1.

TPAE

Idea generation: Idea generation is described as the process of creating, developing and
communicating abstract, concrete or visual ideas.

It’s the front end part of the idea management funnel and it focuses on coming up with possible
solutions to perceived or actual problems and opportunities.

As mentioned, ideas are the first step towards making improvement. Us making progress as
individual human beings depends on new ideas. From the perspective of an individual, new ideas can
help you to move forward if you feel stuck with a task or are unable to solve a certain problem.
Regardless of your goals or the types of ideas you're looking for, the purpose of new ideas is
to improve the way you operate.

On a larger scale, economies depend on innovation to drive growth and increase well-being.
Innovation creates new technologies and businesses, which provide new jobs for people.

So, although innovation isn’t about ideas alone, they are an important part of the equation as there
wouldn’t be one without the other.

2. Feasibility of projects : A feasibility study determines whether the project is likely to succeed in the
first place. It is typically conducted before any steps are taken to move forward with a project, including
planning. It is one of the—if not the—most important factors in determining whether the project can
move forward. The study identifies the market for the project (if applicable); highlights key goals for the
project based on market research; maps out potential roadblocks and offers alternative solutions; and
factors in time, budget, legal and manpower requirements to determine whether the project is not only
possible but advantageous for the company to undertake.

Although project managers are not necessarily the ones conducting the feasibility study, it can serve as
a critical guideline as the project gets underway. Project managers can use the feasibility study to
understand the project parameters, business goals and risk factors at play.
Key points of a feasibility study

A feasibility study in project management usually assesses the following areas:

Technical capability: Does the organization have the technical capabilities and resources to undertake
the project?
 Budget: Does the organization have the financial resources to undertake the project, and is the
cost/benefit analysis of the project sufficient to warrant moving forward with the project?
Legality: What are the legal requirements of the project, and can the business meet them?
Risk: What is the risk associated with undertaking this project? Is the risk worthwhile to the company
based on perceived benefits?
Operational feasibility: Does the project, in its proposed scope, meet the organization’s needs by
solving problems and/or taking advantage of identified opportunities?
Time: Can the project be completed in a reasonable timeline that is advantageous to the company?

3. Plant layout: Plant layout is the most effective physical arrangement, either existing or in plans of
industrial facilities i.e. arrangement of machines, processing equipment and service departments to
achieve greatest co-ordination and efficiency of 4 M’s (Men, Materials, Machines and Methods) in a
plant.
Layout problems are fundamental to every type of organization/enterprise and are experienced in all
kinds of concerns/undertakings. The adequacy of layout affects the efficiency of subsequent
operations.
A plant layout study is an engineering study used to analyze different physical configurations for
a manufacturing plant.[1] It is also known as Facilities Planning and Layout. The ability to design and
operate manufacturing facilities that can quickly and effectively adapt to changing technological and
market requirements is becoming increasingly important to the success of any manufacturing
organization. In the face of shorter product life cycles, higher product variety, increasingly unpredictable
demand, and shorter delivery times, manufacturing facilities dedicated to a single product line cannot
be cost effective any longer. Investment efficiency now requires that manufacturing facilities be able to
shift quickly from one product line to another without major retooling, resource reconfiguration, or
replacement of equipment.
Investment efficiency also requires that manufacturing facilities be able to simultaneously make several
products so that smaller volume products can be combined in a single facility and that fluctuations in
product mixes and volumes can be more easily accommodated. In short, manufacturing facilities must
be able to exhibit high levels of flexibility and robustness despite significant changes in their operating
requirements.

4. Break-even point: The break-even point (BEP) in economics, business—and specifically cost
accounting—is the point at which total cost and total revenue are equal, i.e. "even". There is no net loss
or gain, and one has "broken even", though opportunity costs have been paid and capital has received
the risk-adjusted, expected return. In short, all costs that must be paid are paid, and there is neither
profit nor loss. The break-even point (BEP) or break-even level represents the sales amount—in either
unit (quantity) or revenue (sales) terms—that is required to cover total costs, consisting of both fixed
and variable costs to the company. Total profit at the break-even point is zero. It is only possible for a
firm to pass the break-even point if the dollar value of sales is higher than the variable cost per unit.
This means that the selling price of the good must be higher than what the company paid for the good
or its components for them to cover the initial price they paid (variable and fixed costs). Once they
surpass the break-even price, the company can start making a profit.
The break-even point is one of the most commonly used concepts of financial analysis, and is not only
limited to economic use, but can also be used by entrepreneurs, accountants, financial planners,
managers and even marketers. Break-even points can be useful to all avenues of a business, as it
allows employees to identify required outputs and work towards meeting these.
The break-even value is not a generic value and will vary dependent on the individual business. Some
businesses may have a higher or lower break-even point. However, it is important that each business
develop a break-even point calculation, as this will enable them to see the number of units they need to
sell to cover their variable costs. Each sale will also make a contribution to the payment of fixed costs
as well.
 5. After tax cost of debt : A company's cost of debt is the effective interest rate a company pays on its
debt obligations, including bonds, mortgages, and any other forms of debt the company may have.
Because interest expense is deductible, it's generally more useful to determine a company's after-tax
cost of debt. Cost of debt, along with cost of equity, makes up a company's cost of capital.
Cost of debt can be useful when assessing a company's credit situation, and when combined with the
size of the debt, it can be a good indicator of overall financial health. For instance, $1 billion in debt at
3% interest is actually less costly than $500 million at 7%, so knowing both the size andcost of a
company's debt can give you a clearer picture of its financial situation.
Calculating cost of debt
In order to calculate a company's cost of debt, you'll need two pieces of information: the effective
interest rate it pays on its debt and its marginal tax rate.
Many companies publish their average debt interest rate, but if not, it's fairly easy to calculate using the
company's financial statements. On the income statement, you can find the total interest the company
paid (note: If you're looking at a quarterly income statement, multiply this figure by four in order to
annualize the data). Then, on the balance sheet, you can find the total amount of debt the company is
carrying. Divide the annual interest by total debt and then multiply the result by 100, and you'll get the
effective interest rate on the company's debt obligations.

