The explanations of technical and economic feasibility were well attempted. The following are some of the required answers for 2(c) where the candidates find it difficult……….
2(a) A feasibility study is a study undertaken to evaluate and analyze the
potential of a proposed project or venture to succeed.
2(b) (i) Technical feasibility – This is an assessment that is focused
on gaining an understanding of the present technical resources
of an organization and their suitability to the expected needs
of a proposed project. It is an attempt to determine whether the organization has the manpower equipment and other machines that match the requirements of the proposed project.
(ii) Economic feasibility – This is an assessment to determine
the positive economic benefits to an organization of a proposed
venture or project. It is a way of determining the gain or profit that may likely arise from embarking on such project. Hence, it involves knowing the financial implication of the project.
2(c) Reasons for carrying out feasibility studies
(i) Gives focus to the project: - feasibility study assist in determining the purpose for which a project is to be embarked upon so as to know what the project actually entails.
(ii) To help outline alternative courses of action:- feasibility study helps to assess various ways or approaches to getting a project done.
(iii) To identify new business opportunities:- The study gives room to identify and utilize new opportunities that may be accommodated by the available means at hand.
(iv) To enhance the probability of success of the proposed venture: Doing a
feasibility study helps to know every step to be taken to get a project done and hence increases the probability of its success.
(v) To provide quality information for decision making :- A feasibility study looks at every aspect of a project and thus provides adequate information to guide in decision making.
(vi) To help in securing funds for the project: Every financial institution will require a feasibility report as part of things to consider in granting a loan.
(vii) To provide evidence that the venture was thoroughly investigated:- A feasibility study produces a report which serves as an evidence that the venture was properly
investigated to ensure its success.
(viii) To obtain approval of top management or board for the project:- The report of a feasibility study helps to secure the approval of top management for the project |
