In this section, suggestions are provided about how to use cost analysis by itself, and in conjunction with evaluations of program effectiveness. Internal Decisions Cost information can contribute to a wide array of internal decisions for a single program or for an organization that administers many programs. Four examples are provided below of the types of decisions for which cost information is important. Planning budget allocations and projecting resource needs. Average and marginal cost information are required in order to know how changes in the number and types of people in each program's target population will affect the needs of various programs for resources.
All programs have to attend to changes in the populations they serve.
For example, high birth rates will generate large increases in the numbers of families needing early intervention services. However, changes in the definition of the target population can also decrease the number of clients, but the need for accurate answers to the same questions are still needed. The systems that provide early preventive intervention services to young families should be estimating the added costs of serving these families as the number increases. Accurate answers to these questions will be required in order to determine how much additional money must be obtained from various sources. Improving the efficiency of program operation.