You have recently started a consulting assignment where you have been asked to prepare a short economic analysis for a problem that your client is facing. The client is a dental office. The office has grown over the past couple of years from a practice of one dentist to a practice of five dentists. The manual processes that sufficed to track appointments and billing for the founder, Dr. Torres, are no longer sustainable with the addition of the four new dental partners. Your consulting practice lead, Darwin, has provided you with the following information and asked you to prepare the economic assessment to be presented to the client.

Assume monetary benefits of a new automated dental office scheduling and billing system of $200,000 in the first year and increasing incremental benefits of $25,000 a year for the next 3 years. There is a monthly cost for cloud hosting services of $10,000. There are annual license fees of $100/user. There will be fifty users for the life of the system. The initial software purchase has a one-time purchase cost of $100,000 in year zero. The system will go-live at the start of the first year. The discount rate that the finance manager for the office has asked you to use is 10%. You MUST use the discount on the class spreadsheet provided. Please show your work and not just the answer.

1. Using a five-year horizon (current plus four), calculate the net present value of this project.
2. Calculate the overall ROI for the new dental office system.
3. Identify the Payback period.