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ENGR 101 Engineering Economy TEST PREP

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ENGR 101 Engineering Economy TEST PREP THE BASICS OF ENGINEERING ECONOMY Engineering is the profession in which a knowledge of the mathematical and natural science gained by study, experience and... practice is applied with judgement to develop ways to utilize, economically the materials and forces of nature for the benefit of mankind. In this definition, the economic aspects of engineering are emphasized, as well as the physical aspects. Clearly, it is essential that the economic part of engineering be accomplished well. In manufacturing, engineering is involved in every detail of a product’s production, from the conceptual design to the shipping. In fact, engineering decisions account for the majority of product costs. Engineers must consider the effective use of capital assets such as building and machinery. One of the engineer’s primary tasks is to plan for the acquisition of equipment (capital expenditure) that will enable the firm to design and produce products economically. Engineering economy is the discipline concerned with the economic aspect of engineering. It involves the systematic evaluation with the economic merits of proposed solutions to the engineering problems. To be economically acceptable (i.e., affordable), solutions to engineering problem must demonstrate a positive balance of long term benefits over long term cost. Engineering economics is the application of economic techniques to the evaluation of design and engineering alternatives. The role of engineering economics is to assess the appropriateness of a given project, estimate its value, and justify it from an engineering standpoint. The General Economic Environment There are numerous general economic concepts that must be taken into account in engineering studies.  Consumer goods and services are those products or services that are directly used by people to satisfy their wants. Examples are foods, clothing, homes, cars, haircuts and medical services. [Show More]

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