Engineering Economy notes

Multiple alternatives analysis is a decision-making tool used to compare and select the best alternative among several options. Multiple alternatives analysis involves evaluating different alternatives based on their costs, benefits, and risks.

A deferred annuity is an annuity that does not begin making payments until a specified date in the future. In engineering economy, deferred annuities are often used to evaluate investments in which cash inflows or outflows are expected to occur at a future date. Engineers use present worth, future worth, annual worth, and nominal rate factors to calculate the value of deferred annuities and compare them to other investment options. In more complicated equivalence calculations, engineers may u...

The three most commonly used profitability measures are present worth (PW), future worth (FW), and annual worth (AW). Each measure provides a different perspective on the profitability of an investment, and engineers can use them in combination to make informed decisions about the use of resources. Present worth (PW) is the value of all future cash flows of an investment at the present time. Engineers use the present worth factor to calculate the present worth of an investment, taking into ac...

Engineering economic analysis is a branch of engineering that deals with the evaluation of engineering projects and investment options from a financial perspective. It involves the application of mathematical and economic principles to assess the feasibility, profitability, and risk of engineering projects.