8/9 Chapter 9 Making a business and financial case Flashcards
Which of the following questions is true about Business Case?
Select one:
1. It should stress on features not benefits
2. It is a living document, revised as project progresses
3. It is subject to benefits realisation at feasibility stage
4. It is first defined during requirements analysis
It is a living document, revised as project progresses
What options should be considered in business case for solving the business issue? Select one: 1. Complex and simple options 2. Do nothing and do something option 3. Process and organisational options 4. Business and technical options
Business and technical options
Which of the following would not be considered in assessing the business feasibility of a project?
Select one:
1. Whether it complies with relevant legislation
2. Whether it is a good cultural fit to the organisation
3. Whether it requires competencies not possessed by employees
4. Whether it produces an acceptable rate of return
Whether it produces an acceptable rate of return
How would staff savings be classified? Select one: 1. As an intangible cost 2. As an intangible benefit 3. As a tangible cost 4. As a tangible benefit
As a tangible benefit
How would "Faster response to customers" be classified? Select one: 1. As an intangible benefit 2. As a tangible cost 3. As an intangible cost 4. As a tangible benefit
As a tangible benefit
How would "reduced inventory" be classified? Select one: 1. As an intangible benefit 2. As an intangible cost 3. As a tangible benefit 4. As a tangible cost
As a tangible benefit
How would "reduced accommodation cost" be classified in a business case? Select one: 1. As an intangible benefit 2. As a tangible benefit 3. As a tangible cost 4. As an intangible cost
As a tangible benefit
How would "reduced effort and improved speed of working" be classified in a business case? Select one: 1. As an intangible cost 2. As a tangible cost 3. As an intangible benefit 4. As a tangible benefit
As a tangible benefit
How would "Increased job satisfaction" be classified in a business case? Select one: 1. As an intangible benefit 2. As an intangible cost 3. As a tangible benefit 4. As a tangible cost
As an intangible benefit
How would "Increased Customer satisfaction" be classified in a business case? Select one: 1. As an intangible cost 2. As a tangible cost 3. As an intangible benefit 4. As a tangible benefit
As an intangible benefit
How would "Better management information" be classified in a business case? Select one: 1. As an intangible cost 2. As a tangible cost 3. As an intangible benefit 4. As a tangible benefit
As an intangible benefit
How would "Greater organisational flexibility" be classified in a business case? Select one: 1. As an intangible benefit 2. As a tangible cost 3. As an intangible cost 4. As a tangible benefit
As an intangible benefit
How would "More creative problem solving time" be classified in a business case? Select one: 1. As a tangible benefit 2. As a tangible cost 3. As an intangible benefit 4. As an intangible cost
As an intangible benefit
How would "Improved presentation or better market image" be classified in a business case? Select one: 1. As a tangible cost 2. As an intangible benefit 3. As a tangible benefit 4. As an intangible cost
As an intangible benefit
How would "Better communications" be classified in a business case? Select one: 1. As an intangible benefit 2. As an intangible cost 3. As a tangible benefit 4. As a tangible cost
As an intangible benefit
How would "Disruption and loss of productivity" be classified in a business case? Select one: 1. As a tangible benefit 2. As an intangible cost 3. As an intangible benefit 4. As a tangible cost
As an intangible cost
How would "Recruitment" be classified in a business case? Select one: 1. As an intangible cost 2. As a tangible benefit 3. As a tangible cost 4. As an intangible benefit
As a tangible cost
How would "Development staff costs" be classified in a business case? Select one: 1. As an intangible benefit 2. As an intangible cost 3. As a tangible cost 4. As a tangible benefit
As a tangible cost
How would "User staff costs" be classified in a business case? Select one: 1. As an intangible cost 2. As a tangible benefit 3. As an intangible benefit 4. As a tangible cost
As a tangible cost
How would "Hardware" be classified in a business case? Select one: 1. As a tangible benefit 2. As a tangible cost 3. As an intangible cost 4. As an intangible benefit
As a tangible cost
How would "Infrastructure" be classified in a business case? Select one: 1. As an intangible cost 2. As an intangible benefit 3. As a tangible benefit 4. As a tangible cost
As an intangible cost
How would "Packaged software" be classified in a business case? Select one: 1. As a tangible cost 2. As a tangible benefit 3. As an intangible benefit 4. As an intangible cost
As a tangible cost
How would "Relocation" be classified in a business case? Select one: 1. As an intangible benefit 2. As a tangible cost 3. As an intangible cost 4. As a tangible benefit
As a tangible cost
How would "Staff training and retraining" be classified in a business case? Select one: 1. As a tangible cost 2. As an intangible benefit 3. As an intangible cost 4. As a tangible benefit
As a tangible cost
Consider the following cash flows.
In which year does the project pays back
Screenshot 2020-07-06 at 22.01.55
Select one:
- Year 2
- Year 3
- Year 4
- Year 5
Year 3
Which one of the following statements is true?
Select one:
1. When considering investments, the project with the lowest capital outlay is always preferable
2. Most companies would choose a project based on organisational fit rather than for financial reasons
3. The internal rate of return (IRR) is calculated by determining which discount rate will achieve a net present value (NPV) of zero
4. Net Present Value (NPV) does not take into account the time value of money
The internal rate of return (IRR) is calculated by determining which discount rate will achieve a net present value (NPV) of zero
When assessing the feasibility of an option, which tool can help identify factors that can help or hinder the proposal? Select one: 1. Force field analysis 2. PESTLE analysis 3. Stakeholder analysis 4. Porter's 5 Forces
Force field analysis
Which of the following would be considered when assessing the financial feasibility of a project? Select one: 1. Return on investment (ROI) 2. Market conditions 3. Proven technology 4. Enterprise architecture
Return on investment (ROI)
Which investment appraisal tecnique allows an organisation to compare a proposed investment against leaving the money in the bank? Select one: 1. Internal Rate of Return (IRR) 2. Discounted cash flow (DCF) 3. Payback 4. Net Present Value (NPV)
Internal Rate of Return (IRR)
Who should be assigned ownership of a risk?
Select one:
1. The person who defines the probability of the risk
2. The person best placed to take the necessary counter-measures to the risk
3. The person who documented the risk
4. The person who initially identified the risk
The person best placed to take the necessary counter-measures to the risk
A company needs to upgrade its hardware at a cost of £3 million to be able to run the new version of its third-party regulatory reporting system or risk lack of support from being behind the upgrade curve. It has been suggested that an alternative option is to change to a completely different supplier who provides a hosted solution which will mean that this situation will not occur again. Although this will cost £5 million, it fits with the long-term IT strategy to outsource all non-core systems as well as having the additional benefit of cheaper maintenance costs and transfer of the responsibility for keeping up-to-date with any regulatory changes. What is the avoided cost in this proposal? Select one: 1. £5 million 2. £2 million 3. £3 million 4. £8 million
£3 million
Which of the following would be documented about a risk? Select one: 1. Interdepartmental relations 2. Organisation structure 3. Working practices 4. None of the above
None of the above
