MCQs in Engineering Economics Part XIX

Compiled MCQs in Engineering Economics Part 19 of the series as one topic in General Engineering and Applied Sciences (GEAS) in the ECE Board Exam.

MCQs in Engineering Economics Part 19

This is the Multiples Choice Questions Part 19 of the Series in Engineering Economics as one of the General Engineering and Applied Sciences (GEAS) topic. In Preparation for the ECE Board Exam make sure to expose yourself and familiarize in each and every questions compiled here taken from various sources including past Board Questions in General Engineering and Applied Sciences (GEAS), Engineering Economy Books, Journals and other Engineering Economy References.

Online Questions and Answers in Engineering Economics Series

Following is the list of multiple choice questions in this brand new series:

Engineering Economics MCQs
PART 1: MCQs from Number 1 – 50                        Answer key: PART I
PART 2: MCQs from Number 51 – 100                   Answer key: PART II
PART 3: MCQs from Number 101 – 150                 Answer key: PART III
PART 4: MCQs from Number 151 – 200                 Answer key: PART IV
PART 5: MCQs from Number 201 – 250                 Answer key: PART V
PART 6: MCQs from Number 251 – 300                 Answer key: PART VI
PART 7: MCQs from Number 301 – 350                 Answer key: PART VII
PART 8: MCQs from Number 351 – 400                 Answer key: PART VIII
PART 9: MCQs from Number 401 – 450                 Answer key: PART IX
PART 19: MCQs from Number 901 – 950                 Answer key: PART XIX

Continue Practice Exam Test Questions Part XIX of the Series

Choose the letter of the best answer in each questions.

901. It is the amount of money earned by given capital.

  • A. Interest
  • B. Annuity
  • C. Cash flow
  • D. None of the above

902. Which of the following is a type of simple interest;

  • A. Ordinary
  • B. Exact
  • C. Both A and B
  • D. None of the above

903. The interest earned by the principal competed at the end of the investment period, it varies directly with time.

  • A. Compound interest
  • B. Simple interest
  • C. Annuity
  • D. Perpetuity

904. The interest is completed every end of each interest period and the interest earned for the period is added to the principal.

  • A. Compound interest
  • B. Simple interest
  • C. Annuity
  • D. Perpetuity

905. It is rate quoted in describing a given variety of compound interest.

  • A. nominal rate
  • B. effective rate
  • C. simple rate
  • D. compound rate

906. It is the actual interest earned in one year period.

  • A. Nominal rate
  • B. Effective rate
  • C. Simple rate
  • D. Compound rate

907. A series of uniform payments made at equal intervals of time.

  • A. perpetuity
  • B. interest
  • C. rate
  • D. annuity

908. Which of the following is type of annuity.

  • A. Ordinary
  • B. Deferred
  • C. Annuity due
  • D. All of the above

909. An annuity where the payments periods extend forever or the periodic payments continue indefinitely.

  • A. Perpetuity
  • B. Interest
  • C. Rate
  • D. Annuity

910. The payment is made at the end of each period starting from the first period.

  • A. Ordinary annuity
  • B. Deferred annuity
  • C. Annuity due
  • D. All of the above

911. The first payment is deferred a certain number of periods after the first.

  • A. Ordinary annuity
  • B. Deferred annuity
  • C. Annuity due
  • D. None of the above

912. The payment is made at the beginning of each period starting from the first period.

  • A. Ordinary annuity
  • B. Deferred annuity
  • C. Annuity due
  • D. None of the due

913. It is an application of perpetuity.

  • A. Capitalized cost
  • B. Machine cost
  • C. Manpower cost
  • D. Equipment cost

914. It refers to the decrease in the value of an asset due to usage of passage of time.

  • A. Interest
  • B. Annuity
  • C. Depreciation
  • D. Perpetuity

915. Which of the following is the method of computing depreciation

  • A. Straight line depreciation
  • B. Sinking fund method
  • C. Sum of the years method
  • D. All of the above.

