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Calculate the total benefit expected for this proposed

MOS 5201 uses a custom textbook including only information used in this course, resulting in a more cost-effective textbook than typically available otherwise.

A proposed engineering control is expected to cut the accident rate by 60 percent for a given process. Auditors have estimated cost data for accidents with this process as follows (average cost per accident)

Direct Cost Hidden Cost Freq/Yr

First aid cases 200 4000 9

Med. treatment cases 6000 9000 3.5

Lost time cases 8000 40000 1.5

No-injury cases none 4000 11.0

a. Calculate the total benefit expected for this proposed engineering control (Must show your calculations).

b. If the proposed engineering control will cost $150,000, does the cost-benefit analysis support funding it? Why or why not?

c. What other factors might support funding the project?

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