MCQOPTIONS
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MCQOPTIONS
This section includes 102 Mcqs, each offering curated multiple-choice questions to sharpen your Chemical Engineering knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
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 |
| Answer» D. Future worth | |
| 2. |
A reactor having a salvage value of Rs. 10000 is estimated to have a service life of 10 years. The annual interest rate is 10%. The original cost of the reactor was Rs. 80000. The book value of the reactor after 5 years using sinking fund depreciation method will be Rs.%! |
| A. | 40096 |
| B. | 43196 |
| C. | 53196 |
| D. | 60196 |
| Answer» E. | |
| 3. |
An investment of Rs. 1000 is carrying an interest of 10% compounded quarterly. The value of the investment at the end of five years will be%! |
| A. | 1000 (1 + 0.1/4)20 |
| B. | 1000 (1 + 0.1)20 |
| C. | 1000 (1 + 0.1/4)5 |
| D. | 1000 (1 + 0.1/2)5 |
| Answer» B. 1000 (1 + 0.1)20 | |
| 4. |
Equipment installation cost in a chemical process plant ranges from __________ percent of the purchased equipment cost.%! |
| A. | 10 to 20 |
| B. | 35 to 45 |
| C. | 55 to 65 |
| D. | 70 to 80 |
| Answer» C. 55 to 65 | |
| 5. |
Nominal and effective interest rates are equal, when the interest is compounded%! |
| A. | Quarterly |
| B. | Semi-annually |
| C. | Annually |
| D. | In no case, they are equal |
| Answer» D. In no case, they are equal | |
| 6. |
In an ordinary chemical plant, electrical installation cost may be about%! |
| A. | 10-15% of purchased equipment cost |
| B. | 3-10% of fixed capital investment |
| C. | Either A or B |
| D. | Neither A nor B |
| Answer» D. Neither A nor B | |
| 7. |
Profit is equal to revenue minus%! |
| A. | Book value |
| B. | Total cost |
| C. | Operating cost |
| D. | None of these |
| Answer» C. Operating cost | |
| 8. |
Which of the following is a component of working capital investment?%! |
| A. | Utilities plants |
| B. | Maintenance and repair inventory |
| C. | Process equipments |
| D. | Depreciation |
| Answer» C. Process equipments | |
| 9. |
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 |
| Answer» B. And plant overhead cost | |
| 10. |
The value of a property decreases __________ with time in straight line method of determining depreciation.%! |
| A. | Linearly |
| B. | Non-linearily |
| C. | Exponentially |
| D. | Logarithmically |
| Answer» B. Non-linearily | |
| 11. |
The ratio of working capital to total capital investment for most chemical plants (except for non-seasonal based products) is in the range of __________ percent.%! |
| A. | 0.1 to 1 |
| B. | 1 to 2 |
| C. | 10 to 20 |
| D. | 50 to 60 |
| Answer» D. 50 to 60 | |
| 12. |
In a manufacturing industry, break even point occurs, when the%! |
| A. | Total annual rate of production equals the assigned value |
| B. | Total annual product cost equals the total annual sales |
| C. | Annual profit equals the expected value |
| D. | Annual sales equals the fixed cost |
| Answer» C. Annual profit equals the expected value | |
| 13. |
For a typical project, the cumulative cash flow is zero at the%! |
| A. | End of the project life |
| B. | Break even point |
| C. | Start up |
| D. | End of the design stage |
| Answer» C. Start up | |
| 14. |
*$_Which of the following is a component of working capital investment?? |
| A. | Utilities plants |
| B. | Maintenance and repair inventory |
| C. | Process equipments |
| D. | Depreciation |
| Answer» C. Process equipments | |
| 15. |
*$_Profit is equal to revenue minus? |
| A. | Book value |
| B. | Total cost |
| C. | Operating cost |
| D. | None of these |
| Answer» C. Operating cost | |
| 16. |
*$_Nominal and effective interest rates are equal, when the interest is compounded? |
| A. | Quarterly |
| B. | Semi-annually |
| C. | Annually |
| D. | In no case, they are equal |
| Answer» D. In no case, they are equal | |
| 17. |
*$_In an ordinary chemical plant, electrical installation cost may be about? |
| A. | 10-15% of purchased equipment cost |
| B. | 3-10% of fixed capital investment |
| C. | Either A or B |
| D. | Neither A nor B |
| Answer» D. Neither A nor B | |
| 18. |
*$_If an amount R is paid at the end of every year for 'n' years, then the net present value of the annuity at an interest rate of i is? |
| A. | R[((1 + i)n - 1)/i] |
| B. | [((1 + i)n - 1)/i(1 + i)n] |
| C. | R(1 + i)n |
| D. | R/(1 + i)n |
| Answer» C. R(1 + i)n | |
| 19. |
