Capital investments consume approximately 20% of the annual GNP of
developed countries. It is therefore important to allocate capital
funds to such projects in the most effective and efficient way.
This text presents the techniques needed by engineers of all
disciplines and by managers at every organizational level to
participate in the process through which capital projects, both in
the public and private sectors, are selected (or should be) for
implementation. The techniques are grounded in a management science
known as engineering economics. They have been refined and further
developed by the application of probability theory. There are
problems at the end of each chapter for self-study and for
teacher-assisted skills development. The arrangement of the text
makes it easy for use in both one- and two-semester courses. We
believe you will find the text both readable and instructive. It
will enable you not only to participate in the capital selection
process when you have the opportunity to do so but also to critique
the capital spending plans of the private and public organizations
in which you share an interest.
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