Chemical Engineering Plant Economics MCQs with answers Page - 7

Here, you will find a collection of MCQ questions on Chemical Engineering Plant Economics. Go through these questions to enhance your preparation for upcoming examinations and interviews.

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Q. 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

A

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Q. For a given fluid, as the pipe diameter increases, the pumping cost

  • (A) Decreases
  • (B) Increases
  • (C) Remains the same
  • (D) May increase or decrease, depending upon whether the fluid is Newtonian or non-Newtonian

A

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Q. The ratio of gross annual sales to the fixed capital investment is termed as the __________ ratio.

  • (A) Cash reserve
  • (B) Capital
  • (C) Turnover
  • (D) Investment

A

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Q. 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

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Q. Which of the following is a component of working capital investment?

  • (A) Utilities plants
  • (B) Maintenance and repair inventory
  • (C) Process equipments
  • (D) Depreciation

A

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Q. If the interest rate of 10% per period is compounded half yearly, the actual annual return on the principal will be __________ percent.

  • (A) 10
  • (B) 20
  • (C) >20
  • (D) < 20

A

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Q. The inventory of raw materials included in the working capital is usually about __________ months supply of raw materials valued at delivery prices.

  • (A) One
  • (B) Three
  • (C) Six
  • (D) Twelve

A

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Q. 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 pay back time?

  • (A) 5 years
  • (B) 7 years
  • (C) 12 years
  • (D) 10 years

A

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Q. The total investment in a project is Rs. 10 lakhs and the annual profit is 1.5 lakhs. If the project life is 10 years, then the simple rate of return on investment is

  • (A) 1.5%
  • (B) 10%
  • (C) 15%
  • (D) 150%

A

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Q. 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

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