Hands-On Project 13-1: Calculating Replacement Costs

Objective: Use a risk analysis tool to calculate replacement costs for equipment.

Description: A software tool can help you perform risk analysis with consistency and objectivity. In this project, you download a trial version of a Windows tool called Project Risk Analysis (PRA) by Katmar Software. You then enter information about network resources in your school's lab and calculate the contingency funds needed to replace lab equipment if disaster strikes. You will need a file-archiving utility, such as WinZip. Enter values for computer equipment in your lab and estimate how much data is contained on each piece of equipment. You may need to research the cost of the network resources. The project specifies the names and costs of sample devices, but you can substitute the names and costs of your lab equipment. If you are not in your lab, you can use the information shown in the project steps.

1. Log on to either Windows Server 2008 or Windows 7.

2. Start your Web browser and go to www.katmarsoftware.com/pra.htm.

3. Read the description of the program, and then click Download Now!.

4. When you are prompted to open or save the Projrisk.zip file, click Save and then save the file to a folder in your file system.

5. When the download is finished, click Close in the Download Complete window. Exit your Web browser, and then double-click the file to open it with WinZip. Extract the files to the folder where you saved the .zip file you downloaded.

6. Double-click the ProjRisk_Setup.exe file, and follow the steps in the setup program to install the file on your computer.

7. Click Start, point to All Programs, point to Risk Analysis, and click ProjRisk to start the program. The first time you run the program, you see a window that states the terms under which the program can be run. (It runs 30 times as an evaluation.) Click OK, and then click OK again when you see a second shareware reminder.

8. Click Add to open the Add a Record at the End window. In the Description text box, type Computers.

9. In the Distribution section, click the Normal option button.

10. In the Likely Cost text box, type 15000. Do not use commas when entering numbers. In the Low Cost text box, type 10000.
11. Click OK to return to the main Project Risk Analysis window. Your estimate is entered in the first row. 12. Repeat Steps 8 through 11. Remember to click Normal in Step 9 each time. If you are not entering your own information, enter the following descriptions and costs:

13. In the main Project Risk Analysis window, click the Analyze button to see the Overall Cost Distribution graph. What are the Lowest Cost, Highest Cost, and Mean Cost?

14. Click the Statistics button. What is the mean cost in the Simulation Statistics Report window?

15. Close the Simulation Statistics Report window, and exit Project Risk Analysis. Leave your system running for the next project.