When it comes to computer prices, the cost of components is the most important factor

When it comes to computer prices, the cost of components is the most important factor

It's difficult for a company to market and properly support any office computer priced less than about $1,000'its profit margin is small enough already. But declining component costs mean that, as time passes, you get better performance for the same price.

Component prices quoted in this guide are all single-quantity prices; manufacturers get big discounts but they also contract for supplies months in advance, and, since most component prices fall with time, they may not be paying much less. But the point is that when retail prices fall, wholesale prices do also.

After some temporary shortages, RAM prices have been dropping recently. Typically, 64M of RAM will run $50, down about 30 percent since January; 128M of RAM runs $100, down about 40 percent.

The 10G Enhanced IDE/Ultra ATA hard drives commonly used in low-end PCs cost about $130; prices have been relatively stable recently. Meanwhile, video graphics memory is also dropping in price.

Although the cost patterns of computer components don't always guarantee that you can get more this year for less than last year, you can always get more for the same price.

'John McCormick

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