Essays on Engineering Economics Assignment

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The paper 'Engineering Economics' is a great example of a Macro and Microeconomics Assignment.   Solution Steps for the LCM method:   Since the LCM of both service lives is 18 years, alternative A will have three cycles while alternative B will have two cycles. For alternative A, the solution is: PWA = – 2500 – 2500 (P/F, 10%, 6yrs) – 2500 (P/F, 10%, 12yrs) + 200 (P/F, 10%, 6yrs) + 200 (P/F, 10%, 12yrs) + 200 (P/F, 10%, 18yrs) – 1000 (P/A, 10%, 18yrs) Combining similar terms yields: PWA = – 2500 – 2300 (P/F, 10%, 6yrs) – 2300 (P/F, 10%, 12yrs) + 200 (P/F, 10%, 18yrs) – 1000 (P/A, 10%, 18yrs) PWA = – 2500 – 1298.5 – 732.8 + 36.0 – 8201 = $-12,696. For alternative B, the solution is: PWB = – 6000 – 6000 (P/F, 10%, 9yrs) + 100 (P/F, 10%, 9yrs) + 100 (P/F, 10%, 18yrs) – 100 (P/A, 10%, 18yrs) PWB = – 6000 – 2544 + 42.4 + 18.0 – 820.1 = $ – 9,303 Therefore, the least cost alternative is B. Solution Steps for the five year study period For alternative A, the solution is: PWA = – 2500 – 1000 (P/A, 10%, 5yrs) + 200 (P/F, 10%, 5yrs) PWA = – 2500 – 3791 + 124.2 = $-6,167 For alternative B, the solution is: PWB = – 6000 - 100 (P/A, 10%, 5yrs) + 100 (P/F, 10%, 5yrs) PWB = – 6000 – 379.1 + 62.09 = $ – 6,317 Alternative A is the least cost alternative. Therefore, if the project engineer used this method, he used alternative A to install networking and network access facilities in the central headquarters of E-Tron Electronics Company.

References

Barsanti, R (2011). Case Studies in Engineering Economics for Electrical Engineering Students. ASEE Southeast Section Conference.
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