cost-benefit analysis

A systematic comparison of the costs and benefits of a proposed course of action to decide whether or not it gives a net benefit. This kind of analysis is often used in environmental impact assessments. The elements of the analysis are generally assigned a monetary value, including intangibles such as the value of human life, business reputation or ecosystem services. Future costs and benefits are then discounted to the present, the discount rate having a big effect on the outcome: A relatively high market rate reflects the common preference for present profit over future profit (effectively de-valuing the future). According to the Natural Capital Committee, cost-benefit analyses are often deficient in their understanding of natural science and in valuing indirect environmental impacts, particularly the cumulative effect of multiple impacts

This definition is abridged from A – Z of tree terms: A companion to British arboriculture.
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