Engr361/ME361Engr361/ME361Engineering EconomicsEngineering Economics

©2009 Dr. B. C. Paul©2009 Dr. B. C. Paul

Why Am I Here? Top ReasonsWhy Am I Here? Top Reasons I have a natural love for the subjectI have a natural love for the subject I heard a really good instructor was teaching the I heard a really good instructor was teaching the

coursecourse I like skipping my meal to feast on intellectual I like skipping my meal to feast on intellectual

stimulationstimulation I love the punishment and pressure (I also slam I love the punishment and pressure (I also slam

my hand in the car door for fun)my hand in the car door for fun) My department requires this course and I want to My department requires this course and I want to

get out of here and make some moneyget out of here and make some money The class is about money and how to get more of The class is about money and how to get more of

it – Whats not to like?it – Whats not to like?

Why Your Department Requires Why Your Department Requires itit

Your degree teaches you how to design Your degree teaches you how to design thingsthings

Building them costs moneyBuilding them costs money People Build Things Because They Make People Build Things Because They Make

MoneyMoney The difference between a paper decoration The difference between a paper decoration

and a project may come down to whether and a project may come down to whether you can show it will make moneyyou can show it will make money

Your Department probably wants you to Your Department probably wants you to pass the FE exampass the FE exam

What is the FE?What is the FE? Fundamentals of Engineering ExamFundamentals of Engineering Exam

– It is a step to becoming a Professional EngineerIt is a step to becoming a Professional Engineer– About 10% of the test in Engineering About 10% of the test in Engineering

EconomicsEconomics As a Professional Engineer you can be As a Professional Engineer you can be

registered and licensed by the State as an registered and licensed by the State as an EngineerEngineer– This allows you to officially design and certify This allows you to officially design and certify

designsdesigns– It is increasingly required in all engineering It is increasingly required in all engineering

fields – has been in Civil for a long time.fields – has been in Civil for a long time.

Becoming a Professional EngineerBecoming a Professional Engineer

You must graduate from an accredited You must graduate from an accredited Engineering School (SIU’s programs are Engineering School (SIU’s programs are accredited)accredited)– Within one year of graduation you can sign up Within one year of graduation you can sign up

to take the FEto take the FE– If you pass and graduate you are recognized as If you pass and graduate you are recognized as

an Engineer In Trainingan Engineer In Training After several years working in Engineering After several years working in Engineering

you can take the Professional Engineer you can take the Professional Engineer ExamExam– If you pass you become a licensed Professional If you pass you become a licensed Professional

EngineerEngineer

Another Reason for Engineering Another Reason for Engineering EconEcon

Taking Care of #1Taking Care of #1 Personal Investments involve making Personal Investments involve making

moneymoney Credit cards, loans and mortgages all Credit cards, loans and mortgages all

require paying extra moneyrequire paying extra money Choosing ways of meeting needs have Choosing ways of meeting needs have

both extra costs and cost savingsboth extra costs and cost savings Understanding how money and interest Understanding how money and interest

works helps you to keep more of the green works helps you to keep more of the green for yourselffor yourself

How will I be Graded?How will I be Graded?

Grading will be based on points Grading will be based on points earnedearned

Points come from Homework (24 Points come from Homework (24 problems) and Two Testsproblems) and Two Tests

Each Test will be 25% of the grade Each Test will be 25% of the grade (50% total for tests)(50% total for tests)

Homeworks will be equally weighted Homeworks will be equally weighted and the average score will be 50% of and the average score will be 50% of the gradethe grade

What Will You Do With the What Will You Do With the Points?Points?

Grading will be on a strictly % basisGrading will be on a strictly % basis– 90% + = A90% + = A– 80% + = B80% + = B– 70% + = C70% + = C– 60% + = D60% + = D– <60% - You'll get to enjoy my course <60% - You'll get to enjoy my course

again next semesteragain next semester

What Kind of Tests Do You What Kind of Tests Do You Give?Give?

