Develop an economic feasibility analysis, using payback analysis, ROI, and present value (assume a discount rate...

Develop an economic feasibility analysis, using payback analysis, ROI, and present value (assume a discount rate of 10%) using the table below

	System in place	In-House System	Vertical Software
Year 1	6 hours overtime total $6,480 per employee Support Staff 7 People Plus, new staff member	12 weeks, hourly salary $35 total $16,800 Commercial package $2,500 10 hrs. weekly training $4200 4 hrs. weekly maintenance $22.5 total of 4,320 Hardware Cost $12,500	Vertical package $12,000 4 weeks to install $5,600 10hrs weekly training $4,200 Free Support first year 4 hrs. weekly maintenance $22.5 total of 4,320 Hardware Cost $12,500
Year 2	6 hours overtime total $6,480 per employee	4 hrs. weekly maintenance $22.5 total of 4,320	Technical Support $600 4 hrs. weekly maintenance $22.5 total of 4,320
Year 3	6 hours overtime total $6,480 per employee	4 hrs. weekly maintenance $22.5 total of 4,320	Technical Support $600 4 hrs. weekly maintenance $22.5 total of 4,320
Year 4	6 hours overtime total $6,480 per employee	4 hrs. weekly maintenance $22.5 total of 4,320	Technical Support $600 4 hrs. weekly maintenance $22.5 total of 4,320
Year 5	6 hours overtime total $6,480 per employee	4 hrs. weekly maintenance $22.5 total of 4,320	Technical Support $600 4 hrs. weekly maintenance $22.5 total of 4,320
Total	$259,200	$57,600	$58,300
Saved in 5 years		$201,600	$200,900

Expert Solution

	System in place	In-House System	Vertical Software
year 1	51,840	12 weeks, hourly salary	16800	vetical package	12000	5
	commercial package	2500	installation	5600
	weekly training	4200	weekly training	4200
	weekly maintenace	4320	weekly maintenace	4320
	hardware	12500	hardware	12500
		40,320		38,620

year 2				Technical Support	600
51,840	weekly maintenace	4320	weekly maintenace	4320
				4920

year 3
51,840	weekly maintenace	4320	Technical Support	600
			weekly maintenace	4320
				4920

year 4				Technical Support	600
51,840	weekly maintenace	4320	weekly maintenace	4320
				4920

year 5	51,840			Technical Support	600
	weekly maintenace	4320	weekly maintenace	4320
				4920
	2,59,200		57,600		58,300
saved	-		2,01,600		2,00,900	compared with system in place
Payback period	5 years		3.50		3.45
ROI			64%		63%
Present value			49,103.47		49,287.03
Net Present Value			8,496.53		9,012.97

jeff jeffy answered 2 years ago

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