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Chemical Engineering Plant Economics MCQ Question with Answer

Chemical Engineering Plant Economics MCQ with detailed explanation for interview, entrance and competitive exams. Explanation are given for understanding.

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Question No : 43
Cost of piping in a fluid processing unit (e.g., distillation) of a chemical process plant is about __________ percent of the fixed capital investment.

4
13
22
34
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Question No : 44
__________ of depreciation calculation does not take into account the interest on investments.

Present worth method
Sinking fund method
Sum of the years-digits method
All (A), (B) and (C)
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Question No : 45
Which of the following methods of depreciation calculations results in book values greater than those obtained with straight line method?

Multiple straight line method
Sinking fund method
Declining balance method
Sum of the years digit method
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Question No : 46
Pick out the wrong statement.

Debt-equity ratio of a chemical company describes the lenders contribution for each rupee of owner's contribution i.e., debt-equity ratio = total debt/net worth
Return on investment (ROI) is the ratio of profit before interest & tax and capital employed (i.e. net worth + total debt)
Working capital = current assets + current liability
Turn over = opening stock + production closing stock
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Question No : 47
The payback method for the measurement of return on investment

Gives a correct picture of profitability
Underemphasises liquidity
Does not measure the discounted rate of return
Takes into account the cash inflows after the recovery of investments
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Question No : 48
Equipment installation cost in a chemical process plant ranges from __________ percent of the purchased equipment cost.

10 to 20
35 to 45
55 to 65
70 to 80
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Question No : 49
In declining balance method of depreciation calculation, the

Value of the asset decreases linearly with time
Annual cost of depreciation is same every year
Annual depreciation is the fixed percentage of the property value at the beginning of the particular year
None of these
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