Significance and Use
5.1 The NB (NS) method provides a measure of the economic performance of an investment, taking into account all relevant monetary values associated with that investment over the investor’s study period. The NB (NS) measure can be expressed in either present value or equivalent annual value terms, taking into account the time value of money.
5.2 The NB (NS) method is used to decide if a given project is cost effective and which size or design for a given purpose is most cost effective when no budget constraint exists.
5.3 The NB (NS) method can also be used to determine the most cost effective combination of projects for a limited budget; that is, the combination of projects having the greatest aggregate NB (NS) and fitting within the budget constraint.
5.4 Use the NB method when the focus is on the benefits rather than project costs.
5.5 Use the NS method when the focus in on project savings (that is, reductions in project costs).
1.1 This practice covers a recommended procedure for calculating and interpreting the net benefits (NB) and net savings (NS) methods in the evaluation of building designs and systems.
1.2 The values stated in inch-pound units are to be regarded as standard. The values given in parentheses are mathematical conversions to SI units that are provided for information only and are not considered standard.
1.3 This standard does not purport to address all of the safety concerns, if any, associated with its use. It is the responsibility of the user of this standard to establish appropriate safety, health, and environmental practices and determine the applicability of regulatory limitations prior to use.
1.4 This international standard was developed in accordance with internationally recognized principles on standardization established in the Decision on Principles for the Development of International Standards, Guides and Recommendations issued by the World Trade Organization Technical Barriers to Trade (TBT) Committee.
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