Input-output analysis
Environmental input-output analysis compares physical resources entering a process with useful output, waste and other exits, allowing for stock changes and measurement units. It can reveal losses whose full purchase and processing cost is hidden when attention is limited to disposal fees. The material balance should reconcile before financial values are attached. It supports investigation but does not by itself explain the cause of every physical difference.
Worked example
A process uses 1,000 kg of material and produces 800 kg of good output and 200 kg of waste. At $2 per input kg, wasted material costs $400 before processing and disposal costs.
Common mistake
Do not value waste only at its disposal invoice or compare incompatible units without a valid physical conversion.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | PM | Direct | September 2026–June 2027 |