Economic Decision Making, EMGT6225

Spring 2017
Instructor
Office
Office Hours

Phone
Mohammad Dehghani
E-mail
Holmes, 577
Mon. 10:30 - 11:30am, Wed. 01:30 - 02:30 pm

(617) 373 4722

m.dehghani@neu.edu

Course Description:
Explores economic modeling and analysis techniques for selecting alternatives from potential
solutions to an engineering problem. Considers measures of merit, such as present worth, annual
worth, rate of return, and benefit/cost techniques. Examines recent techniques of economic analysis,
especially the tools of decision making. Explores decisions under uncertainty. Studies the causes of
risk and uncertainty, and examines ways to change and influence the degree of risk and uncertainty
through sensitivity analysis, expectation-variance criterion, decision tree analysis, statistical decision
techniques, and multiple attribute decision making through group case studies.
Text:
Principles of Engineering Economic Analysis, 6th Edition by John A. White, Kenneth E. Case, and
David B. Pratt, March 2012

An E-book comes with Wiley-plus

WileyPLUS Registration:
You are required to purchase a registration code to access the WileyPLUS components of this course
through the EMGT6225 Blackboard Course Site. You have two options for purchasing this
registration:
1: Online textbook with access to WileyPLUS material in Bb
Use the digital (online) version of the WileyPLUS text within Blackboard, and purchase access
online through www.wileyplus.com. You are presented with the option to buy WileyPLUS
digital access the first time you click on a link to WileyPLUS material from the EMGT6225
course site on the NU Online Blackboard.
2: Printed textbook with access to WileyPLUS material in Bb
Buy the printed textbook from the NU Online bookstore and a WileyPLUS access code will be
included. DO NOT THROW THIS CODE AWAY.

Please note: If you purchase a used book you still need to buy a WileyPLUS access code.
The options presented here are the most cost efficient.

Economic Decision Making, EMGT6225

Spring 2017
Goals:

Understand the time value of money for engineering projects

Be able to compare competing projects under certainty and uncertainty

Manipulate Cash Flows in order to make economic projections

Identify the key financial vehicles that effect how companies do business and describe their
impact on economic decisions

Evaluate projects based on dynamic factors such as depreciation and taxes and choose the
optimal alternatives

Analyze projects and ventures using standard economic decision-making techniques such as
breakeven and sensitivity analysis, risk analysis and uncertainty, expectation-variance
criterion, decision trees, and other statistical decision techniques

Evaluate a variety of economic scenarios through case study analysis and apply multiple
attribute decision-making to each

Tentative Course Schedule: / Topical Outline

Module

Topics

Readings

Economic Principles and an Introduction to the Time Chapter 1 and Chapter 2.1 2.4
value of Money (TVOM)

Analyzing Cash Flows and Series of Cash Flows

Chapter 2.4 end of Chapter 2

Borrowing, Lending, and Investing

Chapter 3

Planning Horizon, MARR and Present Worth Analysis

Chapter 4 and Chapter 5.1 5.5

Future and Annual Worth Analysis

Chapter 5.6 to end of Ch. 5, Chapter 6

and 7

Rate of Return Analysis

Chapter 8

Depreciation Method and After-Tax Economic Analysis

Chapter 9

Replacement Analysis and Inflation

Chapter 10

Breakeven and Sensitivity Analysis

Chapters 11 and 12

10

Probabilistic Risk Analysis

Chapter 13.1 13.3

11

Decision Tree Analysis

Chapter 13.4

12

Economic Decision Making

Chapter 13 Appendix and Case Studies

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Economic Decision Making, EMGT6225

Spring 2017
Course Evaluation:
Your grades are posted on BLACKBOARD you can check your running grade at any time, so there
are no surprises. In fact, you should audit the correct entry of your grades. No grade corrections will
be made after the last week of the semester. Final Grades and Course Letter Grades are not curved
and are assigned as follows:
Percentage:
Assignments

Grade

30 % (15% each)

