TERM OF THE DAY cost benefit analysis (CBA) Process of quantifying costs and benefits of a decision, program, or project(over a certain period), and those of its alternatives (within the same period), inorder to have a single scale of comparison for unbiased evaluation. Unlike thepresent value (PV) method of investment appraisal, CBA estimates the net present value (NPV) of the decision by discounting the investment and returns. Though employed mainly in financial analysis, a CBA is not limited to monetaryconsiderations only. It often includes those environmental and social costs and benefits that can be reasonably quantified. See also feasibility study. Learn more about this term Usage Example After completing a cost benefit analysis, the director of operations concluded that the retailer would profit from opening up another store location.

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