CHAPTER 2 Flashcards
ROI
(Benefits minus costs) divided by costs
The discount rate that results in an NPV of zero for a project
IRR
Internal Rate of Return
Strengths
Weaknesses
Opportunities
Threats
SWOT Analysis
Approach to project management based on the idea of moving quickly or easily
Agile
Benefits minus cost, or income minus expenses
Cash Flow
SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats
A technique that uses branches radiating out from a core idea to structure thoughts and ideas
Mind Mapping
Costs that organizations have discretion in deciding whether or not to fund them
Discretionary Costs
A technique that provides a systematic process for basing project selection on numerous criteria
Weighted Scoring Model
The return available by investing the capital elsewhere
Opportunity Cost of Capital
The amount of time it will take to recoup, in the form of net cash inflows, the total dollars invested in the project
Payback Period
The new requirements imposed by management, government or some external influence
Directives
The minimum acceptable rate of return on investment
Required Rate of Return
The process of determining long term objectives by analyzing the strengths and weaknesses of an organization, studying opportunities and threats in the business environment, predicting future trends, and projecting the need for new products and services
Strategic Planning
The rate used in discounting future cash flows
Basically accounting for inflation
Discount Rate
Strategic Planning
Business Area Analysis
Project Planning
Resource Allocation
Stages of Project Planning
(Benefits minus costs) divided by costs
ROI
Return on Investment
A method of calculating the expected net monetary gain or loss from a project by discounting all expected future cash inflows and outflows to the present point in time
NPV
Net Present Value
A methodology that converts and organization’s value drivers into a series of defined metrics
Balanced Scorecard
Stages of Project Planning
Strategic Planning
Business Area Analysis
Project Planning
Resource Allocation
Costs that organizations must fund to stay in business
Non-discretionary Costs
A multiplier for each year based on the discount rate and year
Discount Factor
