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Questions and Answers
What is Engineering Economics?
What is Engineering Economics?
The discipline concerned with the economic aspects of engineering, involving the systematic evaluation of the cost and benefits of proposed technical projects.
Which principle focuses on differentiating alternatives based on future outcomes?
Which principle focuses on differentiating alternatives based on future outcomes?
The principle 'Use a Common Unit of Measure' suggests that all outcomes should be analyzed in different units.
The principle 'Use a Common Unit of Measure' suggests that all outcomes should be analyzed in different units.
False
Which of the following is NOT a principle of Engineering Economics?
Which of the following is NOT a principle of Engineering Economics?
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What do humans spend the maximum time on, according to economics?
What do humans spend the maximum time on, according to economics?
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The resources required to fulfill human wants are unlimited.
The resources required to fulfill human wants are unlimited.
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What is the definition of 'scarcity' in economics?
What is the definition of 'scarcity' in economics?
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Production is a process of creation of utility or value in goods or services, also known as _____ activity.
Production is a process of creation of utility or value in goods or services, also known as _____ activity.
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Study Notes
Introduction to Engineering Economics
- Engineering applies knowledge from physics, chemistry, life sciences, and mathematics to develop large-scale products beneficial to society.
- Economics focuses on the production, distribution, and consumption of goods and services.
- Engineering Economics evaluates costs and benefits of proposed technical projects systematically.
Principles of Engineering Economics
- Develop the Alternatives: Creative brainstorming leads to a diverse selection of possible decisions.
- Focus on the Difference: Prioritize future outcomes; analyze and compare alternatives for a sound decision.
- Use a Consistent Viewpoint: Maintain a unified perspective during outcome development, often reflecting the stakeholders’ interests.
- Use a Common Unit of Measure: Facilitates easier analysis and comparison of alternatives using standard metrics, e.g., currency or quantities.
- Consider All Relevant Criteria: Decisions should incorporate monetary and non-monetary factors to choose preferred alternatives effectively.
- Make Uncertainty Explicit: Acknowledge inherent risks in projections and outcomes; incorporate them into analyses.
- Revisit Your Decisions: Continual learning from past decisions helps organizations adapt and improve over time.
Economic Concepts
- Economics provides insight into resource allocation decisions, opportunity costs, and project evaluation.
- Economic activities dominate human time; studying wants, efforts, wealth, and satisfaction highlights their importance in economics.
- Wants are unlimited while resources are limited, leading to the necessity of choice and prioritization.
- Problems of choice arise from the scarcity of resources, emphasizing the economic dilemma of fulfilling increasing wants.
Basic Economic Activities
- Economic activities systematically address material needs through the provision of goods and services.
- Production is the creation of utility or value in goods/services, essential for satisfying economic demands.
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Description
This quiz explores the fundamental concepts of Engineering Economics, including the evaluation of costs and benefits in technical projects. It covers principles like developing alternatives and using consistent viewpoints to guide decision-making in engineering contexts.
