Another aspect of engineering economy is cash flow diagrams. They are of a visual representation of casual costs and benefits over the study period. They give the quantity, direction and timing of the cash flow. They are used for each and every study because the relationship between capital revenues and expenses is available at a glance and they facilitate both the entries of data into the ESS-PC and subsequent intuitive comparisons between alternates. Another concept that engineering Economy is time Value of Money.
Money earns interest, which can be re-invested to earn more interest.
The ability of money to earn money that then can be re-invested to earn more money is called interest. So in conclusion, money is the root of all projects. Economic principles are very important, to be a successful engineer one must have knowledge of all possibilities to the outcome for that particular situation. If an engineer wasn t looking at different possibilities then another engineer, who knows about economics, could come along and steal the job from you because he came up with a more economical way to produce the same job.