Chemical Engineering Plant Economics MCQs with answers Page - 4

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Q. Profit is equal to revenue minus

  • (A) Book value
  • (B) Total cost
  • (C) Operating cost
  • (D) None of these

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Q. With increase in the discounted cash flow rate of return, the ratio of the total present value to the initial investment of a given project

  • (A) Decreases
  • (B) Increases
  • (C) Increases linearly
  • (D) Remains constant

A

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Q. Which of the following relationship is not correct is case of a chemical process plant?

  • (A) Manufacturing cost = direct product cost + fixed charges + plant overhead costs
  • (B) General expenses = administrative expenses + distribution & marketing expenses
  • (C) Total product cost = manufacturing cost + general expenses
  • (D) Total product cost = direct production cost + plant overhead cost

A

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Q. Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant?

  • (A) Cash reserve
  • (B) Payout period
  • (C) Rate of return on investment
  • (D) Discounted cash flow based on full life performance

A

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Q. In a chemical process plant, the total product cost comprises of manufacturing cost and the

  • (A) General expenses
  • (B) Overhead cost
  • (C) R & D cost
  • (D) None of these

A

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Q. Factory manufacturing cost is the sum of the direct production cost

  • (A) And plant overhead cost
  • (B) Plant overhead cost and administrative expenses
  • (C) Fixed charges and plant overhead cost
  • (D) None of these

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Q. Manufacturing cost in a chemical company does not include the

  • (A) Fixed charges
  • (B) Plant overheads
  • (C) Direct products cost
  • (D) Administrative expenses

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Q. 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

A

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Q. Cost incurred towards __________ in a chemical plant is a component of the utilities cost.

  • (A) Running a control laboratory
  • (B) Water supply
  • (C) Medical services
  • (D) Property protection

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Q. 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

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