The formula above is known as the

The benefit-cost ratio (BCR) is a financial metric used to evaluate the profitability of an investment or project. It compares the present worth of benefits (such as revenue, cost savings, or other positive impacts) to the present worth of costs (such as initial investment, operating expenses, or other negative impacts). The BCR helps decision-makers assess whether the benefits outweigh the costs. A BCR greater than 1 indicates that the benefits exceed the costs, making the project financially viable1.

 1: The ASQ Certified Manager of Quality/Organizational Excellence Handbook, Fifth Edition, Sandra L. Furterer and Douglas C. Wood, ASQ Quality Press, 2021.