Week 9 — New, Used, Repair or Rent?

Sometimes the cheaper option is not the same item at another store. It may be buying used, repairing, renting, or borrowing instead.

21 September 2026

Core question#

Why compare stores when the better choice may be a different type of purchase?

Weeks 1 through 8 compared prices for the same basic option: buy this item, new, from a retailer. Every trick in that comparison — reference prices (Week 3), discount rules (Week 4), points (Week 8) — assumed “new, from a store” was the right thing to be pricing in the first place. That’s only one possible answer. The same need can often be met by buying used, repairing what you have, renting, or borrowing. The best option is often not “new”.

Lifecycle cost, not purchase price#

A purchase price is a single snapshot at the start of ownership. Lifecycle cost includes what you paid, what it costs to keep the item working, and what you might get back when you sell it:

lifecycle cost = purchase price + running/repair costs − resale value

Depreciation means an item loses resale value over time. It is why a barely-used version of the same product can be much cheaper than new while still having most of its useful life left.

Expected lifetime#

A repair is only worth comparing against a new purchase once you have an honest estimate of how much life the repair buys. Spending 40% of a new item’s price to repair something with 20% of its expected lifetime left is usually a worse deal than it first looks, even if the repair seems cheap.

The $249 headphones#

A near-identical previous-generation model, barely used, is listed for $140. It has already depreciated past the steepest part of its curve, has most of its expected lifetime left, and is not “the same product” — but it may serve the same need. The $109 gap is only worth paying to avoid if the new features are worth $109 to this specific buyer, which is a values question this course reaches properly in Week 12, not a pricing question at all.

The $140 used listing is invented for this example. It is not drawn from any real resale marketplace, and real second-hand prices for any category vary far more widely than one number suggests.

Learning outcomes#

By the end of this week, you should be able to:

• compare at least three ways to meet the same need — new, used, repair, rent or borrow
• define lifecycle cost as purchase price plus running/repair costs minus resale value
• relate depreciation to how quickly a used item’s price falls relative to its remaining lifetime
• judge whether a repair is worth it by comparing lifetime recovered against remaining lifetime, not against the discount on the repair itself
• explain why comparing stores is narrower than comparing all the ways to meet the same need

Before class#

Pick one thing you own that could plausibly be repaired, rented, or bought used instead of new, and estimate — even roughly — what each of those three alternatives would have cost compared to what you actually paid new.

In class#

Using the item you brought, compute a rough lifecycle cost for the “new” option you actually chose — purchase price plus any running or repair cost so far, minus any resale value you could still get — and compare it to your best estimate for the used or repaired alternative.

What you should leave knowing#

“New, from this store” is only one possible option. Lifecycle cost, not just upfront price, is the fairer way to compare it with used, repaired, rented, or borrowed alternatives.

Where this goes#

Week 10 returns to a single new item and asks a timing question: given that prices move (Week 5) and sometimes respond to context (Week 6), is it ever worth simply waiting?