What analytical tool calculates the total value of a purchase over its useful life?

The analytical tool that calculates the total value of a purchase over its useful life is life cycle cost analysis. This method assesses all costs associated with the acquisition, operation, maintenance, and disposal of an asset over time. By considering both initial purchase costs and ongoing expenses, life cycle cost analysis provides a comprehensive view of the financial implications of a purchase, allowing organizations to make informed decisions about investments.

This tool is particularly useful for comparing different options, as it highlights long-term costs that may not be immediately apparent, such as maintenance fees, energy consumption, and expected lifespan. In contrast, other options like price analysis and cost analysis emphasize specific aspects of a purchase, such as current market prices or direct costs, rather than the total economic impact over the object's entire life cycle. Capital equipment justification typically focuses on the rationale for acquiring expensive equipment rather than the full range of costs associated with its use.