916. The most common method used in computing depreciation;

  • A. Straight line depreciation
  • B. Sinking fund method
  • C. Sum of the years digit method
  • D. Declining balance method

917. The depreciation charge in this method is assumed to vary directly to the number of years and inversely to the sum of the year’s digit.

  • A. Straight line depreciation
  • B. Sinking fund method
  • C. Sum of the year’s digit method
  • D. Declining balance method

918. It is invested yearly at a rate of I to amount to (FC –SV) at the end of the life to the property.

  • A. Straight line depreciation
  • B. Sinking fund method
  • C. Sum of the years digit method
  • D. Declining balance method

919. A written contract to pay a certain redemption value on a specified redemption date and to pay equal dividends periodically.

  • A. Bond
  • B. Capital
  • C. Interest
  • D. Annuity

920. A method of determining when cost exactly equal to revenue.

  • A. Experimental method
  • B. Break-even method
  • C. Break-add method
  • D. None of the above

921. Find the interest on P6,800.00 for 3 years at 11% simple interest.

  • A. P 1,875.00
  • B. P 1,987.00
  • C. P 2,144.00
  • D. P 2,244.00

922. A man borrowed P10,000.00 from his friend and agrees to pay at the end of 90 days under 8% simple interest rate. What is the required amount?

  • A. P 10,200.00
  • B. P 11,500.00
  • C. P 9,500.00
  • D. P 10,700.00

923. Annie buys a television set from a merchant who offers P25,000.00 at the end of 60days. Annie wished to pay immediately and the merchant offers to compute the required amount on the assumption that the money is worth 14% simple interest. What is the required amount?

  • A. P 20,234.87
  • B. P 19,222.67
  • C. P 24,429.97
  • D. P 28,456.23

924. What is the principal amount if the amount of interest at the end of 2 1/2 year is P4,500.00 for a simple interest of 6% per annum?

  • A. P 35,000.00
  • B. P 30,000.00
  • C. P 40,000.00
  • D. P 45,000.00

925. How long must a P40,000 note bearing 4% simple interest run to amount to P41,350.00?

  • A. 340days
  • B. 403 days
  • C. 304 days
  • D. 430 days

926. If P16,000 earns P480 in 9monnths, what is the annual rate of interest?

  • A. 1%
  • B. 2%
  • C. 3%
  • D. 4%

927. A man lends P6,000 at 6% simple interest for 4 years. At the end of this time he invest the entire amount (principal plus interest)at 5% compounded annually for 12 years. How much will he have at the end of the 16-year period.?

  • A. P 13,361.20
  • B. P 13,633.20
  • C. P13,333.20
  • D. P16,323.20

928, A time deposit of P110,000 for 31days earns P890.39 on maturity date after deducting the 20% withholding tax on interest income. Find interest per annum.

  • A. 12.5%
  • B. 11.95%
  • C. 12.25%
  • D. 11.75%

929. A bank charges 12% simple interest on a P300.00 loan. How much will be repaid if the loan is paid back in one lump sum after three years.

  • A. P 408.00
  • B. P 551.00
  • C. P415.00
  • D. P450.00

930. A tag price of a certain commodity is for 100 days. If paid in 31 days, there is 3%discount. What is the simple interest paid?

  • A. 12.5%
  • B. 6.25%
  • C. 22.32%
  • D. 16.14%

931. Accumulate P5,000.00 for 10 years at 8% compounded quarterly.

  • A. P 12,456.20
  • B. P 13,876.50
  • C. P10,345.80
  • D. P11,040.20

932. Accumulate P5,000.00 for 10 years at 8% compounded semi-annually.

  • A. P 10,955.61
  • B. P 10,233.67
  • C. P9,455.67
  • D. P11,876.34

933. Accumulate P5,000.00 for 10 years at 8% compounded monthly

  • A. P 15,456.75
  • B. P 11,102.61
  • C. P10,955.61
  • D. P10,955.61

934. Accumulate P5,000.00 for 10 years at 8% compounded annually.

  • A. P 10,794.62
  • B. P 8,567.97
  • C. P10,987.90
  • D. P7,876.87

935. How long it will take P1,000 to amount to P1,346 if invested at 6% compounded quarterly.

  • A. 3 years
  • B. 4 years
  • C. 5 years
  • D. 6 years

936. How long will it take for an investment to double its amount if invested at an interest rate of 6% compounded bi-monthly

