Full course description
Engineering economy continues to be critical to successful engineering practice. This course covers the basics of the subject with emphasis on methods to support economic analysis in business. You will learn how to make decisions on when to purchase equipment and when to lease, how to amortize investments and quantify the effect of depreciation, and how to compute present worth and future worth of capital investments. Also covered are benefit/cost and incremental analysis, rate of return and interest analysis, leading to a discussion of minimum annual return needed to return a profit on a project. (Tax implications of engineering economy are not covered because of the dynamic nature of tax law).
At the end of this course, participants will be able to:
- Explain the fundamental concepts of engineering economy and their importance in engineering practice.
- Apply economic analysis methods to make informed decisions on equipment purchases, leases, and investment amortization.
- Calculate present worth, future worth, and the effects of depreciation on capital investments.
- Evaluate projects using benefit/cost analysis, incremental analysis, rate of return, and interest analysis to determine the minimum annual return needed for profitability.