*$_The 'total capital investment' for a chemical process plant comprises of the fixed capital investment and the? |
| A. | Overhead cost |
| B. | Working capital |
| C. | Indirect production cost |
| D. | Direct production cost |
| Answer» C. Indirect production cost | |
| 20. |
*$_The payback method for the measurement of return on investment? |
| A. | Gives a correct picture of profitability |
| B. | Underemphasises liquidity |
| C. | Does not measure the discounted rate of return |
| D. | Takes into account the cash inflows after the recovery of investments |
| Answer» D. Takes into account the cash inflows after the recovery of investments | |
| 21. |
*$_Gantt chart (or Bar chart) is helpful in? |
| A. | Efficient utilisation of manpower and machines |
| B. | Preparing production schedule |
| C. | Efficient despatching of products |
| D. | Inventory control |
| Answer» C. Efficient despatching of products | |
| 22. |
*$___________ of depreciation calculation accounts for the interest on investement.? |
| A. | Straight line method |
| B. | Declining balance |
| C. | Both A and B |
| D. | Neither A nor B |
| Answer» E. | |
| 23. |
*/*_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 |
| Answer» D. Future worth | |
| 24. |
*/*_Effluent treatment cost in a chemical plant is categorised as the __________ cost.? |
| A. | Fixed |
| B. | Overhead |
| C. | Utilities |
| D. | Capital |
| Answer» D. Capital | |
| 25. |
*/*_The value of a property decreases __________ with time in straight line method of determining depreciation.? |
| A. | Linearly |
| B. | Non-linearily |
| C. | Exponentially |
| D. | Logarithmically |
| Answer» B. Non-linearily | |
| 26. |
*/*_For a typical project, the cumulative cash flow is zero at the? |
| A. | End of the project life |
| B. | Break even point |
| C. | Start up |
| D. | End of the design stage |
| Answer» C. Start up | |
| 27. |
*/*_In a manufacturing industry, break even point occurs, when the? |
| A. | Total annual rate of production equals the assigned value |
| B. | Total annual product cost equals the total annual sales |
| C. | Annual profit equals the expected value |
| D. | Annual sales equals the fixed cost |
| Answer» C. Annual profit equals the expected value | |
| 28. |
*/*_Equipment installation cost in a chemical process plant ranges from __________ percent of the purchased equipment cost.? |
| A. | 10 to 20 |
| B. | 35 to 45 |
| C. | 55 to 65 |
| D. | 70 to 80 |
| Answer» C. 55 to 65 | |
| 29. |
*/*_An investment of Rs. 1000 is carrying an interest of 10% compounded quarterly. The value of the investment at the end of five years will be? |
| A. | 1000 (1 + 0.1/4)20 |
| B. | 1000 (1 + 0.1)20 |
| C. | 1000 (1 + 0.1/4)5 |
| D. | 1000 (1 + 0.1/2)5 |
| Answer» B. 1000 (1 + 0.1)20 | |
| 30. |
*/*_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 |
| Answer» B. And plant overhead cost | |
| 31. |
*/*_A reactor having a salvage value of Rs. 10000 is estimated to have a service life of 10 years. The annual interest rate is 10%. The original cost of the reactor was Rs. 80000. The book value of the reactor after 5 years using sinking fund depreciation method will be Rs.? |
| A. | 40096 |
| B. | 43196 |
| C. | 53196 |
| D. | 60196 |
| Answer» E. | |
| 32. |
*/*_The ratio of working capital to total capital investment for most chemical plants (except for non-seasonal based products) is in the range of __________ percent.? |
| A. | 0.1 to 1 |
| B. | 1 to 2 |
| C. | 10 to 20 |
| D. | 50 to 60 |
| Answer» D. 50 to 60 | |
| 33. |
*/*_A present sum of Rs. 100 at the end of one year, with half yearly rate of interest at 10%, will be Rs.? |
| A. | 121 |
| B. | 110 |
| C. | 97 |
| D. | 91 |
| Answer» B. 110 | |
| 34. |
*/*_'P' is the investment made on an equipment, 'S' is its salvage value and 'n is the life of the equipment in years. The depreciation for rath year by the sum-of years digit method will be? |
| A. | (P - S)/n |
| B. | 1 - (P/S)1/m |
| C. | M/n x (P - S) |
| D. | 2(n - m + 1)/n(n + 1) x (P - S) |
| Answer» E. | |
| 35. |
*/*_A balance sheet for a chemical plant shows its financial condition at any given date. It does not contain the __________ of the plant.? |
| A. | Current asset |
| B. | Current liability |
| C. | Long term debt |
| D. | Profit |
| Answer» E. | |
| 36. |
*/*_'Lang factor' is defined as the ratio of the capital investment to the delivered cost of major equipments. The value of 'Lang factor' for fixed capital investment, for a solid-fluid processing chemical plant ranges from? |
