A framework for replacement analysis

Replacement analysis involves an area of engineering economics with many special models and many detailed rules. In this paper a unified framework for replacement analysis is represented. The framework consists of a four-step method appropriate for engineering economics decisions and a classification of some traditional and current replacement models and analysis techniques. Methods are derived for analyzing finite-horizon models and infinite-horizon models with and without technological change. The models and analysis are compared with the models and analysis of Terborgh and Oakford.