System's Analysis Chapter 4

Research has found that projects identified by individual departments or business units most often:

have a narrow, tactical focus.

Research has found that projects identified by top management more often:

have a strategic, organizational focus.

The reduction of waste creation is an example of a(n):

intangible benefit.

The analysis technique that uses a discount rate determined from the company's cost of capital to establish the present value of a project is commonly called:

net present value (NPV).

A cost associated with project start-up refers to a(n):

one-time cost.

The current value of a future cash flow is referred to as:

present value.

The ratio of the net cash receipts of the project divided by the cash outlays of the project, enabling trade-off analysis to be made between competing projects, is often referred to as:

return on investment (ROI).

The extent to which the project is viewed as helping the organization achieve its strategic objectives and long-term goals describes:

strategic alignment.

The first phase of the systems development life cycle is:

systems planning and selection.

An assessment of the development group's understanding of the possible target hardware, software, and operating environments, system size, complexity, and the group's experience with similar systems should be included as part of:

technical feasibility.

The concept of comparing present cash outlays to future expected returns best defines:

time value of money.

Which of the following would be classified as a tangible cost?

Cost of hardware

Which of the following would be classified as an intangible cost?

Employee morale

If the net present value (NPV) of all costs is $100,000 and the NPV of all benefits is $170,000, then the ROI would be 35 percent.

False

Increased flexibility is an example of an intangible benefit.

False

The extent to which the project is viewed as improving profits, customer service, etc., and the duration of these benefits best defines which of the following evaluation criteria?

Potential benefits

A document prepared for the customer during project initiation and planning that describes what the project will deliver and outlines generally at a high level all work required to complete the project is the:

Project Scope Statement.

A walkthrough is a peer group review of any product created during the systems development process.

True

Economic feasibility is a process of identifying the financial benefits and costs associated with a development project.

True

Site preparation is an example of a one-time cost.

True

The construction of an information system can have political ramifications.

True

The criteria used to evaluate projects will vary by organization.

True

The time value of money (TVM) compares present cash outlays to future expected returns.

True

The objective of the project planning process is the development of:

a Baseline Project Plan and Project Scope Statement.

The analysis technique that finds the amount of time required for the cumulative cash flow from a project to equal its initial and ongoing investment is referred to as:

break-even analysis (BEA).

The interest rate used to compute the present value of future cash flows refers to:

discount rate.