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    Cost-benefit Analysis

    Category
    General Thinking Tools
    Description

    “A systematic approach to estimating the strengths and weaknesses of alternatives that satisfy transactions, activities or functional requirements for a business.” (related: net present value — “a measurement of the profitability of an undertaking that is calculated by subtracting the present values of cash outflows (including initial cost) from the present values of cash inflows over a period of time.”, discount rate)

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    Source

    Gabriel Weinberg's Mental Models I Find Repeatedly Useful