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  • Question
  • 'Lang factor' is defined as the ratio of the capital investment to the delivered cost of major equipments. The value of 'Lang factor' for fixed capital investment, for a solid-fluid processing chemical plant ranges from


  • Options
  • A. 1.2 to 1.4
  • B. 2.5 to 2.7
  • C. 4.2 to 4.4
  • D. 6.2 to 6.4

  • Correct Answer
  • 4.2 to 4.4 


  • Chemical Engineering Plant Economics problems


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    • 1. Functional depreciation of an equipment is the measure of decrease in its value due to its

    • Options
    • A. ageing
    • B. wear and tear
    • C. obsolescence
    • D. breakdown or accident
    • Discuss
    • 2. Generally, income taxes are based on the

    • Options
    • A. total income
    • B. gross earning
    • C. total product cost
    • D. fixed cost
    • Discuss
    • 3. Profit is equal to revenue minus

    • Options
    • A. book value
    • B. total cost
    • C. operating cost
    • D. none of these
    • Discuss
    • 4. Chemical engineering plant cost index is used for finding the present cost of a particular chemical plant, if the cost of similar plant at some time in the past is known.
      The present cost of the plant = original cost   x
      The most major component of this cost index is

    • Options
    • A. fabricated equipment and machinery.
    • B. process instruments and control.
    • C. pumps and compressor.
    • D. electrical equipments and material.
    • Discuss
    • 5. The ratio of gross annual sales to the fixed capital investment is termed as the __________ ratio.

    • Options
    • A. cash reserve
    • B. capital
    • C. turnover
    • D. investment
    • Discuss
    • 6. Pick out the correct statement.

    • Options
    • A. Difference between income and expense is termed as gross revenue.
    • B. Unamortised cost is the difference between the original cost of a property and all the depreciation charges made to date.
    • C. Sum-of-the-years-digits methods of depreciation calculation accounts for the interest on the investment.
    • D. Scrap value is the net amount of money obtainable from the sale of used property over and above any charges involved in its removal & sale.
    • Discuss
    • 7. Depreciation

    • Options
    • A. costs (on annual basis) are constant when the straight line method is used for its determination.
    • B. is the unavoidable loss in the value of the plant, equipment and materials with lapse in time.
    • C. does figure in the calculation of income tax liability on cash flows from an investment.
    • D. all (a), (b) and (c).
    • Discuss
    • 8. Which of the following methods of depreciation calculations results in book values greater than those obtained with straight line method?

    • Options
    • A. Multiple straight line method
    • B. Sinking fund method
    • C. Declining balance method
    • D. Sum of the years digit method
    • Discuss
    • 9. Which of the following is not a component of the working capital for a chemical process plant?

    • Options
    • A. Product inventory.
    • B. In-process inventory.
    • C. Minimum cash reserve.
    • D. Storage facilities.
    • Discuss
    • 10. Manufacturing cost in a chemical company does not include the

    • Options
    • A. fixed charges.
    • B. plant overheads.
    • C. direct products cost.
    • D. administrative expenses.
    • Discuss


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