In: Finance
Your Division at Nashika Limited, a large networking company, has put together a project proposal to develop a new home networking router. The expected Net Present Value (NPV) of the project is K17.7 million, and the project will require 50 software engineers. Nashika has a total of 190 engineers available and the router project must compete with the following other projects for these engineers: Project NPV (K million) Engineering Headcount Router 17.7 50 Project A 22.7 47 Project B 8.1 44 Project C 14.0 40 Project D 11.5 61 Project E 20.6 58 Project F 12.9 32 How should Nashika prioritize these projects?
As per detail of the project given as
Name of Project | NPV | Manpower |
K | 17.7 | 50 |
A | 22.7 | 47 |
B | 8.1 | 44 |
C | 14 | 40 |
D | 11.5 | 61 |
E | 20.6 | 58 |
F | 12.9 | 32 |
Total Manpower | 332 |
As Company has limitation of manpower , can't exceeds from 190. In the situation project should be prioritize on the basis of performance efficiency, NPV / manpower ratio.
Name of Project | NPV | Manpower | NPV/Manpower (million/engineer) | priority rank |
K | 17.7 | 50 | 0.354 | 4 |
A | 22.7 | 47 | 0.483 | 1 |
B | 8.1 | 44 | 0.184 | |
C | 14 | 40 | 0.350 | |
D | 11.5 | 61 | 0.189 | |
E | 20.6 | 58 | 0.355 | 3 |
F | 12.9 | 32 | 0.403 | 2 |
Total Manpower to complete the four projects | 187 |