1. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-1 Premixed-Concrete Plant Project continued on next slide

2. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-1 (continued) Premixed-Concrete Plant Project

3. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-2 Channel Enlargement for Flash Flood Control continued on next slide

4. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-2 (continued) Channel Enlargement for Flash Flood Control

5. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-3 Investing in Circuit Protection to Reduce Probability of Failure continued on next slide

6. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-3 (continued) Investing in Circuit Protection to Reduce Probability of Failure

7. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-4 Project Life as a Random Variable continued on next slide

8. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-4 (continued) Project Life as a Random Variable continued on next slide

9. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-4 (continued) Project Life as a Random Variable continued on next slide

10. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-4 (continued) Project Life as a Random Variable

11. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-5 Project Analysis Using a Probability Tree continued on next slide

12. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-5 (continued) Project Analysis Using a Probability Tree continued on next slide

13. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-5 (continued) Project Analysis Using a Probability Tree

14. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-6 Annual Net Cash Flow as a Continuous Random Variable continued on next slide

15. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-6 (continued) Annual Net Cash Flow as a Continuous Random Variable

16. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-7 Probability of an Unfavorable Project Outcome

17. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-8 Linear Combination of Independent Random Variables continued on next slide

18. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-8 (continued) Linear Combination of Independent Random Variables continued on next slide

19. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-8 (continued) Linear Combination of Independent Random Variables

20. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-9 Project Analysis Using Monte Carlo Simulation continued on next slide

21. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-9 (continued) Project Analysis Using Monte Carlo Simulation

22. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-10 Probabilistic Decision Tree Analysis continued on next slide

23. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-10 (continued) Probabilistic Decision Tree Analysis

24. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-11 Hytech Industries continued on next slide

25. Engineering Economy, Sixteenth Edition Sullivan | Wicks | Koelling Copyright ©2015, 2012, 2009 by Pearson Education, Inc. All rights reserved. EXAMPLE 12-11 (continued) Hytech Industries