49003 Economic Evaluation

Warning: The information on this page is indicative. The subject outline for a particular semester, location and mode of offering is the authoritative source of all information about the subject for that offering. Required texts, recommended texts and references in particular are likely to change. Students will be provided with a subject outline once they enrol in the subject.

Subject level:

Postgraduate

Handbook description

This subject deals with the application of economic concepts to engineering decision-making. Main topics include: macroeconomic issues and policies; microeconomic market theory; theory of the firm; project evaluation and cost-benefit analysis; intangibles and risk.

Subject objectives/outcomes

On the completion of this subject you should understand:

1. the relevance of economics to your profession;

2. the meaning and significance of macro-economic and micro-economic concepts;

3. the concepts, logic, and methods of project evaluation;

4. how to apply economic reasoning to engineering decision making.

Content

Introduction to Economics

• Evolution of economic thought
• Definition and classification of economics

Macroeconomics

• National Income
• Multiplier Effect
• International trade
• Macroeconomic policy

Microeconomics

• The theory of the consumer
• The theory of the producer
• The theory of the market

Project Evaluation

• The context of project evaluation
• Financial evaluation
• Economic Evaluation (Cost-benefit analysis)
• Sensitivity and Risk Analysis

Assessment

Assessment Item 1: Assignment 1

Assessment Item 2: Assignment 2

Assessment Item 3: Final Exam

Minimum requirements

Students are advised that a 40% mark in the final exam is a mandatory requirement for passing the subject.

Students who obtain a mark of >= 50% for this subject, but have failed in the final examination will be awarded a Fail (X) grade for this subject.

Required texts

Baumol, W J and Blinder, A S, Economics: Principles and Policy, Thomson, Australia, 2003 Department of Finance Handbook of Cost–Benefit Analysis, Australian Government Publishing Service, Canberra, 1991 Mankiew, N G, Principles of Economics, The Dryden Press, Sydney, 1997 McDonald, I M, Macroeconomics, John Wiley and Sons, Brisbane, 1992 Samuelson, P A, et al, Economics, Vol 1 and 2, McGraw Hill, Sydney, 1992

Recommended texts

Baumol, William J. and Blinder, Alan S. (2012 edition) Economics: Principles and Policy, Twelfth Edition, South Western CENGAGE Learning, Australia.