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WorksheetsENGINEERING ECONOMICS
Total questions: 123
Worksheet time: 1hrs 2mins
What is defined as the interest on a load or principal that is based only on the original amount of the loan or principal?
Effective rate of interest
Nominal rate of Interest
Compound interest
Simple interest
The term used to express the series of uniform payments occurring at equal interval of time ls
compound interest
annuity
perpetuity
depreciation
Which of the following is an accelerated depreciation method?
Straight line method and sinking fund method
Straight line method and double decining balance method
Double declining balance method and SYD method
SYD method and sinking fund method
Gross margin is the ratio of the gross profit to
Net sale
Owner's equity
Inventory turnover
Quick assets
What is the ratio of the market price per share to earnings per share called?
ross margin
Price earnings ratio
Book value per share of common stock
Inventory turnover
As applied to capitalized asset, the distribution of the initial cost by periodic changes to operation as in depreciation or the reduction of the depth by either periodic or irregular prearranged program is called
The ratio of the Interest payment to the principal for a given unit of time and is usually expressed as a percentage of the principal Is known as:
investment
nominal test
Interest
interest rate
The true value of interest rate computed by equations for compound interest for a 1 year period is known as
Expected return
Nominal interest
Effective interest
Economic return
Cash money and credit necessary to establish and operate an enterprise are generally called ______.
Capital
Funds
Assets
Liabilities
What is another term for "acid-test ratio"?
Current ratio
Profit margin ratio
Quick ratio
Price-earnings ratio
Funds supplied by others on which a fixed rate of interest must be paid and
the debt be repaid at a specific place and time
discount
cash flow
working capital
borrowed capital
What do you call any particular raw material or primary
product such as cloth, wool, flour, coffee, etc.?
Utility
Commodity
Necessity
Stock
Which Is NOT an essential element of an ordinary annuity?
The amounts of all payments are equal.
The payments are made at equal Interval of time.
The first payment is made at the beginning of each period.
Compound Interest is paid on all amounts in the annuity.
Consists of the actual counting or determination of the
actual quantity of the materials on hand as of a given date.
Physical Inventory
Material update
Technological assessment
Material count
Under ordinary simple interest, how many days in one year?
300
365
360
366
An equipment which cost $200,000 has a useful life of 8
years with a salvage value of $25,000 at the end of Its useful
life. If the depreciation at the first year us $21,875,what
method is used in the calculation of depreciation?
Straight line
Declining balance
Sinking fund
Sum of Years Diglt
What is defined as the reduction or fall of the value of an
asset due to constant use and passage of time?
Depletion
Depreciation
Inflation
Deflation
The suspension of repayment of debt or interest for a
specified period of time is called
Moratorium
Numeraire
Escrow
Porcupine
What is an accelerated depreciation method?
It is one that calculates a depreciation amount greater than
a straight line amount
It is one that calculates a depredation amount lesser than
a straight line amount
It is one that calculates a depredation amount equal to
straight line amount
It is one that calculates a deprecation not in any way
related to straight line amount
The discount of one unit of principal for one unit of time.
Rate discount
Nominal discount
Actual discount
Sales discount
The profit derived from a project or business enterprise without consideration of obligations to financial contributors and claims of others based on profit is known
yield
earning value
economic return
expected yield
Duopoly is a market situation where there is/are:
Few sellers and few buyers
Few sellers and many buyers
Many sellers and few buyers
One seller and few buyers
A fund into which annual deposits of A are made in order to
accumulate fund F at n years in the future
amortization
depreciation
annuity
sinking fund
Which one of the following is NOT a method of depredating
plant equipment for accounting and engineering economics
purposes?
double-entry method
modified accelerated cost recovery system
sum-of-years digits method
straight-line method
A bond where the security behind it are the equipment of the
issuing corporation.
In the formula, P= (1 + i)^n, the factor is (1+i)^n is called the
Sinking fund factor
Single payment present worth factor
Single payment compound amount factor
Capital recovery factor
A series of uniform accounts over an Infinite period of time.
