FREE Master of Engineering Management Engineering Economics Questions and Answers

Question 1

False or True. Are the following future receipts' present values accurate? $8,500 In 12 years, at a compound annual interest rate of 12% $2182

Accepted Answer

TRUE

Answer

FALSE

Question 2

True or False: What circumstances cause the market inter-set rate to be less than?

Accepted Answer

FALSE

Answer

TRUE

Question 3

False or True. If a home was purchased 12 years ago and is currently being sold for 2.5 times the original price, the average annual rate would be 7.93%.

Accepted Answer

TRUE

Answer

FALSE

Question 4

How long must $500 be invested for it to grow to $625 at a 10% simple interest rate each year?

Accepted Answer

2.5 years

Answer

1 year

Answer

3 years

Answer

2.1 years

Question 5

A small construction business is thinking about spending $61,000 for a used bulldozer. If the company buys the dozer now, what is the closest company per for the identical future amount in year 4 that the company is paying for the dozer 4% year interest?

Accepted Answer

$71,365

Answer

over $72,000

Answer

$65,461

Answer

$52,143

Question 6

If interest is compounded annually at 10%, how long will it take for a $1,000 investment to grow to $7,400?

Accepted Answer

21 years

Answer

7 years

Answer

6 months

Answer

10 years

Question 7

Think about the interest rate and the following cash flow.

Accepted Answer

20.90%

Answer

30%

Answer

17.50%

Answer

10%

Question 8

By allowing fans to join up to pay a "mortage" for the opportunity to purchase premium seats at football games for several decades with tickets locked in at current pricing, a sports mortgage is an innovative approach to finance cash-strapped sports organizations. The locked-in price duration at Notre Dame is 50 years. What is the equivalent annual cost of the football tickets over the 50-year period at an interest rate of 8% per year if a fan pays a $130,000 "mortage" fee now (i.e., in year 0), when season tickets are selling for $290 each?

Accepted Answer

-10924

Answer

-14562

Answer

-10420

Answer

-11244

Question 9

If a sports enthusiast purchases a mortgage to attend USC football games by paying $130,000 in 10 equal installments starting now, and then pays a fixed price of $290 per year for 50 years (starting 1 year from now) for through 50 of the season tickets at 8% per year interest?

Accepted Answer

$7,991

Answer

$360

Answer

$9,500

Answer

$10,000

Question 10

The advantages of a cooling filtration project for a nuclear power plant along the Ohio River are $10,000 per year, starting with year 1. $50,000 is spent in year 0 and $50,000 is spent at the conclusion of year 2. Determine the B/C ratio at a rate of 10% annually.

Accepted Answer

1. 1%

Answer

30. 4%

Answer

13%

Answer

2 %