ECO 1192 Lecture Notes - Lecture 1: Mansfield, Cash Flow, Engineering Economics
15 Sep 2017
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Document Summary
Engineering economics: the science that deals with techniques of quantitative analysis useful for selecting the preferred competing alternative. Economics: the study of choices made by individuals, businesses, governments, and societies as they cope with scarcity and efficiency. Scarcity: societal wants exceed resources available to produce goods and services to satisfy them. This means that decisions are required by individuals, businesses, and governments to ensure the largest number will be satisfied (knowing that it is impossible to satisfy all wants). Physical efficiency: measure of the success of engineering activity in the physical environment, ratio of outputs to inputs, physical units like btus kw-hours. Economic efficiency: ratio of value/worth to cost, must exceed 1 (or 100%) to be successful. Identification of all limiting factors and strategic factors: engineering community identifies societal wants. 2: determination of means or proposals, evaluation of alternatives, decision making.
