ENgineering Economics Project
ENG 3000, Engineering Economics Term Project (2 0% of the total mark) Prepared by: Nishant Balakrishnan and Farhoud Delijani Due Date: December 2nd , 20 20 , 11 :59 PM Project Description: In the society we live in today, it is often a challenge to get people to do what is right in the lens of sustainability (economic, environmental, or social), and there is no better example compared to the way we approach garbage/waste in our society. As t ime has progressed, as a society we have turned to plastics and other products for a variety of our goods so that they become cheaper to produce, and many people view this as a positive change because these materials have the ability to be recycled. Unfort unately, t he ability to be recycled does not correlate to a requirement to recycle these goods, and often the cost to recycle makes the operation not financially viable. To combat this, many modern recycling operations focus on the economics of recycling a nd accept items that are capable of being easily recycled, an example being the 4R depot in Winnipeg, MB. As part of this course, you will be tasked to explore a similar approach to recycling. Over the rest of the semester you will be tasked with a projec t to pitch a recycling operation that could be viably implemented at a community or city level (such as a station at a 4R depot, neighborhood level or community center collection system ) by implementing the nine steps of decision making . You will be asked to: 1. Provide a brief background on why the economics of recycling is important to consider, underlining the perils of only focusing on the social and environmental pillars of sustainability. 2. Come up with a proposed system to accept, and process a certain t ype of recyclable good. Goods that are accepted : Should have a supply capable of running the operation . Should be recycled, not reused . Re -purposing of goods are acceptable. Must be processed in a local (in the context of the country) facility. Are goods t hat are not received or processed at 4R depot 3. Create 3 viable economic options (to recycle your selected material) that can be analyzed for how your recycling operation would work over a time span of 5 years. 4. Apply principles in the class such as the time value of money, inflation, and other economic analysis tools to refine your options . 5. Use the analysis tools taught in the class to analyze your options and perform a formal analysis. A focus of this project i s to show you that the skills you learn can be translated to real world problems, but require practice to frame real world problems in a solvable manner. The emphasis on the project will be placed on the economic analysis you do, and the skills you apply r ather than the presentation of your work. Constraints and Guidelines: In your analysis, a few key constraints/guidelines should be considered: Unless permission is sought, projects must have a "recycling" component to them and cannot focus on collection and re -use (ex. Collecting used bicycles, fixing them and reselling them is not recycling as much as it is reusing) The cost of capital for all a nalysis should be determined based on ‘municipal rates ’ that are typically used for infrastructure projects. Alternatively, you can determine it based on current market rates and hurdle rate for the investors in this project, but this must be specified cle arly. At the end of the day, you need to find the interest rate you will have to pay on the borrowed money you are going to use to start and run your project/business. Any type of economic analysis can be used, however your mark will be based on using the tools taught in class to approach this problem. A typical consideration of an option will include determining lifespan , NPV, IRR (if applicable), and looking at considerations of risk, sustainability, and other economic aspects . Deliverables: A report wi th UP TO 15 pages including 1 page (title) indicating who is submitting this project, with a title relevant to the topic 1 page for an introduction and summary 1 page for a conclusion/recommendation 1 page for references (needed for all sourced values/info rmation) 1 The remainder of the pages can be used as you see fit to present analysis. All information presented in the body of the report (not the appendix) must be typed (no hand written portions) and should be in a maximum of 12pt font (Times New Roman or equivalent ) For any recycling operation you pick, there IS at least one aspect that you can approach with the economic problem solving approach taught in class. This would mean setting up options, modelling them, analyzing them using various analysis tool s, and making a decision from an economic perspective, it's expected that somewhere in the report you'll have this Marking Guidelines: The report will be marked as follows (total of 100 marks) : 15% of your grade will come from technical communication / proper English and proper referencing . Your report must be written in full sentences, with correct spelling and grammar as would be expected of a student admitted to university (at a bare minimum) . 5% of your grade will come from your determining of your ‘cost of capital ’ for your project . 10% of your grade will come from defining your problem and constraining it to a form that you apply a reasonable economic analysis to . 50% of your grade will come purely from the quality of your analysis. Your analysis sh ould be clear, and show all assumptions and factor in risk wherever possible. If you're uncertain about numbers, a researched reference is a good start. Note that this means that if you're evaluating an NPV there should be a clear indication of how you did it (not just writing that everything was computed from an excel spreadsheet). Spreadsheets for NPV analysis can be included in an appendix to your report . 10% of your grade will come from drawing a reasonable economic conclusion, considering bot h what the economic analysis tells you and what other aspects of the problem tell you. 10 % of your grade is an overall mark looking at how well you tied the analysis together to present your work (flow of your report). This assignment is expected to be done either individually or in a pair, and a declaration should be made at the time of submitted your assignment (include it as an extra page) to indicate how the marks should be distributed. If you feel that in your pair you both did an EQUAL portion of the work (ie . both had some hand in every portion of the report) then equal marks will be given. If not, please indicate clearly. Any examples of plagiarism of academic dishonesty in the submission of this report will be handled under the guidelines provided in the course outline (not a good idea). 1 Note that there is no mark associated with this. If your references are reasonable and in at least some standard format they will be accepted, but if they are not you will lose marks on the "overall" portion of your report. Marking Rubric: Excellent Good Satisfactory Needs work Technical Communication 15 13 9 5 /15 Initial Feedback Excellent writing skills, you've tied in your sections well in a fluid manner, reads like a good engineering report. Good writing, some minor issues that impede the flow of the writing and understanding, but overall good. Acceptable writing, could use wor k to develop writing/tech comm skills to ensure that the work you've done is adequately represented. Writing skills need work Cost of Capital 5 4 3 0 /5 Initial Feedback Well researched, well done! Good work done on the cost of capital, you might want to refine this a bit more for it to be considered excellent! Some work done in researching cost of capital, but needs work.Had you considered researching what is used in practice. No reference provided for cost of capital, little to no work done into researching it. Problem Definition 10 8 6 0 /10 Initial Feedback Problem is excellently defined and well framed as a practical problem. Problem is well defined, and has made some practical considerations as well. Problem definition needs work, has structural issues that affect the rest of the analysis. Missing component or very poorly done. Economic Conclusion 10 8 6 0 /10 Initial Feedback Conclusion is excellent and exceeds expectations! Conclusion is good, analysis is also good, very good work overall! Conclusion needs some work and has weak support that is not accounted for. Conclusion needs work and does not accurately reflect the conclusion expected of the analysis. Overall Report Presentation 10 8 6 0 /10 Initial Feedback Excellent report, looks like what a proper engineering report should be flows nicely. Good report, some minor issues but nothing to detract from the overall presentation. Some work could be done on tying elements of the report together.
Some issues in integration that detract from the overall report. Needs work to be considered an engineering report.
Overall report integration is lacking. Economic Analysis Excellent Good Satisfactory Needs work Score Cost Analysis 10 points 8 points 7 points 0 points / 10 Analysis Quality 40 points 35 points 28 points 10 points / 40 Overall Score Excellent Very Good Satisfactory Developing Needs work 90 or more 80 or more 70 or more 60 or more 0 or more
