9. Calculation that can help create a realistic projection of the actual cost for a purchase

The total cost of ownership (TCO) is a calculation that helps predict the actual cost of a purchase.

Answer: Total cost of ownership (TCO)

TCO (total cost of ownership) is a type of calculation designed to help consumers and call center managers assess both direct and indirect costs and benefits related to the purchase of any outsourcing service or IT component. The intention is to arrive at a final figure that will reflect the effective cost of purchase, all things considered. When you decide to buy a computer you may go through a TCO analysis: for example, the greater cost price of a high-end computer might be one consideration, but one that would have to be balanced by adding likely repair costs and earlier replacement to the purchase cost of the bargain brand...
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This was first published in October 2006

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