Engineering Economic Decisions
L1: Engineering Economic Decisions
ECON 320 Engineering Economics Mahmut Ali GOKCE Industrial Systems Engineering Computer Sciences
www.izmirekonomi.edu.tr 1
Lecture No.1 Chapter 1 Engineering Economic Decisions
Rational Decision- making Process The Engineer’s Role in Business Types of Strategic Engineering Economic Decisions Fundamental Principles in Engineering Economics
Bose Corporation
www.izmirekonomi.edu.tr
Chapter Opening Story - Bose Corporation
Dr. Amar Bose, a graduate of electrical engineering, an MIT professor, and Chairman of Bose Corporation. He invented a directional home speaker system that reproduces the concert experience. He formed Bose Corporation in 1964 and became the world’s No.1 speaker maker. He became the 288th wealthiest American in 2002 by Forbes magazine.
www.izmirekonomi.edu.tr
Engineering Economics Overview
• • • • • • Rational Decision-Making Process Economic Decisions Predicting Future Role of Engineers in Business Large-scale engineering projects Types of strategic engineering economic decisions www.izmirekonomi.edu.tr Rational Decision-Making Process
1.
2.
3.
4. 5. 6.
Recognize a decision problem Define the goals or objectives Collect all the relevant information Identify a set of feasible decision alternatives Select the decision criterion to use Select the best alternative
www.izmirekonomi.edu.tr
Which Car to Lease? Saturn vs. Honda
1.
2.
3.
4. 5. 6.
Recognize a decision problem Define the goals or objectives Collect all the relevant information Identify a set of feasible decision alternatives Select the decision criterion to use Select the best alternative
Need a car
Want mechanical security Gather technical as well as financial data Choose between Saturn and Honda Want minimum total cash outlay Select Honda
www.izmirekonomi.edu.tr
Financial Data Required to Make an Economic Decision
www.izmirekonomi.edu.tr
Engineering
ECON 320 Engineering Economics Mahmut Ali GOKCE Industrial Systems Engineering Computer Sciences
www.izmirekonomi.edu.tr 1
Lecture No.1 Chapter 1 Engineering Economic Decisions
Rational Decision- making Process The Engineer’s Role in Business Types of Strategic Engineering Economic Decisions Fundamental Principles in Engineering Economics
Bose Corporation
www.izmirekonomi.edu.tr
Chapter Opening Story - Bose Corporation
Dr. Amar Bose, a graduate of electrical engineering, an MIT professor, and Chairman of Bose Corporation. He invented a directional home speaker system that reproduces the concert experience. He formed Bose Corporation in 1964 and became the world’s No.1 speaker maker. He became the 288th wealthiest American in 2002 by Forbes magazine.
www.izmirekonomi.edu.tr
Engineering Economics Overview
• • • • • • Rational Decision-Making Process Economic Decisions Predicting Future Role of Engineers in Business Large-scale engineering projects Types of strategic engineering economic decisions www.izmirekonomi.edu.tr Rational Decision-Making Process
1.
2.
3.
4. 5. 6.
Recognize a decision problem Define the goals or objectives Collect all the relevant information Identify a set of feasible decision alternatives Select the decision criterion to use Select the best alternative
www.izmirekonomi.edu.tr
Which Car to Lease? Saturn vs. Honda
1.
2.
3.
4. 5. 6.
Recognize a decision problem Define the goals or objectives Collect all the relevant information Identify a set of feasible decision alternatives Select the decision criterion to use Select the best alternative
Need a car
Want mechanical security Gather technical as well as financial data Choose between Saturn and Honda Want minimum total cash outlay Select Honda
www.izmirekonomi.edu.tr
Financial Data Required to Make an Economic Decision
www.izmirekonomi.edu.tr
Engineering