if your agency hire a consultant to develop new software programs to lease at a constant cost of $ 1000 per year.
the consultant say you can save $ 200 per year for every computer you purchase but you will be charged $ 100 for each harddrive you purchase . how many programs should be purchased and why?
To determine the number of programs that should be purchased, we need to compare the savings from purchasing computers with the additional cost of purchasing hard drives. Let's break down the costs and savings:
1. Cost of Software Program: $1000 per year for each program
2. Savings from Purchasing Computers: $200 per year for each computer
3. Cost of Purchasing Hard Drives: $100 for each hard drive
Now, to find the optimal number of programs to be purchased, we can consider the following steps:
Step 1: Calculate the net savings for each additional computer purchased:
Net Savings = Savings from Purchasing Computers - Cost of Purchasing Hard Drives
Net Savings = $200 - $100 = $100
Step 2: Divide the cost of the software program by the net savings to determine the number of computers that would cover the cost:
Number of Computers = Cost of Software Program / Net Savings
Number of Computers = $1000 / $100 = 10
In conclusion, if the agency purchases 10 programs and corresponding computers, the savings from purchasing computers will cover the cost of the software programs. Beyond this point, the savings will exceed the costs and result in a net benefit for the agency.