ROI calculation

Question

I don't understand why when calculating the ROI we don't take the taxi licenses into consideration, I know that this cost disappear after one year but weren't we supposed to calculate the ROI of the 1st year?

Answer 1

Phil,

that's a good question and your challenge sounds fair.

Beyond the scope of this question, I'd seriously encourage you to ask these sort of questions in the interview as well. That's exactly what they want to see - that you think through the process and can challenge some of the assumptions.

You might also find this useful:

Cheatsheet: The Must-Know Consulting Terms for Interviews

Best,
Cristian

Answer 2

Hm? We do…

It's accounted for in the first year

Answer 3

The taxi licenses are not a cost, but an investment.

If you check the answer, they are being considered in the ROI in the investment part.

Answer 4

Hello Benjamin, Please notice what is written in the yellow part: "Keep in mind that this calculation implicitl... (read entire answer)

Hello Benjamin, Please notice what is written in the yellow part: "Keep in mind that this calculation implicitly assumes a 100% utilization which is alright for simplicity... (read entire answer)

Answer 5

Hi, I confirm it is correct and maybe more intuitive. However, the proposed one is preferable in terms of speed. B... (read entire answer)

Hi, I confirm it is correct and maybe more intuitive. However, the proposed one is preferable in terms of speed. Best, Antonello