New Radar for the F-13 - A Discounted Cash Flow Analysis.
Abstract
This report is a case study on the application of economic analysis and discounted cash flow techniques as an input to the decision making process regarding the acquisition of major weapon systems. The case contains four separate parts, which include: A. Application of economic analysis in the selection of the best of two alternative acquisition strategies for the installation of a new radar on a fighter aircraft already in the operational inventory - modification of an existing radar presently being installed on another aircraft or development of an advanced state of the art radar. B. Introduction of uncertainty and its impact on the acquisition decision. Several of the applicable cash flows are converted from a point estimate to a discrete probability distribution and the expected value of cash flows must be determined. C. Application of discounted cash flow analysis to three alternative production methods envisioned by a prospective manufacturer of the radar. The alternatives include subcontracting, modification of an existing production line, and purchase of a fully automated production line. D. Introduction of increased volume and its impact on the selection of the best production methodology. (Author)
Document Details
- Document Type
- Technical Report
- Publication Date
- May 01, 1976
- Accession Number
- ADA033918
Entities
People
- Porter W. Venn
Organizations
- Defense Systems Management College