Project work: Economic decision-making tools

Aims of the course

The student knows the basic principles of analysis that inform business and economic decision-making, knows the methods of financial analysis and economic evaluations, can judge which method is suitable for specific cases and knows how to prepare an analysis of decision alternatives from private and societal perspectives.

Objectives:

- to understand the role of analyses that inform business and economic decision-making from private and societal perspectives
- to get acquainted with the methods and elements of financial analyses and economic evaluations
- to assess which method is most suitable for the analysis of specific decision alternatives from a private and societal perspective
- to understand and identify the problems of double counting of costs and effects
- to analyse selected decision alternatives from a private and societal perspective

Course syllabus

1. Economic decision-making
1.1. Contribution approach
1.2. Time horizon
1.3. Private and social perspective

2. Analysis of decision alternatives from the societal perspective
2.1. Methods for economic evaluations
2.2. Types of benefits
2.3. Types of costs

4. Cost-benefit analysis
3.1. Determining economic cash flow
3.2. External effects
3.3. Monetization methods
3.4. Selection between decision alternatives

4. Sensitivity and risk analysis
4.1 Sensitivity analysis
4.2. Scenario analysis
4.3. Risk analysis

5. Other methods of economic evaluations
5.1. Cost efficiency analysis
5.2. Multi criteria analysis

6. Sectoral specifics

Course director(s)