### Title

Replacement cost formula

### Post

Hi all,

I am trying to create a FM formula that will calculate the replacement cost of a component. I know the original cost (say $1,000), I know the expected lifetime in months (say 240) and I am assuming a CPI index of say 2%. What calculation will tell me what my expected replacement cost will be at the end of the lifetime?

The replacement cost is increasing by 2% annually?

If so:

PurchaseCostField + (lifetimeField/12) * CPIfield * PurchaseCostField

I'm also assuming that the CPI field stores the percent as a decimal (0.02 in your example)