Realistic model for equipment replacement

The work described in this paper attempts to review briefly the field of construction equipment replacement with the intent of highlighting the gradual development in the last six decades of quantitative models and associated terms and concepts. Various features as well as shortcomings of the models presented in the literature are outlined. The work also incorporates a realistic economic model developed by the writers and programmed on a standard microcomputer for ease of application. This model is described in some detail. Although it reflects realistically the taxation situation that currently prevails in Australia, the writers feel that owing to the similarities of economic systems in many free-trading countries, the model would be of interest to managers and planners around the world. Finally, a sample problem is included to illustrate the application of this model.