14Use of Cost Metrics and Ratios
14.1 INTRODUCTION
Cost ratios, indices, metrics, and even rules of thumb are commonly used in the financial sector to convey the health and performance of a company from both a strategic and operational perspective and even make complex decisions. Engineering projects can also use simple metrics as a way to understand the worth or return for a project. Some common metrics are shown in Figure 14.1 (many of these were taken from Marr, 2012). These ratios can play an important role in portfolio analysis, marketing a project, conveying non-economic value, decision analysis, and so on. However, they can also be misleading, especially for public-sector projects.
Figure 14.1 Company- ...
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