After completion of this course each student would be able to:
The Engineering Economy is a compulsory course and has been offered by the Department of Industrial Engineering and Management.
Aim
The aim of this course is to introduce student with advanced concepts of engineering economic analysis and its role in engineering decision making. It is designed to offer the students the tools needed for rigorous presentation of the effect of the time value of money on engineering problem solving.
Objectives
Contents:
Introduction
Concept of Engineering Economics, Element of Cost, Cash Flows: Their Estimation and Diagramming, Break-Even Analysis, Profit/Volume Ratio Analysis, Material Selection Analysis, Product Design Analysis, Production Process Analysis,
Interests and Their Applications
Time value of money, Single-Payment Compound Amount, Single-Payment Present Worth Amount, Present Worth Method of Comparison, Future Worth Method
Rate of Return Analysis
ROR Calculations, cautions when using ROR methods, ROR Evaluations, Using spreadsheets for ROR analysis
Replacement and Retention Analysis: Types of Replacement Problem, Determination of Economic Life of an Asset, Replacement Analysis of Existing Asset with a New Assets, Using spreadsheets for replacement analysis
Depreciation Analysis: Methods of Depreciation, Straight Line Method of Depreciation, Declining Balance Method of Depreciation, Sum-of-the-Years-Digits Method of Depreciation, Service Output Method of Depreciation, Using Spreadsheets for Depreciation Computations