6. Risk-adjusted discount rate : An estimation of the present value of cash for high risk investments is
known as risk-adjusted discount rate. A very common example of risky investment is the real estate.
Risk adjusted discount rate is representing required periodical returns by investors for pulling funds to
the specific property. It is generally calculated as a sum of risk free rate and risk premium. The variation
of risk premium is depending on the risk aversion of investor and the perception of investor about the
size of property’s investment risk.
Risk-adjusted discount rate = Risk free rate + Risk premium
Under CAPM or capital asset pricing model
Risk premium= (Market rate of return - Risk free rate) x beta of the project
The risk-adjusted discount rates declare for that by altering the rate depending on possibility of risks of
investment projects. For higher risk investment project a higher rate will be used and for a lower risk
investment project, a low rate will be used. The net present value is inversely proportional to risk-
adjusted discount rate as an increase in adjusted rate will decrease net present value, representing that
the task is less acceptable and perceived as riskier one. A rate which would be used to discount the
cash flow is the sum of risk free rate and compensation for investment risk. Suppose risk free rate is
10% and compensation of investment risk is 5%, then a rate of 15% will be use for discount cash flow.

7.Shadow pricing: A shadow price is commonly referred to as a monetary value assigned to currently
unknowable or difficult-to-calculate costs. It is based on the willingness to pay principle - in the absence of
market prices, the most accurate measure of the value of a good or service is what people are willing to give
up in order to get it. Shadow pricing is often calculated on certain assumptions and premises. As a result, it is
subjective and somewhat imprecise and inaccurate.[1] The origin of these costs is typically due to an
externalization of costs or an unwillingness to recalculate a system to account for marginal production. For
example, consider a firm that already has a factory full of equipment and staff. They might estimate the shadow
price for a few more units of production as simply the cost of the overtime. In this manner, some goods and
services have near zero shadow prices, for example information goods. Less formally, a shadow price can be
thought of as the cost of decisions made at the margin without consideration for the total cost.
While shadow pricing may be imprecise and inaccurate, it is still frequently employed as a useful technique
and is widely used in cost-benefit analyses. For instance, before taking on a project, businesses and
governments may want to weigh the costs and benefits of the project to decide whether the project is
worthwhile. While tangible costs and benefits such as the cost of labor are easy to quantify, intangible costs
and benefits such as the number of hours saved is much more difficult to quantify. In this case, business
owners and policymakers turn to shadow pricing to determine what these intangibles are. There are usually
numerous tools that help those to determine what the monetary values of these intangibles are. Some of the
most common are: contingent valuation, revealed preferences, and hedonic pricing.

8 Ho on null hypothesis :In inferential statistics, the null hypothesis is a general statement or default
position that there is no relationship between two measured phenomena, or no association among
groups.[1] Testing (accepting, approving, rejecting, or disproving) the null hypothesis—and thus
concluding that there are or are not grounds for believing that there is a relationship between two
phenomena The null hypothesis is generally assumed to be true until evidence indicates otherwise.
In statistics, it is often denoted H0; and, regardless of whether the expression is pronounced "H-
nought", "H-null", or "H-zero" (or, even, by some, "H-oh"), the subscript is always written with the digit 0,
never the upper-case letter of the alphabet O.
The concept of a null hypothesis is used differently in two approaches to statistical inference. In the
significance testing approach of Ronald Fisher, a null hypothesis is rejected if the observed data
are significantly unlikely to have occurred if the null hypothesis were true. In this case, the null
hypothesis is rejected and an alternative hypothesis is accepted in its place. If the data are consistent
with the null hypothesis, then the null hypothesis is not rejected. In neither case is the null hypothesis or
its alternative proven; the null hypothesis is tested with data and a decision is made based on how
likely or unlikely the data are. This is analogous to the legal principle of presumption of innocence, in
which a suspect or defendant is assumed to be innocent (null is not rejected) until proven guilty (null is
rejected) beyond a reasonable doubt (to a statistically significant degree).

9 Cost over runs : A cost overrun, also known as a cost increase or budget overrun, involves
unexpected incurred costs. When these costs in are in excess of budgeted amounts due to an
underestimation of the actual cost during budgeting, they are known by these terms.Cost overruns are
common in infrastructure, building, and technology projects. For IT projects, a 2004 industry study by
the Standish Group found an average cost overrun of 43 percent; 71 percent of projects came in over
budget, exceeded time estimates, and had estimated too narrow a scope; and total waste was
estimated at $55 billion per year in the US alone. [1]
Many major construction projects have incurred cost overruns; cost estimates used to decide whether
important transportation infrastructure should be built can mislead grossly and systematically. [2]
Cost overrun is distinguished from cost escalation, which is an anticipated growth in a budgeted cost
due to factors such as inflation.

