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System cost index formula

Author
Kethas Protagonist
Protagonist Ventures
#1 - 2014-10-15 06:04:06 UTC
Do we know the exact formula/algorithm used to determine the system cost index for a particular system + activity type? I know (from this blog) that the cost is supposed to be proportional to the square root of the fraction of job-hours performed in that particular system, but that's not a formula. I've also heard that these indices can be quite volatile, which is a concern. In particular, I remember reading a horror story of an indy corp doing ~5500 activity-hours per day bumping up their system cost index several percentage points.

I'm quite happy to move farther away from trade hubs to get lower install fees, but I'm worried that either 1) system cost indices are too volatile in general for their current values to be a good predictor of future profitability, or 2) my own industry will be enough to bump a 0.5% system to 2.5% or higher. Moving's nontrivial.
tumirnichtweh
Viziam
Amarr Empire
#2 - 2014-10-15 19:31:44 UTC  |  Edited by: tumirnichtweh
I started with 0.5% and brought it to 2.2% within 2 weeks.
It has stabelised at this niveau. I have 30 prodslots but on average i use 25 more or less.
Reverse engi however skyrocketed to 12% within a week from 1 char spamming it.

If you are comfortable with ~2.5% you dont need to move. Keep in mind, that POS saves you 2% vs station allready.

If you want to produce at 1% and below i advise having several POSes. start a lot of jobs until it goes up and set up the next POS at the next low cost index system.

There is much more concurrency at selling items, compared to before crius.
If you dont like 1 cent game i suggest using Wholesale-trade or produce items that have huge skill reqs.

Greetings from a fellow industrialist

edit: as many people are running after low cost index, better dont go to the lowest index. it will rise faster than the second/third lowest.