Economic Evaluation & Investment Decision Methods (17th Edition)

Economic Evaluation & Investment Decision Methods (17th Edition)

Economic Evaluation and Investment Decision Methods is written for individuals with both technical and non-technical backgrounds, regardless of prior experience in economic evaluation. This book introduces the fundamental concepts of the time value of money and the decision criteria used to evaluate investments, with a strong emphasis on the correct application of those criteria in both before-tax and after-tax contexts. The first six chapters focus on before-tax analysis, exploring how to apply economic evaluation techniques across a range of investment scenarios while accounting for the effects of inflation, risk, and uncertainty. Subsequent chapters transition into after-tax considerations, providing detailed guidance on understanding and calculating after-tax cash flows. These chapters reflect current tax law, including the Tax Cuts and Jobs Act of 2017, and examine the terminology and methodology involved in determining federal and state income tax liabilities in the United States. Chapter 11 explains the treatment of borrowed funds and emphasizes why they are considered in secondary analysis rather than as a primary driver in economic evaluations. Although the text includes examples from the oil and gas and mining industries, it is intentionally designed with a wide range of generic examples, making it relevant and accessible to students across all engineering disciplines. It is equally valuable to those working in geology, geophysics, business, accounting, finance, management, and operations research—or anyone with an interest in economic decision-making. Problems at the end of each chapter help reinforce concepts and guide readers in developing a comprehensive and practical approach to evaluating economic alternatives. John Stermole is currently President of Investment Evaluations and has served as Director since 1984. He received his M.S. in Mineral Economics from the Colorado School of Mines and his B.S.B.A. in Finance from the University of Denver. In addition to co-authoring the textbook, “Economic Evaluation and Investment Decision Methods,” now in the 16th Edition, 2019, other publications include (1) “Mining Royalties, A Global Study of Their Impact on Investors, Government, and Civil Society, 2006, by The International Bank for Reconstruction and Development, The World Bank (2) The Global Mining Taxation Comparative Study, 1997, published by the “Institute for Global Resources Policy & Management, Colorado School of Mines” (3) “Northwest Mining Association” (4) “Heavy and Highway Construction” (5) “The Business of Petroleum Exploration,” published by the American Association of Petroleum Geologists (AAPG),” 1992, re-printed in 1993. In 1987, John Stermole began his teaching career as an Adjunct and then Associate Teaching Professor at Colorado School of Mines, where he taught this subject matter for the Division of Economics and Business (Mineral Economics) and the Division of Chemical and Biological Engineering. The courses “Engineering Economics,”and “Economic Evaluation and Investment Decision Methods” were presented to Junior, Senior, and graduate level students. From 1996 through 2010, 2012, 2015 and again in 2016, CSM’s graduating Seniors recognized Mr. Stermole as one of the “Outstanding Faculty Members” at Colorado School of Mines. Read less In 1997, he was appointed as a Fellow to the Institute for Global Resources Policy and Management at the Colorado School of Mines where his work focused on modeling mining taxation issues for over 20 different countries. John officially retired from teaching at Colorado School of Mines in 2017. From 1998 through 2005, John also taught this subject matter as an Adjunct Professor at the University of Denver, Sturm College of Law, in their Natural Resource and Environmental Law Graduate Program. John Stermole gained nearly four years of industry experience at Lowdermilk Construction Co. (also Tectonic Construction), applying the concepts of engineering economics to heavy construction projects including state and interstate highway projects, oil shale mine site development and equipment repair and replacement analyses.