10 Critical path : The critical path method (CPM), or critical path analysis (CPA), is
an algorithm for scheduling a set of project activities.[1] It is commonly used in conjunction with
the program evaluation and review technique (PERT). A critical path is determined by identifying the
longest stretch of dependent activities and measuring the time[2] required to complete them from start to
finish.
The essential technique for using CPM [8][9] is to construct a model of the project that includes the following:

1. A list of all activities required to complete the project (typically categorized within a work breakdown
structure),
2. The time (duration) that each activity will take to complete,
3. The dependencies between the activities and,
4. Logical end points such as milestones or deliverable items.
Using these values, CPM calculates the longest path of planned activities to logical end points or to the end of
the project, and the earliest and latest that each activity can start and finish without making the project longer.
This process determines which activities are "critical" (i.e., on the longest path) and which have "total float"
(i.e., can be delayed without making the project longer). In project management, a critical path is the sequence
of project network activities which add up to the longest overall duration, regardless if that longest duration has
float or not. This determines the shortest time possible to complete the project. There can be 'total float'
(unused time) within the critical path.

11 Types of projects
(1) Manufacturing Projects: Where the final result is a vehicle, ship, aircraft, a piece of machinery etc.
(2) Construction Projects:
Resulting in the erection of buildings, bridges, roads, tunnels etc. Mining and petro-chemical projects can be
included in this group.
(3) Management Projects:
Which include the organization or reorganization of work without necessarily producing a tangible result.
Examples would be the design and testing of a new computer software package, relocation of a company’s
headquarters or the production of a stage show.
(4) Research Projects:
In which the objectives may be difficult to establish, and where the results are unpredictable.

12 Market feasibility:A feasibility study aims to objectively and rationally uncover the strengths and
weaknesses of an existing business or proposed venture, opportunities and threats present in the
natural environment, the resources required to carry through, and ultimately the prospects for success.
In its simplest terms, the two criteria to judge feasibility are cost required and value to be attained.
A well-designed feasibility study should provide a historical background of the business or project, a
description of the product or service, accounting statements, details of the operations and management,
marketing research and policies, financial data, legal requirements and tax obligations.Generally, feasibility
studies precede technical development and project implementation.

A feasibility study evaluates the project's potential for success; therefore, perceived objectivity is an
important factor in the credibility of the study for potential investors and lending institutions.It must
therefore be conducted with an objective, unbiased approach to provide information upon which
decisions can be based.
A feasibility study includes an estimate of the level of expertise required for a project and who can provide
it, quantitative and qualitative assessments of other essential resources, identification of critical points, a
general timetable, and a general cost estimate.
Whether a project is viable or not, i.e. whether it can generate an equal or a higher rate of return during
its lifetime requires a thorough investigation of the investment per se as well as the level of current
expenditure. The preliminary design is the simple description of the conceived idea with an indication of
the main factors to be considered in the study.

13 Market survey
Market survey--where you actually speak to members of your target audience--are an important part of
market research. You can choose to hire a company to do it for you, but conducting the interviews
yourself will most likely give you a much better idea of the needs of your target audience and will
provide you with insights that you might not otherwise have gleaned.

If you're going the do-it-yourself route, you'll probably want to act as the focus group moderator. As the
moderator, you'll want to encourage an open-ended flow of conversation and be sure to solicit
comments from quieter members, or you may end up getting all your information from the talkative
participants only. Also, when conducting any type of survey, whether it's a focus group, a questionnaire
or a phone survey, pay particular attention to customers who complain or give you negative feedback.
You don't need to worry about the customers who love your product or service, but the ones who tell
you where you're going wrong provide valuable information to help you improve.

Telephone interviews: This is an inexpensive, fast way to get information from potential customers.
Prepare a script before making the calls to ensure you cover all your objectives. Most people don't like
to spend a lot of time on the phone, so keep your questions simple, clearly worded and brief. If you
don't have time to make the calls yourself, hire college students to do it for you.

Direct-mail interviews: If you want to survey a wider audience, direct mail can be just the ticket. Your
survey can be as simple as a postcard or as elaborate as a cover letter, questionnaire and reply
envelope. Keep questionnaires to a maximum of one page, and ask no more than 20 questions. Ideally,
direct-mail surveys should be simple, structured with "yes/no" or "agree/disagree" check-off boxes so
 respondents can answer quickly and easily. If possible, only ask for one or two write-in answers at
most.

Fax/e-mail interviews: Many of the principles used in direct-mail interviews also apply to these surveys.
One exception: Never send an unsolicited fax that is more than one page. Give clear instructions on
how to respond, and be appreciative in advance for the data you get back

14 Profitability
Profitability ratios are a class of financial metrics that are used to assess a business's ability to generate
earnings relative to its revenue, operating costs, balance sheet assets, and shareholders' equity over time,
using data from a specific point in time.
Profitability is one of four building blocks for analyzing financial statements and company performance
as a whole. The other three are efficiency, solvency, and market prospects. Investors, creditors, and
managers use these key concepts to analyze how well a company is doing and the future potential it
could have if operations were managed properly.
The two key aspects of profitability are revenues and expenses. Revenues are the business income.
This is the amount of money earned from customers by selling products or providing services.
Generating income isn’t free, however. Businesses must use their resources in order to produce these
products and provide these services.
Resources, like cash, are used to pay for expenses like employee payroll, rent, utilities, and other
necessities in the production process. Profitability looks at the relationship between the revenues and
expenses to see how well a company is performing and the future potential growth a company might
have.

15 WACC
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average
to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of
capital. Importantly, it is dictated by the external market and not by management. The WACC
represents the minimum return that a company must earn on an existing asset base to satisfy its
creditors, owners, and other providers of capital, or they will invest elsewhere.

