Current methods of economic decision-making use multiple criteria that often result in conflicting indications of the best alternatives, none of which are provably optimal. As a consequence, economic decision-making differs between and within organizations. The proof presented in this paper provides a single criterion for selecting engineering and financial alternatives that maximize the net present-value of an organization subject to a capital constraint 1 . Major differences from current

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... ice include forecasting costs of borrowing money for discounting cash flows and measuring capital costs. It is assumed each alternative has accurate input and output cash flow forecasts that incorporate engineering and marketing risks. The proof of optimal economic decision-making can then be validated mathematically and verified with financial accounting statements. The single criterion for selecting alternatives that is proposed here promises to be the best practical guide for optimal economic decision-making not only in industrial firms, but also in financial institutions, government agencies and nonprofit organizations.