opportunity is worth pursuing is to conduct a cost benefit analysis. And the first step of the cost benefit analysis is to construct a problem statement.
The problem statement is this: A large auto manufacturer is coming to the county and the city’s water treatment plant will be tasked with meeting the new demand that the manufacturer will bring. The plant is already operating at maximum levels and maintenance of the plant is only getting more and more expensive. The plant is over 40 years old and there are costs and benefits associated with each of the possible solutions that could be employed to address this problem.
Step 2: Define the Scope; Formulate Facts and Assumptions
The second step is to identify the stakeholders involved in the problem and the facts, limitations and assumptions associated with the problem. The stakeholders involved in this problem are the residents of both the unincorporated county and the city, both of whom rely on the water treatment plant. The auto manufacturer...
Benefit Analysis Introduction and Analysis of the Project: Cost-Benefit Analysis of Proposed New Health Warnings on Tobacco Products (Report, 2003) The new regulation introduced in July 2004 to be implemented for all the years till 2030, have significant cost impact on the economy. Certain benefits are also associated with it, the primary ones include health improvement, increased revenues for non-tobacco industry and the decreased healthcare expense. The major costs are related
Benefit Analysis Memorandum Cost-Benefit Analysis Cost-benefit analyses are routinely conducted for federal programs and proposed federal programs. The researchers propose a cost-benefit analysis for homeland security expenditures designed to address conventional threats to national security. An evaluation of catastrophic threats is specifically excluded from this analysis as only 14% of the federal homeland security budget is directed at the prevention of catastrophic threats to national security. The recommendation from the authors
Vaughan, J.L., Leming, M.L.M., Liu, M., & Jaselskis, E., 2013. Cost-Benefit Analysis of Construction Information Management System Implementation: Case Study. Journal of Construction Engineering and Management. Managers working within construction projects encounter significant expenditure of resources in collecting project data, evaluating production rates, and exchanging information with project stakeholders. The paper focuses on the execution of project tasks through manual reduction of inefficiency as well as improved effective operations in
Gun Laws Cost-benefit Analysis: Cost Benefit Analysis (CBA) is the method with the help of which the answer to the question of "did the spending serve its purpose?" is obtained. It is an analytical process of measuring the utility of an interventional process or ways and methods of reaching and objective. In the domain of crime prevention, the programs carried out are subjected to this analysis among others by the Australian government
Value Calculation. Consider the following scenario: A city wants to open a recycling center aimed at reducing waste. The total benefits of the program are valued at $1,000,000. Three different discount rates are estimated at 5%, 6%, and 7%. The time period for receiving the benefits of the program is two years. Scenario 1 tasks: Calculate the present value at each interest rate. Note and discuss what happens to the present
Establishing the Decision Framework Does the study carefully define a problem? Yes. The study argues that traditional special education classes should be replaced with Instructional Support Teams. This argument is based on the premise that traditional special education classes are costly and educationally insufficient. The study notes that the 1993-94 federal estimate of children enrolled in special education classes was 5.4 million, which is an increase of 3.7% in just one
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now