Depredation
Perpetuity
Annuity
Innation
Return on Investment ratio is the ratio of the:
Net Income to owner's equity
Market price per share to earnings per share
Cost of goods sold to average cost of Inventory at hand
Net credit sales to average net receivable
The decrease in the value of a certain property due
to the gradual extraction of Its content is called
depreciation
declining balance
scrap value
depletion
32.Additional information of prospective bidders on
contract documents issued prior to bidding date.
You are planning to buy stocks in a high growth
company. Which of the following ratios best indicates
the company's growth potential?
Total asset tum-over ratio
Debt ratio
Profit ratio
Price-earning ratio
Which of the following does NOT affect owner's equity?
Dividends paid
License to start operation
Invested capital
Expense to get license to start operation
The flow back of profit plus depredation from a given project
is called
Capital recovery
Cash flow
Economic return
Earning value
The actual Interest earned by a given principal is known as?
Compounded Interest
Simple Interest
Nominal Interest
Effective Interest
What refers to the need, want or desire for a product backed
by the money to purchase it?
Supply
Demand
Product
Good
The Interest rate at which the present worth of cash flow
on a project is zero, or the interest earned by an investment
rate of return
Nominal rate
effective rate
yield
Type of bond whose security is a mortgage on certain
specified assets of the corporation.
Registered bond
Mortgage bond
Collateral bond
Debenture bond
It Is the worth of the property which is equal to the original
cost less the amount which has been charged to depreciation.
Scrap value
Fair value
Book value
Userche
Type of bond is issued jointly by two or more corporations.
What refers to the present worth of the probable future
net earnings?
Total fair value
Total market value
Going concem value
Earning value
An artificial being created by operation of law, having the
right of succession and the process, attributes and properties
expressly authorized by the law or incident to its existence.
44.What refers to the amount of money paid for the use of
borrowed capital?
Interest
Simple interest
Rate of interest
Principal
.What denotes in the fall In the exchange rate of one
currency In terms of the others?
Currency appreciation
Currency depreciation
Currency devaluation
Currency float
An accounting term that represents an Inventory account
adjustment.
Cost of goods sold
Standard cost
Overhead cost
Cost accounting
It is a stock of a product which is held by a trade body or government as a means of regulating the price of that product.
Stock plle
Hoard stock
Withheld stock
.Buffer stock
48.What is the ratio of the net Income to owner's equity?
Gross margin
Return of Investment ratio
Book value per share of common stock
Inventory turnover
What Is the feature of some bonds whereby the Issuer can redeem it before it matures?
Recall clause
Callability
Call class
Recall clause
The functional depreciation is sometimes called
Demand depreciation
Adolescence
Life Depreciation
Failure Depreaciation
What method Is often used in municipal project evaluations where benefits and costs accrue to different segments of the community?
Annual cost method
Rate of return method
Benefit-cost ratio
EUAC
What Is the main reason why the sinking fund method of computing depredation is seldom used in the Industry?
Unstable economy
Rate of Interest cannot be exactly determined
The Initial deprecation Is high
The initial depreciation is low
Which is true about partnership?
It has a perpetual life.
It will be dissolved if one of the partners ceases to be connected with the partnership.
It can be handed down from one generation of partners to another.
Its capitalization must be equal for each partner.
The ability to convert assets to cash quickly is known as
Solvency
Leverage
Liquidity
Insolvency
What is the basic accounting equation?
Assets =liability +owner's equity
Liability = assets + owners' equity
Owner's equity = assets +liability
Owner's equity =llability-assets
The ability to meet debts as they become due is known as
Solvency
Leverage
Insolvency
Liquidity
In what method of computing depreciation where it assumes that a sinking fund is that a sinking fund is established in which funds will accumulate for replacement purposes?
.Straight line method
Sinking fund method
Sum-of-year digit method
Declining balance method
What type of depredation is due to the reduction in the demand for the function that the equipment or asset was designed to render?
Salvage value Is sometimes known as
Junk value
Scrap value
Second-hand value
Going value
The unrecovered deprecation which results due to poor estimates as to the life of the equipment is called
Sunk cost
In-place value
Annuity
Economic Life
In case of bankruptcy of a partnership,
The partners are not liable for the liabilities of the partnership
The partnership assets (excluding the partners personal
The partners personal assets are attached to the debt of the partnership
The partners might sell stock to generate additional capital
What Is the simplest form of business organization?
