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Example 3: Decrease of Purchase Cost of Licenses - Payback Target in 2 years from start of operations, December Y2.

The analytical procedure is described in Module 4, Case 4.1.

Why this example?

This example refers to the analytical approach to decrease the purchase cost of licenses to obtain a payback at the end of Y2, working with cash flows, financial statements and graphical interpretation.

We shall describe howto calculate the purchase cost of licenses so to reach the payback target at any set future date, two years in this example. A similar approach shall be followed for other payback targets.

The following, as an illustration, is the case of key management action: decrease of the purchase cost of licenses. The numerical computation is shown in Module 4, Case 4.1. The objective is to obtain a balance of 

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