Engineering Economics (IME 4030)

Learning Objectives:

1. Grasping the basic principle that a dollar today is worth more than a dollar in the future because of its potential to earn interest or generate returns.
2. Understand the basics cash flow diagram
3. Drawing basic cash flow diagrams.

Video Lectures:

Learning Objectives:

1. Define and provide examples of the time value of money.
2. Distinguish between simple and compound interest, and use compound interest in engineering economic analysis.
3. Explain equivalence of cash flows.
4. Solve problems using the single-payment compound interest formulas.
5. Distinguish and apply nominal and effective interest rates.

Video Lectures:

Learning Objectives:

1. Evaluate investment problems that involve regularly occurring payments or receipts (like monthly loan repayments or annual investments) using specific methods that account for compound interest over time.
2. Evaluate investment problems where the payment amounts increase or decrease steadily over time (either by a fixed amount or by a percentage) using basic arithmetic and geometric techniques.

Video Lectures:

Learning Objectives:

1. Compare two or multiple investment alternatives using present worth (PW).
2. Apply the PW model in cases with equal, unequal, and infinite project lives.

Video Lectures:

Learning Objectives:

1. Understand equivalent uniform annual cost (EUAC) and equivalent uniform annual benefits (EUAB)
2. Transforming Economic Problems into Annual Cash Flows
3. Performing EUAW Analysis for a Single Investment
4. Comparing Different Options Using EUAW, EUAC, and EUAB

Video Lectures:

Learning Objectives:

1. Define Internal Rate of Return (IRR)
2. Evaluate a single investment alternative with the internal rate of return (IRR) measure
3. Plot a project's present worth (PW) against the interest rate.

Video Lectures:

Learning Objectives:

1. Use an incremental rate of return analysis to evaluate competing alternatives.
2. Develop and use spreadsheets to make IRR and incremental rate of return calculations.

Video Lectures:

Learning Objectives:

1. Distinguish between depreciation and cash flow.
2. Use classic depreciation methods to calculate the annual depreciation charge and book value over the asset’s life.
3. Fully account for depreciation recapture due to the disposal of a depreciated business asset.
4. Use the modified accelerated cost recovery system (MACRS) to calculate allowable annual depreciation charges and book value over the asset’s life for various cost bases, property classes, and recovery periods.
5. Compare commonly used depreciation methods.
6. Use spreadsheets to calculate depreciation.

Video Lectures:

Learning Objectives:

1. Calculate taxes due or taxes owed for corporations.
2. Utilize an after-tax tax table to find the after-tax cash flows for a prospective investment project.
3. Calculate after-tax measures of merit, such as present worth, annual worth, payback period, internal rate of return, and benefit-cost ratio, from after-tax cash flows.
4. Evaluate investment alternatives on an after-tax basis including asset disposal.

Video Lectures:

Learning Objectives:

1. Define real and actual dollars and interest rates.
2. Develop and use cash flows that inflate at different interest rates and cash flows subject to different interest rates per period.
3. Incorporate the effects of inflation in before-tax and after-tax calculations.
4. Develop spreadsheets to incorporate the effects of inflation and price change.

Video Lectures: