WMGT 101 CE Exam #2 (Engineering
Economics)
SOB: Know the difference between nominal and effective interest.
Explain nominal interest. - correct answer ✔The annual interest without
considering the effect of any compounding.
SOB: Know the difference between nominal and effective interest.
Explain effective interest. - correct answer ✔The annual interest rate taking
into account the effect of any compounding during the year.
SOB: Describe the purpose and use of the Economic Analysis Process.
Purpose: - correct answer ✔A systematic approach to analyzing cost,
benefits, and risks of various alternatives.
SOB: Describe the purpose and use of the Economic Analysis Process.
Use: - correct answer ✔Aid in the selection of the best alternative.
SOB: Determine situations when an Economic Analysis is required.
Five (5) categories. - correct answer ✔1. Construction projects > $2 million.
Economics)
SOB: Know the difference between nominal and effective interest.
Explain nominal interest. - correct answer ✔The annual interest without
considering the effect of any compounding.
SOB: Know the difference between nominal and effective interest.
Explain effective interest. - correct answer ✔The annual interest rate taking
into account the effect of any compounding during the year.
SOB: Describe the purpose and use of the Economic Analysis Process.
Purpose: - correct answer ✔A systematic approach to analyzing cost,
benefits, and risks of various alternatives.
SOB: Describe the purpose and use of the Economic Analysis Process.
Use: - correct answer ✔Aid in the selection of the best alternative.
SOB: Determine situations when an Economic Analysis is required.
Five (5) categories. - correct answer ✔1. Construction projects > $2 million.
