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- Question
Pick up the correct statement from the following:
Options- A. The change in the amount of money over a given time period is called 'time value' of money, a most important concept in engineering economy.
- B. The manifestation of the time value of money is termed as interest.
- C. Interest on borrowing = present amount owed - original loan
- D. The original investment (or loan) is referred to as principal.
- E. All of these.
- Correct Answer
- All of these.
- 1. The annuity which refers to a debt payment for recovering the initial amount or capital in equal periodical payments, is known as;
Options- A. Present Worth Annuity
- B. Sinking fund annuity
- C. Compound annuity
- D. Capital recovery annuity Discuss
- 2. In the cash-flow diagram shown in the given figure
Options- A. Equal deposits of Rs 3000 per year (A) are made, starting now.
- B. The rate of interest is 10% per yearaccount
- C. The amount accumulated after the seventh deposit is to be computed
- D. All of these Discuss
- 3. Annuities involve:
Options- A. a series of payments
- B. all payments of equal amount
- C. payment at equal time intervals
- D. payments at the end of periods.
- E. All of these Discuss
- 4. In a cash flow series :
Options- A. uniform gradient signifies that an income or disbursement changes by the same amount in each interest period.
- B. Either an increase or a decrease in the amount of a cash flow is called the gradient.
- C. The gradient in the cash flow may be positive or negative.
- D. All of these Discuss
- 5. Which one of the following statements is correct?
Options- A. The number of years required to recover the initial cash investment in a project, is called Pay Back period (PBP).
- B. The discount rate that equates the present value of the expected Net Cash Flows (CFs) with the Initial Cash Outflow (ICO) is known as internal rate of return.
- C. The present value of the proposal's net cash flows, less the proposal's initial cash outflow is known as the Net Present Value (NPV)
- D. All of these Discuss
- 6. The CRF (ep) is also known as: [CRF(EP) - 8% - 7], where
Options- A. 8% is the rate of interest per year
- B. money is borrowed for n = 7 years
- C. both (a) and (b)
- D. Neither (a) nor (b) Discuss
- 7. The project contractor relies on the cost of the estimate :
Options- A. for submission of a competitive bid for a lumpsum contract
- B. for a unit price contract
- C. for preparation of a definitive estimate to help negotiate contract.
- D. All of these Discuss
- 8. Pick up the correct reason for making conceptual (or preliminary) estimate from the following:
Options- A. To have a check on a definitive cost estimate.
- B. To check qoutations from contractors and/or sub contractors.
- C. To compute target estimate for the owner while drawings and specifications are in initial stage.
- D. All of these. Discuss
- 9. Current assests less inventories divided by current liabilities is known as
Options- A. Liquidity ratio
- B. Current ratio
- C. Acid-Test (or Quick) ratio
- D. Debts ratio Discuss
- 10. The financial analysis helps to judge:
Options- A. The operational efficiency of the firm
- B. The financial position of the firm.
- C. Both (a) and (b)
- D. Neither (a) nor (b) Discuss
Engineering Economy problems
Search Results
Correct Answer: Capital recovery annuity
Correct Answer: All of these
Correct Answer: All of these
Correct Answer: All of these
Correct Answer: All of these
Correct Answer: both (a) and (b)
Correct Answer: All of these
Correct Answer: All of these.
Correct Answer: Acid-Test (or Quick) ratio
Correct Answer: Both (a) and (b)
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