MEE 501 – Engineering Economics
COURSE PARTICULARS
Course Code: MEE 501
Course Title: Engineering Economics
No. of Units: 3
Course Duration: Two hour of Lecture and two hours of tutorial per week for 14 weeks.
Status: Compulsory
Course Email Address: tcakintayo@futa.edu.ng
Course Webpage:
Prerequisite: MEE525 (Computer Aided Design)
COURSE INSTRUCTOR
AKINTAYO, Tunde Claudius, B. Sc. (Ife). M. Sc. (Lagos)
Dept. of Mechanical Engineering,
The Federal University of Technology, Akure, Nigeria.
Phone: +2348062866061,
Email: tcakintayo@futa.edu.ng
COURSE DESCRIPTION
Law of managerial economics. Management models. Revenue of the firm: production
decisions, cost of production, profit analysis of the firm, pricing techniques. Marketing, Demand
and Forecasting. Distributive trade in Nigeria. Business finance & investment. Capital
budgeting & management control. Government policies and the firm. Financing technology:
capital equioment, investment appraisal methods. Break-even analysis. Fundamrntal of cost
accounting with emphasis on production costing. Areas of conflicts between engineers and
accountants. Engineering valuation.
COURSE LEARNING OBJECTIVES
The objectives of this course are to:
I.
II.
III.
review with students basic economic principles with students;
introduce to students basic capital appraisal methods used for carrying out economic
analysis of different alternatives of engineering projects or works;
educate the students on how to systematically evaluate the various cost elements of a
typical manufactured product, an engineering project or service, with a view to
determining the price offer.
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COURSE LEARNING OUTCOMES
Upon successful completion of this course, the student will be able to:
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explain the basic economic principles of wants, scarcity, choice, opportunity cost, etc as
applied to business organizations and engineering firms;
understand the time value of money, and how to sketch the cashfow diagram;
calculate common capital appraisal techniques such as NPV, IRR, Profitability Index,
Payback period, and use these figures of merits to determine the most profitable
alternative;
understand the various sources available to raise equity funds and debts funds for a
business organization;
understand the concept of depreciation of fixed assets and know how to calculate
depreciation values using different methods of depreciation;
carry out the cost analysis of a manufactured product;
prepare a manufacturing account, profit&loss account, balance sheet;
calculate important financial ratios and know how to make useful deductions from the
values of these ratios;
apportion budgeted overheads on most equitable basis;
identify areas of conflicts between engineers and accountants.
evaluate the profit of a firm, carry out the break even analysis and employ this tool to
make production decision;
GRADING SYSTEM FOR THE COURSE
This course will be graded as follows:
Short Quizzes
20%
Main Test
20%
Final Examination
60%
TOTAL
100%
GENERAL INSTRUCTIONS
Attendance: It is expected that every student will be in class for lectures and tutorial classes..
Attendance records will be kept and used to determine each person’s qualification to sit for the
final examination. A minimum of 70% attendance is required for a student to be allowed to sit
for the final exam. In case of illness or other unavoidable cause of absence, the student must
communicate as soon as possible with theinstructor, stating the reason for the absence.
Academic Integrity: Dishonesty and cheating in assignments, class short quizzes, tests or
examinations, or any act tantamount to the violation of academic integrity is totally prohibited.
You are not allowed to make copies of another person’s work and submit it as your own; that is
plagiarism. All cases of academic dishonesty will be reported to the University Management for
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appropriate sanctions in accordance with the guidelines for handling students’ misconduct as
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Wide Area Network, The Internet and World Wide
spelt out in the Students’ Handbook.
Code of Conduct in Lecture Rooms and Laboratories: Students should turn off their cell phones
during lectures. Students are prohibited from engaging in other activities (such as texting,
watching videos, etc.) during lectures. Food and drinks are not permitted in the laboratories.
READING LIST
Riggs, J; Bedworth, D & Ranhawa, S. (1995). Engineering Economics. 4 th Edition. McGraw-Hill
Publishing, USA.
Park, C. S. (2002). Cntemporary Engineering Economic. 3 rd Edition. Prentice Hall.
Steiner, H. M. (1992). Engineering Economics Principles. NcGraw-Hill, Inc., New York.
Principle
COURSE OUTLINE
Week
1
2
3
4
5
Topic
Review of definitions of economics, basic concepts of wants, scarcity,
choice, opportunity cost, demand and supply curves, price determination
and elasticityproduction systems, de. Defintion of etc as applied to
business organizations and engineering firms
Time value of money. The cashfow diagram.
Determination of NPV, Profitability Index, Payback period, and selection
criteria.
Minimum Attractive Rate of Returns, Internal Rate of Reurns (IRR)
Sources of funds for business organization.
6
Causes of depreciation of assets. Calculate of depreciation values using
different methods of depreciation
7
Introduction to Cost Accounting: Fixed cost and Variable Cost. Direct
costs and Indirect costs. Break-even analysis.
Standard Cost. Apportionment of budgeted Overheads on appropriate
bases.
7
8
9
10
11
12
13
14
3
Remarks
13
14
Virtual Reality and Video Conferencing
 Virtual Reality
 Video Conferencing
Practical Class
15
REVISION
Networking using workstation and
base station will be used to buttress
information
technology
in
Manufacturing
This is the week preceding the final
examination. At this time,
evaluation will be done to assess
how far the students’ expectations
for the course have been met.
Second test
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