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The Custom Bike Company has set up a weighted scoring matrix for evaluation of potential projects. Below are five projects under consideration. 1. Using the
The Custom Bike Company has set up a weighted scoring matrix for evaluation of potential projects. Below are five projects under consideration. 1. Using the scoring matrix below, which project would you rate highest? Lowest? 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? Why is it important that the weights mirror critical strategic factors? Strong Criteria Support Business 10% of Sale From Urgency Support Strategy New Products Weight 2 15 4 3 Project 5 2 10 Fill Weighted Weighted Competition Market Total (a) Total (b) Gap 1 ? ? 3 9 2 5 1 17 N 0 2 5 18 2 3 6 18 ? ? Project 3 2 Project 16 3 Project 4 Project 3 10 10 6 19 ? 5 10 10 8 0 ? 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
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