engineering economy MCQs – Page 5

Practise focused engineering economy questions with marked answers for exam preparation and subject revision.

engineering economy Mcqs

81. What refers to the cost of borrowing money or the amount earned by a unit principal per unit time ?
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A. Rate of return

B. Yield rate

C. Economic return

D. Rate of interest

82. A manufacturer produces certain items at a labor cost of P 115 each, material cost of P 76 each and variable cost of P 2.32 each. If the item has a unit price of P 600, how many units must be manufactured each month for the manufacturer to break even if the monthly overhead is P428,000 _________________?
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A. 1,033

B. 1,037

C. 1,043

D. 1,053

83. What refers to the cumulative effect of elapsed time on the money value of an event, based on the earning power of equivalent invested funds capital should or will earn ?
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A. Yield

B. Present worth factor

C. Time value of money

D. Interest rate

84. Which of these gives the lowest effective rate of interest ?
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A. 12.20 % compounded annually

B. 11.60 % compounded annually

C. 11.90 % compounded annually

D. 12.35 % compounded annually

85. The monthly demand for ice cans being manufactured by Mr. Camus is 3200 pieces. With a manual operated guillotine, the unit cutting cost is P25.00. An electrically operated hydraulic guillotine was offered to Mr. Camus at a price of P275,000.00 and which cuts by 30% the unit cutting cost. Disregarding the cost of money, how many months will Mr. Camus be able to recover the cost of the machine if he decides to buy now ?
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A. 12 months

B. 10 months

C. 11 months

D. 13 months

86. Aside from many sellers and many buyers, which one is a characteristic of perfect competition ?
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A. Homogeneous product

B. All of the above

C. Perfect information and absence of all economic friction

D. Free market entry and exit

87. A man invested P110,000 for 31 days. The net interest after deducting 20% withholding tax is P890.36. Find the rate of return annually?
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A. 12.32%

B. 11.50%

C. 11.95%

D. 11.75 %

88. A firm borrows P2,000 for 6 years at 8%. At the end of 6 years, it renews the loan for the amount due plus P2,000 more for 2 years at 8%. What is the lump sum due ?
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A. P 3,250.34

B. P 3,270.34

C. P 3,260.34

D. P 3,280.34

89. By the condition of a will, the sum of P20,000 is left to a girl to be held in trust fund by her guardian until it amounts to P50,000. When will the girl receive the money if fund invested at 8% compounded quarterly ?
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A. 11.87 years

B. 11.46 years

C. 11.57 years

D. 11.23 years

90. What is the ordinary interest on P1,500.50 for 182 days at 5.2% ?
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A. P39.82

B. P39.99

C. P39.01

D. P39.45

91. Miss Calledo deposited P 1,000, P 1,500 and P 2,000 at the end of the 2nd year, 3rd year and 4th year, respectively in a savings account which earned 10% per annum. How much is in the account at the end of the 4th year ?
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A. P 4,820.00

B. P 4,860.00

C. P 4,840.00

D. P 4,880.00

92. The process of determining the value or worth of a physical property for specific reason is called ____________________?
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A. Depletion

B. Valuation

C. Investment

D. Economy

93. What is defined as the certificate of indebtedness of corporation usually for a period not less than 10 years and guaranteed by a mortgage on certain assets of a corporation ?
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A. Stock

B. Promissory note

C. Bond

D. T-bills

94. A student plans to deposit P1,500 in the bank now and another P3,000 for the next 2 years. If he plans to withdraw P5,000 three years from after his last deposit for the purpose of buying shoes, what will be the amount of money left in the bank after one year of his withdrawal? Effective annual interest rate is 10% ?
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A. P1,459.64

B. P1,945.64

C. P1,549.64

D. P1,345.98

95. What refers to the present worth of all the amount the bondholder will receive through his possession of the bond ?
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A. Redeemed value of bond

B. Value of bond

C. Par value of bond

D. Face value of bond

96. What type of bond where the corporations owner name are recorded and the interest is paid periodically to the owners with their asking for it ?
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A. Callable bond

B. Preferred bond

C. Registered bond

D. Incorporators bond

97. Under ordinary simple interest, how many days in one year ?
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A. 366

B. 365

C. 360

D. 300

98. A person buys a piece of lot for P 100,000 downpayment and 10 deferred semi-annual payments of P 8,000 each, starting three years from now. What is the present value of the investment if the rate of interest is 12% compounded semi-annually ?
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A. P 143,999.08

B. P 142,189.67

C. P 143,104.89

D. P 142,999.08

99. What refers to the goods and services that are desired by human and will be acquired only after all the needs have been satisfied ?
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A. Luxury

B. Necessity

C. Producer products

D. Consumer products

100. What is the present worth of a year annuity paying P 3,000.00 at the end of each year, with interest at 8% compounded annually ?
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A. P 7,654.04

B. P 7,420.89

C. P 7,590.12

D. P 7,731.29

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