cost effectiveness

cost effectiveness definition - business

cost effectiveness

A comparison of the added costs with the added benefits of a course of action. For example, a retailer might investigate the cost effectiveness of hiring more security personnel in an attempt to reduce theft of merchandise. Hiring more personnel would be cost effective if the added cost of additional staff was less than the savings from a reduction in stolen goods.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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