01lecture introductiontoengineeringeconomy 131109072700 phpapp02

7/25/2019 01lecture Introductiontoengineeringeconomy 131109072700 Phpapp02

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Introduction toEngineering Economy

Prepared by Sebghatullah Karimi

1392

Kardan University

Civil Engineering aculty


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Content o! this lecture

1. Introduction to Engineering Economy2. The principles of Engineering

Economy

3. Engineering Economy and the designprocess4. Using spreadsheets in Engineering

Economy


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"s engineers not only model the stresson a column# they must also model the

economic impact o! theirrecommendations$

Introduction to EngineeringEconomy Engineer %eans& Problem solver !ind ne" "ays doing things economically Engineering is the art of doing that "ell "ith

one dollar "hich any bungler can do "ith t"o

#$rthur %. &ellington 1''().'he challenge& Every problems has multiple solutions *o" to

choose the best one+


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Introduction to EngineeringEconomy

(hat is engineering economy) Engineering pro,ect must be not only physically

reali-able but also economically aordable. Engineering economy involves the systematic

evaluation of the economic merits of proposedsolutions to engineering problems.

Engineering ismore than a

problem solvingactivity


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The Principles of EngineeringEconomy Can be discussed under sevenprinciples&

*evelop the alternativesIdenti!y# *e+ne# Creativity# Innovation

ocus on the di,erences*i,erences in the !uture outcomes

Use a consistent vie-pointThe prospective outcomes of the alternatives#sta/eholders)

Use a common unit o! measure%onetary # usually U0) presentation of the


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The Principles of EngineeringEconomyConsider all relevant criteria

ecision ma/ing based on several criteria#organisational ob,ectives e.g. long terminterest)

%a.e ris. and uncertaintye/plicitIdentify dene allocate and mitigate

0evisit your decisionsThe initial pro,ected outcomes of the selectedalternatives should be subseuently compared"ith actual results achieved.


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Engineering Economy and thedesign processEngineering economic

analysis procedureSteps&1. Problem recognition denition

and evaluation.2. evelopment of the feasible

alternatives.3. evelopment of the outcomes

and cash o"s for eachalternative.

4. 0election of a criterion

5. $nalysis and comparison of thealternatives.6. 0election of the preferred

alternatives.(. Performance monitoring and

post monitoring results.

Engineering

*esign Process"ctivity&1. Problem7need

denition.2. Problem7need

formulation andevaluation.

3. 0ynthesis ofpossible solutions.

4. $nalysis

optimisation andevaluation.5. 0pecication of

preferredalternatives.

6. 8ommunication.


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Engineering Economy and thedesign processEngineering economic analysis

procedureProblem recognition# de+nition# andevaluation$Problem must be "ell understood and stated in ane9plicit form before the pro,ect team proceeds "ith the

rest of the analysis.

*evelopment o! the !easible alternatives$0earching for potential alternatives #creativity andresourcefulness) screening them to select a smaller

group of feasible alternatives for detailed analysis.

*evelopment o! the outcomes and casho-s !or each alternative$8ash o" approach #revenue and payments)

nonmonetary factors e.g. meeting or e9ceeding


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Engineering Economy and thedesign processEngineering economic analysis

procedureSelection o! a criterion$:ong;term interest of the client and the organisationenvironmental concerns etc.

"nalysis and comparison o! thealternatives$


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Using spreadsheets inEngineering Economy

Spreadsheets are use!ul tool !orsolving engineering economyproblems$ ecause o! the !ollo-ingreasons&They consist of structured repetitive calculations

that can be e9pressed as formulas that rely on afe" functional relationships.

The parameters of the problems sub,ected to

change.The result must be documented. =raphical output is often reuired as "ell as

control over the format of the graphs.


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Conclusion

1. Introduction to Engineering Economyengineer means the ,ob of an engineer.

2. The principles of Engineering EconomyThe seven principles of engineering

economy is discussed3. Engineering Economy and the design

process

0teps should be ta/en in the decisionma/ing process and the activities shouldbe done in the design process.

4. Using spreadsheets in EngineeringEconom


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Any question

01lecture introductiontoengineeringeconomy 131109072700 phpapp02

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