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Utilization of the virtual classroom as a laboratory for teaching and learning experimentation has increased significantly in recent years as development tools for Web-based applications have become easier to use, and computers have become more capable and less expensive. But, does the virtual classroom improve student learning?Herein we describe the results of two experiments conducted on sections of an Engineering Economy course (ISE 2014) at Virginia Tech during the Spring 2000 and Fall 2000 semesters. The two experiments were designed to determine if student learning of Engineering Economy was significantly affected by two treatments: 1) An industrial team project provided by General Electric (GE) in the Spring and Fall of 2000, and 2) Web-based supplemental course materials in the Fall of 2000. The actual final scores of students in the experimental and control sections were compared (for the Spring and Fall experiments) in order to determine the impact on learning of the project and/or the Web-based...

This paper discusses a measure for estimating the wealth creation potential of capital investments in manufacturing. The measure, called “Economic Value Added,” has recently become popular in the United States and can be derived from an after-tax analysis of cash flows generated by a capital investment. A proposed investment in manufacturing capacity is analyzed to illustrate the after-tax cash flow calculations required to determine its EVA potential.

This paper describes the use of multimedia lectures in an engineering economy course that is attended by 200 sophomore engineering students at Virginia Tech. The purpose of this paper is to examine the important issue of applying innovative information technology to support the effective dissemination of learning materials and to report on an experiment in which the benefits of multimedia-based support materials are assessed. Our hypothesis is that students exposed to a series of multimedia-based lectures will exhibit greater interest in the subject matter and will eventually perform better or as well as students in the traditional teaching environment. In addition, we hope to establish that students tend to become more involved (participate actively) in a multimedia-based teaching environment to the extent of actually making positive suggestions for improvement to the computer presentations. Just as important, we will support and encourage such contributions made by cross-disciplinary groups of students in the hope of cultivating student's interest in the subject matter throughout the course.

One of the major risks encountered in economic evaluation of foreign direct investment is the changes in future exchange rates that may affect the accuracy of the estimated economic worm of the investment. The objective of this article is to present a model for reducing the uncertainty associated with changes in foreign exchange rates when conducting economic evaluations of foreign direct investments. The model uses the Purchasing Power Parity Theorem and weighted averages for creating a procedural approach in which future changes in exchange rates are considered and included in the calculation of an overall profitability measure.

This paper provides a comprehensive list of relevant books and articles pertaining to the subject area of “engineering design,” with specific focus on the methodology, education, economics, and management aspects of the design discipline. The purpose of this survey of engineering design literature is to provide a compendium of books and articles that may be instrumental in facilitating the process of sharing and disseminating design knowledge

This paper applies a multi-attribute evaluation model to the choice between local area network (LAN) topologies in an office automation project. A computerized decision support system, JustLAN, has been developed to facilitate sensitivity studies. It incorporates the following features: (1) a group-participative process for data acquisition, (2) the development of ratio-scaled importance weights for the attributes, (3) detailed cost estimation worksheets for the determination of life-cycle costs for feasible alternatives, (4) a graphical assessment of tradeoffs between monetary and nonmonetary considerations, and (5) the capability to conduct on-line sensitivity analyses to test the “robustness” of the recommended alternative to estimation errors. In a sample application of the procedure, involving a LAN selection problem in a government office building, an inferior alternative would have been selected if results of traditional present worth analysis had been followed. Only through the use of multi-attrib...

This paper discusses a fundamental change that appears to be occurring in the practical and theoretical aspects of engineering economy. Recent emphasis on the engineer's role in strategic and design-related decision processes has created a very real need for a change in focus in engineering economy technique and methodology. Several areas of research opportunity that arise because of the paradigm shift are also identified herein.

Most traditional approaches to capital expenditure analysis have been partially successful in explicitly accounting for risk. A utilitarian model for risk treatment is described in this paper. Specifically, we address two major aspects of the utilitarian approach: (1) the mathematical legitimacy of the underlying utility function with respect to its domain of economic significance and (2) the way “Expectancy-Variance” and “Expectancy-Semivariance” compare as risk/return trade-off criteria. In particular, we have shown how commonly used quadratic utility functions present some theoretical and practical inconveniences from an economic standpoint. Then, a hybrid utility function is introduced as a more legitimate and often more realistic model where semi-variance, rather than variance, is used as a measure of the investment riskiness.

This case study is an evaluation of actual alternatives for capacity expansion of an electrical power company. A systematic analysis of the important parameters of this complex problem is described to illustrate how multiple attribute decision analysis can be utilized to include the monetary and nonmonetary aspects of such a real world capacity expansion problem. The service cost data utilized is the type generated routinely by utilities and/or regulatory staffs. However, the use of outage costs and socio-economic coats demonstrates that the readily available service coats data can be expanded and combined into a framework that allows a more detailed analysis of the complex, capacity planning problem. The information reported here has been altered to the extent necessary to conceal the identity of the utility.

(1983). Review of: “ INFLATION IN ENGINEERING ECONOMIC ANALYSIS”by Byron W. Jones, John Wiley & Sons, New York, 1982, 216 pages. The Engineering Economist: Vol. 28, No. 4, pp. 339-339.