Engineering Economics
Assignment 1
Azan Ali Kadri
355295
Differences Between Economics and
Engineering Economics
The key differences between Economics and Engineering Economics are the following:
What They're About:
Engineering Economics: Imagine this as the "money matters" side of engineering.
It's all about figuring out if a project is worth the investment, how much it'll cost, and how much
money it can make in the long run.
Economics: This is the big picture. It looks at how countries and people decide what to
make, sell, and buy. It's like understanding the money game on a larger scale, including policies,
markets, and our daily choices.
Where They Apply
Engineering Economics: Think of this as the financial advisor for engineering
projects. It helps engineers and managers decide if a project is financially smart before jumping
in. It's like doing math to make sure it's a good investment.
Economics: This field is everywhere. It's the playbook for businesses, governments, and us
as consumers. It guides decisions like setting prices, making laws, and even how we spend our
paychecks.
Project Focus
Engineering Economics: This is all about projects—building stuff, using new
technology, or even making things. We use money math to decide if these projects make sense
financially.
Economics: It's about way more than just projects. It covers everything from how
businesses work to how governments make choices that affect all of us.
Tools They Use
Engineering Economics: They use special financial tools like figuring out how much
money you'll make over time (net present value), how fast you'll get your investment back
(payback period), and more.
Economics: They use all sorts of tools and tricks—numbers, stats, fancy math—to
understand how the money world operates.
Real-Life Differences
Engineering Economics: In the real world, this means making sure a new project,
like a fancy new building or a new type of car, is worth the money before going ahead.
Economics: This is what guides important decisions in the country, like taxes, how much
things cost, and how many jobs are available.
