CHAPTER 4

Measuring Costs and Benefits

The language of efficiency and effectiveness is important; it appeals to the pragmatic streak inside most Americans. But it’s not enough. No one is going to go to the barricades for utility.

—Samuel Gregg

Chapter 4 Preview

When you have completed reading this chapter you will:

interpret cost benefit analysis (CBA) costs as the monetary or dollar value of alternate projects forfeited if a proposed project is implemented; for example, $80,000 spent on any project could represent one less mile of highway resurfaced;

understand that full cost exceeds user fees, such as tolls and tuition, for publicly provided services;

recognize that both costs and benefits are monetary values; these values represent ...

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