Exercises 1 and 2 written questions.
1- Based on the financial analysis, I would recommend investing in this project. The
project generates a positive Net Present Value (NPV), indicating that it creates
value when considering the time value of money at an 8% discount rate.
Additionally, the project achieves a return on investment (ROI) of approximately
37%, which demonstrates strong profitability relative to its total costs. The
payback period occurs in under three years, suggesting that the initial investment
is recovered in a reasonable timeframe. Taken together, these financial indicators
show that the project is financially viable and presents an acceptable balance
between risk and return, supporting the decision to proceed with the investment.
2- Based on the weighted scores, Project 3 achieved the highest total score (80.0),
followed by Project 2 (78.8) and Project 1 (70.0). Project 3 performs consistently
well across all criteria, particularly in strategic value and financial performance,
without any major weaknesses. Therefore, Project 3 is the recommended option
according to the weighted scoring model.
A bar chart was created to visually compare the total weighted scores of each
project. The x-axis represents the projects (Project 1, Project 2, Project 3), and
the y-axis represents the total weighted score. The chart clearly shows Project 3
with the highest score, reinforcing its selection as the preferred project.