Decision Making in Engineering Design
17 A Designer's View to Economics and Finance
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In recent years, the engineering design community has expanded its quest to address analytically design intent, particularly as it is manifested within a producing enterprise; see, for example, , , , , , , , , , , , , [1, 2], , , [28, 29], [31, 32], , [51, 52], , , , , . These investigators, while following different approaches, have shown that designers can and should not only balance technical trade-offs but also account more directly for the needs of users and producers, positioning engineering trade-offs in a societal context. In such a view, technical objectives not only compete amongst each other, but generate a long chain of effects that influence purchasing behavior, firm growth, regional economics and environmental policies.
In this article we review some basic concepts that are the building blocks for modeling economic and finance considerations in the context of product development. Along the way we will use case studies to demonstrate how to incorporate these concepts in design decision-making. We conclude with proposing a simple synthesis of engineering design, economics and finance in a single design optimization model.