Companies raise money from a number of sources: common stock, preferred stock, straight debt,
convertible debt, exchangeable debt, warrants, options, pension liabilities, executive stock options,
governmental subsidies, and so on. Different securities, which represent different sources of finance,
are expected to generate different returns. The WACC is calculated taking into account the relative
weights of each component of the capital structure. The more complex the company's capital structure,
the more laborious it is to calculate the WACC.
WACC is the average of the costs of these types of financing, each of which is weighted by its
proportionate use in a given situation. By taking a weighted average in this way, we can determine how
much interest a company owes for each dollar it finances.

Debt and equity are the two components that constitute a company’s capital funding. Lenders and
equity holders will expect to receive certain returns on the funds or capital they have provided. Since
the cost of capital is the return that equity owners (or shareholders) and debt holders will expect,
WACC indicates the return that both kinds of stakeholders (equity owners and lenders) can expect to
receive. Put another way, WACC is an investor’s opportunity cost of taking on the risk of investing
money in a company.

A firm's WACC is the overall required return for a firm. Because of this, company directors will often use
WACC internally in order to make decisions, like determining the economic feasibility of mergers and
other expansionary opportunities. WACC is the discount rate that should be used for cash flows with
the risk that is similar to that of the overall firm.

16 DCF Techniques
 Discounted cash flow (DCF) is a valuation method used to estimate the value of an investment based
on its future cash flows. DCF analysis attempts to figure out the value of a company today, based on
projections of how much money it will generate in the future.

DCF analysis finds the present value of expected future cash flows using a discount rate. A present
value estimate is then used to evaluate a potential investment. If the value calculated through DCF is
higher than the current cost of the investment, the opportunity should be considered.
DCF is calculated as follows:

CF = Cash Flow
r = discount rate (WACC)
DCF is also known as the Discounted Cash Flows Model
However, DCF can be very helpful for evaluating individual investments or projects that the investor or
firm can control and forecast with a reasonable amount of confidence.

DCF analysis also requires a discount rate that accounts for the time value of money (risk-free rate)
plus a return on the risk they are taking. Depending on the purpose of the investment, there are
different ways to find the correct discount rate.

17 SCBA
A social cost benefit analysis is a systematic and cohesive method to survey all the impacts caused by an
(urban) development project or other policy measure. It comprises not just the financial effects (investment
costs, direct benefits like profits, taxes and fees, et cetera), but all the societal effects, like: pollution,
environment, safety, travel times, spatial quality, health, indirect (i.e. labour or real estate) market impacts,
legal aspects, et cetera. The main aim of a social cost benefit analysis is to attach a price to as many effects as
possible in order to uniformly weigh the above-mentioned heterogeneous effects. As a result, these prices
reflect the value a society attaches to the caused effects, enabling the decision maker to form an opinion about
the net social welfare effects of a project.
A major advantage of a social cost benefit analysis is that it enables investors (mostly public parties) to
systematically and cohesively compare different project alternatives. Hence, these alternatives will not just be
compared intrinsically, but will also be set against the “null alternative hypothesis”. This hypothesis describes
“the most likely” scenario development in case a project will not be executed. Put differently, investments on a
smaller scale will be included in the null alternative hypothesis in order to make a realistic comparison in a
situation without “huge” investments.
The social cost benefit analysis calculates the direct (primary), indirect (secondary) and external effects:
• Direct effects are the costs and benefits that can be directly linked to the owners/users of the project
properties (e.g., the users and the owner of a building, recreational area, wind energy park, or highway).
• Indirect effects are the costs and benefits that are passed on to the producers and consumers outside the
market with which the project is involved (e.g., the owner of a bakery nearby the new building, or a
business company located near the newly planned highway, recreational area, indirect tax incomes, etc.).
• External effects are the costs and benefits that cannot be passed on to any existing markets because they
relate to issues like the environment , safety (traffic, external security) and nature (biodiversity,
dehydration, etc.).

18 Operational projects
Operational Project means any Project that has: (i) achieved commercial operations in accordance with
the terms of its applicable construction agreement, power sales agreement or interconnection agreement,
as the case may be; and (ii) generated operating revenue from the sale of electricity or transmission
services under its applicable power sales agreement or transmission services agreement.Operational
Project Manager will be subject to review by Prudential and mutually agreed upon by the parties in writing.
Risk Management will form part of the Strategic, Operational, Project and Line Management
responsibilities and where possible, be incorporated within the Shire's Integrated Planning Framework.
Immediately prior to joining us, Mr. Baechler served as the Head of Operational Project Management at
RMD where he led the implementation of the diagnostic project pipeline. No price adjustments shall be
performed in respect of the capitalized Gross Rentals attributable to the H&M anchor tenant at the Poznan
 Plaza Operational Project, as contemplated in Section 2.4(c)(ii) above. In such event, PCE shall also have
the option to determine that the determination of the Final Price Adjustment Date shall occur
simultaneously with the Lease-Up Break-Off Date, and in such event the Final Price Adjustments to be
made in terms of the provisions of Section 4.8 below shall be conducted on the Lease-Up Break-Off Date
in respect of the relevant Operational Project.

