The Replacement Cost of an asset is a determination of the current cost of a similar new asset with an equivalent utility as the asset being valued. The replacement cost method is one of the business valuation methods under the asset-based approach. Given the fast rate of technological advancement and the speed with which technology and equipment become obsolete, the determination of the replacement cost could be a tricky issue. It is possible to encounter a situation where comparable technology or equipment are modern or more advanced than the equipment being valued. In such instances, valuators face a dilemma as to how to determine the exact replacement cost.