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    ACC4100-Lesson 3 Self Study

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    daljeet singh
    This document provides an exercise on financial modeling concepts for project selection, including calculating payback period, return on investment (ROI), and rate of return with compounding. Trainees are asked to calculate the payback period, ROI, and compound interest for various investment scenarios, including investing $100,000 with a $50,000 annual return, lending $10,000 at 5% interest, and investing $5,000 that returns $8,000 over 8 years. The purpose is for project managers to understand financial models used for project screening and selection.

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    © All Rights Reserved
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    ACC4100-Lesson 3 Self Study

    Uploaded by

    daljeet singh
    36 views3 pages
    This document provides an exercise on financial modeling concepts for project selection, including calculating payback period, return on investment (ROI), and rate of return with compounding. Trainees are asked to calculate the payback period, ROI, and compound interest for various investment scenarios, including investing $100,000 with a $50,000 annual return, lending $10,000 at 5% interest, and investing $5,000 that returns $8,000 over 8 years. The purpose is for project managers to understand financial models used for project screening and selection.

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    Project management

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    This document provides an exercise on financial modeling concepts for project selection, including calculating payback period, return on investment (ROI), and rate of return with compounding. Trainees are asked to calculate the payback period, ROI, and compound interest for various investment scenarios, including investing $100,000 with a $50,000 annual return, lending $10,000 at 5% interest, and investing $5,000 that returns $8,000 over 8 years. The purpose is for project managers to understand financial models used for project screening and selection.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    36 views3 pages

    ACC4100-Lesson 3 Self Study

    Uploaded by

    daljeet singh
    This document provides an exercise on financial modeling concepts for project selection, including calculating payback period, return on investment (ROI), and rate of return with compounding. Trainees are asked to calculate the payback period, ROI, and compound interest for various investment scenarios, including investing $100,000 with a $50,000 annual return, lending $10,000 at 5% interest, and investing $5,000 that returns $8,000 over 8 years. The purpose is for project managers to understand financial models used for project screening and selection.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 3

    ACC4100 Project Cost Management and Finance

    Lesson 3 Self study Week 03

    1) Financial Models – Value Statement

    The elevator pitch. Here is one example used for interviews.

    https://theinterviewguys.com/write‐elevator‐pitch/

    2) Consider the following questions.

    How do the financial models for project selection apply to non‐profit or charitable
    organizations?

    What financial indicators would you like to see for these types or organizations?

    3) Exercise: Financial Models

    As project manager you need to know how financial models are constructed so that you canexpress the
    business value and successfully pas any project screening and selection criteria.

    In this exercise you respond to the questions below and calculate the answers.

    Payback period

    Assume inflation is 0%

    Question 1 ‐ What is the Payback period for the following

    a) You invest $100,000 Your return is $50,000 per year

    Payback period is:

    b) You invest $200 Your return is $20 per year

    Payback Period is:


    c) You invest $250,000 Your return is $50,000 per year

    Payback Period is:

    ROI ‐ Return on Investment

    Assume inflation is 0%

    Question 2 ‐ What is the ROI for the following

    a) You invest $50,000 in a new chip wagon downtown and 5 years later sell your stake for
    $75,000.

    b) You lend $10,000 to a relative to buy a boat. Your simple interest rate is 5% every month.
    After 6 months how much interest are you owed? $3,000

    c) You invest $5,000 in collectibles which you manage to sell over the next 8 years for $8,000.
    Rate Compounding (Math is use of exponents)

    Question 3

    a) You have $2000 invested in a 5‐year GIC that pays 5% per year compounded. How much is itworth at
    maturity?

    b) Would you rather have $1000 today or $1200 in 5 years. Inflation is 5%

    c) Would you rather have $50,000 today or $75000 in 8 years. Inflation is 4%

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