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Story: Whiteboard: Calculating ROI

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Posted by: benlast (Wednesday 15 November 2006, 1:06 PM)

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Needs more explanation at two points

Needs to explain how the 12% pa cost of capital takes 240k to 215k; can't find any way of discounting by 12% pa that turns 240 into 215.
Secondarily; "do the math" is not a helpful explanation of how 215/200 becomes 8%. The formula as expressed would give 1.075, or 107.5%. Presumably what's happening is that the formula is (return-cost)/cost (15/20) expressed as a percentage and rounded up.

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Featured Talkback

Software development for instance can be off shored with a perceived reduction in development costs but the resulting code is rarely of good quality and there is much greater expense in reworking and support over the life of software developed in this way. As a consultant who has to deal with off shoring on daily basis I very often see no savings at all over the lifetime of a software product, and in some cases actually see projects costing a fortune to rework.

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Offshoring behind UK tech-labour divide