Engineering economics operating expense estimation

Engineering economics is the critical criterion to consider early in design, process improvement, and troublshooting. In this section, we review the role of economics in financial reporting through the balance sheet and the income statement, options for measuring financial attractiveness, operating expense estimation, and capital cost estimation. 

The generalized economic analysis expression in Eq. (11.1) is particularly adapted to corrosion engineering problems. Given the numerous uncertainties associated with most corrosion problems this equation can provide fairly good estimates of prevention and control alternatives. This equation takes into account the influence of taxes, straight-line depreciation, operating expenses, and salvage value in the calculation of present worth and annual cost [11]. 

---