Valuing an IT Investment Is Difficult Because

question 44

Multiple Choice

Valuing an IT investment is difficult because:

• A) Many IT investments are necessities and payback is hard to calculate.
• B) Increased customer satisfaction is not valued enough to justify costs.
• C) IT investments often add no real business value.
• D) IT managers do not see the need to value an investment whose payback period is relatively short.
• E) IT is seen as "a necessary evil".

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Definitions:

Consumption

The use of goods and services by households or individuals for personal needs or enjoyment, as opposed to investment or production purposes.

Supply of Savings

The total amount of savings that individuals and institutions are willing to lend or invest, available in the economy.

Interest Rates

The fee that lenders impose on borrowers for utilizing funds, represented as a percentage of the principal sum.

Investment

The process of distributing funds with the aim of earning an income or profit.