Tests are open book open notesTests are open book open notes– If you can hook to internet you can use thatIf you can hook to internet you can use that– If you want to bring a computer or financial calculator If you want to bring a computer or financial calculator

you can use thatyou can use that– You cannot use another person in any formYou cannot use another person in any form

Usually about 2-3 problemsUsually about 2-3 problems– Often similar to homework (another reason to do your Often similar to homework (another reason to do your

homework)homework)– May have multiple problems with you picking what to doMay have multiple problems with you picking what to do

Don’t give you a do them all and take grade on bestDon’t give you a do them all and take grade on best Old Test Archives on the Web lets you look at Old Test Archives on the Web lets you look at

previous testsprevious tests– I also have often posted practice tests.I also have often posted practice tests.

More on TestsMore on Tests

In general tests are time intensiveIn general tests are time intensive– If don’t already have an idea what the If don’t already have an idea what the

answer isanswer is– If your trying to do research during the If your trying to do research during the

testtest– Your probably a sunk monkeyYour probably a sunk monkey

HomeworkHomework

Homework is intended as an application Homework is intended as an application exercise for classexercise for class– Get your hands on the problem or procedureGet your hands on the problem or procedure

It is acceptable to work with others on It is acceptable to work with others on homework, but because most homework is homework, but because most homework is on-line it’s a little tricky.on-line it’s a little tricky.

Rationale for shifting to computer is that it Rationale for shifting to computer is that it can give instant feedback on whether you can give instant feedback on whether you are doing things right.are doing things right.

Homework TimingHomework Timing Most homework can be done in 20 minutes Most homework can be done in 20 minutes

or lessor less– If it is taking you more you have probably become lost If it is taking you more you have probably become lost

(might be good to consult a friend or the instructor)(might be good to consult a friend or the instructor)

Warning on Wait till 30 minutes before Warning on Wait till 30 minutes before class approachclass approach– Often are best able to do homework right after learning Often are best able to do homework right after learning

about how – not waiting several daysabout how – not waiting several days– If something goes wrong you won’t make itIf something goes wrong you won’t make it

If you really screw-up bad the computer will kick you out If you really screw-up bad the computer will kick you out and order you to submit your homework on a written form and order you to submit your homework on a written form after consulting with the instructor.after consulting with the instructor.

Homework When Life Su_ksHomework When Life Su_ks Late Homework PolicyLate Homework Policy

– Homework is due on the due dateHomework is due on the due date If you have to do paper submission you turn it in at the end If you have to do paper submission you turn it in at the end

of class.of class. If you do it on computer it is due at the close of the due If you do it on computer it is due at the close of the due

datedate– (Warning – if you decide that means you work at 11:45 pm (Warning – if you decide that means you work at 11:45 pm

after the class and you get kicked out of the system you have after the class and you get kicked out of the system you have already missed the paper homework deadline – guess that already missed the paper homework deadline – guess that means your dead)means your dead)

What if my dog spot dies and I have to go to the What if my dog spot dies and I have to go to the pet cemetery in Chicago for his burial?pet cemetery in Chicago for his burial?– If you are doing computer submission you can do things If you are doing computer submission you can do things

anywhere you have accessanywhere you have access– If you get booted off and ordered to do a paper If you get booted off and ordered to do a paper

submission – use my e-mail to turn it in. E-mail is only submission – use my e-mail to turn it in. E-mail is only for out of town emergencies.for out of town emergencies.

But What If Life S_cks Even Worse But What If Life S_cks Even Worse Than That?Than That?

Your hospitalized with swine flue, mono, Your hospitalized with swine flue, mono, and a brain tumer and because you are and a brain tumer and because you are also radio-active from a meal fed to you by also radio-active from a meal fed to you by an international terrorist you are isolated an international terrorist you are isolated in a lead room and cannot get the internetin a lead room and cannot get the internet– If its really that bad you can get a doctor’s If its really that bad you can get a doctor’s

excuseexcuse I cannot accept homework after any paper I cannot accept homework after any paper

copies have been returned to students.copies have been returned to students. A statement that you were at a doctors A statement that you were at a doctors

office is not sufficient.office is not sufficient.

