• Benefit Cost Ratio (BCR) is a measure showing the relationship between the relative costs and benefits of a proposed project, expressed in monetary or qualitative terms.
  • If the project has a BCR greater than 1.0, the project is expected to generate a positive net present value for the firm and its investors.
  • If the project’s BCR is less than 1.0, the project costs outweigh the benefits and should not be considered.