49003 Economic Evaluation
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Subject handbook information prior to 2024 is available in the Archives.
Credit points: 6 cp
Subject level:
Postgraduate
Result type: Grade and marksThere are course requisites for this subject. See access conditions.
Description
Economic evaluation of investment options is an integral part of the professional role of an engineer–manager. This subject aims to develop students’ knowledge of macroeconomics and microeconomics that underpin frameworks and methods for evaluating investment options from a broader economic perspective. Students also develop the ability to apply economic reasoning to evaluate investment options and make recommendations. Students are not expected to have any prior knowledge of economics.
Subject learning objectives (SLOs)
Upon successful completion of this subject students should be able to:
| 1. | Demonstrate the relevance of economics to their profession. (B.1) |
|---|---|
| 2. | Apply macroeconomic and microeconomic principles and reasoning to make informed decisions for an engineering project. (D.1) |
| 3. | Evaluate viability of investment in projects, from financial, economic, social and environmental perspectives. (B.1) |
| 4. | Identify and incorporate “values” of multiple stakeholders when evaluating engineering projects. (B.1) |
| 5. | Communicate the outcome of their complex technical analyses in a succinct form for a non-technical audience. (E.1) |
Course intended learning outcomes (CILOs)
This subject also contributes specifically to the development of the following Course Intended Learning Outcomes (CILOs):
- Socially Responsible: FEIT graduates identify, engage, and influence stakeholders, and apply expert judgment establishing and managing constraints, conflicts and uncertainties within a hazards and risk framework to define system requirements and interactivity. (B.1)
- Technically Proficient: FEIT graduates apply theoretical, conceptual, software and physical tools and advanced discipline knowledge to research, evaluate and predict future performance of systems characterised by complexity. (D.1)
- Collaborative and Communicative: FEIT graduates work as an effective member or leader of diverse teams, communicating effectively and operating autonomously within cross-disciplinary and cross-cultural contexts in the workplace. (E.1)
Contribution to the development of graduate attributes
Engineers Australia Stage 1 Competencies
Students enrolled in the Master of Professional Engineering should note that this subject contributes to the development of the following Engineers Australia Stage 1 competencies:
- 1.5. Knowledge of engineering design practice and contextual factors impacting the engineering discipline.
- 2.4. Application of systematic approaches to the conduct and management of engineering projects.
- 3.2. Effective oral and written communication in professional and lay domains.
Teaching and learning strategies
Lectures
A 1.5-hour weekly session will begin with a formal lecture. The purpose is to develop students' understanding of concepts and methods. Lecture notes and pre-recorded videos for each week will be made available on Canvas. Students are expected to download the notes, watch the videos, engage with new content and use it in the lectures. The lecture will explain each topic based on the Canvas materials and encourage students to clarify their interpretations through verbal interaction and feedback. During each lecture, the lecturer will have further discussions on the topic for each week, which require students' engagement.
Tutorials
Every lecture session will follow with a tutorial where a set of questions will be provided for students to apply their understanding of concepts and methods for problem-solving.
Tutorials are designed to engage students in learning activities, encourage them to collaborate with other students, learn from each other's ideas through group discussion and peer review, and provide additional feedback on teaching materials that inform the assessment tasks. Tutorial classes will involve a range of planned activities, such as testing students' understanding using
problem-solving and group activities and discussions. Students are required to learn concepts covered in each week's lecture topic before each tutorial.
Weekly tutorial questions (case study and discussion questions) and instructions for each class will be available on Canvas to enable students to engage with the content, draft their answers, and then actively and collaboratively complete the questions in the tutorials. Students will form collaborative groups to discuss their solutions with their peers, complete problem-solving activities, analyse case studies and answer discussion questions in teams.
Project
An authentic group project is designed for students to identify a project that is significant to their community/society, and to work with their peers to apply concepts and methods for evaluating the project in specific contexts, to analyse trade-offs when making decisions about the project, and to develop constructive critique on the concepts and methods applied for evaluating projects.
Online quizzes
Quizzes are designed to provide a continuous assessment of students’ knowledge and their understanding of subject content
Content (topics)
Introduction to 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 task 1: Project Evaluation
| Intent: | To apply an understanding of economic concepts to evaluate an engineering project. Students will also develop their abilities to present complex technical analyses in a succinct form for a non-technical audience. |
|---|---|
| Objective(s): | This assessment task addresses the following subject learning objectives (SLOs): 1, 4 and 5 This assessment task contributes to the development of the following Course Intended Learning Outcomes (CILOs): B.1 and E.1 |
| Type: | Report |
| Groupwork: | Group, group and individually assessed |
| Weight: | 60% |
| Length: | Following are the length of each deliverable
|
Assessment task 2: Online Quizzes
| Intent: | To demonstrate knowledge and understanding of subject content. |
|---|---|
| Objective(s): | This assessment task addresses the following subject learning objectives (SLOs): 1, 2, 3 and 4 This assessment task contributes to the development of the following Course Intended Learning Outcomes (CILOs): B.1 and D.1 |
| Type: | Quiz/test |
| Groupwork: | Individual |
| Weight: | 40% |
Minimum requirements
In order to pass the subject, a student must achieve an overall mark of 50% or more.
Required texts
- Boardman, AE., Greenberg, DH., Vining, AR., & Weimer, DL. (2018). Cost-Benefit Analysis: Concepts and Practice. Cambridge University Press.
- Mankiw, NG. (2021). Principles of Economics. MA Cengage.
- Park, CS. (2020). Fundamentals of Engineering Economics. Pearson.
- NSW Government. (2023, February). NSW Government Guide to Cost-Benefit Analysis. https://www.treasury.nsw.gov.au/sites/default/files/2023-04/tpg23-08_nsw-government-guide-to-cost-benefit-analysis_202304.pdf
Recommended texts
ALTERNATIVE TEXTS
- Baumol, WJ and Blinder, AS (2019) Economics: Principles and Policy, Cengage Learning, USA.
- Gans, J, King, S and Mankiw, G (2018), Principles of Microeconomics, Cengage Learning, Albany, Victoria.
- Hubbard, G., Garnett, A., Lewis, P. and O'Brien, A. (2018), Macroeconomics, Pearson, Melbourne, Victoria.
- Stiglitz, JE, Walsh, CE, Gow, J, Guest, R, Tani, M (2016) Principles of Economics, John Wiley & Sons, Milton, Qld.
- Park, C. (2016) Contemporary Engineering Economics, Pearson, Boston.
- Sullivan, WG, Wicks, EM and Koelling, CP, 2018, Engineering Economy, Pearson.
RECOMMENDED ADDITIONAL READINGS
- Chang, H-J. (2014) Economics: The User's Guide, Penguin Press.
- Dasgupta, P. (2021), The Economics of Biodiversity: The Dasgupta Review, London: HM Treasury. [https://www.gov.uk/government/publications/final-report-the-economics-of-biodiversity-the-dasgupta-review]
- Quiggin, J. (2019) Economics in Two Lessons: Why Markets Work So Well, and Why They Can Fail So Badly, Princeton University Press.
- Stilwell, F. (2012) Political Economy: The Contest of Economic Ideas, Oxford University Press.