TextbookTextbook Don’t require a textbookDon’t require a textbook

– Makes class attendance more criticalMakes class attendance more critical Some People Learn Best from Reading or Some People Learn Best from Reading or

Alternate PerspectivesAlternate Perspectives– Engineering Economic AnalysisEngineering Economic Analysis– Donald G. Newnan, Jerome P. Lavelle, Ted G. Donald G. Newnan, Jerome P. Lavelle, Ted G.

EschenbachEschenbach– (8(8thth Addition) Addition)– Or Essentials of Engineering Economic Analysis Or Essentials of Engineering Economic Analysis – Donald G. Newnan, Jerome P. Lavelle, Ted G. Donald G. Newnan, Jerome P. Lavelle, Ted G.

EschenbachEschenbach– (2nd Addition)(2nd Addition)– Two books are same for chapters coveredTwo books are same for chapters covered

Portions of these books are available on-linePortions of these books are available on-line

Comments on Learning Comments on Learning ResourcesResources

Resources AvailableResources Available– Class Lectures (attending class)Class Lectures (attending class)– Doing ProblemsDoing Problems– Class WebsiteClass Website

Class AttendanceClass Attendance In general this is #1 correlation with A studentsIn general this is #1 correlation with A students Professors are most likely to test what they teachProfessors are most likely to test what they teach

– If its on their mind when their lecturing its likely to be on If its on their mind when their lecturing its likely to be on their mind when they testtheir mind when they test

My class is designed to emphasize lecture heavilyMy class is designed to emphasize lecture heavily– Material found only in the text book isn’t going to be on Material found only in the text book isn’t going to be on

the testthe test– My approach to subject differs from the bookMy approach to subject differs from the book

Uses a lot of examples to illustrateUses a lot of examples to illustrate Uses a lot of intuitive logic as opposed to proofs and Uses a lot of intuitive logic as opposed to proofs and

derivationsderivations

Doing ProblemsDoing Problems

Given a series of assigned problemsGiven a series of assigned problems Most assignments are a single problemMost assignments are a single problem Purpose is to give you hands on experience Purpose is to give you hands on experience

practicing something covered in lecturepracticing something covered in lecture An issue of BalanceAn issue of Balance

– Tried to keep modest reasonable workload for 2 Tried to keep modest reasonable workload for 2 credit classcredit class

ProblemProblem– Some people learn by repeatedly doingSome people learn by repeatedly doing– Not enough homework problems to beat it into your Not enough homework problems to beat it into your

skullskull Can do supplemental problems from bookCan do supplemental problems from book

Class WebsiteClass Website

Web site has copies of all lecture Web site has copies of all lecture notes postednotes posted– Some print out and take notes besideSome print out and take notes beside– Warning – some feel easy access to Warning – some feel easy access to

notes removes need to attend classnotes removes need to attend classNot enough text on power point slides to Not enough text on power point slides to

teach everythingteach everything

www.engr.siu.eduwww.engr.siu.edu

Enterwww.engr.siu.edu

This brings up theCollege Web Site

By the time I show you how to get there you’ll be ready to Book Mark

Under the Education Tab Select Under the Education Tab Select ProgramsPrograms

Under Programs Pick The Coolest Under Programs Pick The Coolest DepartmentDepartment

That would beMining and MineralResourcesEngineering

From the Departmental PageFrom the Departmental Page

Select Faculty andStaff

From the Faculty and Staff Page From the Faculty and Staff Page Click the Coolest Faculty MemberClick the Coolest Faculty Member

Which is MeOf Course!

