Abstract. 

We propose a model that describes the decrease in the market value of equipment with age (depreciation). To measure the depreciation of a used equipment item, we accept the goodness factor, that is, the ratio of its market value to the market value of similar new equipment. The model is based on the discounting cash flows method (DCF). It takes into account that with age, the technical and economic characteristics of the machine deteriorate, and during operation, accidental failures are possible, after which the equipment item must be decommissioned. It is assumed that in the absence of failures, the benefits brought by the equipment item are reduced at a random rate, so that its service life is random. We present the results of calculations according to the model for options when this service life has the Weibull distribution. It was found that the discount rate, average service life and its coefficient of variation have little effect on the dependence of the goodness factor on the relative age (the ratio of actual age to average service life).

Keywords: 

machinery equipment, degradation, service life, log-normal distribution, Weibull distribution, failure, valuation, DCF method, depreciation, percent good factor.

PP. 55-64.

DOI: 10.14357/20790279200107

 

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