EVALUATING TOTAL LIFETIME COSTS

An understanding of the principals of economic calculation is necessary to the design engineer who must evaluate projects. Starting from the factors of life expectancy of the ship and the rate of interest at which money is borrowed the total annual return can be computed. If the total annual return and the initial capital sum is known, the Capital Recovery Factor is equal to the total annual return divided by the initial capital sum, or another method for finding CRF is given using just the interest rate and the number of years life expectancy. The computation for finding return after taxes is given. From these figures it is possible to determine whether or not an increased capital expenditure can be justified.

• Corporate Authors:

  Transport and Technical Publications Limited

  161-166 Fleet Street
  London,   England 
• Publication Date: 1971-12-10

Media Info

• Features: Figures;
• Pagination: p. 31
• Serial:
  • Shipbuilding and Shipping Record
  • Volume: 118
  • Issue Number: 24
  • Publisher: Transport and Technical Publications Limited

Subject/Index Terms

• TRT Terms: Analysis; Cost effectiveness; Costs; Evaluation; Life cycle costing
• Uncontrolled Terms: Cost analysis; Project evaluation
• Subject Areas: Administration and Management; Design; Finance; Marine Transportation;

Filing Info

• Accession Number: 00028927
• Record Type: Publication
• Source Agency: United States Merchant Marine Academy
• Files: TRIS
• Created Date: Apr 21 1973 12:00AM