(Dr. Bradley C Paul)

Next Go to the Course MaterialsNext Go to the Course Materials

Select Courses

This onesGood looking

Because of Copyrighted Materials Because of Copyrighted Materials the Site is Password Protected to the Site is Password Protected to

Ensure Academic Fair UseEnsure Academic Fair Use

This is tough

Your User Name isCurrentStudent

Your Password isSenior Design 460

I Know All that Digging Was Fun But You I Know All that Digging Was Fun But You May Want to Consider Bookmarking this as a May Want to Consider Bookmarking this as a

Favorite (ok at least for now)Favorite (ok at least for now)

Has lists of classTimes, room numbersContact information

Also has a ReadingRoom.

Reading Room Has an Area for Reading Room Has an Area for Engineering EconomicsEngineering Economics

Has Books, and IRS Has Books, and IRS PublicationsPublications

Ok it also has yourTextbook

Well – At Least the Part We Well – At Least the Part We CoverCover

Files will downloadAs PDF

(Means you needAdobe Acrobat onYour computer –It’s a free program)

Has Problems from Textbook Has Problems from Textbook Available (if you need drilling Available (if you need drilling

practice)practice)

Also has the InterestFormulas and Tables(relax if you don’tKnow what they areRight now)

Has specific readingsFor each lecture(if you want to doSupplemental reading)

The Class WebsiteThe Class Website The textbookThe textbook

– The textbook or parts covered are available The textbook or parts covered are available online as PDF filesonline as PDF files

Can read book anywhere you have accessCan read book anywhere you have access Do I need to buy the textDo I need to buy the text

– Tried to design so that you don’t have to spend Tried to design so that you don’t have to spend your moneyyour money

– If you don’t buy you won’t have the resourceIf you don’t buy you won’t have the resource Future referenceFuture reference May not always have web access during test – tests May not always have web access during test – tests

are open book but have to have the bookare open book but have to have the book

Back to the Introductory PageBack to the Introductory Page

Scrolling Down We SeeSupplemental Class Resources

Now We Are In the Area to Find Now We Are In the Area to Find Those Course NotesThose Course Notes

Hey!! Here’s Our Course

Trick – youCan short-cutTo here bywww.paulywogbog.net

Woo – I Think We Have Woo – I Think We Have SomethingSomething

One Feature isCalled Where WeAre

Features of Where We AreFeatures of Where We Are

It tells you what lecture we are on.

You can track when assignments arePosted and due (in case your not sureWhether you went to sleep during class)

Key Announcements cover things like upcomingtests

Tips can giveAnswers toProblems I findComing up.

The Assignment PageThe Assignment Page

Has theDate assignmentIs issued

Has the date it isDue

Has status ofAssignment.(ie graded, returned)

Other Important StuffOther Important Stuff

The link to do yourHomework on-line

The link to get to thePaper homework isYou get booted offThe computer.

You Need to Log In to Submit Your You Need to Log In to Submit Your HomeworkHomework

Click Here to Login.

The System Uses Your Regular The System Uses Your Regular SIU Dawgtag and PasswordSIU Dawgtag and Password

After Checking Your University ID After Checking Your University ID and the Class List You See Which and the Class List You See Which Assignments Are Available to Do.Assignments Are Available to Do.

Only the currently open assignments will be available.

Click onTheAssignmentTo Start

It Starts Off With Reminders on the It Starts Off With Reminders on the “Rules of the Game”“Rules of the Game”

Limits and FactsLimits and Facts

You will see only one question at a time You will see only one question at a time and they will be presented to you in order.and they will be presented to you in order.– You cannot forward or skip ahead until you You cannot forward or skip ahead until you

have responded to the current question.have responded to the current question. You can tab back – ButYou can tab back – But

– The previous questions will not show your The previous questions will not show your answers (so you probably want to jot them answers (so you probably want to jot them down as you work)down as you work)

– It will not accept any re-answering of previous It will not accept any re-answering of previous questions.questions.

