(a). Determining how much we should pay for a machine that will provide savings.
(b). Determining the priority of investing our company’s
(c). Illustrating the economic advantages of one alternative over other feasible choices.
(d). Convincing management that one person should be hired over another.
Answer to Problem 1P
Option D is the situation in which engineering economic analysis does not provides a useful input.
Explanation of Solution
Engineering economic analysis is analyzing the economy and its effect on the engineering. How our economy helps in engineering and how engineering provides useful tools and techniques for the development of the society as a whole.
Engineering economic analysis provides useful input in all of the following situations.
(a) Determining how much we should pay for a machine that will provide savings.
(b) Determining the priority of investing our company’s retained earnings.
(c) Illustrating the economic advantages of one alternative over other feasible choices.
As the process used in engineering economic analysis helps us in determining how much we should pay for a machine that will provide savings. Investment and savings is one of the most important concept of economics that is even used by engineers for the betterment of their projects and the betterment of the economy as a whole.
It helps us in determining from a pool of investment that which alternative should be selected first, which one will provide that maximum benefits and maximum return.
It helps us in determining the advantages of one alternative over the other so that the best results can be obtained.
Engineering economic analysis does not provide useful input in convincing the management that one person should be hired over another. As this is the task of human resource manager and the management has to decide the qualitative aspect attached with the selection of the person to be hired. So this is the work of management engineering economic analysis has no role to play in this situation.
Conclusion:
So, Option D is the situation in which engineering economic analysis does not provides a useful input.
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Chapter D Solutions
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