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The objective of Cost-Benefit Analysis is to provide decision-makers with information about the social value of government-sponsored programs, projects and policies, so that they can allocate resources in a way that improves the well-being of society as a whole.  The course covers  the key concepts and tools that are essential for the evaluation of government activity by applying cost-benefit techniques, including under conditions of uncertainty.  Case studies are employed to give students the confidence and insights required to undertake their individual assignment.  Alternative decision-making approaches will also be presented to provide a perspective on the advantages and disadvantages of cost-benefit analysis.

Learning Outcomes

Upon successful completion, students will have the knowledge and skills to:

On successful completion of this course, students will have: 

• a solid understanding of the basic rationale and techniques for applying cost-benefit analysis to government-sponsored programs, policies and projects. 
• the ability to plan and implement a cost-benefit study;
• the ability to understand and critique a cost-benefit study prepared by someone else.

Required Resources

Recommended Resources

Recommended Text:

Tevfik F. Nas, (2018), Cost-Benefit Analysis: Theory and Application, 2nd Edition, Lexington Books, Rowman and Littlefield, Washington, D.C.

Other Relevant Readings:

Belli, P., J. Anderson, J.Dixon and T. Jee-Peng, (2000), Economic Analysis of Investment Operations: Analytical Tools and Practical Applications, WBI, World Bank, Washington, D.C.

Sinden, J.A. and D.J. Thampapillai, (1995), Introduction to Benefit-Cost Analysis, Longman, Sydney.

Staff Feedback

Students will be given feedback in the following forms in this course:

• Written comments
• Verbal comments
• Feedback to the whole class, to groups, to individuals, focus groups

Student Feedback

ANU is committed to the demonstration of educational excellence and regularly seeks feedback from students. Students are encouraged to offer feedback directly to their Course Convener or through their College and Course representatives (if applicable). The feedback given in these surveys is anonymous and provides the Colleges, University Education Committee and Academic Board with opportunities to recognise excellent teaching, and opportunities for improvement. The Surveys and Evaluation website provides more information on student surveys at ANU and reports on the feedback provided on ANU courses.

Class Schedule

Week/Session	Summary of Activities	Assessment
1	week 1 Introduction – Development projects - The need to choose - The concept of Pareto Optimality	Power Point Presentation will be uploaded in the Wattle.
2	week 2 Actual or potential Pareto improvements – From individual to Social improvements- Pareto Optimality and Public Goods.	Power Point Presentation will be uploaded in the Wattle.
3	week 3 General principles of valuation of benefits and costs - The concept of net social benefit –– Specific guidelines	Power Point Presentation will be uploaded in the Wattle.
4	week 4 The competitive market – Valuation with market prices – A sample analysis: a second international airline for New Zealand.	Power Point Presentation will be uploaded in the Wattle.
5	week 5 Market Distortions - Valuation without market prices –Investment criteria	Power Point Presentation will be uploaded in the Wattle.
6	week 6 Project selection – Discounting to a present value – Choosing the base date for discounting.	Power Point Presentation will be uploaded in the Wattle. Mid-term Test
7	week 7 Calculating an equivalent annual cost - Issues in using the net present value rule	Power Point Presentation will be uploaded in the Wattle.
8	week 8 Allowing for inflation - Concepts of the discount rate.	Power Point Presentation will be uploaded in the Wattle.
9	week 9 Benchmark discount rates – Risk-neutrality and risk aversion – Techniques for handling uncertainty	Power Point Presentation will be uploaded in the Wattle.
10	week 10 Sensitivity analysis - . Criticisms and limitations of benefit-cost analysis.	Power Point Presentation will be uploaded in the Wattle.
11	week 11 Benefit-cost analysis of Health projects	Power Point Presentation will be uploaded in the Wattle.
12	week 12 Benefit-cost analysis of environment projects.	Power Point Presentation will be uploaded in the Wattle.

Tutorial Registration

Tutorial registration will be done on the first day of the lecture on 27/02/2020.

Assessment Summary

Assessment task	Value	Due Date	Return of assessment	Learning Outcomes
Mid-term Examination	40 %	02/04/2020	05/04/2020	1,3
Final Examination	60 %	06/06/2020	02/07/2020	1,2,3,4,5

* If the Due Date and Return of Assessment date are blank, see the Assessment Tab for specific Assessment Task details

Policies

ANU has educational policies, procedures and guidelines, which are designed to ensure that staff and students are aware of the University’s academic standards, and implement them. Students are expected to have read the Academic Misconduct Rule before the commencement of their course. Other key policies and guidelines include:

• Student Assessment (Coursework) Policy and Procedure
• Special Assessment Consideration Policy and General Information
• Student Surveys and Evaluations
• Deferred Examinations
• Student Complaint Resolution Policy and Procedure

Assessment Requirements

The ANU is using Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. For additional information regarding Turnitin please visit the ANU Online website Students may choose not to submit assessment items through Turnitin. In this instance you will be required to submit, alongside the assessment item itself, hard copies of all references included in the assessment item.

