Certified Authorization Professional (CAP) — Question 16

You are the project manager for your organization. You have identified a risk event you're your organization could manage internally or externally. If you manage the event internally it will cost your project $578,000 and an additional $12,000 per month the solution is in use. A vendor can manage the risk event for you. The vendor will charge $550,000 and $14,500 per month that the solution is in use. How many months will you need to use the solution to pay for the internal solution in comparison to the vendor's solution?

Answer options

• A. Approximately 13 months
• B. Approximately 11 months
• C. Approximately 15 months
• D. Approximately 8 months

Correct answer: B

Explanation

The internal solution costs $578,000 plus $12,000 per month, while the vendor costs $550,000 plus $14,500 per month. Setting the total costs equal to find the break-even point leads to approximately 11 months, making option B the correct choice. The other options do not account for the correct calculations based on the given monthly costs.