ECON 320
Engineering Economics
Instructor:
Office:
Mahmut Ali GÖKÇE
A 412
Office Hours:
Wednesdays 13:30-15:30 or by appointment
Contact info:
email: ali.gokce@ieu.edu.tr
Course Webpage:
http://homes.ieu.edu.tr/~agokce/courses/econ320
Class Hours:
Section 1:
Wednesday 08:30 - 11:20
Classroom: M109
Section 2:
Monday 08:30 - 11:20
Classroom: C506
Course Objectives:
To introduce the fundamental concepts of economics/finance/costing and to explain
how these will affect the functioning of an engineering company and contribute to
decision making in engineering operations. Throughout the course, students are
expected
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
To understand the time value of money and principles of engineering economics
To develop skills to perform economic analysis of various engineering projects

To gain the ability to make informed financial decisions as a project
evaluation team member or project manager
Learn and use basic concepts for dealing with risk and uncertainty in project
outcomes
Practice engineering report writing, and written and oral communication skills
To built critical decision making tools for making appropriate personal,
private or public economic and financial decisions



Requirements: Calculus and Probability Theory are required topics. Homeworks and
exams are prepared assuming you have knowledge of Spreadsheet calculations and a
scientific calculator.
Course outline:
LEC #
DATE
SUBJECTS
KEY DATES
24(26) Sep.
1
Engineering Economic Decisions ()
2007
2
1 (3) Oct.
Time Value of Money ()
3
8 (10)Oct.
Factors ()
4
15 (17) Oct.
Understanding Money Management ()
Homework 1 due
(Solutions)
Homework 2 due
5
22 (29) Oct.
Present-Worth Analysis ()
(Solutions)
6
Annual Equivalence Analysis ()
Homework 3 due
Review
(Solutions)
29 (31) Oct.
24 March
Saturday- 9:00-11:00 am, (Building C, 3rd floor)
7
30 March
Exam Review
8
5(6) Apr.
Rate-of-Return Analysis ()
9
12(13) Apr.
Rate-of-Return Analysis
10
19(20) Apr.
Equivalance calculations under inflation ()
11
26(27) Apr.
Accounting for Depreciation and Income Taxes ()
Homework 4 due
(Solutions)
12
3(4) May
Project Cash Flow Analysis ()
5 May
Exam 2 - Saturday 9:30-11:20 (Exam prep. Matl.)
13
10(11) May
Project Cash Flow Analysis ()
14
17(18) May
Decision making under uncertainty ()
15
24(25) May
Review for Final Exam
Homework 5 due
(Solutions)
Final Exam To be Announced
Textbook: Fundamentals of Engineering Economics, 3rd ed., S. Park Chan, PrenticeHall.
Reference textbooks:


Engineering Economy, Leland Blank, Anthony Tarquin, McGraw-Hill
Contemporary Engineering Economics, S. Park Chan, 3rd ed., Prentice-Hall.
Lecture notes:
Will be posted on course website and/or handed out in class as needed.
Assignments:
Homework will be posted weekly on the course web site
(http://homes.ieu.edu.tr/~agokce/courses/econ320), and will be announced in class. If you
don’t understand a homework problem or have any questions about the material, please come and
see me. Answers to the homework problems will be posted on the course website.
Course Grading:
Performance shown in homework, quizzes, exams and participation make up an important part of
instructor's final opinion. Grades will be changed only when an error has been made;
negotiation is not appropriate.
Grading
Midterm
Final
Homeworks
Participation
Attendance
Percent
30
40
20
5
5
Attendance:
Attendance is required at all times. When assigning the final grade, I will consider class
involvement and participation when determining the grade. This just means being involved
with the learning process, asking questions when things are not clear, and seeking help
from me or a tutor if necessary. It also suggests regular attendance.
Announcements: Announcements will be given in class, posted on the course website.