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A full-scale text intended as a practical guide to administrative and research planners on all aspects of selecting, comparing, and evaluating the cost-effectiveness of general-purpose digital computers. Part I presents the microeconomic theory of value, demand, price, profit, time, risk, costs, inputs and outputs. Part II is concerned with applications and discusses the computer industry, including manufacturers, software houses, service bureaus, time-sharing services; the sale and rental of computers; the cost effectiveness of computer systems and memory systems, and the pricing of services in-house and out. Most of the work is entirely new, but an attempt is made to draw together such relevant material as is available to widely scattered sources. Conflicting or competing analyses are compared and evaluated. Specific organizations and machines are named throughout. An appendix explains the principles of regression analysis, curve fitting and selection, and sensitivity testing.

This report is part of the RAND Corporation Report series. The report was a product of the RAND Corporation from 1948 to 1993 that represented the principal publication documenting and transmitting RAND's major research findings and final research.

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