As an analyst, you are working on a project to implement a new system. You have been asked to do a cost benefit analysis for this project.

The relevant costs, benefits and other financial information are as follows:

1. The project life is estimated to be 5 years but could be 7

2. The operational life of the system is 10 years after implementation

3. The costs incurred in yr 1 to 5 are: 10k,10k,10k, 20k and 20k, yr 6.7 35k

4. Thebenefitsincurredinyr1-5,0inyr6-1015keachyr,inyr11-1525k

5. The interest rates to be used are 2.5% and 5%

Perform the CBA and indicate the NPV and breakeven for the two worst case scenarios. What is your recommendation?