Return on Software: Maximizing the Return on Your Software Investment

Chapter 11 Self-Study Questions

1.	End of Year (1) Salvage Value if Retired at Year n (2) AE(i) Cost if Retired in Year n [CR(i)] (3) Operating and Maintenance Costs for Year n (4) PW(i) of O&M for Year n in Year 0 (5) Sum of Year 0 O&Ms through Year n (6) AE(i) Cost of Operating for n Years (7) Total AE(i) if Retired at Year n 1 $1000 $344 $100 $89 $89 $100 $444 2 $850 $309 $125 $100 $189 $112 $421 3 $700 $292 $150 $107 $296 $123 $415 4 $550 $280 $175 $111 $407 $134 $414 5 $400 $270 $200 $113 $520 $144 $414 6 $250 $261 $225 $114 $634 $154 $415 7 $100 $253 $250 $113 $747 $164 $417
2.	The economic life of the laser printer is either 4 years or 5 years, and the total AE(i) of retiring it then is $414.
3.	If the economic life was chosen to be 4 years, then If the economic life was chosen to be 5 years, then