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GAQM CBAF-001 Exam - Topic 4 Question 24 Discussion

An IT department needs to upgrade its hardware to run the new version of an established operating system. The cost of this required upgrade is $2 million. As an alternative, the IT director has suggested that the company should change to a completely different operating system. Although this will cost $6 million, the change will bring many other benefits, including cheaper maintenance costs and increased security. What is the avoided cost in his proposal?
A) $2 million.
B) $4 million.
C) $6 million.
D) $8 million.

GAQM CBAF-001 Exam - Topic 4 Question 24 Discussion

Actual exam question for GAQM's CBAF-001 exam
Question #: 24
Topic #: 4
[All CBAF-001 Questions]

An IT department needs to upgrade its hardware to run the new version of an established operating system. The cost of this required upgrade is $2 million. As an alternative, the IT director has suggested that the company should change to a completely different operating system. Although this will cost $6 million, the change will bring many other benefits, including cheaper maintenance costs and increased security. What is the avoided cost in his proposal?

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Suggested Answer: A

by Louisa at Feb 06, 2023, 03:15 PM

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Tish
8 months ago
I agree, $4 million makes sense when you compare the costs.
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Cora
8 months ago
Wait, how is changing OS worth $6 million? Seems high!
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Carman
9 months ago
Definitely $6 million if you consider the total switch.
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Hayley
9 months ago
I think the avoided cost is actually $4 million.
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Hyun
9 months ago
The upgrade cost is $2 million.
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Yuette
9 months ago
If we go with the new OS, we’re looking at $6 million total, but the avoided cost should just be the $2 million for the upgrade, I think.
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Providencia
9 months ago
I practiced a similar question where we had to compare costs, but I can't recall if we included future savings in the avoided cost.
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Lajuana
9 months ago
I think the avoided cost is just the initial upgrade cost of $2 million, right? That seems to make sense.
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Katie
9 months ago
I remember something about avoided costs being the difference between options, but I'm not sure how to calculate it here.
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Lashandra
9 months ago
Option B sounds promising. If the REST services are already there, we just need to enable them. I'll double-check the details, but that seems like the most straightforward approach.
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Phil
9 months ago
I'm pretty sure this is the nominal group technique, but I'll double-check the definitions just to be sure.
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Tamar
9 months ago
Okay, I've seen questions like this before. I know the standard deviation of the sample means is equal to the population standard deviation divided by the square root of the sample size.
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Gregoria
10 months ago
I'm a bit confused; I thought it was D, half the standard charge, but there might be an exception I overlooked in the material.
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