Question: As a project manager, you have been asked to evaluate the feasibility of the following proposed acquisition:Your organization is considering the purchase of an automated
As a project manager, you have been asked to evaluate the feasibility of the following proposed acquisition:Your organization is considering the purchase of an automated OB/GYN documentation system.Proposed costs are as follows:
| Hardware | $ 250,000 |
| Software | $ 400,000 |
| Software maintenance | $ 65,000 |
| Training | $ 35,000 |
| Implementation | $ 75,000 |
Software maintenance will start after one year and will be incurred annually.All other costs are incurred in the first year.
Your analysis projects the following benefits to be expected annually:
| Labor savings | $ 220,000 |
| Equipment savings | $ 55,000 |
| Reduced malpractice premiums | $ 20,000 |
| Increase in OB business | $ 50,000 |
Construct a table showing the investment, and showing annual benefits for five years.
Use a discount rate of 5%.
Use an assumed inflation rate of 4%.
Show the Net Present Value and the Internal Rate of Return of the proposed investment every year for five years.
*If using Excel Please let me know the formula.**
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