Jonny Gupta is a Project Manager for TOTAL Consultants. She has been asked to help choose one of the four potential project candidates. The
management used Payback Period Technique, ROI and NPV over 5 years at 5.5% for
project selection.
A. Renovating an apartment. The project involves making an investment of $200,000.
Monthly rental returns of $4,800.
B. Building a bridge. The project involves making an investment of $4,000,000.
Quarterly returns via toll for the bridge of $150,000.
c. Upgrading software platform. The project involves making an investment of
$485,000. There will be Quarterly returns of $33,000.
D. Building a new high school. The project involves making an investment of $900,000
while offering Free School tuition for the first two years. After 24 months, there will
be monthly returns via school fees of $50,000.
AL CALCULATIONS: (3 POINTS)