Jimmy B. Orajay Jr.

2014-00022-MN-0
BSEE 4-1

Homework in Project Management

Discount Rate 8%
Year
1 2 3 4 Total
Costs 100,000 25,000 25,000 25,000
Discount factor 0.93 0.86 0.79 0.74
Discounted costs 93,000 21,500 19,750 18,500 152,750

Benefits 0 80,000 80,000 80,000

Discount factor 0.93 0.86 0.79 0.74
Discounted 0 68,800 63,200 59,200 191,200
benefits

NPV
Discounted (100,000) 47,300 43,450 40,700 38,450
benefits - cost
Cumulative (100,000) 45,700 2,250 38,450
benefits- cost

ROI 25%

By performing financial projections such as Net Present Value Analysis, Return on

Investment, and Payback Analysis in the given project we can therefore conclude that the
project is good for execution because is has a reasonable value of Net Present Value and
Return of Investment.