Wiley-Plus
In-Class

Presentation

10%

Mini-Exams

30% (15% each)

Mini-Exam 1

Mini-Exam 2

Projects

Grade

Range

93 100

C+

77 - 79

A-

90 92

73 76

B+

87 89

C-

70 72

83 86

below 70

B-

80 - 82

30% (15% each)

Project 1
Project 2

Total

Range

100%

The WileyPLUS assignments will be assigned through Blackboard which is linked to WileyPLUS.
These assignments will be given after each module is completed. Assignment are due according to
the deadlines listed on the WileyPLUS system. The online system will automatically deduct points
for late submissions. For each assignment you would have 5 attempts and the grading policy of
them is as follows:
Attempts

Hints AFTER each submission

Reduced score of total grade

1st attempt

N/A

0%

2nd attempt

N/A

0%

3rd attempt

Show Link to Text

0%

4th attempt

Show GO Tutorial

5%

5th attempt

Show Answer

5%

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Economic Decision Making, EMGT6225

Spring 2017

Up to 12 In-Class Assignments will be given during class lectures. These assignments will be
given to students within the class hours. These assignments has to be submitted at the end of the
class.

The worst WileyPLUS and in-class assignment grades will be dropped at the end of semester.

Since the concepts in this course are interrelated and often build off each other, at two points
during the term, you will be assessed on your cumulative understanding of course topics. The
exams will be administered during the first hour of the weekly course lecture, and will be
announced at least 1-2 weeks in advance. Taking the exam in advance is permissible under certain
circumstances. Please contact me if the need arises, but keep in mind that you should plan on
being at each course lecture (do not make travel plans that conflict).

The projects provide an opportunity to apply core principles of economic decision making in
order to analyze a complex, real-world problem and make concrete recommendations as to its
solution. The details about the projects will be announced.

Class Policies

Laptops: You may need use your laptop during the class upon the instructor request.
Phones/tablets/smart watches: Electronic devices may not be open or in use during class. If
you have class work, social networking or sports-score browsing that is more important to do,
then please skip class. Life is full of such choices.

Attendance Policy:
Students are expected to attend all class sessions and are responsible for all materials presented in
class. While attendance is not mandatory, past experience has shown students who attend regularly
and interact with instructors/classmates tend to be better overall.
Due Date Policy
All assignments are due on the due date and cannot be handed in late. No make-up assignments and
exams will be given. Please note that all due dates and times are specified according to the Eastern
Standard Time zone (EST);
Honor Code:
All students must adhere to the Northeastern University honor code available on the Northeastern
website (http://www.northeastern.edu/osccr/academicintegrity/index.html) and in the graduate
student handbook.

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Economic Decision Making, EMGT6225

Spring 2017
Northeastern University Copyright Statement:
This course material is copyrighted and all rights are reserved by Northeastern University. No part of
this course material may be reproduced, transmitted, transcribed, stored in a retrieval system, or
translated into any language or computer language, in any form or by any means, electronic,
mechanical, magnetic, optical, chemical, manual, or otherwise, with the express prior written
permission of the University.
Other Information:

Changes in syllabus may be modified as deemed appropriate. All changes will be announced
in class.

Any student who feels s/he may need an accommodation based on the impact of a disability
should contact me privately to discuss your specific needs. Additionally, if you have a
documented disability you are protected from discrimination and have the right to a
reasonable accommodation. Additional information can be found at the Northeastern
University Disability Resource Center (www.access-disability-deaf.neu.edu).

Any student who is unable, because of his religious beliefs, to attend classes or to participate in
any examination, study, or work requirement on a particular day shall be excused from any
such examination or study or work requirement, and shall be provided with an opportunity to
make up such examination, study, or work requirement which he may have missed because
of such absence on any particular day; provided, however, that such makeup examination or
work shall not create an unreasonable burden upon such school.

Faculty evaluations will be administered at the end of the semester.

Knowledge is like money: to be of value it must circulate, and in circulating it can increase in quantity
and, hopefully, in value.
Louis L'Amour

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