Engineering economy

709 Pages·35.546 MB·English

by  Sullivan, William G;Wicks, Elin M;Koelling, C Patrick

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ISBN-13: 978-1-292-01949-9
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Abbreviations and Notation Summary
CHAPTER 4
APR annualpercentagerate(nominalinterest)
EOY endofyear
¯
f a geometric change from one time period to the next in cash flows
orequivalentvalues
i effectiveinterestrateperinterestperiod
r nominalinterestrateperperiod(usuallyayear)
CHAPTER 5
AW(i%) equivalent uniform annual worth, computed at i% interest, of one
ormorecashflows
CR(i%) equivalentannualcostofcapitalrecovery,computedati%interest
CW(i%) capitalizedworth(apresentequivalent),computedati%interest
FW(i%) future equivalent worth, calculated at i% interest, of one or more
cashflows
EUAC(i%) equivalentuniformannualcost,calculatedati%interest
IRR internalrateofreturn,alsodesignatedi%
MARR minimumattractiverateofreturn
N lengthofthestudyperiod(usuallyyears)
PW(i%) present equivalent worth, computed at i% interest, of one or more
cashflows
CHAPTER 6
(cid:2)(B−A) incrementalnetcashflow(difference)calculatedfromthecashflow
ofAlternativeBminusthecashflowofAlternativeA(read: deltaB
minusA)
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CHAPTER 7
ATCF after-taxcashflow
BTCF before-taxcashflow
EVA economicvalueadded
MACRS modifiedacceleratedcostrecoverysystem
NOPAT netoperatingprofitaftertaxes
WACC tax-adjustedweightedaveragecostofcapital
CHAPTER 8
A$ actual(current)dollars
f generalinflationrate
R$ real(constant)dollars
CHAPTER 9
EUAC equivalentuniformannualcost
TC total(marginal)costforyeark
k
CHAPTER 12
E(X) meanofarandomvariable
f(x) probabilitydensityfunctionofacontinuousrandomvariable
p(x) probabilitymassfunctionofadiscreterandomvariable
SD(X) standarddeviationofarandomvariable
V(X) varianceofarandomvariable
CHAPTER 13
CAPM capitalassetpricingmodel
R risk-freerateofreturn
F
SML securitymarketline
X binarydecisionvariableincapitalallocationproblems
j
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Right now, in your course, there are young men and women whose engineering
achievements could revolutionize, improve, and sustain future generations.
Don’t Let Them Get Away.

Engineering Economy, 16th Edition, together with MyEngineeringLab, is a complete
solution for providing an engaging in-class experience that will inspire your students
to stay in engineering, while also giving them the practice and scaffolding they need
to keep up and be successful in the course.
Learn more at myengineeringlab.com
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“a01_suli9499_16_se_fm” — 2014/3/18 — 14:39 — page 2 — #2
ENGINEERING
ECONOMY
Sixteenth Edition
Global Edition
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E E
NGINEERING CONOMY
SIXTEENTH EDITION
GLOBAL EDITION
WILLIAM G. SULLIVAN ELIN M. WICKS C. PATRICK KOELLING
VirginiaPolytechnicInstitute WicksandAssociates,L.L.P. VirginiaPolytechnicInstitute
andStateUniversity andStateUniversity
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TherightsofWilliamG.Sullivan,ElinM.Wicks,andC.PatrickKoellingtobeidentifiedastheauthorsofthisworkhavebeen
assertedbytheminaccordancewiththeCopyright,DesignsandPatentsAct1988.
AuthorizedadaptationfromtheUnitedStatesedition,entitledEngineeringEconomy,16thedition,ISBN978-0-13-255490-9,byWilliam
G.Sullivan,ElinM.Wicks,andC.PatrickKoelling,publishedbyPearsonEducation©2014.
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ISBN10:1-29-201949-2
ISBN13:978-1-29-201949-9
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AcataloguerecordforthisbookisavailablefromtheBritishLibrary
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CONTENTS
Preface 13
Green Content 20
CHAPTER1
Introduction to Engineering Economy 25
1.1 Introduction 26
1.2 ThePrinciplesofEngineeringEconomy 27
1.3 EngineeringEconomyandtheDesignProcess 31
1.4 UsingSpreadsheetsinEngineeringEconomicAnalysis 39
1.5 TryYourSkills 39
1.6 Summary 40
CHAPTER2
Cost Concepts and Design Economics 44
2.1 CostTerminology 45
2.2 TheGeneralEconomicEnvironment 51
2.3 Cost-DrivenDesignOptimization 62
2.4 PresentEconomyStudies 67
2.5 CaseStudy—TheEconomicsofDaytimeRunningLights 73
2.6 TryYourSkills 75
2.7 Summary 76
Appendix2-A AccountingFundamentals 84
CHAPTER3
Cost-Estimation Techniques 91
3.1 Introduction 92
3.2 AnIntegratedApproach 94
3.3 SelectedEstimatingTechniques(Models) 102
3.4 ParametricCostEstimating 107
3.5 CaseStudy—DemanufacturingofComputers 118
3.6 ElectronicSpreadsheetModeling:LearningCurve 120
3.7 TryYourSkills 122
3.8 Summary 124
7
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