Cost Analysis Calculator

Deciding if you should buy something expensive? Looking at JUST the price doesn't make sense. Sometimes it's helpful to review the Cost-Per-Hour. Enter the cost and usage here:

How much does it cost?
$

Hours used per day:
1 hour/day 2 hours/day 3 hours/day 4 hours/day 5 hours/day 6 hours/day 7 hours/day 8 hours/day 9 hours/day 10 hours/day 11 hours/day 12 hours/day 13 hours/day 14 hours/day 15 hours/day 16 hours/day 17 hours/day 18 hours/day 19 hours/day 20 hours/day 21 hours/day 22 hours/day 23 hours/day 24 hours/day

New Phone $800  |  MacBook Pro $1,800  |  Porsche 911 $89,000

 

How this cost analysis works:

Let's say I already have a computer, but I'm deciding if I should buy a brand new MacBook Pro laptop. That's an $1,800 investment....yeesh :-/



Now that $1,800 price tag might cause some sticker shock, but what if we ran this through our Cost Analysis Calculator to figure out the cost-per-hour?

MacBook Pro cost = $1,800.
Hours used per day = 8 hours.
Years will use this for = 3 years.

We'll use this formula for our calculation:


*NOTE* We use 300 days per year instead of 365 to account for weekends and days off.

Now we plug all the numbers into the formula, and get this:

Cost Per Hour = [COST] / ([Hours Per Day] x [300 days] x [Years])

....which translates to....

$0.25 = [$1,800] / ([8] x [300 days] x [3])

This shows us that if we use this Macbook Pro for 8 hours a day, for 300 days a year, for 3 years.....this computer actually only costs $0.25 per hour!!!!

Running the numbers through the calculator above instantly shows you how much it costs per year to operate:


If your laptop is one of the main tools you use to produce work, then this $1,800 laptop is actually very cheap!

Let's Buy Something More Expensive:

Now let's say we wanna buy a Porsche 911. It costs about $89,000 and it's pretty sweet!


Now there's nothing wrong with buying a fancy car, but let's run it through the cost-per-hour calculator:

Cost Per Hour = [COST] / ([Hours Per Day] x [300 days] x [Years])

....which translates to....

$98 per hour= [$89,000] / ([1] x [300 days] x [3])

This means assuming we drive the car for 1 hour a day, for 3 years....it still costs $98 an hour to operate. Yikkees....

But let's say you drive the car 4 hours per because you drive in a lot of traffic. Over the 3 years the Porsche 911 comes down to just $24/hour to operate.

However if you bought a reasonably priced used car for $25,000 and drove it the same, it would only cost $7/hour.



So if you're deciding to buy something, run it through this Cost Analysis Calculator to figure out the Cost Per Hour first. The results are very helpful in deciding!



Sincerely,
Neville Medhora - Cost Analyzer & Copywriter