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Lec - 1 - Inroduction and Outline of - Engg - Economics 3+0 BSCS10

This document provides an overview of an engineering economics course. The course covers key concepts like cost concepts, time value of money, comparing project alternatives from both a public and private sector perspective. It includes 5 lecture topics: an introduction, basic costs, time value of money, comparing alternatives, and public/private engineering economy. Evaluation is based on tests, quizzes, assignments, and a final exam. Recommended textbooks are also provided.

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Usama Qureshi
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25 views16 pages

Lec - 1 - Inroduction and Outline of - Engg - Economics 3+0 BSCS10

This document provides an overview of an engineering economics course. The course covers key concepts like cost concepts, time value of money, comparing project alternatives from both a public and private sector perspective. It includes 5 lecture topics: an introduction, basic costs, time value of money, comparing alternatives, and public/private engineering economy. Evaluation is based on tests, quizzes, assignments, and a final exam. Recommended textbooks are also provided.

Uploaded by

Usama Qureshi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
You are on page 1/ 16

03/01/24 1

Dedication
This presentation is dedicated
to the

Students
Of Today’s Class
03/01/24 2
N on-technical skills and know ledge areas that an engineer should

acquire

Economics

03/01/24 3
A dapted from Redm ill : 133
03/01/24 4
Engineering
Economics
Course Code: ECO-132

Credit Hours : 3+0

03/01/24 5
Engineering
Economics

 Engineering Economics is the


application of economic techniques
to the evaluation of design and
engineering alternatives.

03/01/24 6
He
ad
lin
e s

7
Lecture Headlines
1)Introduction to Engineering Economics

2) Basic cost concepts

3) Time value of money and discounted cash flow


calculations

4) Comparing alternatives

5) Public sector engineering economy

6)Private
03/01/24 sector engineering economy 8
1) Introduction to Engineering Economics

 Economics vs. Engineering economics;

 Typical problems addressed by Engineering


Economy studies

 Public sector,

 Private sector,

 Engineering economics studies

 Demand, Supply and Equilibrium


03/01/24 9
2) Basic Cost and
Revenue Concepts
Basic terms and concepts –

 Cost (Fixed, Variable, Average, Marginal,


Sunk Cost)
 Revenue (Average, Marginal in SR & LR)
Break-even Analysis
 Profit Maximization,

03/01/24 10
3) Time value of money and
discounted cash flow calculations
What is interest;
 Simple interest;
 Compound interest –
 Nominal vs. effective interest;
 Continuous compounding;
Time-value equivalencies;
Compound interest factors;
The functional notation system;
Cash flow diagrams;
Solving
03/01/24 interest problems 11
4) Comparing alternatives
Identifying and defining alternatives;

Present worth comparisons;

Equivalent annual worth comparisons;

Rate of return comparisons

03/01/24 12
5) Public sector and Private Sector
Engineering Economics

Concept of the Public Sector;


Sources and Costs of capital;
Income tax considerations
The discount rate question;
Incentives for Private Sector Investment
Benefit-Cost Analysis and Applications

03/01/24 13
Text book
Donald E. Newnan, Engineering Economic
Analysis, 9th Ed.
Reference book
Contemporary Engineering Economics: by
Park et al, Pearson
Principles of Economics by Sameulson 13th
Edition
Applied Mathematics for Business Economics
and the Social Sciences by Frank S Budnick
03/01/24 14
Weightage
One Hour Tests : 30 %
Quizzes : 15%
Assignments : 10%
End Semester Exam : 45 %

03/01/24 15
Any Question ?

03/01/24 16

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