Spruce Bank Is Planning to Automate Some of Its Back

question 44

Multiple Choice

Spruce Bank is planning to automate some of its back office functions and reduce operating costs.The installation of new computers and software will require an initial investment of $1,000,000.The savings generated because of reduced personnel cost is $200,000 per year.The bank uses an 8 percent rate of discount to evaluate cost saving projects which are expected to last 10 years. The maximum cost savings that can be generated with this new equipment has been estimated to be $264,237.In order to accept this project, what is the minimum number of years the projected savings must be realized before the project breaks even?

• A)3.7 years.
• B)4.7 years.
• C)5.7 years.
• D)6.7 years.
• E)7.7 years.

---

Definitions:

Implicit Motives

Unconscious desires, preferences, or needs that influence an individual's behavior without their explicit awareness.

Projective Technique

A psychological assessment method in which individuals reveal their underlying motives, feelings, and attitudes through the interpretation of ambiguous stimuli.

Thematic Apperception Test

A projective psychological test in which individuals express their feelings and thoughts through stories they create about ambiguous pictures.

Picture Story Exercise

A projective psychological test used to uncover an individual's implicit motives, desires, and fears through the stories they create about ambiguous pictures.