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Engg Economics

Engineering economics involves producing goods and services within cost limitations by applying engineering knowledge and technology. It aims to maximize utility and welfare for humans with limited resources. Engineering economics studies production at both the micro level of individual firms and the macro level of the national economy. Key concepts include goods, commodities, utility, and how utility can take different forms depending on transformations to goods over time, place, and form.

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Pradnya Surwade
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188 views10 pages

Engg Economics

Engineering economics involves producing goods and services within cost limitations by applying engineering knowledge and technology. It aims to maximize utility and welfare for humans with limited resources. Engineering economics studies production at both the micro level of individual firms and the macro level of the national economy. Key concepts include goods, commodities, utility, and how utility can take different forms depending on transformations to goods over time, place, and form.

Uploaded by

Pradnya Surwade
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Engineering Economics

What is economics:

It is the science which studies human behavior as relationship between ends & resources & aims at meeting maximum objectives with the help of limited resources.

Economic cycle:
Efforts

wants

Alternatives

New wants

satisfaction

Aims & utility of economics:


To increase the wealth & provide more comfort to human. Regulate economic activities of human being with view to maximize the welfare of human. Use of household & business management Use to society, labor welfare & social security Economics will examine the causes of equitable distribution of wealth. It will explains maldistribution of wealth & offers practical guidance

Nature of economics:
Micro economics: study of firm or individual ex.. Price theory ,wage theory

Macro economics: Study of economy of nation, international economy Ex..GNP, total income , total output

Engineering Economics:
It means producing goods and services within the cost limitation i.e. producing quality good & services in quantity with least possible cost. By applying engineering knowledge and utilizing technology to create structures , machines & combine materials & human efforts to produce the goods and services to satisfy the

FUNDAMENTAL ECONOMIC CONCEPTS


Goods: anything which carries the quality of usefulness. Types: Free goods: these are free in nature & can be used without payment. Eg air,sun Economic goods: which carries price & market in exchange of other goods or money. Commodity: anything the satisfies human wants & has value in exchange.

Types of commodity:

1) Necessities: Essential goods satisfying basic wants eg. Food ,cloth etc.

2) comforts: make life easy & comfortable eg. Chairs ,shoes etc.
3) Luxuries: superficies goods Eg. Jewelry ,AC car

What is Utility?

The goods satisfy human wants. This want satisfying quality in a good is called Utility

Types of Utility:
Form Utility: Due to change in form there is change in utility, e.g. Wood when transformed into furniture, utility will increase. Place utility: When goods transported from one place to another place utility can increase. For example apple will fetch more prices in other part of country than in Kashmir and Himachal Pradesh. Time utility: By storing a commodity and selling it at a time of scarcity, utility can be realized more.

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