Which of the following statements about the cost-benefit approach is TRUE?
A)Resources should be spent if they are expected to better attain company goals in relation to the expected costs of these resources.
B)In a cost-benefit analysis, both costs and benefits are easy to obtain.
C)Resources should be spent if the costs of a decision outweigh the benefits of the decision.
D)A cost-benefit approach would not be appropriate for a decision to install a budget system or not.
E)The cost-benefit approach is more important than behavioural considerations.

Question

Quizplus · Accepted Answer

The cost-benefit approach involves weighing the expected costs and benefits of a decision. Resources should only be spent if the expected benefits outweigh the expected costs. Option B is incorrect as obtaining costs and benefits may not always be easy. Option C is the opposite of what the cost-benefit approach recommends. Option D is incorrect as a cost-benefit analysis could inform the decision to install a budget system. Option E is incorrect as the cost-benefit approach considers both costs and benefits, as well as behavioral factors.

Which of the Following Statements About the Cost-Benefit Approach Is