EGR3101: Engineer in Society II

w 11

Engr. ABBA IBRAHIM MN IAE

trnent of A ri'.:L t1 ·-IE· ir- _

B-3\'• r, IJnivers;l,', f{·jno.
[email protected]
 • Course description
• Learning outcomes
• Topics
• Assessment
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1. Basic Econo mics-B usines s organization, industrial
combi nation s; public utilities and finance, industrial
conce ntratio n and Gover nment control.
2. The locatio n of West African indust ry and trade.
3. The background of the West African economy, planning
of develo pment , financing of develo pment .
4. The banking system, Money and Capital markets,
inflatio.n, cost benefi t analysis.
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 COURSE CONTENT

Module 1.
.. . Meaning and · Basic Concept of Economics: Meaning of
Economics, Nature and Scope of Economics. Concept of
Scarcity. Concept of Choice.. Opportunity Cost. Scale of
Preference. Why we study Economics.
• Basic Economics Problems and Goals of Society; Basic
economic problems of society. What to produce, ho,v to
produce, for whom to produce, efficiency of resource use,
instability and unemployment. Economic Goals of society.
Module 2.
Supply.
• Demand, Supply and Price Determination; Demand.
Price determination under supply and demand conditions.
tal Cost.
• The Theory of Costs; Fixed Cost, Variable Cost and To
Cost.
Average Cost, Average Fixed Cost and Average Variable
Marginal Cost.
 Modul e 3.
·· • Busine ss Organi zations ; Meanin g of business organization.
• Types of busine ss organization. Sources of finance available
to busine ss organiz ation. Problems of business enterprises.
Module 4.
• Money and Inflatio n.
• Financial institut ions; Money and Capital rllarkets

Module 5.
• Meanin g and Types of Industries
• Location and Localization of Industries.
• Role of Industrialization in Economic Development.
• Industrialization in West Africa
• Nigeria's case study and ways forward
 Reading Materials for further Studies
Principles of
I. Gran t, E. L. , Ireson, W. G., and Leavenworth, R. S.
Eng inee ring Economy, 8th Edition, Wiley, New York, 1990
2. DeG arm o, E. B. and Sullivan, W. G., Engineering
Economics,
Mac mill an Publishing Company, New York, 1979
U. S. A.
3. Riggs, J. L. Engineering Economics, McG raw- Hill s Inc.
1977
4. Any Goo d Econ omic s Textbook (For the basics)
• J 5. Onli ne relevant materials
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Course work 30%

Assignments & Attendance 20%

General Test 10%

Final Exam 70%

Total 100%
 Introduction: Engineering & Economics
the knowledge of
• En gin eer ing : a profession in which
uired by study,
ma the ma tics and natural science acq
exp eri en ce and practice is applied/use to
develop goods and
nomical way(s).
services for the be ne fit of mankind in an eco
s human behaviours
• Economics: a social science which studie
ans, which have
in rel atio nsh ip bet we en ends and scarce me
ns
alte rna tiv~ uses (choices). - Prof. Lord Robbi
ividual, private
Economics consists of any attempt by an ind
n from limited
or public agencies, etc to maximize satisfactio
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 • WHY DO WE ST UD Y ENGINEERING'! '!'!'!

• WH Y DO WE ST UD Y ECONOMICS ?
•!• It enables us to think while spending to avoid un nccc sSJl} ~r'-·nJin ~.
•!• To understand the decision process behind allocJting tht: rcl•:-, l.·urr~:ntl:
ur'"'·
available resources, the needs are always unlim ited hut rl'~ou
bein g limited. ·
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•!• It enables the individual to make right decis ions on the spcnJin_:! uf hi~
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money.
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Basfo concept of Economics

1. Want/Need - desire or wish to own goods and services (basic need of a human are food.
shelter and cloth).

2 • Scarcity - means limitedness of existing available resources used to satisfy needs.

3. Scale of Preference - means arrangement/list of wants/needs in order of their importance
or priority.
4. Choice - means selection from a group of alternatives or the distributi on of
resources. Due to scarcity, choices must be made. Every choice h::is a cost (a
trade-oft).
5. Opportunity Cost - means the value of the best alternative forgone/rejected in in making
any choice.
6. Money Illusion/Purchasing Power \
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 Questions : Idenff
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th e follow1ng: Y e e ements of scarcity, choice, and opportunit y co,t in each of

l. The Environmental Protection Agency is considering an order that a 500-acre area

on the outskirts of a large city be preserved in its natural state, because the area is
home to a rodent that is considered an endangered species. Developers had planned
to build a housing development on the land.
2. The manager of an automobile assembly plant is considering whether to produce
cars or sport utility vehicles (SUVs) next month. Assume that the quantities of labor
and other materials required would be the same for either type of production.
3. A young man who went to work as a nurses' aide after graduating from high school
leaves his job to go to college, where he will obtain training as a registered nurse.

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Discussions
1~~ SOO-acre area is site
ion in
l. ~carce because it has alternative uses: preservat
en these
atu ral sta te or a for homes. A choice must be made betwe
g the land in its natu ra l state is the
use s. Th e opp ort uni ty cos t of preservin
forgo~e value of the land as a housing devpm elopment. The opportunity cost
ent is the forgone value of
of . us1n~ the lan d as a housing develo
pre ser vin g the land.
Th e sca rce res our ces are the pla nt and the labour at the plant. The
2. cars and producing SUV s. The
ma nag er mu st cho ose bet we en producing
profit that could be earn ed from
opp ort uni ty cos t of pro duc ing cars is the
of producing SUVs is the profit
pro duc ing SU Vs ; the opportunity cost
s.
tha t cou ld be ear ned from producing car
current career or to an education ; his
3. Th e ma n can dev ote his time to his between these alternatives. Th e
tim e is a sca rce resource. He must choose
ses' aide is the forgone benefit . he
opp ort uni ty cos t of continuin~ as a nur
se; the opportunity ~ost of go_1ng
exp ect s fro m trai nin g as a registered nur
ld have earned workmg full-time
to col leg e is the forgone income he cou
as a nur ses ' aide.
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Basic Economic Problems

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Ec on om ic Problem s · b
se ecause of the scarcity of resources to satisfy human "an ts
go od s and services. an
iety
that he feels necessary for the soc
s to develop all
The En gin ee r may lack the resource ces to produ ce
1. Wh~t gSh ould be Produce? - Using the economy's scarce resour
requires giving up another.
one thm
be prod emplo)
uced? -Should a firmrec~
ld G oo ds an d Se rv ices
2. H ow Shou a lot of unskilled workers?, Should ni~mufacturing firms use new or cled
a few skilled or ts? etc
raw materials to make their produc
G oo ds an d Serv ices be Prod uc ed? Ifa good or
3. For whom Shoualddecision must be made about who wilJ get/use it.
service is produced, rces (land ,
rc e Use Efficienc y - Efficient use of available resou
4. Resou ize output of goods and servic
es
ca pit al, Jabour) to maxim

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