MCQOPTIONS
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MCQOPTIONS
This section includes 82 Mcqs, each offering curated multiple-choice questions to sharpen your Chemical Engineering knowledge and support exam preparation. Choose a topic below to get started.
| 51. |
The economic life of a large chemical process plant as compared to a small chemical plant is |
| A. | Only slightly more |
| B. | Much more |
| C. | Slightly less |
| D. | Almost equal |
| Answer» C. Slightly less | |
| 52. |
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 |
| A. | 0.1 |
| B. | 0.6 |
| C. | 0.8 |
| D. | 0.2 |
| Answer» C. 0.8 | |
| 53. |
Accumulated sum at the end of 5 years, if Rs. 10000 is invested now at 10% interest per annum on a compound basis is Rs |
| A. | 15000 |
| B. | 16105 |
| C. | 18105 |
| D. | 12500 |
| Answer» C. 18105 | |
| 54. |
Which of the following is not a component of the working capital for a chemical process plant? |
| A. | Product inventory |
| B. | In-process inventory |
| C. | Minimum cash reserve |
| D. | Storage facilities |
| Answer» E. | |
| 55. |
Out of the following, the depreciation calculated by the __________ method is the maximum. |
| A. | Diminishing balance |
| B. | Straight line |
| C. | Sum of the years digit |
| D. | Sinking fund |
| Answer» B. Straight line | |
| 56. |
Optimum number of effects in a multiple effect evaporator is decided by the |
| A. | Cost benefit analysis |
| B. | Floor area availability |
| C. | Terminal parameters |
| D. | Evaporation capacity required |
| Answer» B. Floor area availability | |
| 57. |
A machine has an initial value of Rs. 5000, service life of 5 years and final salvage value of Rs. 1000. The annual depreciation cost by straight line method is Rs. |
| A. | 300 |
| B. | 600 |
| C. | 800 |
| D. | 1000 |
| Answer» D. 1000 | |
| 58. |
An investment of Rs. 100 lakhs is to be made for construction of a plant, which will take two years to start production. The annual profit from the operation of the plant is Rs. 20 lakhs. What will be the payback time? |
| A. | 5 years |
| B. | 7 years |
| C. | 12 years |
| D. | 10 years |
| Answer» C. 12 years | |
| 59. |
"Break-even point" is the point of intersection of |
| A. | Fixed cost and total cost |
| B. | Total cost and sales revenue |
| C. | Fixed cost and sales revenue |
| D. | None of these |
| Answer» C. Fixed cost and sales revenue | |
| 60. |
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 |
| Answer» B. Rate of return on investment | |
| 61. |
Fixed charges for a chemical plant does not include the |
| A. | Interest on borrowed money |
| B. | Rent of land and buildings |
| C. | Property tax, insurance and depreciation |
| D. | Repair and maintenance charges |
| Answer» E. | |
| 62. |
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 | |
| 63. |
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. | 40,096 |
| B. | 43,196 |
| C. | 53,196 |
| D. | 60,196 |
| Answer» E. | |
| 64. |
Direct costs component of the fixed capital consists of |
| A. | Contingencies |
| B. | Onsite and offsite costs |
| C. | Labour costs |
| D. | Raw material costs |
| Answer» C. Labour costs | |
| 65. |
Cost of piping in a fluid processing unit (e.g., distillation) of a chemical process plant is about __________ percent of the fixed capital investment. |
| A. | 4 |
| B. | 13 |
| C. | 22 |
| D. | 34 |
| Answer» C. 22 | |
| 66. |
Which of the following is not a component of depreciation cost? |
| A. | Repairs and maintenance cost |
| B. | Loss due to obsolescence of the equipment |
| C. | Loss due to decrease in the demand of product |
| D. | Loss due to accident/breakdown in the machinery |
| Answer» B. Loss due to obsolescence of the equipment | |
| 67. |
Purchased cost of equipments for a chemical process plant ranges from __________ percent of the fixed capital investment. |
| A. | 10 to 20 |
| B. | 20 to 40 |
| C. | 45 to 60 |
| D. | 65 to 75 |
| Answer» C. 45 to 60 | |
| 68. |
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 (A), (B) and (C) |
| Answer» C. Is affected by the variation in earnings after the recovery of the investment | |
| 69. |
Which of the following ceramic packing materials is the costliest of all? |
| A. | Berl saddles |
| B. | Raschig rings |
| C. | Pall rings |
| D. | Intalox saddle |
| Answer» B. Raschig rings | |
| 70. |
The inventory of raw materials included in the working capital is usually about __________ month‟s supply of raw materials valued at delivery prices. |
| A. | One |
| B. | Three |
| C. | Six |
| D. | Twelve |
| Answer» B. Three | |
| 71. |
Fixed capital investment of a chemical plant is the total amount of money needed to supply the necessary plant and manufacturing facilities plus the working capital for operation of the facilities. Which of the following components of fixed capital investment requires minimum percentage of it? |
| A. | Electrical installation cost |
| B. | Equipment installation cost |
| C. | Cost for piping |
| D. | Equipment insulation cost |
| Answer» E. | |
| 72. |
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 |
| Answer» D. None of these | |
| 73. |
Depreciation |
| A. | Costs (on annual basis) are constant when the straight line method is used for its determination |
| B. | Is the unavoidable loss in the value of the plant, equipment and materials with lapse in time |
| C. | Does figure in the calculation of income tax liability on cash flows from an investment |
| D. | All (A), (B) and (C) |
| Answer» E. | |
| 74. |
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 | |
| 75. |
A shareholder has __________ say in the affairs of company management compared to a debenture holder. |
| A. | More |
| B. | Less |
| C. | Same |
| D. | No |
| Answer» B. Less | |
| 76. |
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 | |
| 77. |
Pick out the wrong statement. |
| A. | Gross revenue is that total amount of capital received as a result of the sale of goods or servi |
| B. | Net revenue is the total profit remaining after deducting all costs excluding taxes |
| C. | The ratio of immediately available cash to the total current liabilities is known as the cash ratio |
| D. | Consolidated income statement based on a given time period indicates surplus capital and shows the relationship among total income, costs & profit over the time interval |
| Answer» C. The ratio of immediately available cash to the total current liabilities is known as the cash ratio | |
| 78. |
A balance sheet for an industrial concern shows |
| A. | The financial condition at any given time |
| B. | Only current assets |
| C. | Only fixed assets |
| D. | Only current and fixed assets |
| Answer» B. Only current assets | |
| 79. |
__________ taxes are based on gross earnings. |
| A. | Property |
| B. | Excise |
| C. | Income |
| D. | Capital gain |
| Answer» D. Capital gain | |
| 80. |
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 |
| Answer» D. None of these | |
| 81. |
Operating profit of a chemical plant is equal to |
| A. | Profit before interest and tax i.e., net profit + interest + tax |
| B. | Profit after tax plus depreciation |
| C. | Net profit + tax |
| D. | Profit after tax |
| Answer» B. Profit after tax plus depreciation | |
| 82. |
Which of the following does not come under the sales expenses for a product of a chemical plant? |
| A. | Advertising |
| B. | Warehousing |
| C. | Legal fees |
| D. | Customer service |
| Answer» D. Customer service | |