Which of the following describes the purpose of Cost Benefit Analysis when assessing a Green IT investment?

Question

Options

• ATo determine the cash flow of a Green IT investment.
• BTo identify the risks of a Green IT investment.
• CTo calculate the return on a Green IT investment.
• DTo identify the advantages of a Green IT investment.

• A
  5% (1)
• B
  5% (1)
• C
  90% (18)

Explanation

Cost Benefit Analysis (CBA) is specifically designed to weigh the total costs of an investment against the total benefits it generates, making it the standard tool for calculating return - whether financial, environmental, or operational - on a Green IT investment, which is why C is correct.

Why the distractors are wrong:

• A (cash flow) - Cash flow analysis is a separate financial tool; CBA compares aggregate costs vs. benefits, not the timing of money in and out.
• B (identify risks) - Risk identification belongs to risk assessment frameworks (e.g., risk registers or SWOT analysis), not CBA.
• D (identify advantages) - While CBA surfaces benefits, its core purpose is quantifying the net return, not simply listing advantages; that would be closer to a feasibility study or business case narrative.

Memory tip: Think of CBA as a scale - costs on one side, benefits on the other. The scale tells you the return (is it worth it?), not the cash timing (A), the dangers (B), or a one-sided list of pros (D).

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