CEI stands for Cost Effectiveness Index and is used to measure what?

• A. The ratio of costs to benefits
• B. The relative cost per unit of effectiveness
• C. The net present value
• D. The monetized crash costs

Answer: (B)

CEI measures how much money is needed for each unit of effect achieved, focusing on the cost per unit of outcome. In practice, you take the total cost of an intervention and divide it by the amount of effect it produces (for example, dollars per crash prevented or dollars per life saved). This is exactly the idea of a relative cost per unit of effectiveness. It’s not about net present value, which mixes timing and value of money, nor simply monetizing crash costs or comparing costs to benefits. So this question points to the measure of relative cost per unit of effectiveness.