chemical engineering plant economics MCQs – Page 5

Practise multiple-choice questions from chemical engineering plant economics for competitive examinations and subject revision. Review each marked answer and report any item that may be outdated or unclear.

chemical engineering plant economics Mcqs
81. Gross earning is equal to the total income minus___________________?
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A. Income tax

B. Total product cost

C. Fixed cost

D. None of these

82. Which of the following is not a component of depreciation cost ?
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A. Loss due to obsolescence of the equipment

B. Loss due to accident/breakdown in the machinery

C. Repairs and maintenance cost

D. Loss due to decrease in the demand of product

83. In declining balance method of depreciation calculation, the _____________________?
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A. Annual depreciation is the fixed percentage of the property value at the beginning of the

B. None of these

C. Value of the asset decreases linearly with time

D. ticular year</strong>

E. Annual cost of depreciation is same every year

84. 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?
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A. n0.6

B. n

C. ?n

D. n0.4

85. Pick out the wrong statement?
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A. Working capital turnover ratio = sales/net working capital

B. Total cost of production is more than net sales realisation (NSR) at breakeven point

C. Return on equity = profit after tax/net worth

D. Net worth means paid up share capital and reserve & surplus (i.e. shareholders equity)

86. The total investment in a project is Rs. 10 lakhs and the annual profit is 1.5 lakhs. If the project life is 10 years, then the simple rate of return on investment is__________________?
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A. 1.5%

B. 15%

C. 10%

D. 150%

87. In a manufacturing industry, breakeven point occurs, when the___________________?
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A. Annual profit equals the expected value

B. Total annual rate of production equals the assigned value

C. Total annual product cost equals the total annual sales

D. Annual sales equals the fixed cost

88. A shareholder has ______________ say in the affairs of company management compared to a debenture holder ?
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A. More

B. No

C. Same

D. Less

89. Which of the following is the costliest material of construction used in pressure vessel construction ?
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A. Lead

B. Titanium

C. Low alloy steel

D. High alloy steel

90. Following the six-tenth factor rule, if a log-log plot of capacity of the equipment vs. cost of the equipment is made, then a straight line is obtained, whose slope is equal to_________________?
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A. 0.6

B. 0.2

C. 0.8

D. 0.1

91. Factory manufacturing cost is the sum of the direct production cost_________________?
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A. And plant overhead cost

B. Fixed charges and plant overhead cost

C. None of these

D. Plant overhead cost and administrative expenses

92. Which of the following methods of depreciation calculations results in book values greater than those obtained with straight line method ?
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A. Sum of the years digit method

B. Multiple straight line method

C. Declining balance method

D. Sinking fund method