CFOS Unit 9/Efficiency and Cost Effectiveness Ratio
Unit 9 
Introduction  What is the Difference between Efficiency and Effectiveness  Efficiency  CostEffectiveness  CostEffectiveness of ODL Institutions  Making the Case for ODL 
EXERCISE 9.2 and 9.4: Efficiency and CostEffectiveness Ratios
A community college in Canada offers its programmes through both conventional, facetoface classes and paperbased distance education materials. Information for 2004 on total student enrolments, total graduates and total costs for both modes in relation to the Certificate in Cost Accounting programme are given in the table below:
Programme  Delivery Mode  Total Student Enrolments  Total Graduates  Success Rate (percent)  Total Costs (Cdn.$)  Average Costs per Student (Cdn.$)  Average Cost per Graduate (Cdn.$) 
Cert in Cost Accounting  ODL  131  43  34,977  
Cert in Cost Accounting  Conventional  954  886  712,433  
Programme as a Whole  Combined  1,085  929  747,410 
Exercise 9.2: Efficiency
Calculate the Average Cost per Student for the ODL and conventional modes of delivering this course, as well as for the programme as a whole. Insert your answers in the blank cells of the table below. Now calculate the Efficiency Ratio for the ODL versus conventional modes of this programme, using the average costs per student.

EQUATION
ER = AC_{a} ÷ AC_{b}
Where:
 ER = efficiency ratio
 AC_{a} = average cost per FTE student for programme/institution A
 AC_{b} = average cost per FTE student for programme/institution B
Exercise 9.4: CostEffectiveness
Now calculate the Success Rate and the Average Cost per Graduate for the different modes and insert your answers in the blank cells of the table above. Once you have finished the above, calculate the CostEffectiveness Ratios for the two modes of the Certificate in Cost Accounting Programme. The equation is the same as for the Efficiency Ratio above, but utilises Average Cost per Graduate.

EQUATION for CostEffectiveness Ratio
 CER = ACG_{a} ÷ ACG_{b}
Where:
 CER = costeffectiveness ratio
 ACG_{a} = average cost per graduate for programme/institution A
 ACG _{b} = average cost per graduate for programme/institution B
In this case study, what factors have influenced the relatively poor costeffectiveness of the ODL mode of delivery?
Please refer to the Sample Answers for Exercices 9.2 and 9.4 by clicking on the link.