  • A. 10 years
  • B. 12 years
  • C. 13 years
  • D. 14 years

937. If the compound interest on P3,000.00 in years is P500.00 then the compound interest on P3,000.00 in 4 years is:

  • A. P 956.00
  • B. P 1,083.00
  • C. P1,125.00
  • D. P1,526.00

938. The salary of Mr. Cruz is increased by 30%every 2 years beginning January 1, 1982. Counting from that date, at what year will his salary just exceed twice his original salary?

  • A. 1988
  • B. 1989
  • C. 1990
  • D. 1991

939. If you borrowed P10,000 from the bank with 18% interest per annum, what is the total amount to be repaid at the end of one year.

  • A. P 11,800.00
  • B. P 19,000.00
  • C. P28,000.00
  • D. P10,180.00

940. What is the effective rate for an interest rate at 12% compounded continuously?

  • A. 12.01%
  • B. 12.89%
  • C. 12.42%
  • D. 12.75%

Answer: D

941. How long it will take for an investment to fivefold its amount if money is worth 14%compounded semiannually.

  • A. 11
  • B. 12
  • C. 13
  • D. 14

942. An interest of 8% compounded semiannually is how many percent if compounded quarterly?

  • A. 7.81%
  • B. 7.85%
  • C. 7.92%
  • D. 8.01%

943. A man is expecting to receive P450,000.00 at the end of 7 years. If money is worth 14% compounded quarterly how much is it worth at present?

  • A. P 125,458.36
  • B. P 147,456.36
  • C. P162,455.63
  • D. P171,744.44

944. A man has a will of P650,000.00 from his father. If his father deposited an amount of P450,000 in a trust fund earning 8% compounded annually, after how many years will he man receive his will?

  • A. 4.55 years
  • B. 4.77 years
  • C. 5.11 years
  • D. 5.33 years

945. Mr. Adam deposited P120,000.00 in a bank who offers 8%interest compounded quarterly. If the interest is subject to a 14% tax, how much will he receive after 5 years?

  • A. P 178,313.69
  • B. P 153,349.77
  • C. P 170,149.77
  • D. P 175,343.77

946. What interest compounded monthly is equivalent to an interest rate of 14% compounded quarterly

  • A. 1.15%
  • B. 13.84%
  • C. 10.03%
  • D. 11.52%

947. What is the worth of two P100,000 payments at the end of the third and the fourth year? The annual interest rate is 8%.

  • A. P 152.87
  • B. P 112.34
  • C. P 187.98
  • D. P 176.67

948. A firm borrows P2,000.00 for 6years at 8%. At the end of 6 years, it renews the loan for the amount due plus P2,000 more for 2 years at 8%. What is the lump sum due?

  • A. P 5,679.67
  • B. P 6,789.98
  • C. P 6,034.66
  • D. P 5,888.77

949. At an annual rate of return of 8%, what is the future worth ofP1,000 at the end of 4 years?

  • A. P 1,388.90
  • B. P 1,234.56
  • C. P 1,765.56
  • D. P 1,360.50

950. A student has money given by his grandfather in the amount of P20,000.00. How much money in the form of interest will he get if the money is put in a bank that offers 8% rate compounded annually at the end of 7 years?

  • A. P 34,276.48
  • B. P 34,270.00
  • C. P 36,276.40
  • D. P 34,266.68

Complete List of MCQs in General Engineering and Applied Science per topic


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