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dc.contributor.authorDes Bordes, Emmanuel
dc.contributor.authorBuyuktahtakin, Esra
dc.identifier.citationEmmanuel des-Bordes and I. Esra Büyüktahtakın. 2017. Optimizing capital investments under technological change and deterioration: A case study on MRI machine replacement. Engineering Economist, vol. 62:no. 2:pp 105-131en_US
dc.descriptionClick on the DOI link to access the article (may not be free).en_US
dc.description.abstractWe study the multiple style and type parallel asset replacement problem (MST-PRES), which determines an optimal policy for keeping or replacing a group of assets that operate in parallel under a limited budget. Operating assets generally suffer from deterioration, which results in high operation and maintenance (O&M) cost and decreased salvage value, and technological improvements make it possible for new assets to operate more efficiently at a lower cost. In order to address these issues, we formulate a multi-objective mixed-integer programming (MIP) model that minimizes fixed and variable costs of purchasing new assets, O&M cost, inventory cost, and penalty cost for unmet demand minus salvage values, while considering technological advances and deterioration as a gain and loss in capacity, respectively. We apply our model to a case study involving two different styles of assets: a full-body magnetic resonance imaging (MRI) machine and a smaller extremity magnetic resonance imaging (eMRI) machine. Each has two types: high-field and low-field. We perform computational experiments and analyses using key model parameters and illustrate optimal replacement strategies considering the impact of technological advances and deterioration. Results show that the proposed MIP model provides valuable insights and strategies for companies, decision makers, and government entities on the capital asset management.en_US
dc.description.sponsorshipNational Science Foundation under grant no. EPS-0903806, the state of Kansas through the Kansas Board of Regents, and the KEEP program at Wichita State University through the Workforce Center of Kansas.en_US
dc.publisherTaylor & Francis LTDen_US
dc.relation.ispartofseriesEngineering Economist;v.62:no.2
dc.subjectEquipment replacementen_US
dc.subjectAsset replacementen_US
dc.titleOptimizing capital investments under technological change and deterioration: a case study on MRI machine replacementen_US
dc.rights.holderCopyright © 2017 Taylor & Francisen_US

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