Life cycle cost: An individual consumer’s perspective

Pricing of certain items (mainly durables) involves two components: purchase cost and maintenance cost. The interaction between both cost components is commonly referred to by the term Life Cycle Cost (LCC). Previous studies indicate that potential buyers are not always aware of the adverse financial outcomes that may stem from certain selections where alternative LCC items are considered. Nevertheless, all these indications are rather indirect. The present study examines directly both the awareness of potential buyers to LCC considerations as well as their capability of handling ‘properly’ LCC decisions. In this regard hypotheses are formulated and tested against experimental data that simulate both durable and non-durable purchase situations.