Calculation and determination of the independence index

Each unit of output,  each product of the following industries:

     food, water / wastewater, energy, traffic / transportation, communication, information

1. should be allowed to sell only with the real costs of its production. So that everyone could see that the manufacturer actually spent per unit of production. This ensures transparency of information about a product in an economic sense.

2. Each product gets a independence index (II), which will be calculated with the information about this new product and other, older, similar products, that was be used until now. An standard product can be by government defined as reference product and ware be always updated according to the technical development of society

The indication of the cost is for transparency and ensures that the product is properly valued and avoids the speculative actions  (which always presupposes dependence).

 

Calculation and determination of the independence index

How is it calculated?     The calculation principle is simple.
It means the following:

What factors play a large role?

Factor 1:

Comparing my life condition before buying a product and after ... and it is in terms of "equivalent" of my work for the purchase of the product, if these "equivalent" is directly reduced, then I will be more independent than before ... when is increased, then I will be more dependent than before .

The "equivalent" in a modern society - it's money or time that is required, a certain amount of money to "earn" for the procurement of the product.
That is, earned money - this is the time of my life at work for someone (for the owner of the company).

 Factor 2:

Resources are consumed by the product: the consumption and the cost of maintenance.

For example: a car with a gasoline engine different from a car with an electric motor. If we combine  a solar collector to electro car  ...

 Factor 3:

The shelf life of the product or warranty.

It is understandable, because the longer drives a car, the less money you need to buy a new ... or a light bulb, or a mobile phone or a water pump. ... the less money is needed the less you have to work.

 These factors can be measured and used to calculate the relative independence (before buying a product and after).

 

The exact formula of independence index (II) has yet to be discussed. It should be an integral index to make clear to all the necessary parameters. Essentially, there are the following relevant product information (parameters):

Price, consumption, maintenance costs / consequential costs, performance guarantee time

For each parameter (PARAM_NEW):

If ([PRM_OLD_VALUE] - [PARAM _NEW_VALUE]) = 0
then

   II (PRM _NEW) = 0;
otherwise

II (PRM_NEW) =

    [TREND] * ([PRM_NEW_VALUE] - [PR_OLD_VALUE]) /

 MAX ([PRM_OLD_VALUE]: [PRM_NEW_VALUE])

After that is the average of all index - the index is the integral independence index of the product.

II (PRODUCT _NEW) = SUM(all II(PRM_NEW)) /COUNT(all PRM_NEW)

 

Definitions:

II - Independent Index, Independence Index of Product.

PRM_NEW - Parameters of the new product (one of: price, consumption, maintenance / renewal cost, performance guarantee period)
PRM_OLD - Parameters of the reference product (one of: price, consumption, maintenance / renewal cost, performance guarantee period)

TREND is a corrective parameters:
"-1 Means that the value must fall to achieve positive results in the II "
"+1 Means that the value must change to positive to achieve positive results in the II "
For example:
     the guarantee period should be increased, in this case  TENDENZ = +1
     consumption of gasoline per 100 km should decrease, in this case  TENDENZ = -1

All these II for each parameter are used for calculating of product index II.

The formula might look like:

II(PRODUCT _NEW) = SUM(II(all PRM_NEW))/COUNT(all PRM_NEW)

Wherein in the formula as shown above, for each parameter a PRM_NEW own independence index II is calculated.

 

Examples.

Example 1

I have an old car:

The price of the old car (may be used as a guide, a reference car) if it is to be bought new would be

-      Price  :                                10000

-      Consumption /100km:           10

-      Maintenance cost / year:        2000

-      Performance Warranty Time:   1 

I was offered another recent comparable car:

-      Price :                                   9000

-      Consumption /100km:             5

-      Maintenance cost / year:         3000

-      Performance Warranty Time:   5

Independence index (II) calculation between the old product (car) and new (car):

II for new car

 

T (Trend)

old

New

II

II  Price

-1

10000

9000

0,1

II  Consumption/100km

-1

10

5

0,5

II  Maintenance cost / year

-1

2000

3000

-0,3333

II  Performance Warranty Time

1

1

5

0,8

 

 

 

 

 

 

 

 

 

 

II Result (normalized)

 

 

 

0,26667

II Result (%)

 

 

 

26,6667

positive value means decreasing dependence

 

Example 2 :  diesel price

 

T (Trend)

old

New

II

II  Price

-1

1.359

1.379

-0,0145

II  Consumption /100km (100PS)

-1

6

5,9

0,01667

 

 

 

 

 

 

 

 

 

 

II Result (normalized)

 

 

 

0,00108

II Result (%)

 

 

 

0,10817

positive value means decreasing dependence

 

Extreme examples:

 

A car as gift:

 

T (Trend)

old

New

II

II  Price

-1

1000

0

1

II  Consumption/100km

-1

7

5

0,28571

II  Maintenance cost / year

-1

0

3000

-1

II  Performance Warranty Time

1

0

5

1

 

 

 

 

 

 

 

 

 

 

II Result (normalized)

 

 

 

0,32143

II Result (%)

 

 

 

32,1429

positive value means decreasing dependence

 

II for Diesel (Price increases by100%)

 

T (Trend)

old

New

II

II  Price

-1

1.359

2.718

-0,5

II  Consumption/100km (100PS)

-1

6

5,9

0,01667

 

 

 

 

 

Sum

 

 

 

-0,4833

II Result (normalized)

 

 

 

-0,2417

II Result (%)

 

 

 

-24,167

negative value means increasing dependence

 

Gifted a car, the car has a warranty and no consumption and no cost caused.


 

T (Trend)

old

New

II

II  Price

-1

1000

0

1

II  Consumption/100km

-1

5

0

1

II  Maintenance cost / year

-1

400

0

1

II  Performance Warranty Time

1

0

5

1

 

 

 

 

 

Sum

 

 

 

4

II Result (normalized)

 

 

 

1

II Result (%)

 

 

 

100

positive value means decreasing dependence ---- you are travel-independent for 5 years!!! :o)