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Overview Payback Analysis NPV

Project: NNG Hospital. Overview Payback Analysis NPV. Tasks:. Provide an overview of the proposed system, including costs and benefits , with an explanation of the various cost-benefit types and categories .

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Overview Payback Analysis NPV

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  1. Project: NNG Hospital Overview Payback Analysis NPV

  2. Tasks: • Provide an overview of the proposed system, including costs and benefits, with an explanation of the various cost-benefit types and categories. • Develop an economic feasibility analysis, using payback analysis, ROI, and present value (assume a discount rate of 10%). • Cost-Benefit Summary • Payback Analysis

  3. Current System: • six hours of office staff (2 people) overtime per week (1.5 times normal rate) at a base rate of R150 per hour for 6 months • add another full-time clerical position in about six months for another 6 months. • an average of three errors per day, and each error takes about 20 minutes to correct

  4. In-House System • complete the project in about 12 weeks • R350 per hour. • database application, you can expect to spend about R42,000 for a networked commercial package

  5. Vertical-Package: • a vertical software package is available for about R120,000. The vendor offers a lease-purchase package of R40,000 down, followed by two annual installments of R40,000 each. • four weeks to install, configure, and test it • free support during the first year of operation, but then NNH must sign a technical support agreement at an annual cost of R6,000

  6. Costs for Both Systems: • 10 hours of initial training and support each week for the first three months of operation • routine maintenance, file backups, and updating. These tasks will require about four hours per week and can be performed by a clinic staff member • hardware and network installation will cost about R125,000 • System life will be about five years

  7. Tasks: • Provide an overview of the proposed system, including costs and benefits, with an explanation of the various cost-benefit types and categories. • Develop an economic feasibility analysis, using payback analysis, ROI, and present value (assume a discount rate of 10%). • Cost-Benefit Summary • Payback Analysis

  8. Task 3 • Provide a brief explanation of the various alternatives that should be investigated if development continues, including in-house development and any other possible strategies.

  9. Answer: • These include • Web-based software trends, • outsourcing options (such as application service providers and Internet business service providers), • and in-house development (including building, purchasing, or customizing a software package, and user applications).

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