What are the common mistakes in cost-benefit analysis?

What are the common mistakes in cost-benefit analysis?

Some common mistakes include overlooking indirect costs, failing to account for opportunity costs, and using inaccurate data.

Can you explain why overlooking indirect costs is a mistake?

Overlooking indirect costs can lead to an inflated perception of benefits, resulting in poor decision-making.

What are opportunity costs and why are they important?

Opportunity costs represent the benefits you miss out on when choosing one option over another, crucial for informed choices.

How can I avoid these mistakes in my analysis?

To avoid mistakes, ensure comprehensive data collection, involve diverse perspectives, and regularly review your assumptions.