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The Institute of Asset Management IAM-Certificate Exam - Topic 2 Question 9 Discussion
Actual exam question for
The Institute of Asset Management's
IAM-Certificate exam
Question #: 9
Topic #: 2
[All IAM-Certificate Questions]
Topic #: 2
What information is most likely to help in deciding whether to replace an asset rather than repair it?
Suggested Answer:
A
Lifecycle cost analysisprovides a complete financial picture of both options (repair vs. replace). It considers capital, operating, maintenance, and disposal costs---enabling informed decisions.
Exact Extract from IAM -- Asset Management: An Anatomy (v4), Section 4.5.1 -- Lifecycle Costing:
''Lifecycle cost analysis enables decision-making based on total cost of ownership rather than isolated capital or operational expenditure.''
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