CONSTRUCTION-EQUIPMENT POLICY: THE ECONOMIC LIFE OF EQUIPMENT

THE PURPOSE WAS TO DEVELOP AND APPLY A MATHEMATICAL MODEL FOR THE ANALYSIS OF THE ECONOMIC LIFE OF CONSTRUCTION EQUIPMENT. THE MATHEMATICAL MODEL USED IN THE AUTHOR'S PREVIOUS STUDIES OF OBSOLESENCE WAS REOREINTED AND AUGMENTED IN ORDER TO STUDY ECONOMIC LIFE. NEW VARIABLES WERE INTRODUCED TO ACCOUNT FOR MONOTONICALLY DECREASING DISCRETE COSTS OF MAINTENANCE AND OPERATION--IT WAS BELIEVED THAT THESE COSTS MIGHT HAVE A SIGNIFICANT EFFECT IN TRIGGERING MAJOR OVERHAULS AND THE REPLACEMENT OF EQUIPMENT. IN ADDITION TO THE NEW EQUATIONS, EQUATIONS ALREADY DEVELOPED WERE REWRITTEN WITH NEW VARIABLE NAMES TO SIMPLIFY THE NUMBERING SYSTEM AND TO MAKE THE VARIABLES MORE COMPATIBLE WITH THE COMPUTER-PROGRAM VARIABLES. AFTER DEVELOPMENT OF THE MODEL, PROGRAMS WERE WRITTEN IN FORTRAN IV TO SOLVE THE ALGORITHMS AND TO PLOT THE RESULTS ON THE CALCOMP PLOTTER. IT WAS BELIEVED THAT THESE GRAPHIC RESULTS WOULD BE MORE IMPRESSIVE AND EASIER TO ANALYZE. LIAISON WAS ESTABLISHED WITH A LARGE READY-MIX OPERATOR IN THE SAN FRANCISCO BAY AREA. WITH HIS COOPERATION, COSTS WERE DEVELOPED AND STUDIED THAT COULD BE USED IN A COMPUTER ANALYSIS TO DETERMINE THE ECONOMIC LIFE OF THE TRANSMIXERS IN HIS OPERATION. THE FOLLOWING CONCLUSIONS WERE DRAWN ON THE FEASIBILITY OF UTILIZING THE COMPUTER-RUN MODEL TO AID THE OPERATOR IN MAKING POLICY DECISIONS ABOUT THE ECONOMIC LIFE OF HIS EQUIPMENT: (1) COMPUTER ANALYSIS OF EQUIPMENT ECONOMIC PROBLEMS IS FEASIBLE AND RELATIVELY INEXPENSIVE, (2) THE MATHEMATICAL MODEL IS FLEXIBLE AND ADAPTABLE TO REAL-LIFE SITUATIONS, (3) THE ECONOMIC LIFE OF TRANSMIXERS IN THE USE OF THE COMPANY STUDIED IS SOMEWHERE BETWEEN THREE AND FIVE YEARS, (4) FURTHER RESEARCH IS NEEDED TO DEVELOP THE PARAMETERS FOR APPLICATION OF THE MATHEMATICAL MODEL FOR ESTABLISHMENT OF EQUIPMENT POLICY AND (5) GOOD COST KEEPING IS NECESSARY FOR A THOROUGH AND ACCURATE ANALYSIS OF EQUIPMENT, GOOD COST KEEPING APPEARS TO BE THE EXCEPTION, HOWEVER, RATHER THAN THE RULE. /AUTHOR/

  • Supplemental Notes:
    • Tech Rept NO 61, 93 PP, 24 FIG, 11 TAB, 4 REF, 4 APP
  • Corporate Authors:

    Stanford University

    Department of Civil Engineering
    Stanford, CA  United States  94305
  • Authors:
    • DOUGLAS, J
  • Publication Date: 1966-7

Subject/Index Terms

Filing Info

  • Accession Number: 00215271
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Aug 3 1970 12:00AM