Why is cost-benefit analysis such a difficult job?
(i) there is no price with which to judge the value of a public good
(ii) surveys are often biased and unreliable
(iii) it is difficult to identify all factors that influence costs and benefits of public goods
A)(i) and (ii)
B)(ii) and (iii)
C)(ii) only
D)(i), (ii) and (iii)

Question

Quizplus · Accepted Answer

All three options mentioned are valid reasons why cost-benefit analysis can be a difficult job. Firstly, in the case of public goods, there is no actual market price that can be used to judge their value. Secondly, surveys conducted to determine people's preferences can often be biased or unreliable. Lastly, identifying all the costs and benefits associated with public goods can be a complex task, as some of the factors may be difficult to quantify. All these factors contribute to making cost-benefit analysis a challenging job.

Why Is Cost-Benefit Analysis Such a Difficult Job