Economic Evaluation Techniques

Several different techniques exist for economic appraisal of different materials and alternative corrosion control measures. Among these are the concepts of  

Some of these techniques lack adequate sophistication others are unduly complex and do not lend themselves readily to comprehension and use, especially in calculations. Generally, the applied method should embody accepted economic terminology at the accounting and managerial levels, so that a material/corrosion engineer s judgment can be properly expressed to and understood by project management. 

Therefore, for economic evaluation, reference is made to the NACE Standard Method RP-02-72, Direct Calculation of Economic Appraisal of Corrosion Control Measures, in which the excellent presentation of the subject matter makes it superfluous to enlarge on the factors to be considered in economic evalnation. 

Phosphor bronze (ingot) 3.24 Copper (grade A ingot) 2.12 

Concrete (ready mixed) 0.04 Concrete (ready mixed) 0.01 

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This chapter adds the socio-economic dimension to the medical or technical perspectives of the proceeding contributions of this book. As its health economic terminology and approach might be unfamiliar to some readers, we start with a section on methodology. In particular, we present an overview of the concept of Cost-of-Illness (COI) and of relevant health economic evaluation techniques. In Sect. 2, we present the basic findings of a meta-analysis of the socio-economic costs of HIV/AIDS and of the socio-economic impact of antiviral intervention. The major findings are reflected in Sect. 3. The chapter closes with a speculation on long-term socio-economic costs of antiviral intervention. 

Once values have been assigned for the costs and benefits of each proposed risk-reduction modification, a variety of economic evaluation techniques may be used to choose the most attractive option. These techniques include net present value, discounted cash flow rate of return and cost-benefit ratio analyses. Most companies have a preferred method for evaluating project economics, which can be used with little or no modification. Chapter 8 of... 

A. Maynard, Economic evaluation techniques in healthcare Reinventing the wheel , PharmacoEconomics 11 (1997), 115-118. 

The project cashflow forms the basis of the economic evaluation methods which will be described. From the cashflow a number of economic indicators can be derived and used to judge the attractiveness of the project. Some of the techniques to be introduced allow the economic performance of proposed projects to be tested against investment criteria and also to be compared with alternative investments. 

Economic evaluations of algal production indicate that production costs vary from 0.15 to 4.00/kg of algal product, depending on type of bioreactor, culture technique, and operating conditions (51). For systems with controlled agitation and carbonation, including raceways and tubular reactors, production costs ate estimated to range from 2.00 to 4.00/kg. 

The simplest economic theories assume— somewhat unrealistically—that markets work sufficiendy well to ensure that society s scarce resources are allocated efficiendy. Of course, few markets are as well-behaved as in the elementary textbook, but nevertheless market forces can often be relied upon to allocate goods and services reasonably well between competing demands. If this is the case, then the need for economic evaluation of the costs and outcomes flowing from alternative uses of scarce resources is lessened. Mental health-care services in Britain are purchased and provided within internal markets (quasi-markets) within the state sector (mainly), and these muted market forces have clearly had some influence over allocations. Market forces have a more overt role in countries such as the USA, strongly influencing who obtains what service and at what cost to different parties. However, it is difficult to imagine circumstances in which techniques such as... 

For small projects, and for simple choices between alternative processing schemes and equipment, the decisions can usually be made by comparing the capital and operating costs. More sophisticated evaluation techniques and economic criteria are needed when decisions have to be made between large, complex projects, particularly when the projects differ widely in scope, time scale and type of product. Some of the more commonly used techniques of economic evaluation and the criteria used to judge economic performance are outlined in this section. For a full discussion of the subject one of the many specialist texts that have been published should be consulted Brennan (1998), Chauvel et al. (2003) and Vale-Riestra (1983). The booklet published by the Institution of Chemical Engineers, Allen (1991), is particularly recommended to students. 

There is no one best criterion on which to judge an investment opportunity. A company will develop its own methods of economic evaluation, using the techniques discussed in this section, and will have a target figure of what to expect for the criterion used, based on their experience with previous successful, and unsuccessful, projects. 

