In this note, we are going to discuss the Engineering Economics and the relationship between Engineering and Economics. Welcome to Poly Notes Hub, a leading destination for Diploma Engineering Notes Syllabus-Wise and in Pdf Format.
Author Name: Arun Paul.
What is Engineering Economics ?
It is the study of engineering projects, procedures, and decisions from an economics perspective. It entails using economic theories and methods to evaluate the risks, costs, and rewards of engineering endeavors and choices. By weighing financial as well as technical concerns, it assists engineers and decision-makers in making well-informed decisions.
Relationship between Engineering and Economics
In the table, we listed some differences between Engineering and Economics –
| Aspect | Engineering | Economics |
|---|---|---|
| 1. Cost Analysis | Analyzes costs associated with engineering projects | Provides tools for cost estimation, analysis, and management |
| 2. Investment Decisions | Evaluates financial viability of engineering investments | Offers frameworks for assessing returns and risks of investments |
| 3. Risk Management | Identifies and manages uncertainties in projects | Provides strategies for quantifying and mitigating risks |
| 4. Optimization | Balances costs and benefits to optimize resource allocation | Helps identify optimal solutions to maximize value |
| 5. Sustainability | Considers environmental and social impacts of engineering | Promotes sustainable practices through economic incentives |