Benefit-Cost Ratio & Return-on-Investment: Project Selection - Part 3 | PMP | PMBOK

** Apologies: Error in the lesson **
There is a mistake in the calculations of Present Value for Year #1 and #2 in the example used to explain BCR and ROI. This has no impact on the concepts (ROI, BCR and NVP) explained in this lesson.

Nilakantha Panigrahi: Thank you for pointing out this mistake to me.

Benefit-Cost Ratio or BCR is the ratio of Benefit to Cost. Return-on-Investment or ROI is the ratio of Return to Investment. These are closely related, but each provides a unique insight. BCR is focused on total gains, whereas, ROI is focused on net gain.

In this lesson we will cover:
1. What is BCR?
2. What is ROI?
3. How can we calculate the BCR?
4. How can we calculate the ROI?
5. How are ROI, BCR and NPV related to each other?
6. Sample Problems with solutions

#SunnySensei