6 - Replacement Analysis
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Practice Questions
Test your understanding with targeted questions
What are the phases of equipment life?
💡 Hint: Think about what happens when equipment wears out.
What does defender refer to in equipment analysis?
💡 Hint: It is the machine you might eventually replace.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What does economic useful life denote?
💡 Hint: Think about cost efficiency.
True or False: Downtime refers only to repairs needed on equipment.
💡 Hint: Consider other factors that lead to inactivity.
1 more question available
Challenge Problems
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A construction manager must decide whether to keep an excavator that is 12 years old. The running costs have increased by 40% over the last year, and a new model promises a 25% reduction in operating costs. Analyze the replacement decision using economic life principles.
💡 Hint: Consider both the rising costs and the potential savings.
You have two options: keep your current mixer that has frequent breakdowns but is not yet dead, or replace it with a state-of-the-art model. Estimate downtime costs over a year and compare against new mixer costs to justify your decision.
💡 Hint: Account for all indirect costs that come with downtime.
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