Engineering Economics

Onsite Training: Mechanical Engineering, Manufacturing
  • Course:Engineering Economics
  • Course ID:ECONENG Duration:2 days Where: Your Office (7+ Persons)
  • Available as a private, customized course for your group at your offices or ours and in some cases as a WebLive(TM) class.

  • Download Course Description (PDF)

Course Outline

Day 1: Morning Session

  • Introduction.
  • Course overview.
  • The capital acquisition and budgeting process.
  • Investment decision considerations.
  • Cost elements, including labor, material, equipment, installation, and moving services.
  • Depreciation and amortization.
  • Standards, efficiency factors, and utilization factors.
  • Capturing manufacturing costs.
  • Costs related to poor quality and recurring nonconformances.
  • Approval levels.
  • Prioritizing capital investment candidates.
  • Class exercise.

 

Day 1:  Afternoon Session

  • Time value of money.
  • The time value of money concept.
  • Interest rates, compounding periods, and other factors.
  • Calculating simple and compound interest.
  • Nominal and effective interest rates.
  • Interest formulas relating present and future values.
  • The impact of burden, overhead, and general and administrative rates on capital investment decisions.
  • Identifying interest rate factors and overhead rates.
  • Microsoft Excel features that support time value of money calculations.
  • Class exercise.

 

Day 2:  Morning Session

  • Investment Approaches.
  • Capital investment considerations.
  • The annual worth, net present value, internal rate of return, and payback approaches.
  • Replacement analysis.
  • Considering depreciation in investment decisions.
  • Tax considerations.
  • Advantages and disadvantages of the different investment analysis approaches.
  • Microsoft Excel features that support investment analysis.
  • Class exercise.


Day 2:  Afternoon Session

  • Capital investment, design, facilitization, procurement, environmental health and safety, regulatory, and other risks.
  • The Yes-No analysis approach.
  • Capital equipment supplier stability and after-sale support.
  • Identifying capital equipment after sale maintenance requirements.
  • Selecting capital equipment sources.
  • Creating capital equipment specifications.
  • The roles of the Procurement and Finance organizations in capital investment decision-making.
  • Recap, Q/A, and evaluations