Loading...
Please wait, while we are loading the content...
Similar Documents
Cost-Benefit Analysis for Investment Decisions: Chapter 7 (Principles Underlying The Economic Analysis of Projects)
| Content Provider | Semantic Scholar |
|---|---|
| Author | Jenkins, Glenn P. Kuo, Chun-Yan Harberger, Arnold C. |
| Copyright Year | 2011 |
| Abstract | While the financial analysis of a project focuses on matters of interest to investors, bankers, public sector budgets, etc., an economic analysis deals with the impact of the project on the entire society. The primary difference between the economic and financial evaluation is that the former aggregates benefits and costs over all the country's residents to determine whether the project improves the level of economic welfare of the country as a whole while the latter conside'rs the project from the point of view of the well-being of a particular institution or subgroup of the population. A broad consensus exists among accountants on the principles to be used in undertaking a financial appraisal of a potential investment. There is also considerable agreement among financial analysts on the cash flow and balance sheet requirements for a public sector project to pay for itself on a cash basis. However, these accounting and financial principles are not a sufficient guide for undertaking an economic appraisal of a project. This chapter explains the relationship between the financial and the evaluations and how the economics is grounded in microeconomic theory and it applications in welfare economics. |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://www.queensjdiexec.org/publications/qed_dp_200.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
