This quiz works best with JavaScript enabled. Home > Finance > Economics > Welfare Economics > Cost Benefit Analysis > Cost Benefit Analysis – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Cost Benefit Analysis Quiz 4 (17 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. On average, individuals with a college degree will earn more over the course of their lifetimes than those with only a high school diploma. A) False. B) True. Show Answer Correct Answer: B) True. 2. Why do goernments do a cost-benefit analysis? A) So everyone has a chance to decide how to spend their money. B) To make sure that all the citizens have paid their taxes. C) To limit the risk of making a bad decision and to compare ideas to see which one is best. D) None of above. Show Answer Correct Answer: C) To limit the risk of making a bad decision and to compare ideas to see which one is best. 3. Which of the following is not true regarding Cost-Benefit Analysis (CBA)? A) CBA is an analytical framework used to measure the benefits and costs of a policy design. B) Basically, CBA is an 'ordinary' rational decision-making process. C) CBA focuses on economic efficiency. D) CBA requires a medium-term view and involves immediate benefits and costs. Show Answer Correct Answer: D) CBA requires a medium-term view and involves immediate benefits and costs. 4. Essentially, what is a cost-benefit analysis? A) A list of all the employees you want to hire. B) A pros-cons list. C) A christmas wishlist. D) A list of all the projects you want to do. Show Answer Correct Answer: B) A pros-cons list. 5. The following are some of the limitations of CBA analysis, except A) It is morally unacceptable to judge nature (life, living creatures, etc.). B) CBA does not deal with social values. C) Every individual has the same preferences. D) Based on income, so it tends to be biased. Show Answer Correct Answer: C) Every individual has the same preferences. 6. Diamonds are a ..... resource because they are hard to find. A) Handy. B) Normal. C) Scarce. D) None of above. Show Answer Correct Answer: C) Scarce. 7. The following are some of the advantages of CBA analysis, except A) CBA is able to calculate all types of costs and benefits of a project. B) CBA provides a systematic and consistent evaluation method. C) CBA provides a systematic and consistent evaluation method. D) CBA mempertimbangkan trade-off dan opportunity cost. Show Answer Correct Answer: A) CBA is able to calculate all types of costs and benefits of a project. 8. What are consequences? A) Something that is possible but is not yet real. B) Money charged to do something for a service. C) Task that demands time and effort to complete. D) The results (positive or negative) of an action or decision. Show Answer Correct Answer: D) The results (positive or negative) of an action or decision. 9. Willingness to Pay studies are ..... studies A) Revealed preference. B) Stated preference. C) Human capital. D) Observed preference. Show Answer Correct Answer: B) Stated preference. 10. Arnold works at an entry-level post in a pharmaceutical company. He is now considering pursuing a course to help him move ahead in his company. Per his calculations, the total estimated cost of his education will be about $ 100, 000, and the course would increase his lifetime earning potential from $ 1M to $ 1.1M. What is the lifetime ROI of his investment? A) 10%. B) 1, 000%. C) 1%. D) 100%. Show Answer Correct Answer: D) 100%. 11. The present value will be higher when? A) The future value is low and the time period is long. B) The future value is low and the time is not long. C) The future value is high and the time period is long. D) The future value is high and the time is not long. Show Answer Correct Answer: D) The future value is high and the time is not long. 12. An opportunity cost is entailed in which of the following situations?I. A student decides to attend college full-time. II. A family uses its $ 20, 000 savings to purchase an automobile. III. A farmer decides to grow more wheat and less corn. A) I only. B) II only. C) III only. D) I and III only. E) I, II, and III. Show Answer Correct Answer: E) I, II, and III. 13. In terms of today's lesson, what is a cost? A) A negative outcome. B) A positive outcome. C) The price of an item. D) None of above. Show Answer Correct Answer: A) A negative outcome. 14. For decision making in Cost-Benefit analysis, there are several methods that can be used, except A) Net Present Value (NPV). B) Cost Effectiveness Analysis. C) Benefit-Cost Ratio. D) Discount Rate. Show Answer Correct Answer: D) Discount Rate. 15. The total cost of Lindsay's graduate degree was $ 35, 000. With this degree, she expects to earn an additional $ 10, 000 per year. What is Lindsay's break-even point? A) 3.5 years. B) 1 year. C) 1.5 years. D) 2 years. Show Answer Correct Answer: A) 3.5 years. 16. Thinking in terms of financial gain, any kind of higher education choice is a good choice, because a degree or certification will always pay off in some way. A) False. B) True. Show Answer Correct Answer: A) False. 17. When should cost benefit analysis be used? A) When planning a vacation. B) When choosing a restaurant for dinner. C) When making decisions about investments or projects. D) When deciding what to wear for the day. Show Answer Correct Answer: C) When making decisions about investments or projects. ← PreviousRelated QuizzesWelfare Economics QuizzesEconomics QuizzesCost Benefit Analysis Quiz 1Cost Benefit Analysis Quiz 2Cost Benefit Analysis Quiz 3 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books