After You Understand the Rules After You Understand the Rules Check Off That You Have Read Check Off That You Have Read

ThemThemAnd Hit AcceptAnd Hit Accept

Many Problems Begin By Giving Many Problems Begin By Giving You Background Info.You Background Info.

After you have read it and understand click on next.

Up Comes A Question.Up Comes A Question.

Your current score is displayed (this is an optimistic computer so itAssumes you will get points until you blow them).

Pay attention to the format for your answer – the computer has no senseOf humor for misformated input.

After you have answered click submit to move to the next question.

What If I Put in a Wrong Answer?What If I Put in a Wrong Answer?

(General note – most answers have a tolerance zone around the targetAnswer).

If You Answer Wrong the Computer If You Answer Wrong the Computer Will Make a Rude Remark About Will Make a Rude Remark About Your Intelligence (or give you a Your Intelligence (or give you a

hint) and then ask again.hint) and then ask again.

What Happens If You Keep Getting What Happens If You Keep Getting It Wrong?It Wrong?

Here the computer is seen docking your points

And almost telling you the answer before having you submit again.

What Do I Do If I Get Ask a What Do I Do If I Get Ask a Question and I Really Have No Question and I Really Have No

Idea?Idea?

Pop the escape hatch and run to your friends or instructor for help.

The Computer Saves Your Place The Computer Saves Your Place and Lets You Come Back and Pick and Lets You Come Back and Pick

Up Where You Left OffUp Where You Left Off

(Unless you wait until after the assignment is due and access has beenCut off).

At the End It Lets Me Know I’m At the End It Lets Me Know I’m Done.Done.

I click submitTo finish.

It Reports My ScoreIt Reports My Score

(One of theReasons forKeeping trackOf your scoreIs that I amA percentageGrader andYou can figureOut whereYou stand atAny time inThe course).

Has all the usual Syllabus StuffHas all the usual Syllabus Stuff

Here

Note that you were notGiven a paperSyllabus because itsAll on-line.

Can Track Assignments from Can Track Assignments from Here AlsoHere Also

One of the Features Under One of the Features Under TestsTests

The Old TestArchives

Links to Previous TestsLinks to Previous TestsSome With and Some Without a Some With and Some Without a

KeyKey

The Class WebsiteThe Class Website

Old Test ArchivesOld Test Archives– Can get copies of old tests, often with the Can get copies of old tests, often with the

answer keysanswer keys Helpful for seeing what kind of Helpful for seeing what kind of

questions the professor asksquestions the professor asks May take the test and then use key to May take the test and then use key to

evaluate your answerevaluate your answer– In general I discourage the look at question In general I discourage the look at question

– look at answer and say “Oh I know that – look at answer and say “Oh I know that method”method”

The Topical OutlineThe Topical Outline

Topical OutlineAlso Leads to CourseNotes

Shows the Class All Divided into Shows the Class All Divided into Major UnitsMajor Units

Shows Each Topical Area in the Shows Each Topical Area in the UnitsUnits

Material for Each TopicMaterial for Each Topic

Lecture notesEither in PowerPoint or HTML(for those withoutPower point or aReader)

Some lecturesHave a RealplayerAudio lecture

Links to ReadingAssignments orAssignments ifapplicable

So Whats Under That So Whats Under That Resources Tab?Resources Tab?

The Resources PageThe Resources Page

The Formulas for Discount Factors

Key Chapters from the Textbook

Extra Homework Problems (for those who need to beat it in)

Materials Pertaining to Tax Law

More Resources StuffMore Resources Stuff

Quick Review of the Course the way I organize it

Useful Spreadsheets

Whats Useful About Them?Whats Useful About Them?

Class Assistant Does All theBasic Types of CalculationsNeeded for this class

Nice Alternative toBuying a specialCalculator or a lotOf time doing math

Other SpreadsheetsOther Spreadsheets

Spreadsheet to help estimate home ownershipCosts and different ways of financing it

One comparing money from different types of loansAnd credit cards.

These go along with taking care of #1