19 Time and cost of the projects

The Project Management Triangle (called also the Triple Constraint, Iron Triangle and "Project Triangle") is a
model of the constraints of project management. While its origins are unclear, it has been used since at least
the 1950s.[1] It contends that:
1. The quality of work is constrained by the project's budget, deadlines and scope (features).
2. The project manager can trade between constraints.
3. Changes in one constraint necessitate changes in others to compensate or quality will suffer.
The Project Management Triangle is used to analyze projectsIt is often misused to define success as
delivering the required scope, at a reasonable quality, within the established budget and schedule.The Project
Management Triangle is clearly insufficient as a model of project success because it omits crucial dimensions
of success including impact on stakeholders,learning and user satisfaction.
The time constraint refers to the amount of time available to complete a project. The cost constraint refers to
the budgeted amount available for the project. The scope constraint refers to what must be done to produce
the project's end result. These three constraints are often competing constraints: increased scope typically
means increased time and increased cost, a tight time constraint could mean increased costs and reduced
scope, and a tight budget could mean increased time and reduced scope.
The discipline of project management is about providing the tools and techniques that enable the project team
(not just the project manager) to organize their work to meet these constraints.

20 PERT
PERT:PERT is a project management planning tool used to calculate the amount of time it will take to
realistically finish a project. PERT stands for Program Evaluation Review Technique. PERT charts are tools
used to plan tasks within a project - making it easier to schedule and coordinate team members
accomplishing the work. PERT charts were created in the 1950s to help manage the creation of weapons
and defense projects for the US Navy. While PERT was being introduced in the Navy, the private sector
simultaneously gave rise to a similar method called Critical Path. PERT is similar to critical path in that they
are both used to visualize the timeline and the work that must be done for a project. However with PERT,
you create three different time estimates for the project: you estimate the shortest possible amount time
each task will take, the most probable amount of time, and the longest amount of time tasks might take if
things don't go as planned. PERT is calculated backward from a fixed end date since contractor deadlines
typically cannot be moved.
PERT is a method of analyzing the tasks involved in completing a given project, especially the time
needed to complete each task, and to identify the minimum time needed to complete the total project. It
incorporates uncertainty by making it possible to schedule a project while not knowing precisely the
details and durations of all the activities. It is more of an event-oriented technique rather than start- and
completion-oriented, and is used more in projects where time is the major factor rather than cost. It is
applied to very large-scale, one-time, complex, non-routine infrastructure and Research and
Development projects.
PERT offers a management tool, which relies "on arrow and node diagrams of activities and events:
arrows represent the activities or work necessary to reach the events or nodes that indicate each
completed phase of the total project."[1]
PERT and CPM are complementary tools, because "CPM employs one time estimate and one cost estimate
for each activity; PERT may utilize three time estimates (optimistic, expected, and pessimistic) and no costs for
each activity. Although these are distinct differences, the term PERT is applied increasingly to all critical path
scheduling."

21 Project concept
Project conception is the first step in the process of specifying the actual scope of a project. The project
conception normally begins when a requirement or an opportunity is manifested that will benefit the corporate
interests and culminates when one or more prelude options have been developed which will satisfy the
originally presented expectations of the company theoretically.

Stages of Project Conception

There are various degrees of complexity in the initial conceptualization of a project, which depend on the
nature of the particular project and specific analysis & procedures employed by the company.

Formulations of programs are required for the planning strategy of the company that includes many projects.
Conception of the individual particular projects is preceded by the conception of the entire program.

Following activities are involved in the conceptual stage

• Specification of an opportunity or requirement that governs the interests of the company.

• Development of a group of preliminary alternatives that have the capacity to accomplish the initial
requirement
• Choosing of alternative(s) that can fulfill the requirements in terms & conditions favorable to the
company.
22 Financial feasibility

FINANCIAL FEASIBILITY:-A financial feasibility study projects how much start-up capital is needed,
sources of capital, returns on investment, and other financial considerations. The study considers how
much cash is needed, where it will come from, and how it will be spent. It can focus on one particular
project or area, or on a group of projects (such as advertising campaigns).

The study is an assessment of the financial aspects of something. It could be anything, but is most
often used to consider a few key points that, if refined correctly, should answer most of the basic
questions of anyone who takes a seat at the table.

Start-Up Capital Requirements

Start-up capital is how much cash you need to start your business and keep it running until it is self-
sustaining. You should include enough capital funds (cash, or access to cash) to run the business for
one to two years. Although many business or sole proprietorships determine their capital requirements
individually, larger corporations may use the help of their respective bank or capital firm to pinpoint
capital requirements for either a round of funding or business launch.

Finding Start-Up Capital Funding Sources

There are many ways to raise capital for your business, but no matter what route you take, investors
are more likely to invest, banks are more likely to approve loans, and large corporations are more likely
to give you contracts if you have personally invested in the business yourself.

Depending on the size of your business, you may be able to utilize one of the many Small Business
Administration's (SBA) Microloan programs. Using these, you will not need much capital, as the
program allows for a much smaller down-payment on their lending partner's loans. These can vary, but
are around three-to-twelve percent.

Potential Returns for Investors Feasibility Study

 Investors can be a friends, family members, professional associates, client, partners, share holders, or
investment institutions. Any business or individual willing to give you cash can be a potential investor.
Investors give you money with the understanding that they will receive "returns" on their investment,
that is, in addition to the amount that is invested they will get a percentage of profits.

In order to entice investors you need to show how your business will make profits, when it will begin to
make profits, how much profit it will make, and what investors will gain from their investment. The
investment return section should offer both a description of how investors will be involved and discuss
different variables that will affect the profitability of your business, offering more than one scenario.

