Discussion 2: Project Management Processes Chapter 3 Enginee

Discussion 2 Project Management Processeschapter 3 Engineering Econ

Reflect on the assigned readings for the week. Identify what you thought was the most important concept(s), method(s), term(s), and/or any other thing that you felt was worthy of your understanding. Also, provide a graduate-level response to each of the following questions: · American businesses have often been criticized for short-term thinking that places too much emphasis on payback period and ROR. When Honda started making cars in the early 1970s, for example, the chief executive officer stated that the firm would be “willing to accept an ROR no greater than 2% or 3% for as long as it took to be recognized as the best car maker in the world.” In light of the success of many Japanese firms, is the criticism of American business justified? · Most countries have a progressive income tax system whereby each dollar earned in incrementally higher tax brackets is taxed at an increasingly higher rate. Do you think that a flat tax system would be more fair? How about a proportional tax system? Explain your answer. · Discuss the effect of taxes on the life-cycle costing (LCC) of passenger cars. Compare domestic and imported cars. [Your initial post should be based upon the assigned reading for the week, so the textbook should be a source listed in your reference section and cited within the body of the text.

Paper For Above instruction

The assigned readings for this week primarily focused on critical aspects of project management processes, engineering economics, and life-cycle costing, which together provide a comprehensive understanding of how organizations plan, evaluate, and manage investments over time. Among the pivotal concepts, the emphasis on economic analysis tools—such as payback periods, rate of return (ROR), and life-cycle costing—stood out as essential for informed decision-making in engineering and business contexts. These tools enable organizations to assess the financial viability of projects, accounting for initial costs, operational expenses, maintenance, and end-of-life costs, providing a holistic view of project sustainability and profitability (Kerzner, 2017). Understanding these concepts is vital, as they influence strategic decisions and resource allocations across industries.

One of the most important concepts highlighted was the significance of the rate of return in investment decisions. Honda’s strategy in the 1970s exemplifies a long-term investment perspective, where accepting a low ROR—between 2% and 3%—was justified by the broader goal of establishing brand reputation and market dominance. This approach contrasts sharply with the short-term focus typical of many American businesses that prioritize rapid payback periods and high RORs. The success of Japanese firms like Honda, Toyota, and Sony demonstrates that a long-term perspective can be more advantageous, especially in industries requiring substantial technological innovation and brand development (Liker & Meier, 2006). Therefore, the criticism of American business for short-term thinking is partly justified; however, it also depends on industry context and strategic goals. Short-term focus may be detrimental if it impairs long-term growth, but in certain markets, rapid returns are necessary for survival.

The discussion of tax systems—progressive, flat, and proportional—originates from the need to understand how taxation influences economic efficiency and fairness. A progressive tax system, where higher income brackets are taxed at higher rates, is designed to promote equity but can sometimes incentivize tax avoidance and discourage high earners from productive activities (Piketty & Saez, 2014). Conversely, a flat tax system, which applies the same rate across all income levels, simplifies tax administration and arguably offers fairness by treating all taxpayers equally in proportion to their income. Nonetheless, critics argue that flat taxes may be less equitable, as they impose a relatively higher burden on low-income individuals (Mertens & Ravn, 2014). A proportional tax system, which taxates at a constant percentage, shares similarities with flat taxes but is often discussed when referring to specific tax bases. Whether such systems are fair depends largely on societal perceptions of fairness and income redistribution goals.

Taxes profoundly influence the life-cycle costing (LCC) of passenger cars, affecting both domestic and imported vehicles. Taxes such as sales tax, value-added tax, excise tax, and annual registration fees impact the total ownership cost, which is a critical consideration for consumers assessing long-term affordability. Domestic cars often benefit from lower import tariffs and related taxes, possibly making them more attractive economically (Katz & Shapiro, 2008). Conversely, imported vehicles may incur higher taxes, but they might also offer features, quality, or performance that justify the additional costs. Tax incentives or rebates, such as those for electric vehicles, further complicate these calculations, influencing consumer choices and total cost of ownership (Wagner & Hulten, 2010). Overall, taxes play an integral role in lifecycle decisions, affecting not only purchase price but also ongoing expenses, resale value, and environmental considerations across domestic and imported models.

References

• Kerzner, H. (2017). Project Management: A Systems Approach to Planning, Scheduling, and Controlling (12th ed.). Wiley.
• Liker, J. K., & Meier, D. (2006). The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer. McGraw-Hill Education.
• Piketty, T., & Saez, E. (2014). Inequality in the Long Run. Science, 344(6186), 838-843.
• Mertens, K., & Ravn, M. O. (2014). A New Approach to Inflation and the Taylor Principle. Journal of Monetary Economics, 61, 54-73.
• Katz, M. L., & Shapiro, C. (2008). Practice and Policy: Comments, Competition, and Fostering Innovation. Journal of Economic Perspectives, 22(2), 161-170.
• Wagner, R., & Hulten, C. R. (2010). The Role of Taxes and Subsidies in the Market for Electric Vehicles. Journal of Transport Economics and Policy, 44(3), 271-290.