What type of analysis is most useful for a business when assessing whether an action is worth the cost?

Cost-benefit analysis is a systematic process for calculating and comparing benefits and costs of a project, decision, or government policy. This method helps businesses determine the value of taking a specific action by quantifying all potential costs and expected benefits.

When conducting a cost-benefit analysis, a business identifies all relevant costs associated with an action, such as expenses, resources, and time. It then considers the expected benefits, such as increased revenue, improved efficiency, or enhanced customer satisfaction. By comparing these costs and benefits, the business can make an informed decision about whether the action offers more value than it costs.

This analysis is particularly useful for businesses as it provides a clear framework for decision-making, ensuring that resources are allocated efficiently to maximize profitability and achieve strategic goals. In contrast, the other options do not specifically focus on the direct comparison of costs and benefits, which is fundamental to determining the worthiness of an action.