The IT department of your company has begun to appreciate that its projects do not exist in a business vacuum. That is, your company must also commit resources to operations, shareholder returns, and non-IT projects for short- and long-term durations. It is therefore necessary to assess project risks from a financial standpoint before committing to a project.
The report should include:
- Discuss capital budgeting and time value of money (TVM).
- Explain why time value of money is important to capital budgeting.
- Analyze potential financial investment risks, and explore the relevance of the capital asset pricing model (CAPM) in determining portfolio risks.