After an analysis, you are told that it will cost $100,000 to modify an information system so that it captures several new facts about your customers. Knowing those additional facts will help you to increase sales by an estimated $500 per year. You conclude that the information provided by this data:

After an analysis, you are told that it will cost $100,000 to modify an information system so that it captures several new facts about your customers. Knowing those additional facts will help you to increase sales by an estimated $500 per year. You conclude that the information provided by this data: is not worth its cost .Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency of a number of different investments. ROI tries to directly measure the amount of return on a particular investment, relative to the investment’s cost. To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment. The result is expressed as a percentage or a ratio. The Current Value of Investment” refers to the proceeds obtained from the sale of the investment of interest. Because ROI is measured as a percentage, it can be easily compared with returns from other investments, allowing one to measure a variety of types of investments against one another. Since the Rate I’d return is low . This option isn’t is not worth its cost

For example, suppose Joe invested $1,000 in Slice Pizza Corp. in 2017 and sold his stock shares for a total of $1,200 one year later. To calculate his return on his investment, he would divide his profits ($1,200 - $1,000 = $200) by the investment cost ($1,000), for a ROI of $200/$1,000, or 20 percent.

DanielCastro DanielCastro · Answer 2 · 2020-03-12T03:23:17+01:00

Answer:

The cost of revenue would be amazingly high and the return on investment increadibly low so it is not worth to improve the information system.

Explanation:

All right, in this case, the scenario it would take us 200 years to recover the invested capital. So, it is not really a good project because even though information about our patients is important. Maybe this type of technology is not the proper one to obtain this information because its cost won't provide us a valuable investment. It is said that the recommended amount of time to recover the investment in one year and the revenue after recovering that investment should be around 10 to 30%.