23 Sales projectors

A sales projection is the amount of revenue a company expects to earn at some point in the future. It's
a prediction that is synonymous with a sales forecast. Both help determine the health of a company and
whether sales will trend upward or downward. Small companies use various input to determine sales
projections. The initiative usually commences in the sales department. There are certain inherent
advantages to calculating and using sales projections.
Stating Sales Projections
Sales projections usually are stated in terms of units and dollars. Small companies also allocate a
certain time period for sales projections. For example, sales projections may be calculated on a
monthly, quarterly or annual basis. Moreover, most companies compare their sales projections to past
sales figures, showing a percent increase or decrease versus the earlier period. The earlier period may
be from the same period a year earlier. Sales projections also may be made for multiple years, which
helps production managers plan and run their departments more efficiently.
Determining Sales Projections
Small business owners or sales managers usually make the sales projections. They may obtain input
from sales reps, top management and the marketing department. Most small companies first calculate
the costs of producing or purchasing their products or services. They then determine how many sales it
will take to break even. Subsequently, business owners calculate the number of sales calls they plan to
make and the amount of advertising they will run. Economic conditions, seasonal sales spikes, the
intensity of competition and population shifts also are factored in to determine sales projections.

24 Breakeven point :- Breakeven point:-The break-even point (BEP) in economics, business—and

specifically cost accounting—is the point at which total cost and total revenue are equal, i.e. "even".
There is no net loss or gain, and one has "broken even", though opportunity costs have been paid and
capital has received the risk-adjusted, expected return. In short, all costs that must be paid are paid,
and there is neither profit nor loss.
The break-even point (BEP) or break-even level represents the sales amount—in either unit (quantity)
or revenue (sales) terms—that is required to cover total costs, consisting of both fixed and variable
costs to the company. Total profit at the break-even point is zero. It is only possible for a firm to pass
the break-even point if the dollar value of sales is higher than the variable cost per unit. This means that
the selling price of the good must be higher than what the company paid for the good or its components
for them to cover the initial price they paid (variable and fixed costs). Once they surpass the break-even
price, the company can start making a profit.
The break-even point is one of the most commonly used concepts of financial analysis, and is not only
limited to economic use, but can also be used by entrepreneurs, accountants, financial planners,
managers and even marketers. Break-even points can be useful to all avenues of a business, as it
allows employees to identify required outputs and work towards meeting these.
The break-even value is not a generic value and will vary dependent on the individual business. Some
businesses may have a higher or lower break-even point. However, it is important that each business
develop a break-even point calculation, as this will enable them to see the number of units they need to
 sell to cover their variable costs. Each sale will also make a contribution to the payment of fixed costs
as well.
For example, a business that sells tables needs to make annual sales of 200 tables to break-even. At present
the company is selling fewer than 200 tables and is therefore operating at a loss. As a business, they must
consider increasing the number of tables they sell annually in order to make enough money to pay fixed and
variable costs.
If the business does not think that they can sell the required number of units, they could consider the
following options:
1. Reduce the fixed costs. This could be done through a number or negotiations, such as reductions in
rent payments, or through better management of bills or other costs.
2. Reduce the variable costs, (which could be done by finding a new supplier that sells tables for less).
Either option can reduce the break-even point so the business need not sell as many tables as before,
and could still pay fixed costs.

25 Non DCF techniques:- A non-discount method of capital budgeting does not explicitly consider
the time value of money. In other words, each dollar earned in the future is assumed to have the same
value as each dollar that was invested many years earlier. The payback method is one of the
techniques used in capital budgeting that does not consider the time value of money.
The payback method simply computes the number of years it will take for an investment to return cash
equal to the amount invested.
The accounting rate of return or return on investment (ROI) are two more examples of methods used in capital
budgeting that does not involve discounting future cash amounts.
To overcome the shortcomings of payback, accounting rate of return, and return on investment, capital
budgeting should include techniques that consider the time value of money. Two of these methods include (1)
the net present value method, and (2) the internal rate of return calculation. Under these techniques, the future
cash flows are discounted. This means that each dollar in the distant future will be less valuable than each
dollar in the near future, and both of these will have less value than each dollar invested in the present.

26 Marginal cost of capital:

Marginal cost of capital is the weighted average cost of the last dollar of new capital raised by a
company. It is the composite rate of return required by shareholders and debt-holders for financing new
investments of the company. It is different from the average cost of capital which is based on the cost of
equity and debt already issued.
The weighted average cost of capital (WACC), the most common measure of cost of capital used in
capital budgeting and business valuation, is the weighted average of the marginal cost of common
stock, marginal cost of preferred stock and marginal after-tax cost of debt.
The distinction between average cost of capital and marginal cost of capital is important. The marginal
cost of capital rises as the company raises more and more capital. This is because capital is scarce,
just like any other factor of production, and must be compensated through a higher required return. The
return available on new projects must be compared with the marginal cost of capital and not the
average cost of capital and the projects should be accepted only when the expected return is higher
than the required return.
Marginal cost of capital increases in steps and not linearly. This is because a company can finance a
certain portion of new investments by reinvesting earnings and raising enough debt and/or preferred
stock to maintain the target capital structure. The reinvestment of earnings comes without any increase
in cost of equity. However, as soon as the expected capital exceeds the combined amount of retained
earnings and debt and/or preferred stock raised to maintain the target capital structure, the marginal
cost of capital increases.
 Break Point
Break point is the total amount of new investments that can be financed and the new capital that can be
raised before a jump in marginal cost of capital is expected. It is the point at which the marginal cost of
capital curve breaks out from its flat trend.
The break point can be worked out by dividing the retained earnings for the period by the weight of the
retained earnings in the target capital structure. The retained earnings in a period equals the product of
net income for the period and the retention rate (also called plow-back rate), which equals 1 minus the
dividend payout ratio.
The following equation can be used to calculate the break point:
NI × (1 - DPR)
Break Point =
We
Where NI is the net income for the period, DPR is the dividend payout ratio, i.e. the dividends declared
dividend by net income and W e is the weight of retained earnings in the target capital structure.

