For example, evaluating a $50,000 machine with annual savings of $12,000 over 8 years and a 10% MARR (Minimum Acceptable Rate of Return) becomes a one-formula task: =NPV(10%, B2:B9) - B1 , where B1 holds the initial cost. This replaces an entire page of manual present worth factor calculations.
While deterministic analysis is common, applied engineering economics increasingly requires risk assessment. Excel, combined with its and random number functions ( RAND() , NORM.INV ), can perform Monte Carlo simulations. For example: applied engineering economics using excel pdf