This can be represented by the following formula: Incremental Benefit-Cost Ratio for Name Brand over Professional: ଺଺,଻଴଴ି଻଼,ସ଴଴ ଵ଼,ହହ଴ିଷଶ,ସ଴଴ = 0.845 The Incremental Benefit-Cost Ratio is less than 1, therefore, the Name Brand nail gun will be selected. For ACS patients, when a sustained benefit of high-dose statins beyond 5 years is assumed, the incremental cost-effectiveness ratio (ICER) for a high-dose statin strategy would remain under $44 000 per QALY even when the net daily price difference between high- and conventional-dose statins was $3.50 . The Nail Gun type with best Benefit-Cost Ratio is … Just substitute the values of discount rate and the number of years … An incremental analysis must always be used to compare alternates when using a B/C ratio approach. In this form of analysis the ICER is expressed as the ratio of the incremental costs to the incremental utility gain. Since the result is greater than 1, The Generic type is rejected. It is calculated by dividing discounted value of incremental benefits by discounted value of incremental costs. Benefit-Cost Analysis 6 The Benefit-cost analysis is commonly used to evaluate public (government) projects. Incremental net monetary benefit (INMB) as the value of incremental effects (АДЕ) less incremental costs (ДС), INMB = АДЕ - ДС, provides a continuous metric that does not face the decision ordering problems of the ICER as a ratio, while representing the same decision rule. F is below the line: B/C ratio is < 1. The page provides you the Cost benefit ratio formula to calculate the Benefit-Cost Ratio. Cost–utility analysis. This method is analogous to the Incremental Benefit-Cost Ratio Method. Example : A current process costs $50,000/yr. 3) Determine the project of choice using: A) Benefit to cost ratio B) Incremental Benefit to cost ratio P.W of Cost P.W of Benefit Project $15,500 $28,200 1 $13,500 $25,300 2 $2,800 $1,500 3 $5,300 $12,500 4 Incremental cost is the amount of money it would cost a company to make an additional unit of product. The most common expression of this form of ICER is as cost (£) per incremental gain in the quality adjusted life years (£ per QALY). C 3.36 1.32 0.76 0.33 15 A, B, C, and D are above the 45-degree line; their B/C ratio is > 1. Alternatives are considered in increasing order of total discounted costs until all are considered. Incremental Benefit-Cost Ratio If more than one alternative is considered for a single project, an incremental benefit-cost ratio can be used to determine which Alternative(s) are the most economically desirable (optimize additional benefits gained for the added cost). 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