The official business definition of cost efficiency vs cost effectiveness is that cost efficiency is the ratio of output to input, or the measure of how much output is generated from a given input. Cost effectiveness, on the other hand, is the measure of how well resources are used to achieve a desired outcome. Cost efficiency is concerned with the amount of resources used to produce a given output, while cost effectiveness is concerned with the quality of the output produced. In other words, cost efficiency is concerned with how much it costs to produce a given output, while cost effectiveness is concerned with the quality of the output produced. Cost efficiency is important in businesses because it helps to reduce the cost of production and increase profits. Cost effectiveness is important because it helps to ensure that the output produced is of the highest quality and meets the desired objectives.