project management

The Quantum Leap Company has set up a weighted scoring matrix for evaluation of potential projects. Below are five projects under consideration. Criteria Weight 4 1 3 2 9 3 5 5 la 2 2 5 7 0 2 5 Project 1 Project 2 Project 3 Project 4 Project 5 2 2. 6 8 3 6 8 1 0 10 6 9 5 10 3 10 1 8 0 SHOW THE RESULT OF CALCULATIONS IN THE ABOVE MATRIX FOR COLUMNS a AND b. If no figures are placed in columns a and b, then the work for questions 1 and 2 will be marked with ZERO (O). 1. Using the scoring matrix above, which project would you rate highest? Lowest? ANSWER: 2. If the weight for "Strong Sponsor" is changed from 2.0 to 5.0, will the project selection change? What are the three highest weighted project scores with this new weight? ANSWER: 3. Why is it important that the weights mirror critical strategic factors? ANSWER: 4. Two new software projects are proposed to a young, start-up company. The Alpha project will cost $150,000 to develop and is expected to have annual net cash flow of $40,000. The Beta project will cost $200,000 to develop and is expected to have annual net cash flow of $50,000. The company is very concerned about their cash flow. Using the payback period, which project is better from a cash flow standpoint? Why? Required: Show calculations for payback periods. Payback (Alpha): Payback (Beta) ANSWER (for 4): 4a. Assume that the rate of inflation is 6%, use the Net Present Value (NPV), approach to calculate the NPV for both projects. Which project would you now recommend? Why? Required: Show calculations for Net Present Values. NPV (Alpha)