Economic Analysis of Alternatives for PC Upgrade of OR Department Laboratory
NAVAL POSTGRADUATE SCHOOL MONTEREY CA
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The Operations Research Department at the NPS plans to upgrade the hardware of the Personal Computer PC laboratory. The objective of the thesis is to analyze the potential upgrade paths dependent upon hardware availability, software compatibility, maintenance and initial cost. The alternatives are a to upgrade the existing Zenith with a 80386 CPU, b to buy the UNISYS desktop III system, or c to purchase the DELL SYSTEM-310. The study utilizes the economic costbenefit view to examine the alternatives and to develop recommendations. The principles of economic analysis are reviewed. The results of survey of users opinion are analyzed to establish the requirements for upgrade. The result of economic analysis shows the UNISYS system to be the least expensive and most system-effective. The price of each unit is an undiscounted 2,176. or discounted 1,994 for five years of economic life and is within the budget available. The sensitivity analysis reveals a by break-even analysis, the economic life parameter is insensitive, b the cost reduction parameter is also insensitive, and c the discount rate is also insensitive. Therefore the recommendations is that the UNISYS system be chosen.
- Economics and Cost Analysis
- Computer Programming and Software