Moderation of Assessment

Marks that are allocated during Semester are to be considered provisional until formalised by the College examiners meeting at the end of each Semester. If appropriate, some moderation of marks might be applied prior to final results being released.

Assessment Task 1

Mid-term Examination

One and half hour mid-term test at the sixth week of the semester. Value of 40 marks out of 100.

Assessment Task 2

Final Examination

One two-hour paper at the end of the semester. Value of 60 marks out of 100. Candidates will be required to apply the methodology underlying CBA to demonstrate their overall understanding of the course. Full course materials will be covered in the final examination.

Academic Integrity

Academic integrity is a core part of our culture as a community of scholars. At its heart, academic integrity is about behaving ethically. This means that all members of the community commit to honest and responsible scholarly practice and to upholding these values with respect and fairness. The Australian National University commits to embedding the values of academic integrity in our teaching and learning. We ensure that all members of our community understand how to engage in academic work in ways that are consistent with, and actively support academic integrity. The ANU expects staff and students to uphold high standards of academic integrity and act ethically and honestly, to ensure the quality and value of the qualification that you will graduate with. The University has policies and procedures in place to promote academic integrity and manage academic misconduct. Visit the following Academic honesty & plagiarism website for more information about academic integrity and what the ANU considers academic misconduct. The ANU offers a number of services to assist students with their assignments, examinations, and other learning activities. The Academic Skills and Learning Centre offers a number of workshops and seminars that you may find useful for your studies.

Online Submission

The ANU uses Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. While the use of Turnitin is not mandatory, the ANU highly recommends Turnitin is used by both teaching staff and students. For additional information regarding Turnitin please visit the ANU Online website.

Hardcopy Submission

For some forms of assessment (hand written assignments, art works, laboratory notes, etc.) hard copy submission is appropriate when approved by the Associate Dean (Education). Hard copy submissions must utilise the Assignment Cover Sheet. Please keep a copy of tasks completed for your records.

Late Submission

Late submission of assessment tasks without an extension are penalised at the rate of 5% of the possible marks available per working day or part thereof. Late submission of assessment tasks is not accepted after 10 working days after the due date, or on or after the date specified in the course outline for the return of the assessment item. Late submission is not accepted for take-home examinations.

Referencing Requirements

Accepted academic practice for referencing sources that you use in presentations can be found via the links on the Wattle site, under the file named “ANU and College Policies, Program Information, Student Support Services and Assessment”. Alternatively, you can seek help through the Students Learning Development website.

Extensions and Penalties

Extensions and late submission of assessment pieces are covered by the Student Assessment (Coursework) Policy and Procedure The Course Convener may grant extensions for assessment pieces that are not examinations or take-home examinations. If you need an extension, you must request an extension in writing on or before the due date. If you have documented and appropriate medical evidence that demonstrates you were not able to request an extension on or before the due date, you may be able to request it after the due date.

Privacy Notice

The ANU has made a number of third party, online, databases available for students to use. Use of each online database is conditional on student end users first agreeing to the database licensor’s terms of service and/or privacy policy. Students should read these carefully. In some cases student end users will be required to register an account with the database licensor and submit personal information, including their: first name; last name; ANU email address; and other information. In cases where student end users are asked to submit ‘content’ to a database, such as an assignment or short answers, the database licensor may only use the student’s ‘content’ in accordance with the terms of service — including any (copyright) licence the student grants to the database licensor. Any personal information or content a student submits may be stored by the licensor, potentially offshore, and will be used to process the database service in accordance with the licensors terms of service and/or privacy policy. If any student chooses not to agree to the database licensor’s terms of service or privacy policy, the student will not be able to access and use the database. In these circumstances students should contact their lecturer to enquire about alternative arrangements that are available.

Distribution of grades policy

Academic Quality Assurance Committee monitors the performance of students, including attrition, further study and employment rates and grade distribution, and College reports on quality assurance processes for assessment activities, including alignment with national and international disciplinary and interdisciplinary standards, as well as qualification type learning outcomes. Since first semester 1994, ANU uses a grading scale for all courses. This grading scale is used by all academic areas of the University.

Support for students

The University offers students support through several different services. You may contact the services listed below directly or seek advice from your Course Convener, Student Administrators, or your College and Course representatives (if applicable).

• ANU Health, safety & wellbeing for medical services, counselling, mental health and spiritual support
• ANU Diversity and inclusion for students with a disability or ongoing or chronic illness
• ANU Dean of Students for confidential, impartial advice and help to resolve problems between students and the academic or administrative areas of the University
• ANU Academic Skills and Learning Centre supports you make your own decisions about how you learn and manage your workload.
• ANU Counselling Centre promotes, supports and enhances mental health and wellbeing within the University student community.
• ANUSA supports and represents undergraduate and ANU College students
• PARSA supports and represents postgraduate and research students