It is useful to distinguish between three categories of costs, namely, investment costs, operating costs, and working capital when doing a cost-benefit analysis.

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Distinguishing between investment costs, operating costs, and working capital is crucial in cost-benefit analysis as it allows for a comprehensive understanding of all financial aspects of a project, including initial outlays, ongoing expenses, and funds needed for day-to-day operations.

It Is Useful to Distinguish Between Three Categories of Costs