Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please use excel formulas to answer:Your company has been quoted $ 5 . 5 million for a new cyber defense system. The new program will

Please use excel formulas to answer:Your company has been quoted $5.5 million for a new cyber defense system. The new program will likely protect the company for 6 years and then need to be replaced as technology improves. Using sophisticated detection skills, they determine that your companys website faces approximately 1,800 cyber security incidences a day, 365 days a year. They also estimate that 1 in 750 attacks are successful, and the cost of the average attack is $1,585 due to lost merchandise, notification of the customers affected and time spent by employees following up on the incidents. Using a 5 years MACRS schedule, a tax rate of 21% and a cost of operation of $30,000 a year to monitor the system, should you buy the system? Your company estimates its cost of capital is 7.5%. Calculate the payback period, discounted payback period, and the NPV.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Economics Of Money Banking And Financial Markets

Authors: Frederic Mishkin

10th Global Edition

0273765736, 978-0273765738

More Books

Students also viewed these Finance questions