Chemical Engineering Plant Economics MCQ Questions & Answers

1

The depreciation during the year 'n', in diminishing balance method of depreciation calculation, is calculated by multiplying a fixed percentage 'N' to the

A) Initial cost B) Book value at the end of (n - 1)^th year C) Depreciation during the (n - 1)^th year D) Difference between initial cost and salvage value

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Answer & Solution

Answer: Option B

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2

Which of the following is not a current asset of a chemical company?

A) Inventories B) Marketable securities C) Chemical equipments D) None of these

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Answer & Solution

Answer: Option C

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3

In declining balance method of depreciation calculation, the

A) Value of the asset decreases linearly with time B) Annual cost of depreciation is same every year C) Annual depreciation is the fixed percentage of the property value at the beginning of the particular year D) None of these

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Answer & Solution

Answer: Option C

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4

Generally, income taxes are based on the

A) Total income B) Gross earning C) Total product cost D) Fixed cost

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Answer & Solution

Answer: Option B

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5

A series of equal payments (e.g., deposit or cost) made at equal intervals of time is known as

A) Perpetuity B) Capital charge factor C) Annuity D) Future worth

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Answer & Solution

Answer: Option C

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6

With increase in the discounted cash flow rate of return, the ratio of the total present value to the initial investment of a given project

A) Decreases B) Increases C) Increases linearly D) Remains constant

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Answer & Solution

Answer: Option A

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7

Which of the following relationship is not correct is case of a chemical process plant?

A) Manufacturing cost = direct product cost + fixed charges + plant overhead costs B) General expenses = administrative expenses + distribution & marketing expenses C) Total product cost = manufacturing cost + general expenses D) Total product cost = direct production cost + plant overhead cost

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Answer & Solution

Answer: Option D

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8

Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant?

A) Cash reserve B) Rate of return on investment C) Payout period D) Discounted cash flow based on full life performance

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Answer & Solution

Answer: Option A

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9

In a chemical process plant, the total product cost comprises of manufacturing cost and the

A) General expenses B) Overhead cost C) R & D cost D) None of these

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Answer & Solution

Answer: Option A

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10

Factory manufacturing cost is the sum of the direct production cost

A) Fixed charges and plant overhead cost B) And plant overhead cost C) Plant overhead cost and administrative expenses D) None of these

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Answer & Solution

Answer: Option A

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Chemical Engineering Plant Economics MCQ Questions & Answers | Chemical Engineering