Cost- benefit analysis:
A)makes sure that the government can compensate all the losers.
B)stresses the importance of the distribution of benefits across economic agents.
C)makes sure there are more winners than losers.
D)a project is undertaken if the net social benefit is positive.

Question

Quizplus · Accepted Answer

Cost-benefit analysis is a tool used to determine whether a project is worth undertaking or not. It involves comparing the total costs of a project to the total benefits. If the benefits outweigh the costs, the net social benefit is positive, which means that the project should be undertaken. Therefore, the correct choice is option D: a project is undertaken if the net social benefit is positive. The other options (A, B, and C) are either incomplete or incorrect. While compensating the losers, distributing benefits, and ensuring more winners than losers are important considerations when undertaking a project, they do not necessarily determine whether the project is worthwhile. The net social benefit, as determined by cost-benefit analysis, is the primary consideration.

Cost- Benefit Analysis