18 Questions
What is the first step in the decision-making process?
Recognize a decision problem
What financial data is required to make an economic decision according to the text?
Minimal cash outlay
Why is focusing on the differences among alternatives important in decision-making?
To simplify the decision process
What does 'use a consistent viewpoint' mean in the context of decision-making?
Having a defined perspective for evaluating alternatives
Why is selecting the best alternative considered one of the final steps in decision-making?
To ensure all relevant information is gathered
In the context of decision criterion selection, what should be avoided when developing alternatives for analysis according to the text?
Using an inconsistent viewpoint
What are some examples of objectives other than profit maximization or cost minimization that can be important to an organization?
Meeting or exceeding customer expectations and improving employee satisfaction
According to Step 4, what will the decision maker normally select?
The alternative that best serves the long-term interests of the owners of the organization
What is largely based on cash-flow estimates for the feasible alternatives selected for detailed study?
Analysis and comparison of alternatives
What is an essential part of an engineering economy study according to Principle 6?
Considering future uncertainties
Which factor often requires a substantial effort to obtain reasonably accurate forecasts in an engineering economy study?
Inflationary pressures
What is incorporated in Step 5 for detailed study of alternatives?
Cash-flow estimates and consideration of future uncertainties
What is the advantage of using a common unit of measurement when analyzing and comparing alternatives?
It simplifies the analysis and comparison
Why is it important for decision making to consider outcomes expressed in different units of measurement?
To have a comprehensive view of all relevant criteria
What role does uncertainty play in the analysis of future outcomes of alternatives?
Uncertainty is inherent and should be recognized in the analysis
How does improved decision making result from revisiting decisions?
By comparing projected outcomes with actual results achieved
What is one important application of engineering economy according to the text?
Seeking new and wider applications of technical knowledge for mankind's benefit
What does engineering economy aim to discover regarding projects or ventures?
'Limiting factors' that may hinder success
Explore the significance of nonmonetary factors in decision making processes, such as meeting customer expectations, ensuring safety, improving employee satisfaction, and maintaining production flexibility. Understand how these objectives influence the final recommendations of an organization.
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