Methods Of The Feasibility Study On Net Present Value Essay

Methods of the feasibility study. Net present value We will determine the viability of the investment using the Net present value method. It will also help to estimate the costs that will be incurred in the future and the benefits that business will get. We choose this method because it shows actual benefits and takes into consideration time value of money ( Baker and Powell, 2000) PV = FV/ (1+r) n PV- present value, FV- future value in n periods, r-expected rate of return. Cost /benefit Analysis Total cost of ownership Since the venture is related to technology, we will use Total Cost of Ownership method to determine the costs that are incurred in the venture. This will help us to come up with estimates on costs for; capital required, licensing fees, labor costs, technology advancement skills, operational costs and other costs related to the business. However, this business will bring both intangible and tangible benefits to the company. This benefits are; 1. 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