Engineering Economics MCQs

Question 1

The more critical (or severe) test of the firm's liquidity can be judged by:

Accepted Answer

Acid-Test (or Quick) ratio

Answer

Liquidity ratio

Answer

Current ratio

Answer

Debts ratio

Question 2

In a cash flow series:

Accepted Answer

All of these

Answer

Uniform gradient signifies that an income or disbursement changes by the same amount in each interest period

Answer

Either an increase or decrease in the amount of a cash flow is called the gradient

Answer

The gradient in the cash flow may be positive or negative

Question 3

A VOM has a selling price of P 400. If its selling price is expected to decline at a rate of 10% per annum due to obsolescence, what will be its selling price after 5 years?

Accepted Answer

P 236.20

Answer

P 222.67

Answer

P 212.90

Answer

P 231.56

Question 4

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?

Accepted Answer

12 months

Answer

10 months

Answer

11 months

Answer

13 months

Question 5

The key to profitable operation for project cost control, is:

Accepted Answer

To keep the project cost within the cost budget and knowing when and where job costs are deviating

Answer

To keep the project cost equal to original cost estimate

Answer

To keep the project cost equal to subsequent construction budget

Answer

None of these

Question 6

What is an accounting term that represents an inventory account adjustment?

Accepted Answer

Cost accounting

Answer

Cost of goods sold

Answer

Standard cost

Answer

Overhead cost

Question 7

Current ratio is:

Accepted Answer

$$\frac{{{	ext{Current assets}}}}{{{	ext{Current liabilities}}}}$$

Answer

$$\frac{{{	ext{Current assets}} + {	ext{Loans}}}}{{{	ext{Current liabilities}}}}$$

Answer

$$\frac{{{	ext{Current assets}} + {	ext{Loans advances}}}}{{{	ext{Current liabilities}}}}$$

Answer

None of these

Question 8

Under ordinary simple interest, how many days in one year?

Accepted Answer

360

Answer

300

Answer

365

Answer

366

Question 9

The original record of a business transaction is recorded in this book.

Accepted Answer

Journal

Answer

Work book

Answer

Ledger

Answer

Account book