What Is Incremental Analysis?

Incremental analysis method refers to the method of analyzing the difference between the compared schemes in terms of costs and benefits, and then comparing and optimizing the schemes. The method used in the specific analysis process of the incremental analysis method is the elimination method, which compares all the alternatives one by one, and then eliminates the sub-optimal ones in turn. .

Incremental analysis

This entry lacks an overview map . Supplementing related content makes the entry more complete and can be upgraded quickly. Come on!

Incremental analysis method refers to the method of analyzing the difference between the compared schemes in terms of costs and benefits, and then comparing and optimizing the schemes. The method used in the specific analysis process of the incremental analysis method is the elimination method, that is, all the alternatives are compared one by one, and the sub-optimal ones are eliminated in order. The remaining plan is the most economical one among the alternatives. .

In theory, the incremental analysis method is more accurate than other methods. The basic premise of the incremental analysis method is: as long as the profit created by the increased sales staff (the marginal sales profit) is greater than the increased cost of sales (the marginal sales cost), then the size of the sales team should be continued until the two are equal .

Chinese name

Incremental analysis

Foreign name

Incremental Analysis

1 Incremental analysis table 1

Sales potential in the sales area Percentage of total capacity = ÷ 40000 Actual sales Sales of H company per 1% market share = ÷ ÷ 100

1 400 1% 80 80

2 1000 2.5% 175 70

3 200 0.5% 50 100

4 400 1% 80 80

5 2000 5% 300 60

6 2000 5% 300 60

7 1000 2.5% 175 70

8 4000 10% 560 56

9 400 1% 80 80

10 1000 2.5% 175 70

...

Total 40000 3200

2 Incremental analysis table 2

Number of sales areas Relative market potential = 1 ÷ × 100% Sales of the company in each 1% market share Total sales = × × × 100

200 0.5% 100 10000

100 1% 80 8000

40 2.5% 70 7000

20 5% 60 6000

10 10% 56 5600

Example of incremental analysis

Cost-effectiveness analysis is used to evaluate the pharmacoeconomics of alternatives. In the face of higher-efficiency and higher-cost solutions, the economics cannot be directly judged, so the incremental analysis method is needed to further compare and select the options Economy.

Known: CX is the cost of alternative X for treating a disease with test drug x; CY is the cost of alternative Y for treating a disease with control drug y; EX is the effect of option X; EY is the effect produced by alternative Y; and CX> CY, EX> EY. Use the incremental analysis method to select and compare the economics of the options: (1) sort all the alternatives from low to high cost-CY, CX; (2) find the lowest cost solution-option Y is The lowest cost plan; (3) Compare the higher cost plan with the lowest cost plan E = E X E Y , C = C X C Y.

If E / C EY / CY , then plan X is economical, that is, compared with the control drug y, the treatment of a certain disease with the new drug x results in higher treatment costs, but the effect is also higher Moreover, the increased cost of treatment can bring a more satisfactory incremental effect, in other words, the increased efficacy of the new drug x is worth paying more. At this time, the new drug x is economical and can save the cost of medicines in the whole society. It should be actively promoted and applied. ^[1]