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[CE 22] Eng'g Econ > LE 2 Concepts > Flashcards

LE 2 Concepts Flashcards

1
Q

Four Elements of MCDA

A
  • Decision makers
  • Objective/Goals
  • Criteria
  • Alternatives
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2
Q

Each attribute distinguishes at least two alternatives

A

Operationality

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3
Q

Each attribute captures a unique dimension or facet of the decision problem

A

Redundancy

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4
Q

Attributes, in a collective sense, are assumed to be sufficient for the purpose of selecting the best alternative

A

Completeness

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5
Q

collapses all information into a single dimension

A

Compensatory models

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6
Q

retain the individuality of the attributes as the best alternative is being determined, full dimensional analysis

A

Non-compensatory models

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7
Q

screening method for eliminating inferior alternatives

A

Dominance

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8
Q

method of feasible ranges –establishes minimum or maximum acceptable values (the standard) for each attribute

A

Satisficing

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9
Q

similar to satisficing, except this method evaluates each alternative on the “best” value achieved for any attribute

A

Disjunctive Resolution

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10
Q

especially suitable for decisions in which a single attribute is judged more important than all other attributes

A

Lexicography

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11
Q

SMART

A

Simple Multi-attribute Rating Technique

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12
Q

ranking attributes in order of decreasing importance

A

Ordinal Scaling

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13
Q

quantifying relative importance of attributes on a dimensionless scale from, say, 0 to 1, 0 to 10 or 0 to 100

A

Weighting attributes

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14
Q

quantifying how well each alternative (or investment opportunity) meets each attribute on a dimensionless scale and then summing the product of the “evaluations” and their respective “weightings” (from method 2) for each alternative

A

Weighted evaluation of alternatives

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15
Q

Formula of Weighted Evaluation

A

normalized attribute weight x Evaluation Rating/10

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16
Q

displaying a matrix of alternatives vs. objectives (attributes) together with numbers and/or other symbols to represent how well each alternative meets each objective

A

Alternatives-objectives score card

17
Q

includes many of the recurring annual expense items associated with the operation phase of the life cycle

A

Operation and Maintenance Cost (O&M)

18
Q

includes non-recurring costs of shutting down the operation and the retirement and disposal of assets at the end of the life-cycle

A

Disposal Cost

19
Q

usually a policy issue resolved by the top management of an organization, minimum return that a company will accept on the money it invests

A

Minimum Attractive Rate of Return (MARR)

20
Q

The additional risk associated with the project if you are dealing with a project with higher risk than normal project

A

Risk premium

20
Q

The required return necessary to make an investment project worthwhile.

A

Cost of capital

21
Q

The time it takes to recover the investment without considering the time value of money. (i= 0%)

A

Simple Payback Period

22
Q

The time it takes to recover the initial investment considering the time value of money. (i> 0%)

A

Discounted Payback Period

23
Q

commonly used to evaluate public projects

A

Benefit-Cost(B/C) Ratio Method

24
Q

The interest rate for the public sector

A

discount rate (MARR)

25
Q

For the Philippines, NEDA has a prescribed discount rate for public projects

A

10%

26
Q

An investment in which a firm never borrows money from the project.

A

Pure Investment

27
Q

An investment in which a firm borrows money from the project during the investment period

A

Mixed Investment

28
Q

Several projects proposed to address the same need, Only one of the viable projects can be selected

A

Mutually Exclusive

29
Q

Projects do not compete against each other, None, one or more than one viable projects maybe selected

A

Independent

30
Q

Projects whose revenues depend on the choice of alternatives

A

Revenue (Investment) Projects

31
Q

Projects whose revenues do not depend on the choice of
alternatives

A

Service (Cost) Projects

32
Q

The time span over which the
service of an equipment (or project) will be needed.

A

Required Service Period (Useful Life)

33
Q

The time span over which the
economic effects of an
investment will be evaluated

A

Analysis Period

34
Q

a comparative decision-making process analyzing the difference in revenues or costs between two alternatives

A

Incremental Analysis

[CE 22] Eng'g Econ (1 decks)

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