| A. | 1.2 to 1.4 |
| B. | 2.5 to 2.7 |
| C. | 4.2 to 4.4 |
| D. | 6.2 to 6.4 |
| Answer» D. 6.2 to 6.4 | |
| 37. |
*/*_In which of the electric power generation system, the operating cost is minimum?? |
| A. | Thermal |
| B. | Nuclear |
| C. | Hydroelectric |
| D. | Fast breeder reactor |
| Answer» D. Fast breeder reactor | |
| 38. |
*/*_Generally, income taxes are based on the? |
| A. | Total income |
| B. | Gross earning |
| C. | Total product cost |
| D. | Fixed cost |
| Answer» C. Total product cost | |
| 39. |
%_Pick out the wrong statement._% |
| A. | The annual depreciation rate for machinery and equipments in a chemical process plant is about 10% of the fixed capital investment |
| B. | Annual depreciation rate of buildings in a chemical plant is about 3% of its initial cost |
| C. | Insurance rates on annual basis in a chemical plant may be about 1% of the fixed capital investment |
| D. | In a chemical industry, research and development cost amounts to about 15% of net sales realisation (NSR) |
| Answer» E. | |
| 40. |
%_Payback period_% |
| A. | And economic life of a project are the same |
| B. | Is the length of time over which the earnings on a project equals the investment |
| C. | Is affected by the variation in earnings after the recovery of the investment |
| D. | All of the above |
| Answer» C. Is affected by the variation in earnings after the recovery of the investment | |
| 41. |
_ A present sum of Rs. 100 at the end of one year, with half yearly rate of interest at 10%, will be Rs.$? |
| A. | 121 |
| B. | 110 |
| C. | 97 |
| D. | 91 |
| Answer» B. 110 | |
| 42. |
_ A balance sheet for a chemical plant shows its financial condition at any given date. It does not contain the __________ of the plant.$? |
| A. | Current asset |
| B. | Current liability |
| C. | Long term debt |
| D. | Profit |
| Answer» E. | |
| 43. |
_ 'P' is the investment made on an equipment, 'S' is its salvage value and 'n is the life of the equipment in years. The depreciation for rath year by the sum-of years digit method will be$? |
| A. | (P - S)/n |
| B. | 1 - (P/S)1/m |
| C. | M/n x (P - S) |
| D. | 2(n - m + 1)/n(n + 1) x (P - S) |
| Answer» E. | |
| 44. |
_ In which of the electric power generation system, the operating cost is minimum?$? |
| A. | Thermal |
| B. | Nuclear |
| C. | Hydroelectric |
| D. | Fast breeder reactor |
| Answer» D. Fast breeder reactor | |
| 45. |
_ 'Lang factor' is defined as the ratio of the capital investment to the delivered cost of major equipments. The value of 'Lang factor' for fixed capital investment, for a solid-fluid processing chemical plant ranges from$? |
| A. | 1.2 to 1.4 |
| B. | 2.5 to 2.7 |
| C. | 4.2 to 4.4 |
| D. | 6.2 to 6.4 |
| Answer» D. 6.2 to 6.4 | |
| 46. |
_ Which of the following elements is not included in the scope of market analysis?$? |
| A. | Competition from other manufactures |
| B. | Product distribution |
| C. | Opportunities |
| D. | Economics |
| Answer» E. | |
| 47. |
_ An annuity is a series of equal payments occuring at equal time intervals, and this amount includes the sum of all payments plus interest, if allowed to accumulate at a definite rate of interest from the time of initial payment to the end of annuity term. Ordinary annuity is used in the calculation of the$? |
| A. | Manufacturing cost |
| B. | Depreciation by sinking fund method |
| C. | Discrete compound interest |
| D. | Cash ratio |
| Answer» C. Discrete compound interest | |
| 48. |
_ The __________ of a chemical company can be obtained directly from the balance sheet as the difference between current assets and current liabilities.$? |
| A. | Cash ratio |
| B. | Net working capital |
| C. | Current ratio |
| D. | Liquids assets |
| Answer» C. Current ratio | |
| 49. |
_ Payback period$? |
| A. | And economic life of a project are the same |
| B. | Is the length of time over which the earnings on a project equals the investment |
| C. | Is affected by the variation in earnings after the recovery of the investment |
| D. | All of the above |
| Answer» C. Is affected by the variation in earnings after the recovery of the investment | |
| 50. |
_ __________ method for profitability evaluation of a project does not account for investment cost due to land.$? |
| A. | Net present worth |
| B. | Pay out period |
| C. | Discounted cash flow |
| D. | Rate of return on investment |
| Answer» C. Discounted cash flow | |