InterCon Travel Health Case Study
Journal of the Academy of Business Education
InterCon provides services to health insurers of foreign tourists who travel to the United States and Canada. After experiencing high growth, the company confronts several operational challenges. As a responsive measure, management considers developing an IT system. The system must go through the formal capital investment evaluation process, which requires estimation of costs and benefits and uses the NPV method. Subject to uncertainty, "soft" benefits are computed from probability distributions. All costs and benefits are treated as discounted cash flows. Employing a Monte Carlo simulation modeled in a common spreadsheet program, management must decide whether to fund the IT system.
Corporate Finance | Finance and Financial Management | Management Information Systems
Goldstein, Michael A., Gregory E. Truman, Dessislava Pachamanova. 2007. "InterCon Travel Health Case Study." Journal of the Academy of Business Education 8, Summer 2007: 17-32.