Enterprise
Sole proprietorship
Corporation
Partnership
A secondary book of accounts, the
obtained from the journal.
Balance sheet
Worksheet
Ledger
Trial balance
64.What are the common methods computing charge?
Conservative method and conventional method
Rational and Irrational method
Unit method and percentage method
Discrete method and depletion allowance method
Capitalized cost of a project Is also known as.
Project cost
Life cost
Infinite cost
Life cycle cost
What has to increase If the company is to achieve their goal?
The ration of sales to total assets
The ratio of total assets to equlty
Equity
Any combination of (A),(B) and(C)
A method of depreciation whereby the amount to recover is spread uniformly over the estimated life of the asset in terms of the periods or units of output.
Straight line method
Sinking fund method
Declining balance method
SYD method
Funds supplied by others on which fixed rate of interest must be paid and the debt be paid and the debt be repaid at a specific place and time.
Capitalized cost of a project is also known as
Infinite cost
Life cycle cost
Life cost
Project cost
A method of depreciation whereby the amount to recover is spread unfirmly over the estimated life of the asset in terms of the periods or units of output
straight line method
sinking fund method
declining balance method
SYD method
What refers to the reduction in the level of a national income and output usually accompanied by a fall in the general price level?
Deflation
Inflation
Devaluation
Depreciation
What is the main reason why the sinking fund method of computing depreciation is seldom used in the industry?
Unstable Economy
Rate of interest cannot be exactly determined
the initial depreciation is high
the initial depreciation is low
Which of the following depreciation methods cannot have a salvage value of zero?
Sinking fund method
Straight line method
SYD method
Declining balance method
Type of Interest computed using the actual number of days Ina given year, ether 365 days or 366 days.
Ordinary simple interest
Compound Interest
Exact simple Interest
Effective Interest
A method of depreciation where a fixed sum of money is regularly deposited at compound interest in a real or imaginary fund in order to accumulate an amount equal to the total depreciation of an asset at the end of the asset's estimated life.
Straight Line method
Sinking fund method
Declining balance method
SYD METHOD
What is normally used to compare alternatives that accomplish the same purpose but have unequal lives?
Capitalized cost method
Present worth method
Annual cost method
MARR
What refers to the amount of a product made available for a sale?
Supply
Demand
product
Good
What is a measure of the average speed with which accounts receivable are collected?
profit margin ratio
Receivables turnover
Return of investment ratior
Average age of receivables
A type of stock that represents ownership and enjoys certain preferences than a ordinary stock.
Authorized stock
Incorporator stock
Preferred stock
Presidential Stock
A depreciation method where the value of an asset decreases at a constant rate
Sum of years digit
Straight line
Sinking fund
Declining Balance
Kind of obligation which has no condition attached. Deal Favor Gratuitous Agreement
Deal
Favor
Gratuitous
Agreement
"When one of the factors of production is fixed in quantity or is difficult to increase, increasing the other factors of production will result in less than proportionate increase in output".
Law of diminishing return
Law of supply
Law of demand
Law of supply and demand
A type of bond to which are attached coupons indicating the interest due and the date when such interest is to be paid.
Registered bond
Mortgage bond
Coupon bond
Collateral trust bond
The length of time usually in year for the cumulative net annual profit to equal the initial investment is called______
Payback period
return of investment
receivable turnover
redeemed period
What refers to the residual value of a company's assets after all outside liabilities (shareholders excluded) have been allowed for?
Dividend
Return
Equity
Par value
What is defined as the investment of loan or principal which is based not only on the original amount of the loan or principal but the amount of loaned or principal plus the previous accumulated interest?
Effective rate of interest
Nominal rate of interest
Compound Interest
Simple interest
What refers to the buying or selling of goods between two or more markers in order to take profitable advantage of any differences in the prices quoted in these markets?
Cartel
Arbitrage
Black Market
A priori
A formal organization of producers within an industry forming a perfect collusion purposely formed to increase profit and block new comers from the industry is called?
Cartel
Monopoly
Corporation
Competitors
It is defined as the analysis and evaluation of the monetary consequences by using the theories and principles of economics to engineering application, designs and projects
Engineering cost analysis
Engineering economy
Economic analysis
Design cost analysis
A market situation whereby there is only one buyer of an item for which there is no goods substitute.
