Investment Appraisal: A Comparative Analysis of Project A and Project B

Business Decision Making

TABLE OF CONTENTS
introduction......................................................................................................................................1
task 1................................................................................................................................................1
Background..................................................................................................................................1
Rational........................................................................................................................................1
Objective of the research.............................................................................................................1
Methodology................................................................................................................................2
Data analysis................................................................................................................................3
Timeframe....................................................................................................................................3
Budget section.............................................................................................................................4
Designing of a sample questionnaire...........................................................................................4
Task 2...............................................................................................................................................6
1. Mean, Median and Mode.........................................................................................................6
2. Range and Standard deviation.................................................................................................7
3. 25th Percentile (Lower iii...........25th Percentile (Lower Quartile) and 75th Percentile (Upper
Quartile) and use of Percentile....................................................................................................8
4. Inter-quartile range..................................................................................................................8
5. Calculation of correlation coefficient......................................................................................9
Task 3...............................................................................................................................................9
Line graph for advertising and sales figure.................................................................................9
Pie and bar chart for net income generated by five branches and scatter graph for sales.........10
Scatter plot for sales and advertisement cost of the organization..............................................11
Trend line for forecasting sales figure for years 2015 – 2017...................................................11
Business presentation.................................................................................................................12
Business Report.........................................................................................................................12
Task 4.............................................................................................................................................13
4.1 Network diagram.................................................................................................................13
4.2 Calculation of the project duration......................................................................................13
4.3 Critical path.........................................................................................................................14
4.4 Gantt chart and its benefits for project management...........................................................15
task 4B...........................................................................................................................................16
1. Calculation of NPV and IRR of project A and B..................................................................16
2. Recommendations for project selection with justification....................................................18
conclusion......................................................................................................................................19
references.......................................................................................................................................20

TABLE OF FIGURES
Figure 1: Line Graph for advertising and sales figures...................................................................9
Figure 2: Pie chart for net income generated by five branches.....................................................10
Figure 3: Bar chart for net income generated by five branches.....................................................10
Figure 4: Scatter plot for sales and advertising cost......................................................................11
Figure 5: Trend Line for sales and advertising cost......................................................................11
Figure 6: Network diagram............................................................................................................13
Figure 7: Project summery for duration of the project..................................................................14
Figure 8: Gantt chart......................................................................................................................15
LIST OF TABLES
Table 1: Gantt chart for timeframe of the research plan..................................................................3
Table 2: Calculation of mean mode and median.............................................................................6
Table 3: Calculation of the range and Standard deviation...............................................................7
Table 4: Calculation of the percentile and interquartile range........................................................8
Table 5: Calculation of correlation coefficient................................................................................9

INTRODUCTION
Decision making is one of the important function of every business organization.
Business decision making can be defined as a process of selecting best among different
alternatives. It is beneficial for evaluating managerial performance, expansion of business and
developing different policies and processes (Lind, Marchal and Wathen, 2005). The current
research report is based on business decision making and regarding this whole investigation will
focus on different business scenarios. Current report includes range of techniques which can be
used by different organizations for making various business decisions. Further, it also comprises
the importance of different information for different personnel or decision makers of the
company. Along with this, application and importance of various operation and financial
techniques are also included in the upcoming section of the current report.
TASK 1
Background
As per the given business scenario, government of London wants to start a Crossrail
project in London for economic development of UK. It will provide appropriate travelling
facilities to 1.5 million people to connect with their key employment, leisure and other business
activities of different places, such as Heathrow, West and the City, etc. this project will start in
late 2018 and estimated annual passengers will be 200 million. Available fund for deliver
Crossrail is £14.8bn.
Rational
Project rational helps in determining the major reasons behind the completion of whole
investigation. The current research is conducted by the government of UK for determining the
perceived benefits of the Crossrail project for local community. Government has invested the
huge amount of money for starting this project but still they are not sure about that weather it
will be beneficial for local community or not. So, author needs to complete whole investigation
because it will help in identifying the major benefits of Crossrail project for individual of the
local societies of London and its major city areas. Therefore, determination of the major benefits
of this project is the major reason behind this project (Morato, 2013).
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Objective of the research
 To determine the perceived benefits of the Crossrail project for local community of
central London.
 To estimate budget and timeframe for completing whole project.
 To develop a research plan for completing the whole investigation and collecting
appropriate primary and secondary information about this project.
Methodology
For conducting the whole investigation author will follow a systematic methodology for
collecting primary and secondary data for this Crossrail project. It will include qualitative and
quantitative techniques which will contribute in collecting necessary information. Qualitative
techniques will play significant role in understanding the behavior of local community towards
the Crossrail project. On the other hand, using the quantitative technique researcher can collect
numerical data which will help in determining the benefits of this project for local passengers of
London. Including this, qualitative research technique will also help in conducting survey of all
passenger in effective manner (Prieto and Revilla, 2006).
Data collection:
Including this, researcher will use primary and secondary data collection method for
obtaining appropriate and necessary information about this project.
Primary data collection method:
Primary data collection methods will help in collecting new and fresh information about
this project and its benefits. Regarding this research will use a survey methodology. Researcher
will develop a structured questionnaire for conducting survey which will include open and close
ended questions about the Crossrail project and its benefits.
Secondary data collection method:
Researcher will also use the secondary data collection method for gathering historical and
past information about the Crossrail project. Regarding this, author will use the different
secondary sources such as websites, books, journals and other research articles relevant to the
current subject (Jankowicz, 2005).
Sampling Frame:
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As per the above discussion researcher will collect primary data from local community of
London so, author needs to select sample from entire population using appropriate method of
sampling. So, for the current investigation researcher will use random number sampling which is
an important tool of probability sampling method. It will help in selecting sample using random
number table as well as provide equal chance to every member of local community of London to
select in the sample of research (Newbold and et.al, 2009). It will also reduce the sampling error
in entire investigation. Using this method author will select 20 individuals from local
community. It will represent the sample size for entire investigation.
Data analysis
As per the above discussion author will apply the qualitative and quantitative techniques
for conducting investigation and collecting data. So, all collected data will be analyzed by
t5hematci and statistical analysis. Thematic analysis will play important role in examining
qualitative or subjective information. On the other hand statistical analysis will play significant
role in interpreting numerical information about the benefits of the Crossrail project for local
community of London (Little, 2011).
Timeframe
Researcher needs to estimate an appropriate time for completing whole investigation in
effective manner (Helfert, 2004). Timeframe for the whole investigation will be represented by
Gantt chart which will comprise different activities and duration. Gantt chart for the current
investigation as described as under:
Table 1: Gantt chart for timeframe of the research plan
Activities/ duration in days 2 4 6 8 10 12 14 16
Background analysis
Formulating appropriate
objectives of the research
Methodology for developing
a research plan
Collection of primary and
secondary data
Analysis of the data
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