Chemical Plant Engineering Questions with Answers - Set 03 - ObjectiveBooks

Chemical Plant Engineering Questions with Answers - Set 03

Practice Test: Question Set - 03

1. Which of the following is not a component of depreciation cost?
    (A) Repairs and maintenance cost
    (B) Loss due to obsolescence of the equipment
    (C) Loss due to decrease in the demand of product
    (D) Loss due to accident/breakdown in the machinery

2. Cost of piping in a fluid processing unit (e.g., distillation) of a chemical process plant is about __________ percent of the fixed capital investment.
    (A) 4
    (B) 13
    (C) 22
    (D) 34

3. Direct costs component of the fixed capital consists of
    (A) Contingencies
    (B) Onsite and offsite costs
    (C) Labour costs
    (D) Raw material costs

4. A reactor having a salvage value of Rs. 10000 is estimated to have a service life of 10 years. The annual interest rate is 10%. The original cost of the reactor was Rs. 80000. The book value of the reactor after 5 years using sinking fund depreciation method will be Rs.
    (A) 40,096
    (B) 43,196
    (C) 53,196
    (D) 60,196

5. In which of the electric power generation system, the operating cost is minimum?
    (A) Thermal
    (B) Nuclear
    (C) Hydroelectric
    (D) Fast breeder reactor

6. According to six-tenths-factor rule, if the cost of a given unit at one capacity is known, then the cost of similar unit with '' times the capacity of the first unit is approximately equal to __________ times the cost of the initial unit.
    (A) n
    (B) n0.6
    (C) n0.4
    (D) √n

7. Fixed charges for a chemical plant does not include the
    (A) Interest on borrowed money
    (B) Rent of land and buildings
    (C) Property tax, insurance and depreciation
    (D) Repair and maintenance charges

8. Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant?
    (A) Cash reserve
    (B) Rate of return on investment
    (C) Payout period
    (D) Discounted cash flow based on full life performance

9. "Break-even point" is the point of intersection of
    (A) Fixed cost and total cost
    (B) Total cost and sales revenue
    (C) Fixed cost and sales revenue
    (D) None of these

10. 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 payback time?
    (A) 5 years
    (B) 7 years
    (C) 12 years
    (D) 10 years

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