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Question 11 - BAP18 discussion

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A business case features a management summary, from which the below extract is taken:

‘The new approach will incur significant investment in terms of software licenses and annual maintenance fees, which will not be negotiable until year four of the proposal. We will research competing suppliers in the marketplace at end of year three, the supplier will, therefore, be likely to otter a reduced price for year five and beyond. However, we are convinced that the selected option is the right one. It will give us a competitive edge as a result of improved management information, in addition to the boost it will give to our image with our established customers." Which categories of costs and benefits are described in this extract*?

A.
Tangible costs, intangible benefits.
Answers
A.
Tangible costs, intangible benefits.
B.
Tangible benefits, intangible costs
Answers
B.
Tangible benefits, intangible costs
C.
Intangible benefits, intangible costs
Answers
C.
Intangible benefits, intangible costs
D.
Intangible costs, tangible benefits
Answers
D.
Intangible costs, tangible benefits
Suggested answer: D

Explanation:

The extract describes both tangible costs and intangible benefits. The costs mentioned in the extract are the software licenses and annual maintenance fees, which are tangible costs. The benefits mentioned in the extract are the improved management information and the boost to the company’s image with its customers, which are intangible benefits. Therefore, the correct answer is D: Intangible costs, tangible benefits.

asked 16/09/2024
Jesus Ignacio Morales Vivancos
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