27 Venture capital:Venture capital is financing that investors provide to startup companies and small
businesses that are believed to have long-term growth potential. Venture capital generally comes from well-off
investors, investment banks and any other financial institutions. However, it does not always take a monetary
form; it can also be provided in the form of technical or managerial expertise.
Though it can be risky for investors who put up funds, the potential for above-average returns is an attractive
payoff. For new companies or ventures that have a limited operating history (under two years), venture capital
funding is increasingly becoming a popular – even essential – source for raising capital, especially if they lack
access to capital markets, bank loans or other debt instruments. The main downside is that the investors
usually get equity in the company, and, thus, a say in company decisions.
Basics of Venture Capital
In a venture capital deal, large ownership chunks of a company are created and sold to a few investors through
independent limited partnerships that are established by venture capital firms. Sometimes these partnerships
consist of a pool of several similar enterprises. One important difference between venture capital and
other private equity deals, however, is that venture capital tends to focus on emerging companies seeking
substantial funds for the first time, while private equity tends to fund larger, more established companies that
are seeking an equity infusion or a chance for company founders to transfer some of their ownership stakes.

28 Forms of organization
Before you consult with a tax advisor or consultant you may want to do some research yourself. One of your
first decisions as a business owner is what form of business you choose. This decision is very important
because it can affect how much you pay in taxes, the amount of paperwork your business is required to do, the
personal liability you face and your ability to borrow money. Business formation is controlled by the law of the
state where your business is organized.

The most common forms of businesses are:

• Sole Proprietorships
• Partnerships
• Corporations
• Limited Liability Companies (LLC)
• Subchapter S Corporations (S Corporations)
While state law controls the formation of your business, federal tax law controls how your business is taxed. All
businesses must file an annual return. The form you use depends on how
Your business is organized.
Sole proprietorship:
A sole proprietorship is the most common form of business organization. It's easy to form and offers complete
control to the owner. But the business owner is also personally liable for all financial obligations and debts of
the business.

As a sole proprietor you can operate any kind of business as long as you are the only owner. It can be full-time
or part-time work. This includes operating a:
• Shop or retail trade business
• Large company with employees
• Home-based business
• One-person consulting firm
Every sole proprietor is required to keep sufficient records to comply with federal tax requirements regarding
business records. Your net business income or loss is combined with your other income (other income could
be your salary if you also work for someone else, or your investments) and deductions and taxed at individual
rates on your personal tax return.
.
29 Sensitivity analysis :-is the study of how the uncertainty in the output of a mathematical model or system
(numerical or otherwise) can be divided and allocated to different sources of uncertainty in its inputs. A related
practice is uncertainty analysis, which has a greater focus on uncertainty quantification and propagation of
uncertainty; ideally, uncertainty and sensitivity analysis should be run in tandem.
The process of recalculating outcomes under alternative assumptions to determine the impact of a variable
under sensitivity analysis can be useful for a range of purposes,[3]including:

• Testing the robustness of the results of a model or system in the presence of uncertainty.
• Increased understanding of the relationships between input and output variables in a system or model.
• Uncertainty reduction, through the identification of model inputs that cause significant uncertainty in the
output and should therefore be the focus of attention in order to increase robustness (perhaps by further
research).
• Searching for errors in the model (by encountering unexpected relationships between inputs and outputs).
• Model simplification – fixing model inputs that have no effect on the output, or identifying and removing
redundant parts of the model structure.
• Enhancing communication from modelers to decision makers (e.g. by making recommendations more
credible, understandable, compelling or persuasive).
• Finding regions in the space of input factors for which the model output is either maximum or minimum or
meets some optimum criterion (see optimization and Monte Carlo filtering).
• In case of calibrating models with large number of parameters, a primary sensitivity test can ease the
calibration stage by focusing on the sensitive parameters. Not knowing the sensitivity of parameters can
result in time being uselessly spent on non-sensitive ones.[4]
• To seek to identify important connections between observations, model inputs, and predictions or
forecasts, leading to the development of better models.

30 Technology project development cycle:

Information technology (IT) project management involves managing the total effort to implement an IT
project. IT projects are undertaken to create a product or system, which includes deliverables, such as
software, hardware, data management, business process alignment, training, communications, and
deployment. These deliverables are managed as components and modules. A component is a major piece of
the product or service and is comprised of one or more modules.
The IT project life cycle outlines the technical work and defines the deliverables that are needed to complete
IT projects.
An IT project life cycle includes the following phases, which are based loosely on the six phases of the Project
Management Institute's software project life cycle:

1. Requirements and analysis

2. Architecture
3. Design
4. Construction
5. Integration and test
6. Implementation
An IT project management life cycle is different from a project management life cycle (i.e., phases include
initiating, planning, executing, monitoring and controlling, and closing). However, the two are used together to
manage IT projects. This is in part because the project management life cycle includes phases for organizing
the project and ensuring it flows efficiently from beginning to end.
Robert and Daryl have a landscaping business, Green Thumb, which has grown to a point where their paper
system is no longer meeting their needs. They are losing customer data, and they would like the ability to
generate more reports to show progress and identify opportunities. Robert and Daryl need an electronic
solution to manage their data. They need a database.
They hire Alvin, from Data Systems Warehouse, to manage the project. Alvin explains the process: 'To
develop your landscaping database, you will need to use an IT project management life cycle, which includes
six phases: requirements and analysis, architecture, design, construction, integration and test, and
implementation.'

