This course covers the principles of project evaluation; analysis of capital and operating costs of engineering alternatives, benefit-cost ratio; break-even studies, evaluations recognizing risk, replacement and retirement of assets; tax considerations, influence of sources of funds.
This course is designed to teach engineers how to evaluate different alternative investments/projects in order to find the one that makes the most economical sense. You will learn about how the value of money changes over time due to interest and inflation. You will also learn how to work with cash flows that take place at different times over the life of the project. This knowledge will then be used with different evaluation techniques to determine whether an investment is worth making.
By the end of this course, you should be able to:
1. Apply the concepts of time-value of money, taking into consideration the impact of interest on investment decisions by comparing between potential candidates and identifying the better investment;
2. Determine the book value of an asset for accounting and tax purposes by applying knowledge of depreciation;
3. Explain how assets having different life expectancies cannot be directly compared through use of common life concepts or by using annual worth comparisons;
4. Evaluate different project/investment opportunities to select the most beneficial by applying the appropriate evaluation method;
5. Determine the rate of return of a project through analysis of cash flows, whether they are positive or negative, and how frequently they change from positive to negative;
6. Select the appropriate evaluation method for comparing between alternate investment opportunities by identifying important factors such as life expectancy and measure of interest (dollar value vs. rate of return);
7. Outline basic accounting concepts through identification of elements of a balance sheet and income statement;
8. Evaluate when an asset should be replaced through the use of replacement analysis both before and after tax by determining its economic life;
9. Determine the after-tax viability of a project through the application of after-tax cash flow analysis using capital tax factors, capital salvage factors, tax rates, and depreciation rates;
10. Demonstrate ability to calculate asset/project value due to inflation through application of concepts of real dollars versus actual dollars;
11. Recommend public-sector projects to be implemented by applying benefit cost ratio analysis; and
12. Determine appropriate investment to make taking into consideration uncertainty and risk.
Restriction(s): Registration in the Engineering program
|Online Midterm #1||25%|
|Online Midterm #2||25%|
|Online Final Exam||40%|
Note: The two midterms and the final exam will be done online using Respondus Lock-Down Browser and Monitor. You will therefore be required to have a webcam. You will also be required to take digital images (for example, using a smartphone) of your solutions to each exam question and submit these files immediately after the exam is completed. Detailed instructions will be provided. You will also have an opportunity to practice using Respondus and practice uploading image files before taking the online exams. During the two midterms and the final exam, you will be required to have the ENGG3240 Course Supplement material to refer to.
Additional Technical Requirements
This course will use the Respondus tool to invigilate one or more exams. In order to use Respondus LockDown Browser, you must meet the following technical requirements:
- Operating Systems: Windows 10, 8, 7; Mac OS X 10.10 or higher.
- Memory: Windows 2 GB RAM; Mac 512 MB RAM.
- For Mac users: Safari must function properly on the computer.
- Mac users must have Adobe Flash Player installed to Safari, even if a different browser is normally used.
- A broadband Internet connection. It is recommended that you access the Internet via a wired connection.
*Course details are subject to change.