Governance of Enterprise IT (CGEIT) Certification Practice Exam

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What is the focus of the 'full economic life cycle' principle in Value Delivery?

Maximizing immediate profits
Considering the complete lifecycle of the investment
Reducing time spent on project delivery
Limiting investment to current projects only

The correct answer is: Considering the complete lifecycle of the investment

The principle of the 'full economic life cycle' in Value Delivery emphasizes the importance of evaluating an investment throughout its entire lifespan, from inception to disposal. This comprehensive assessment allows organizations to understand not only the initial costs but also the ongoing operating expenses, potential revenues over time, and eventual exit or disposal costs. By considering the complete lifecycle of the investment, organizations can make informed decisions that optimize value and ensure that all factors contributing to the investment's performance are taken into account. This approach helps organizations avoid underestimating total costs or overestimating potential returns, which can lead to suboptimal investment decisions. It encourages sustainable practices and effective resource allocation that reinforce the long-term strategic objectives of the organization. In contrast, focusing only on immediate profits or limiting investments to current projects overlooks the broader implications and potential long-term benefits associated with fully understanding an investment’s lifecycle.