Engineering Economy
16th Edition
ISBN: 9780133582819
Author: Sullivan
Publisher: DGTL BNCOM
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Chapter 12, Problem 14P
To determine
Calculate the expected present worth.
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Under intervention A, the status quo, 15% of 3-year-old children in the country of Granada die from Dengue and under intervention B, a new intervention only 10% of children in Granada die from Dengue. The life expectancy at three years in Dengue is 55 years. The cost of intervention A is $100 and the cost of intervention B is $185. What is the incremental cost-effectiveness ratio (ICER) comparing intervention B to intervention A expressed as
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[A] Suppose that a drug company has developed an ointment that can be used to treat sores and reduce scarring. Surveys indicated that the ointment, which costs $10,000 for a full course of treatment, can improve the quality of life from 0.6 to 0.7 for patients with this problem. Assume that this population has a life expectancy of 70 years. No need to worry about discounting.
1. What is the Incremental Cost-Utility Ratio (ICUR) for taking the ointment over doing nothing for a typical 20-year-old patient? [Hint: This patient has only 50 years of life remaining.]
2. If the cost-effectiveness threshold is $5,000 per QALYS, will the 20-year-old patient choose to get the ointment? What about a 60-year-old patient?
[B] Is it appropriate to evaluate a healthcare intervention using various methods of economic evaluation as discussed in this course, or should we choose one primary method that best fits the analysis?
The research department at a manufacturing company has developed a new process that it believes will result in an improved product Management must decide whether to go
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Chapter 12 Solutions
Engineering Economy
Ch. 12 - Prob. 1PCh. 12 - Prob. 2PCh. 12 - A new snow making machine utilizes technology that...Ch. 12 - Prob. 4PCh. 12 - Prob. 5PCh. 12 - Prob. 6PCh. 12 - Prob. 7PCh. 12 - Prob. 8PCh. 12 - Prob. 9PCh. 12 - Prob. 10P
Ch. 12 - Prob. 11PCh. 12 - Prob. 12PCh. 12 - Prob. 13PCh. 12 - Prob. 14PCh. 12 - Prob. 15PCh. 12 - Prob. 16PCh. 12 - Prob. 17PCh. 12 - Prob. 18PCh. 12 - Prob. 19PCh. 12 - Prob. 20PCh. 12 - Prob. 21PCh. 12 - Prob. 22PCh. 12 - If the interest rate is 8% per year, what decision...Ch. 12 - Prob. 24PCh. 12 - Prob. 25PCh. 12 - Prob. 26SE
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