Problem
Scenario: A service request has been presented and you have been asked to conduct a financial feasibility assessment of the information system based on the following scenario. The project has an evaluation time period of 4 years and a discount rate of 10%. The project will require an initial investment of $315,000 and will require $30,000 a year in maintenance costs. The company is expected to receive $135,000 a year in benefits from the system.
Evaluate the IT project based on each of the following analyses: net present value (NPV), return on investment (ROI) and break-even analysis (BEA), focus on financial feasibility.