1. Basic principles of economic analysis?
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Diyorjon Keldiyorov Option 18 Questions 1.Basic principles of economic analysis? 2.Using the methods of comparison to asses the growth dynamics of the main indicators
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Larry is the health and safety manager at Padan Manufacturing. The company was recently bought out, and a new upper management team is in place. New management is unfamiliar with the health and safety program at the facility. Some of the incoming management team members are questioning costs required to operate the company's comprehensive health and safety program. Larry is conducting an economic analysis of the health and safety program. He is aiming to demonstrate the value of the health and safety program to the new management team through this analysis. Economic analysis assesses financial and other costs and benefits for operating a program, project or business venture. It is used to determine if resources are being used appropriately and effectively. Costs and benefits of a course of action or a program are evaluated, and the best course of action is selected. Lesson Quiz Course 2.2K views Core Principles of Economic Analysis There are several core economic principles utilized in economic analysis. These include: Decisions are made rationally; they are generally made with an outcome in mind, and in the best (perceived) interest of the individual, company or organization. What are the costs associated with this decision? Every choice that is made has costs. Costs include money, resources and time expended when producing a product or providing a service. In addition to financial costs, there is also an opportunity cost. When you have multiple options to choose from, and you select a particular option, you lose potential benefits from the options that you didn't select. What are the benefits associated with this decision? Every choice also has benefits. Benefits are positive results or outcomes from a decision. What are the incentives associated with this decision? There are positive and negative incentives in every decision. A benefit would be regarded as a positive incentive and a desired result, while a cost would be considered a negative incentive and undesirable. Costs and benefits may be tangible or intangible. Tangible costs and benefits can be measured quantitatively in financial or numerical terms. Intangible costs and benefits are not physically measurable, yet are valuable to a business operation. Some examples of tangible benefits include a management process that increases operational efficiency by 35%, or $100,000 in insurance cost savings from implementing a safe driving program. An example of an intangible benefit is increased employee morale due to implementing a safety incentive program. Conducting an Economic Analysis Larry is conducting an economic analysis of the company's health and safety program; his goal is to clearly communicate the economic value of the program to the new management team. Before beginning the analysis, Larry will need to determine the scope and goal for conducting the analysis. Some Common Types of Economic Analysis There are several different types of economic analysis. Three of the most common are: Cost-effectiveness analysis (CEA): A cost effectiveness analysis compares the costs of different activities ending in a specific outcome. You use it to determine what activity or method is the most cost effective in producing the desired outcome. This analysis is often used in the medical field. Cost-minimization analysis (CMA): This analysis is used to determine the least costly alternative of several options for the same outcome. For example, if you have several treatment options for a medical condition that are equally effective, the CMA would help you to determine the lowest cost treatment that would address the condition. This analysis is also used in the medical field. Cost-benefit analysis (CBA): A cost-benefit analysis measures the benefits and costs of a decision or action and determines a monetary value of costs as well as benefits. The costs are subtracted from the benefits and a net benefit is determined. For instance, the costs of a silica safety program amount to $150,000 a year, while the benefits from the program total $325,000 a year. The net benefits total $175,000. 2.
Production volume In % base year ***1=100 ***2=100%/2.1*2.2 ***3=100/2.1*2.3 ***4=100/2.1*2.4 ***5=100/2.1*2.5 IN % to Previous year ***1=100 ***2=100%/2.1*2.2 ***3=100/2.2*2.3 ***4=100/2.3*2.4 ***5=100/2.4*2.5 Number of employees In % to base year ***1=100 ***2=100%/5.1*5.2 ***3=100/5.1*5.3 ***4=100/5.1*5.4 ***5=100/5.1*5.5 In % to previous year ***1=100 ***2=100%/5.1*5.2 ***3=100/5.2*5.3 ***4=100/5.3*5.4 ***5=100/5.4*5.5 8.mln sum ***1=2.1*5.1 ***2=2.2*5.2 ***3=2.3*5.3 ***4=2.4*5.4 ***5=2.5*5.5 In % to base year ***1=100 ***2=100/8.1*8.2 ***3=100/8.1*8.3 ***4=100/8.1*8.4 ***5=100/8.1*8.5 In % to previous year ***1=100 ***2=100/8.1*8.2 ***3=100/8.2*8.3 ***4=100/8.3*8.4 ***5=100/8.4*8.5 Overwie We can see in the table the volume of production, the number of employees, the volume of work of one employee. The production volume increased by 2% compared to the Base year in the 2nd year, by 1.05% in the 3rd year, by 5% in the 4th year, and by 10.52% in the 5th year. Production volume increased by 2% in the 2nd year, 3.9% in the 4th year, and 5.26% in the 5th year compared to the previous year. In the 3rd year, it decreased by 0.93%. Number of employees decreased to 95,83% compared to the basic year in the 2nd year, to 91,66% in the 3rd year, to 88,33% in the 4th year, to 88,33% in the 5th year. The number of employees decreased to 95.83% in the 2nd year, 95.65% in the 3rd year, and 96.36% in the 4th year compared to the previous year. It did not change in the 5th year Download 20.51 Kb. Do'stlaringiz bilan baham: 
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