Which statement best describes project appraisal?

Project appraisal primarily involves evaluating the financial feasibility of a proposed project. This assessment includes analyzing potential costs, revenues, and returns on investment to determine whether the project is viable and if it aligns with the organization's financial objectives. The goal is to ensure that the resources required for the project can be justified through the expected financial returns.

In the context of project appraisal, various financial metrics may be used, such as net present value (NPV), internal rate of return (IRR), payback period, and return on investment (ROI). These tools help decision-makers understand the economic implications of the project. By focusing on financial feasibility, project appraisal provides critical insights that inform whether a project should proceed.

While other options touch upon important aspects of project management, they do not capture the essence of project appraisal. The assessment of market competition, for instance, while relevant to overall strategy, does not directly relate to the financial analysis that project appraisal entails. The strategic alignment of existing projects emphasizes how projects support broader organizational goals, rather than evaluating the feasibility of new projects. Lastly, focusing on team member performance evaluations is important for managing human resources but is not part of the project appraisal process itself. Hence, the emphasis on financial feasibility is what makes this choice the most accurate