Project proposals estimated costs and benefits

Assignment Help Operation Management

Reference no: EM131414861

What is the net present value of the following project proposal’s estimated costs and benefits (show your work)? The estimation period is 3 years and the risk-free interest rate is 3%. In the first year of the project, there will be an investment of $400,000 in computers and other infrastructure. In the third year, an additional investment of $100,000 will be made in an additional large computer. Software licenses will cost $15,000 per year all three years. Salaries will cost $500,000 in year 1 and $80,000 each in years 2 and 3. There will be no revenue in year 1. Year 2 revenue will be $550,000, and year 3 revenue will be $800,000. Based on your analysis, should this project be pursued?

Reference no: EM131414861

Questions Cloud

Market focus help business create competitive adavantage : How does market focus help a business create competitive adavantage? What risks accompany such a posture? Do you think it is better to concentrate on one source of competitive advantage ( cost versus differentiation versus speed)?

Make sure the integrated program management report : Which of the following describes the purpose of data validation checks? To make sure the Integrated Program Management Report (IPMR) data do not contain anomalies that would make them invalid and negatively impact management decision making.

Encouraged the mass destruction of rainforest : The increased demand of palm oils in prepared foods has encouraged the mass destruction of rainforest in Indonesia for the purpose of planting palm tree plantations. The loss of rainforest threatens the ecosystem and many animal species.

Popularity of technology in the current marketplace : The integration, acceptance, and popularity of technology in the current marketplace and workplace are widespread, particularly with respect to marketing. How might technology add to customer value and a positive cash flow?

Project proposals estimated costs and benefits : What is the net present value of the following project proposal’s estimated costs and benefits (show your work)? The estimation period is 3 years and the risk-free interest rate is 3%. In the first year of the project, there will be an investment of ..

Below are three different aspects of management : Below are three different aspects of management, all of which require the role of an agent of change. Human Resource Management, Sustainability, and System Approach to Organizational Change. What famous business, religious, community or political lea..

Three different aspects of management : Below are three different aspects of management, all of which require the role of an agent of change. Human Resource Management, Sustainability, and System Approach to Organizational Change. How can you apply what you have learned about these three c..

What is markets role in driving sustainability in industry : What is the market’s role in driving sustainability in your industry? How is that different from the role of market forces in driving sustainability in your industry? Do you agree with Jacobs (1993) that the latter is more influential than the former..

System approach to organizational change : Below are three different aspects of management, all of which require the role of an agent of change. Human Resource Management, Sustainability, and System Approach to Organizational Change.

User Account

All Pages