31 Market survey:

Market survey--where you actually speak to members of your target audience--are an important part of
market research. You can choose to hire a company to do it for you, but conducting the interviews yourself
will most likely give you a much better idea of the needs of your target audience and will provide you with
insights that you might not otherwise have gleaned.

Telephone interviews: This is an inexpensive, fast way to get information from potential customers.
Prepare a script before making the calls to ensure you cover all your objectives. Most people don't like to
spend a lot of time on the phone, so keep your questions simple, clearly worded and brief. If you don't have
time to make the calls yourself, hire college students to do it for you.

Direct-mail interviews: If you want to survey a wider audience, direct mail can be just the ticket. Your
survey can be as simple as a postcard or as elaborate as a cover letter, questionnaire and reply envelope.
 Keep questionnaires to a maximum of one page, and ask no more than 20 questions. Ideally, direct-mail
surveys should be simple, structured with "yes/no" or "agree/disagree" check-off boxes so respondents can
answer quickly and easily. If possible, only ask for one or two write-in answers at most.

Fax/e-mail interviews: Many of the principles used in direct-mail interviews also apply to these surveys.
One exception: Never send an unsolicited fax that is more than one page. Give clear instructions on how to
respond, and be appreciative in advance for the data you get back.

32. Plant capacity: This is the first part of a two-part series on process modelling. In this blog I will describe
what’s important for plant capacity modelling. In part two I will talk about energy utilisation modelling.
One of the cornerstones of process modelling is mass continuity and energy balances. In other words “what
goes in comes out, unless it stays there”.
Inherent in the basic premises and calculations is a notional time-base. This might be ‘per hour’ or ‘per year’ for
example. Using these time-bases then allows us to consider the basic quantities of mass and energy in terms
of flows, e.g., ‘tonnes per annum’ or ‘kWh’ etc. Immediately the ability to investigate process (and plant)
throughputs and capacities then becomes apparent.
I will discuss in this blog how we utilise these metrics in plant capacity modelling. They are integral
components of Innoval’s process cost modelling approach which we apply to many process and plant
scenarios (new and existing). I will not describe any particular process, but instead I’ll illustrate the principles
we generally apply to plant capacity modelling.

33.Risk assessment
a risk assessment is the combined effort of 1. identifying and analyzing potential (future) events that may
negatively impact individuals, assets, and/or the environment (i.e., risk analysis); and 2. making judgments
"on the tolerability of the risk on the basis of a risk analysis" while considering influencing factors (i.e., risk
evaluation). Put in simpler terms, a risk assessment analyzes what can go wrong, how likely it is to happen,
what the potential consequences are, and how tolerable the identified risk is.As part of this process, the
resulting determination of risk may be expressed in a quantitative or qualitative fashion. The risk
assessment is an inherent part of an overall risk management strategy, which attempts to, after a risk
assessment, "introduce control measures to eliminate or reduce" any potential risk-related consequences.
Individual risk assessment
Risk assessment is necessary in individual cases, including patient and physician interactions Individual
judgements or assessments of risk may be affected by psychological, ideological, religious or otherwise
subjective factors, which impact rationality of the process.
A systematic review of patients and doctors from 2017 found that overstatement of benefits and
understatement of risks occurred more often than the alternative
Systems risk assessment[edit]
Risk assessment can also be made on a much larger "systems" scale, for example assessing the risks of a
nuclear power plant (an interactively complex mechanical, electronic, nuclear, and human system) or a
hurricane (a complex meteorological and geographical system). Systems may be defined as linear and
nonlinear (or complex), where linear systems are predictable and relatively easy to understand given a change
in input, and non-linear systems unpredictable when inputs are changed. [6] As such, risk assessments of non-
linear/complex systems tend to be more challenging.

32 Venture capital (VC) is a type of private equity,[1] a form of financing that is provided by firms
or funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which
have demonstrated high growth (in terms of number of employees, annual revenue, or both). Venture
capital firms or funds invest in these early-stage companies in exchange for equity, or an ownership
stake, in the companies they invest in. Venture capitalists take on the risk of financing risky start-ups in
the hopes that some of the firms they support will become successful. Because startups face high
uncertainty,[2] VC investments do have high rates of failure. The start-ups are usually based on
an innovative technology or business model and they are usually from the high technology industries,
such as information technology (IT), clean technology or biotechnology.
 The typical venture capital investment occurs after an initial "seed funding" round. The first round of
institutional venture capital to fund growth is called the Series A round. Venture capitalists provide this
financing in the interest of generating a return through an eventual "exit" event, such as the company
selling shares to the public for the first time in an initial public offering (IPO) or doing a merger and
acquisition (also known as a "trade sale") of the company. Alternatively, an exit may come about via
the private equity secondary market

33.Cost benefit analysis Cost–benefit analysis (CBA), sometimes called benefit costs analysis (BCA), is
a systematic approach to estimating the strengths and weaknesses of alternatives used to determine options
which provide the best approach to achieving benefits while preserving savings (for example, in transactions,
activities, and functional business requirements).[1] A CBA may be used to compare completed or potential
courses of actions, or to estimate (or evaluate) the value against the cost of a decision, project, or policy. It is
commonly used in commercial transactions, business or policy decisions (particularly public policy), and project
investments.
CBA has two main applications:[2]

1. To determine if an investment (or decision) is sound, ascertaining if – and by how much – its benefits
outweigh its costs.
2. To provide a basis for comparing investments (or decisions), comparing the total expected cost of each
option with its total expected benefits.