MF-303 APPLIED ECONOMICS FOR ENGINEERS
CREDIT HOURS
Theory = 3
Practical = 0
COURSE LEARNING OUTCOMES (CLOs)
| S. No. | CLOs | Taxonomy |
| 1 | Explain the basic concepts of engineering economics, related to various economic models | Coginitive Level 2* |
| 2 | Apply the concepts and techniques of linear programming for optimization of economic resources | Coginitive Level 3* |
| 3 | Evaluate and justify selection of different alternative(s) by using economic analysis technique(s) | Coginitive Level 4* |
COURSE CONTENT
- Introduction: Engineering economy defined, measures of financial effectiveness, non-monetary factors and multiple objectives. Principles of engineering economy.
- The Economic Environment: Consumer and producer goods, measures of economic worth. price, supply, & demand relationship. production. factors of production laws of return.
- Cost Concepts & Analysis: Sunk & opportunity costs. fixed, variable, and incremental costs, recurring & nonrecurring costs. direct, indirect. and overhead costs, standard costs. Break-even analysis, unit cost of production, cost-benefit analysis, feasibility studies, value analysis in designing & purchasing.
- Time Value of Money: Simple interest, compound interest, cash flow diagrams, interest formulas, nominal versus effective interest rate, continuous compounding.
- Depreciation and Depletion: Purpose of depreciation, types of depreciation, economic life and what can be depreciated?
- Comparing Alternatives: Present economy, selection among machines, materials, processes, and designs, payback period method, present worth method, uniform annual cost method, rate of return method, alternatives having identical lives, alternatives having different lives.
- Production Concepts And Mathematical Models: Manufacturing lead time, production rate, capacity, utilization, availability, work in process, VIP and TIP ratios.
- Linear Programming: Mathematical statement of linear programming problems graphic solution. Simplex method and duality problems.
RECOMMENDED BOOKS
(01) Engineering Economics by William G. Sullivan & James A. Bontadelli
(02) Operational Research: An Introduction by Hamdy A Taha
*For details of Taxonomy Levels CLICK HERE!
