A New Approach to the Determination of Replacement Costs
Published Online:1 Oct 1959https://doi.org/10.1287/mnsc.6.1.111
Abstract
The time adjusted minimum average costs of an industrial equipment or process are expressed in terms of the logarithmic decrement of its salvage values.
The obsolescence gradient and/or the economic life of the equipment do not enter into the formula of the minimum average costs, which are thus obtained more simply and accurately than through the classical estimation procedures.
