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.Management Sciences
Category: Engineering Economy
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 ?
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A. 10 months
B. 11 months
C. 12 months
D. 13 months
What is normally used to compare alternatives that accomplish the same purpose but have unequal lives ?
A. Capitalized cost method
B. Present worth method
C. Annual cost method
D. MARR
A loan of P5,000 is made for a period of 15 months, at a simple interest rate of 15%, what future amount is due at the end of the loan period ?
A. 5,937.50
B. 5,873.20
C. 5,712.40
D. 5,690.12
What refers to an imaginary cost representing what will not be received if a particular strategy is rejected ?
A. Opportunity cost
B. Ghost cost
C. Horizon cost
D. Null cost
By the condition of a will, the sum of P20,000 is left to a girl to be held in trust fund by her guardian until it amounts to P50,000. When will the girl receive the money if fund invested at 8% compounded quarterly ?
A. 11.23 years
B. 11.46 years
C. 11.57 years
D. 11.87 years
In what method of computing depreciation where it assumes that a sinking fund is established in which funds will accumulate for replacement purposes ?
A. Straight line method
B. Sinking fund method
C. Sum-of-year digit method
D. Declining balance method
What is the increase in the money value of a capital asset is called?
A. Profit
B. Capital gain
C. Capital expenditure
D. Capital stock
What is defined as the reduction or fall of the value of an asset due to constant use and passage of time ?
A. Depletion
B. Inflation
C. Depreciation
D. Deflation
What is used when a quick estimate of the doubling time for the invested money is needed ?
A. Rule of 48
B. Rule of 36
C. Rule of 24
D. Rule of 72
A mathematical expression also known as the present value of annuity of one is called ____________________?
A. Load factor
B. Demand factor
C. Sinking fund factor
D. Present worth factor
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