Monosophy
Oligophy
Monopoly
Oligopsony
Two classifications of goods and services
Ready-made and made to order
Consumer and producer
Raw and finished
Local and imported
Another term for "acid-test ratio"
Current ratio
Profit margin ratio
quick ratio
Price-earnings ratio
Provisions in contract for construction to allow cost adjustments due to changes in cost of materials and statutory minimum wage.
Escalatory clause
Specifications
General condition
Quasi-delects
What is another term for "perfect competition"
Atomistic competition
No-limit competition
Free-for-all competition
Heterogeneous market
It 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
Bond
Stock
T-bills
Promissory note
A document that show proof of legal ownership of a financial security
Bond
Coupon
Bank note
Check
Specifies a definite portion of ownership of the capital of the corporation, all of each being alike in value
Stock
Same value
Fair value
Common stock
What is the opposite of perfect competition?
Monopsony
Oligophy
Oligopsony
Monopoly
What refers to the amount of money paid for the use of borrowed capital?
Interest
Rate of interest
Simple interest
Principal
What refers to the ratio of the Interest payment to the principal for a given unit of time and usually expressed as a percentage of the principal?
Return of Investment
Yield
Interest rate
Rate of return
What Is defined as the Investment of loan or principal which is based not only on the original amount of the loan or principal but the amount of loaned or principal plus the previous accumulated interest?
Effective rate of interest
Nominal rate of Interest
Compound Interest
Simple Interest
What refers to the cost of borrowing money or the amount earned by a unit principal per unit time?
Yield rate
Rate of return
Rate of interest
Economic return
What refers to the (1 + i) to the power n is called
present amount factor
future amount factor
compound amount factor
interest amount factor
Compounded bimonthly has an Interest period of
3 months
0.5-month
6 months
2 months
What is an annuity?
A series of equal payments at equal time periods
The cost of manufacturing a product
An investment that yields an equal amount of interest each year
The overhead cost per unit of production
It is the actual interest earned in one year period.
Nominal Rate
Effective rate
Simple rate
Compound rate
A mathematical expression also known as the present value of annuity of one is called
Load factor
Demand factor
Sinking fund factor
Present worth factor
What is the type of annuity where the payments are made at the end of each period starting from the first period?
Ordinary annuity
Perpetuity
Annuity due
Deferred annuity
What Is defined as the reduction or fall of the value of an asset due to constant use and passage of time?
Depletion
Inflation
Depreciation
Deflation
The worth of the property which is equal to the original cost less the amount which has been charged to depreciation.
Scrap value
Book value
Salvage value
Market value
The amount that the property would give if sold for junk.
Junk value
Scrap value
Salvage value
Book value
Estimated value of the property at the useful life.
Market value
Fair value
Salvage value
Book value
The amount which has been spent or capital Invested which for some reasons cannot be retrieved.
Sunk cost
Fixed costs
Depletion cost
Construction cost
Salvage value is sometimes known as
Scrap value
Going value
Junk value
Second-hand value
What refers to the value of an asset which a disinterested third party, different from the buyer and seller, will determine in order to establish a price acceptable to both parties?
Book value
Market value
Fair value
Franchise value
In SYD method of computing depreciation, which of the following is the formula in finding the sum of years' digits?
n(n - 1)
[n(n + 2)] / 2
C. [n(n-1)]/2
[n(n+1)]/2
In what method of computing depreciation where it assumes that the annual cost of depreciation is a fixed percentage of the book value at the beginning of the year?
Straight line method
Sinking fund method
Sum-of-year digit method
Declining balance method
Which of the following depreciation methods cannot have a salvage value of zero?
Declining balance method
Sinking fund method
Sinking fund method
SYD method
The rise in the prices of goods and services over a period of time
Depletion
Inflation
Depreciation
Deflation
What is normally used to compare alternatives that accomplish the same purpose but have unequal lives?
Capitalized cost method
Present worth method
Annual cost method
MARR
What method is often used in municipal project evaluations where benefits and costs accrue to different segments of the community?
Annual cost method
Benefit-cost ratio
Rate of return method
EUAC
What refers to an imaginary cost representing what will not be received if a particular strategy is rejected?
Opportunity cost
Ghost cost
horizon cost
Null cost
