ExpertMedium2 marksMultiple Choice
ACCA · Question 30 · Performance measurement
Section A
HealthFirst, an NGO, runs a vaccination program. They evaluate their performance using the 'Value for Money' framework (the 3 Es: Economy, Efficiency, Effectiveness).
Which of the following best describes 'Effectiveness' in this context?
Section A
HealthFirst, an NGO, runs a vaccination program. They evaluate their performance using the 'Value for Money' framework (the 3 Es: Economy, Efficiency, Effectiveness).
Which of the following best describes 'Effectiveness' in this context?
Answer options:
A.
Purchasing the vaccines at the lowest possible cost per dose.
B.
Administering the maximum number of vaccines per nurse per day.
C.
Measuring the extent to which the program reduced the incidence of the disease in the target population.
D.
Ensuring the budget for the vaccination program is not overspent.
How to approach this question
Match the 3 Es to their definitions: Economy = cheap inputs. Efficiency = high output per input. Effectiveness = achieving the ultimate goal.
Full Answer
C.Measuring the extent to which the program reduced the incidence of the disease in the target population.✓ Correct
In the Value for Money framework used by non-profits and public sectors:
- Economy: Minimizing the cost of inputs (e.g., cheap vaccines).
- Efficiency: Maximizing the ratio of outputs to inputs (e.g., vaccines administered per hour).
- Effectiveness: The extent to which the ultimate objectives are achieved (e.g., actually reducing disease rates).
Common mistakes
Confusing Efficiency (doing things right) with Effectiveness (doing the right things/achieving the goal).
Practice the full ACCA MA — Management Accounting Practice Exam 6
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