The catalytic esterification of ethanol and acetic acid to ethyl acetate and water has been taken as a representative example to emphasize the potential advantages of the application of membrane technology compared with conventional distillation [48], see Fig. 13.6. From the McCabe-Thiele diagram for the separation of ethanol-water mixtures it follows that pervaporation can reach high water selectivities at the azeotropic point in contrast to the distillation process. Considering the economic evaluation of membrane-assisted esterifications compared with the conventional distillation technique, a decrease of 75% in energy input and 50% lower investment and operation costs can be calculated. The characteristics of the membrane and the module design mainly determine the investment costs of membrane processes, whereas the operational costs are influenced by the hfetime of the membranes. 

The economic evaluation is an important and integral part of the overall feasibility study of the project. First, a capital cost estimate is obtained using two estimation techniques. The ratio method and factorial cost estimation techniques are used to determine separate capital cost estimates for the proposed 280 tonne/day plant. Finally an investigation into the expected return on investment from this project is performed. 

In economic evaluations, there is a need to make assumptions about the variables in the analysis. For instance, assumptions that are made commonly include the incidence of adverse effects, the drug s efficacy (in clinical trials) and effectiveness (use in actual practice), and the costs of drugs or other direct medical costs. It is important to keep in mind that assumptions are simply predictions about what a researcher thinks might happen as a result of a program or intervention. To account for the variety of outcomes that may arise in any intervention, researchers should use a technique known as... 

Results obtained using this procedure have shown high correlation with fixed-capital investment estimates that have been obtained with more detailed techniques. Properly used, these factoring methods can yield quick fixed-capital investment requirements with accuracies sufficient for most economic-evaluation purposes. 

Cost minimization can be considered as the simplest approach and provides the least information it is an evaluation of the costs of alternative approaches that produce the same outcome. In the area of diagnostic testing, it is applicable only to the cost of alternative suppliers of the same test, device, or instrument. It is therefore a technique that is limited to the procurement process where the specifications of the service are already established and the outcomes clearly defined. It might be considered as providing the cost per test, an often quoted parameter that is not, however, a true economic evaluation because it does not identify an outcome except the provision of a test result. 

TR Browne. Stable isotope techniques in early drug development an economic evaluation. J Clin Pharmacol 8 213—220, 1998. 

Powell [3] reviewed the basics of various discounted cash flow techniques for project evaluation. Discounting is a method that accounts for the time value of money to provide either for the capital or to convert the cash flows to a common point in time so that they are summed. Ward [4] proposed a new concept known as the net return rate (NRR) that provides a better indication of a project s profitability. Techniques and criteria for economic evaluation of projects are widely available in the literature and texts [5,6,7,8,9,10]. A summary of the conventional decision criteria is given here. 

Fig. 1-1. These methods or tools can be separated into two distinct categories economic and humanistic evaluation techniques. These methods have been used in a variety of fields and are being applied increasingly to health care. ...

Alternative Fractionation and Standardization Techniques - Raw material quality variations with respect to essential oils and other key ingredients require specialized processing schemes to produce extracts of standardized quality. The following are three common fractionation and standardization techniques that are indicative of the process design alternatives currently being used to achieve similar end product results. Economic evaluation of each alternative determines the best process design for a specific application. 

Each method of fractionation requires different operating techniques and different equipment types, sizes and configurations. Two-stage extraction requires longer total extraction cycles, and possibly, parallel separator vessels to collect each fraction Individually, and/or addition of humidification vessels. Multiple stage separation requires additional separator vessels with required heaters and pressure controls. In all three cases, the products can be used as separate fractions, or In various combinations to suit the user needs and marketplace considerations. Choice of fractionation and standardization methods for a commercial-scale SCFCO2 plant Is dependent on results of the economic evaluation of all technically feasible process design alternatives. 

In a comparative study of an integrated hybrid membrane-based system with an earlier locally designed RO unit, such system comprises NF, RO, and membrane distillation (MD) subsystems [79]. The comparison is essentially based on using the NF technique in pretreatment section, while the MD was contributed to concentrate the two brine streams from both NF and RO. Thus, high recovery rate of product water is aimed for. The proposed system was economically evaluated and compared with the RO unit. It was concluded that 76.2% water recovery was possible with a water production cost of 0.92 m . ... 

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