FrontPage: From yesterday – What value would you place on a human life? The Last Word: Ch1 Reviewing Key Concepts due next Wed. Ch 1 quiz next Wed.

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FrontPage: From yesterday – What value would you place on a human life? The Last Word: Ch1 Reviewing Key Concepts due next Wed. Ch 1 quiz next Wed.

Cost/Benefit Analysis and the Value of a Human Life

How do we know when a trade-off is worth it? Consider the following situation: ▫Your grandmother needs a procedure to save her life. She is 94 years old, and has been in good health up to this point. But the procedure will cost $2.5 million and there is a 33% failure rate.  What will you decide?

From “Fight Club” - Narrator: A new car built by my company leaves somewhere traveling at 60 mph. The rear differential locks up. The car crashes and burns with everyone trapped inside. Now, should we initiate a recall? Take the number of vehicles in the field, A, multiply by the probable rate of failure, B, multiply by the average out-of-court settlement, C. A times B times C equals X. If X is less than the cost of a recall, we don't do one.