A cost-benefit analysis is a method for quantitatively assigning values to different actions.

For each action, it weighs up the costs of taking that action against the benefit of that action, usually in expectation if uncertainty is involved.

Cost-benefit analyses can be done at varying levels of precision, starting with fermi estimates and going up to Monte-Carlo analyses with research into the distributions underlying the relevant factors.

See Also:

• Cost-benefit analysis on Wikipedia

• Do The Math, Then Burn The Math and Go With Your Gut

• Fermi Estimation

• Forecasting and Prediction