LASTFIRE November 2001 - NIFV

LASTFIRERISK WORKBOOKCost Benefit AnalysisA Risk Reduction Option is cost beneficial if :-{( ) ( )}× γ - × γ × Pr >C withoutwithoutC withwithPrcontrolCost of implementa tionwhere:C without = Expected cost of incident without option in placeC with = Expected cost of incident with option in placeγ withoutwithout= Expected statistical frequency of the initiating event if optionis not implementedγ withwith= Expected statistical frequency of the initiating event if optionis implementedPr control = Probability that option will perform as requiredcontrol