The value of research in making a particular decision can be determined by applying the following equation: V(dr)- V(d) C(r).In this equation,V(dr)represents the:
A) cost of research.
B) value of the decision with the benefit of research.
C) value of the decision without the benefit of research.
D) difference between the cost of research and the benefit of research.

Question

The value of research in making a particular decision can be determined by applying the following equation: V(dr)- V(d)> C(r).In this equation,V(dr)represents the:
A) cost of research.
B) value of the decision with the benefit of research.
C) value of the decision without the benefit of research.
D) difference between the cost of research and the benefit of research.

Quizplus · Accepted Answer

V(dr) represents the value of the decision with the benefit of research. Therefore, by subtracting the value of the decision without research (V(d)) from the value of the decision with research (V(dr)), we can determine the incremental benefit of research. If this incremental benefit is greater than the cost of research (C(r)), then the value of research in making the decision is positive.

The Value of Research in Making a Particular Decision Can