ECONOMICS OF TKLEPHONK RELAY APPLICATIONS 255 



l)('lo\\, where th(^ (^xttMision of the old code is identified as Plan A, and 

 the use of a new code as Plan B. 



For Plan A, there will be a new demand, (A' + 1'), which is greater 

 than its prex'ious demand hy )', the quantity of the new application. 

 TIu^ demand cost penalty can then be read from charts such as Fig. 4. 

 Performance penalties for pertinent featin"(\s such as speed, power, extra 

 contacts, etc. may be read from charts of the kind described in the earlier 

 sections abo^'e. The sum of these \'ahies, multiplied by Y, is \\w, cost 

 penalty for the now application of an existing code. 



For Plan B, there will b(> a lot-size cost penalty due to its demand. But 

 there will also be a penalty imposed on the original code, (whose demand 

 was A^), because its demand was not enlarged to value X -f Y. Thus 

 the total lot-size cost penalty is made up of two parts: 



(a) Penalty due to demand Y, multiplied by Y. 



(b) [Penalt}' due to demand A" — Penalty due to demand (X + F)] 

 multiplied by X. 



The unit lot-size cost penalty for Plan B is the sum of these two fac- 

 tors, divided by the quantity Y. The design of relay for Plan B may be 

 chosen by the methods previously outlined to be as nearly optimum as 

 is feasible, and then performance penalties itemized as in Plan A above. 

 The sum of these penalties, added to the lot-size penalties just men- 

 tioned, give a number for comparison with Plan A. 



After the penalties due to either plan are compared, the least costly 

 should be chosen. In cases where the costs are approximately equal, 

 preference should probably be given to Plan A, as encouraging stand- 

 ardization. 



In summary, the ideal number of codes in a newly designed system 



Table IV — Check List for Relay Code Selection 

 Amount of Equivalent Cost Penalty 



Note (1): Fill in for demand X + Y. 

 Note (2) : Fill in for demand A'. 

 Note (3) : Fill in for demand Y. 



