CE 303 Introduction to Construction Engineering
Exam 3 Prep
Engineering Economics
Note: On the day of the exam, you will be given the same handout (from the Fundamentals of
Engineering Reference Handbook) including the formulas and tables that were previously
distributed to the class.
Basic Concepts
1) Interest
2) Interest Rates
3) Compound Interest
4) Nominal Interest
5) Effective Interest
6) Effective Annual Interest Rate (ie=(1+r/m)m-1
7) The Time Value of Money
8) Minimum Attractive Rate of Return
9) Inflation
10) Cash Flow Diagrams
11) Incremental Cash Flow
Annual Compounding
1)
2)
3)
4)
5)
6)
7)
Single-payment, Compound-Amount Factor
Single Payment, Present-Worth Factor
Uniform Series, Compound-Amount Factor
Uniform Series, Capital-Recovery Factor
Uniform Series, Sinking-Fund Factor
Uniform Series, Present-Worth Factor
Gradient Series Factor
Indefinite Life and Capitalized Costs
PW, FW, & EUAS
1) Present Worth
2) Future Worth
3) Equivalent Uniform Annual Series (EUAC and EUAB)
NPV, ROR, Benefit-Cost Ratio, Break-Even Analysis
1)
2)
3)
4)
Net Present Value (Present Worth and Future Worth)
Rate of Return
Benefit-Cost Ratio
Break-Even Analysis
Depreciation
1) Definitions
2) Straight-Line Method
3) The Modified Accelerated Cost Recovery Method
Exam 3 Prep.Doc
-1-
CE 303 Introduction to Construction Engineering
Inflation
1) d = i + f + (i*f)
Review and resolve all homework assignments
Review and resolve all example problems from lecture
Exam 3 Prep.Doc
-2-