Suppose that you are trying to choose which of two IT projects to accept. Your company employs three primary selection criteria
for evaluating all IT projects: (1) proven technology, (2) ease of transition, and (3) projected cost savings.One option, Project Demeter, is evaluated as:Technology highEase of transition lowProjected cost savings highThe second option, Project Cairo, is evaluated as:Technology mediumEase of transition highProjected cost savings highConstruct a table identifying the projects, their evaluative criteria, and ratings. Based on your analysis, which project would you argue in favor of adopting? Why?
1 answer:
Answer:
The explanation of this question is given below in the explanation section.
Explanation:
In this question, it is asked about to select one project among two given project based on the evaluation criteria. These evaluation criteria include:
- Proven technology
- Ease of transition
- Projected cost saving
Based on my analysis, I will select the project cairso because It has high transition and high projected cost saving.
The analysis of these project is shown in attached picture with this solution.
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Answer:
FV = 2,621,048.23
Explanation:
we will calcualte the future value of an annuity with an geometric progression:
g 0.03
r 0.092
C 5,356 ( we will save next year (52,000 x 1.03) the 10% )
n 39 (we start saving next year)
FV = 2,400,227.319
As we deposit at the first day of the year this will be an annuity-due so we will multiply by (1 +r)
FV = 2,621,048.23