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Calculation of economic return on a project

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Training return on investment (ROI) is a calculation of economic return on a project. Refer to the lecture for the formula. Review this problem.

An organization lost 125 employees last year, at a cost of $5,000.00 each. (Value is derived from cost to rehire and fill opening, as well as lost investment in the employee.) You suggest that a one-time investment in a training program (costing $250,000 up front) will reduce turnover by 50%. Calculate the following numbers using historical figures as your assumptions.

  1. Total savings that the program stands to create
  2. Net savings the first year in place
  3. Return on investment after one year
  4. Return on investment after two years
  5. Return on investment after six months (assume half of the employees/but all of the cost)

Reference no: EM131294341

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