**9. References**


In the highly multi-modal digital age of the youngest generation, science, technology, engineering and math education and learning is confronted with new challenges that require innovative approaches exploiting our understanding of how children and adults learn engineering. Several new structural models for STEM education have been discussed that combine the best features of formal and informal learning. By introducing impactful, engineering education to this generation by integrating literature, technology, and successful teaching and learning methods into their culture, there are no limits to the meaningful contributions that future engineers will make toward improving our way of life.

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**8. Conclusions** 

**9. References** 

1999.

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*Education,* vol. 53, pp. 80-87, 2010.

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**27** 

Igor Pšunder

*Slovenia* 

**Use of Discounted Cash Flow Methods** 

**for Evaluation of Engineering Projects** 

Research carried out in recent decades shows that the use of discounted cash flow (DCF) methods for engineering project evaluation has increased enormously. Klammer and Walker (1984) established in 1984 that in the USA the use of discounting grew from 19 percent in 1960 to 57 percent in 1970. Their research further stated that the use of discounted cash flow methods grew to 75 percent in 1980 for those projects dealing with the expansion of existing capacities. A few years later, Pike (1988) established that the use of either the internal rate of return or net present value methods in large UK companies grew from 58 percent to 84 percent between 1975 and 1986. Research carried out by Pšunder and Ferlan (2007 & 2008) among Slovenian project managers shows that the use of discounted cash flow methods depends on the project managers' field of education. Among project managers who have an education in civil engineering, only 50 percent use the net present value method and 66.7 percent the internal rate of return. Among mechanical engineers, 62.5 percent use the net

Pšunder and Ferlan (2007) further established that among discounted cash flow methods – net present value (NPV), net present value index (NPVI), internal rate of return (IRR) and modified internal rate of return (MIRR) were taken into consideration – the most commonly used method in Slovene companies is the net present value method (average use is 70.5 percent), while the least popular is the use of the modified internal rate of return method (on average less than 30 percent). Employees with an education in mechanical engineering most often use the internal rate of return method (87.5 percent), followed by the net present value method (62.5 percent), while the modified internal rate of return method and net present value index is used by only half of these. The authors explain that the use of the internal rate of return method among experts with an education in mechanical engineering is explicable in terms of the method's ease of understanding, since the result is expressed in a percentage (of rate of return). At the same time, results can easily be compared between different projects and between different forms of other investments. Although the calculation demands trial and error procedure or interpolation, financial calculators and electronic spreadsheets contain standard procedures for internal rate of return calculation. The frequency of use of the net present value method can be explained by the simplicity of its calculation and by the generally widespread use of this method (a standard function on

present value method and 87.5 percent the internal rate of return.

calculators and electronic spreadsheets).

**1. Introduction** 

*Faculty of Civil Engineering, University of Maribor,* 

