Engineering Economy (IE305) Course Detail

Course Name Course Code Season Lecture Hours Application Hours Lab Hours Credit ECTS
Engineering Economy IE305 2 0 0 2 5
Pre-requisite Course(s)
Course Language English
Course Type N/A
Course Level Bachelor’s Degree (First Cycle)
Mode of Delivery Face To Face
Learning and Teaching Strategies Lecture, Question and Answer.
Course Coordinator
Course Lecturer(s)
  • Dr. Öğr. Üyesi Cihan Tuğrul ÇİÇEK
Course Assistants
Course Objectives This course aims to introduce the economic dimension of evaluating and selecting alternative investment projects. By the end of the course, the student will be able to investigate engineering economy problems, and formulate and solve such problems using appropriate conceptual and mathematical skills and modeling structures.
Course Learning Outcomes The students who succeeded in this course;
  • Students will be able to identify the principles and methods necessary to evaluate and select engineering alternatives.
  • Students will be able to discuss the concepts of time value of money and interest rates.
  • Students will be able to recognize, formulate, and analyze cash flow models in practical situations.
  • Students will be able to analyze cash flow series using present value, future worth, annual worth, and rate of return methods.
  • Students will be able to develop cash flow series considering the effects of depreciation, taxes and inflation
  • Students will be able to analyze decision problems related to equipment replacement.
  • Students will be able to interpret economy studies and investment decisions in the public sector.
Course Content Economic analysis for engineering and managerial decision-making; cash flows, effect of time and interest rate on money and physical assets; methods of evaluating alternatives: present worth, future worth, annual worth, rate-of-return and benefit/cost ratios; depreciation and taxes; effects of inflation.

Weekly Subjects and Releated Preparation Studies

Week Subjects Preparation
1 Foundations of Engineering Economy [1] pages 1-25
2 How time and interest affect money: single payment formulas [1] pages 27-33
3 How time and interest affect money: single payment formulas (cont) [1] pages 27-33
4 How time and interest affect money: uniform series formulas [1] pages 34-36
5 How time and interest affect money: gradient formulas and shifted cash flows [1] pages 37-57
6 Nominal and effective interest rates [1] page 59-78
7 Present worth analysis [1] page 80-106
8 Annual worth analysis [1] pages 107-123
9 Rate of return analysis [1] pages 124-159
10 Benefit/Cost analysis and public sector projects [1] pages 160-181
11 Effects of inflation [1] pages 237-258
12 Midterm
13 Unit method, cost indexes, cost-capacity equations, factor method, unit cost estimation [1] pages 259-286
14 Depreciation methods [1] pages 287-311
15 After-tax economic analysis [1] pages 312-347
16 Final Examination Period


Course Book 1. Basics of Engineering Economy, Leland Blank, Anthony Tarquin, McGraw-Hill Education
Other Sources 2. Contemporary Engineering Economics, CS Park, 3rd Edition, Addison Wesley, 1997.
3. Engineering Economy, GJ Thuesen & WJ Fabrycky, 9th Edition, Prentice Hall, 2001

Evaluation System

Requirements Number Percentage of Grade
Attendance/Participation - -
Laboratory - -
Application - -
Field Work - -
Special Course Internship - -
Quizzes/Studio Critics - -
Homework Assignments - -
Presentation - -
Project - -
Report - -
Seminar - -
Midterms Exams/Midterms Jury 2 60
Final Exam/Final Jury 1 40
Toplam 3 100
Percentage of Semester Work 60
Percentage of Final Work 40
Total 100

Course Category

Core Courses
Major Area Courses X
Supportive Courses
Media and Managment Skills Courses
Transferable Skill Courses

The Relation Between Course Learning Competencies and Program Qualifications

# Program Qualifications / Competencies Level of Contribution
1 2 3 4 5
1 An ability to apply knowledge of mathematics, science and engineering to Industrial Engineering; an ability to apply theoretical and practical knowledge to model and solve engineering problems.
2 An ability to identify, formulate and solve complex engineering problems; an ability to select and apply proper analysis and modeling methods. X
3 An ability to design a complex system, process, tool or component to meet desired needs within realistic constraints; an ability to apply modern design.
4 An ability to develop, select and put into practice techniques, skills and modern engineering tools necessary for engineering practice; an ability to use information technology effectively.
5 An ability to design, conduct experiments, collect data, analyze and interpret results for the study of complex engineering problems or disciplinary research topics.
6 An ability to work individually, on teams, and/or on multidisciplinary teams.
7 Ability to communicate effectively in Turkish orally and in writing; knowledge of at least one foreign language; effective report writing and understand written reports, preparing design and production reports, making effective presentations, giving and receiving clear and understandable instruction.
8 A recognition of the need for, and an ability to engage in life-long learning; an ability to use information-seeking tools and to follow the improvements in science and technology.
9 An ability to behave according to the ethical principles, an understanding of professional and ethical responsibility. Information on standards used in industrial engineering applications.
10 Knowledge of business applications such as project management, risk management and change management. A recognition of entrepreneurship, innovativeness. Knowledge of sustainable improvement.
11 Information on the effects of industrial engineering practices on health, environment and security in universal and societal dimensions and the information on the problems of the in the field of engineering of the era. Awareness of the legal consequences of engineering solutions.
12 An ability to design, development, implementation and improvement of integrated systems that include human, materials, information, equipment and energy.
13 Knowlede on appropriate analytical, computational and experimental methods to provide system integration.

ECTS/Workload Table

Activities Number Duration (Hours) Total Workload
Course Hours (Including Exam Week: 16 x Total Hours) 16 2 32
Special Course Internship
Field Work
Study Hours Out of Class 16 5 80
Presentation/Seminar Prepration
Homework Assignments
Quizzes/Studio Critics
Prepration of Midterm Exams/Midterm Jury 2 3 6
Prepration of Final Exams/Final Jury 1 7 7
Total Workload 125