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SYSTEMSENGINEERINGDEPARTMENT
SE307EngineeringEconomicAnalysis
Instructor:
AtiqWaliullahSiddiqui
Office:
Bldg22422(Phone(office):1619.Email:atique@kfupm.edu.sa)
OfficeHours:
Objective:Todevelopstudents'awarenessoftheconceptsusingcashflowapproach,timevalueofmoney,
product/projectcostingandrateofreturn.Tointroducestudentstotheprocessofintegratingengineering
proposalswitheconomicanalysisinordertoselectamongseveralviablealternativeprojects;andtounderstandand
appreciatethemodelsandmeasuresusedindecisionmakingintheareaofengineeringeconomics.
CourseOutcomes:Thiscashfloworientedcourseconcernstheprinciplesinvolvedinanalyzingeconomic
investmentalternatives.Studentscompletingthiscoursewillbeableto:
1. Evaluatetheeconomicfeasibilityofinvestmentsrelatedtoengineeringprojects.
2. Assesstheimpactofdepreciation,taxationandothereconomicfactorsonprojects'feasibility.
3. Conductsensitivityanalysisonkeycompoundingparameters.
4. Developpoliciesforassetsreplacement.
5. Assessalternativefinancingmodes.
6. Makefinanciallyprudentdecisionsineverydaylife(car/homeloansorinvestments).
CourseTextbook:Park,ChanS.,FundamentalsofEngineeringEconomics,1stEd.,PrenticeHall(2004).
Otherappropriatebookstobeusedasreferences:
OtherReadings:a.Park,ChanS.,ContemporaryEngineeringEconomics3rdEd.,PrenticeHall(2002).(**CEE)
Attendance:Universityregulationswillbeverystronglyenforced.
Homework:Latehomeworkwillnotbeacceptedunderanycircumstances.
GradingPolicy:
Attendance
5%
Homeworks
5%
Quiz(es)
5%
GroupProject(peerreviewed)
10%
MajorExams(I&II)
25%Each
FinalExam(checkreg.website)
25%
Thedistributionmaybereviewedifnecessary
Weeklybreakdownofcoursetopics
Topics
#ofweeks
i.
Engineeringeconomicdecisions
0.5ch.1
ii.
Costsconceptsandbehaviors
2.0ch.3(**CEE)
iii.
CashFlowsandTimeValueofmoneymanagement
1.5ch.2&3
iv.
PresentandFutureworthandannualequivalentworthanalysis
2.0ch.5&6
v.
BondProblems
1.5ch.6.4(**CEE)
vi.
RateofreturnanalysisandPaybackPeriod
2.0ch.7
vii.
Comparisonofalternatives&replacementdecisions
2.0ch.9&11
viii.
Depreciation
1ch.8
ix.
Corporateincometax
0.5ch.8
x.
Inflationanditsimpactonprojectcashflows
0.5ch.4
xi.
Economicanalysisinthepublicsector(BenefitCostAnalysis)
1ch.12
xii.
Projectbreakevenandsensitivityanalysis
0.5ch.10
Computerusage:Therewillbeanumberofhomeworkandcasestudiesthatwillbesolvedthroughcomputer
softwareandExcelspreadsheet.
CAVEAT:Thesyllabusissubjectedtochange.Soifthereisachangemakesuretoupdateyoursyllabuspromptly.