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  • Question
  • An investment of Rs. 100 lakhs is to be made for construction of a plant, which will take two years to start production. The annual profit from the operation of the plant is Rs. 20 lakhs. What will be the pay back time?


  • Options
  • A. 5 years
  • B. 7 years
  • C. 12 years
  • D. 10 years

  • Correct Answer
  • 7 years 


  • Chemical Engineering Plant Economics problems


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    • 1. A balance sheet for a chemical plant shows its financial condition at any given date. It does not contain the __________ of the plant.

    • Options
    • A. current asset
    • B. current liability
    • C. long term debt
    • D. profit
    • Discuss
    • 2. According to six-tenths-factor rule, if the cost of a given unit at one capacity is known, then the cost of similar unit with '' times the capacity of the first unit is approximately equal to __________ times the cost of the initial unit.

    • Options
    • A. n
    • B. n0.6
    • C. n0.4
    • D. n
    • Discuss
    • 3. Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant?

    • Options
    • A. Cash reserve.
    • B. Rate of return on investment.
    • C. Payout period.
    • D. Discounted cash flow based on full life performance.
    • Discuss
    • 4. Pick out the wrong statement.

    • Options
    • A. Gross margin = net income - net expenditure
    • B. Net sales realisation (NSR) = Gross sales - selling expenses
    • C. At break even point, NSR is more than the total production cost
    • D. Net profit = Gross margin - depreciation - interest
    • Discuss
    • 5. Which of the following is not a current asset of a chemical company?

    • Options
    • A. Inventories
    • B. Marketable securities
    • C. Chemical equipments
    • D. None of these.
    • Discuss
    • 6. Relative cost of chemical process plants in India is about __________ percent more than the similar plants in U.S.A.

    • Options
    • A. 15
    • B. 35
    • C. 55
    • D. 75
    • Discuss
    • 7. Purchased cost of equipments for a chemical process plant ranges from __________ percent of the fixed capital investment.

    • Options
    • A. 10 to 20
    • B. 20 to 40
    • C. 45 to 60
    • D. 65 to 75
    • Discuss
    • 8. Which of the following is a batch furnace?

    • Options
    • A. Cupola
    • B. Reheating furnace
    • C. Glass tank furnace
    • D. None of these
    • Discuss
    • 9. Maximum thermal efficiency of boiler may be about __________ percent.

    • Options
    • A. 10
    • B. 25
    • C. 65
    • D. 90
    • Discuss
    • 10. An electric furnace producing heat by means of an electric arc struck between each of three electrodes and the charge is called __________ furnace.

    • Options
    • A. resistance
    • B. arc
    • C. low frequency induction
    • D. none of these
    • Discuss


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