In the Best Value formula (Performance + Quality) / Cost, which element is in the denominator?

In the Best Value formula (Performance + Quality) / Cost, which element is in the denominator?

• A. Performance
• B. Quality
• C. Value
• D. Cost

Answer: (D)

In the Best Value formula, value is defined as (Performance + Quality) divided by Cost. The components in the numerator are Performance and Quality—the attributes you’re optimizing. The denominator is the amount you pay, which is Cost. Since the cost sits in the bottom, higher cost lowers the overall value and lower cost raises it, all else equal. So the element in the denominator is Cost.

In the Best Value formula, value is defined as (Performance + Quality) divided by Cost. The components in the numerator are Performance and Quality—the attributes you’re optimizing. The denominator is the amount you pay, which is Cost. Since the cost sits in the bottom, higher cost lowers the overall value and lower cost raises it, all else equal. So the element in the denominator is Cost.