What this checks
Annual cases are multiplied by the failure rate. The break-even success rate is repair cost divided by replace cost. A rate above one means repair does not pay for itself against replacement.
Economics
Repair versus replace cost
Compare a repair policy with replacement. Sale price is context and is not a legal minimum cost.
How to read the result
Compare a repair policy with replacement. Sale price is context and is not a legal minimum cost.
Annual cases are multiplied by the failure rate. The break-even success rate is repair cost divided by replace cost. A rate above one means repair does not pay for itself against replacement.
A planning model only. It does not state a legal minimum repair price.
Compare a repair policy with replacement. Sale price is context and is not a legal minimum cost.
Annual cases are multiplied by the failure rate. The break-even success rate is repair cost divided by replace cost. A rate above one means repair does not pay for itself against replacement.
A planning model only. It does not state a legal minimum repair price.
Questions
Current, repair-first, user-defined
Current and user-defined use your success rate. Repair-first assumes every case is repaired.
What the sale price does
It is kept as context and is excluded from the cost totals.
Zero cases
A zero volume or a zero failure rate makes the annual totals equal to the reserve only.
Is the delta a legal conclusion?
No. It is the arithmetic gap between the two planning scenarios.