Supply Chain Management Professional (SCMP) · Question
In procurement, what does 'total cost of ownership' (TCO) primarily consider beyond the purchase price?
TCO encompasses all costs incurred from acquisition to disposal, including purchase price, operating costs, and end-of-life expenses.
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Question: In procurement, what does 'total cost of ownership' (TCO) primarily consider beyond the purchase price?
Answer options:
- Only maintenance costs
- All direct expenses related to acquisition ✅ All costs associated with the product or service throughout its lifecycle
- Only disposal costs
Correct answer: All costs associated with the product or service throughout its lifecycle
Explanation: TCO encompasses all costs incurred from acquisition to disposal, including purchase price, operating costs, and end-of-life expenses.
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