Engineering Economy Mcqs for Preparation

The institute of Electronics and Communications Engineers of the Philippines (IECEP) is planning to put up its own building. Two proposals being considered are below.

1. The construction of the building now to cost P 400,000
2. The construction of a smaller building now to cost P300,000 and at the end of 5 years, an extension to be added to cost P 200,000.
By how much is proposal B more economical than proposal A if interest rate is 20% and depreciation to be neglected ?

A. P 19,122.15
B. P 19,423.69
C. P 19,518.03
D. P 19,624.49

Engineering Economy

A P 1,000,000 issue of 3%, 15-year bond was sold at 95%. What is the rate of interest of this investment ?

Miss Calledo deposited P 1,000, P 1,500 and P 2,000 at the end of the 2nd year, 3rd year and 4th year, respectively in a savings account which earned 10% per annum. How much is in the account at the end of the 4th year ?

A young engineer borrowed P 10,000 at 12% interest and paid P 2,000 per annum for the last 4 years. What does he have to pay at the end of the fifth year in order to pay off his loan ?

A person buys a piece of lot for P 100,000 downpayment and 10 deferred semi-annual payments of P 8,000 each, starting three years from now. What is the present value of the investment if the rate of interest is 12% compounded semi-annually ?

A man loans P 187,400 from a bank with interest at 5% compounded annually. He agrees to pay his obligations by paying 8 equal annual payments, the first being due at the end of 10 years. Find the annual payments ?

What is the present worth of a year annuity paying P 3,000.00 at the end of each year, with interest at 8% compounded annually ?

A factory operator bought a diesel generator set for P 10,000.00 and agreed to pay the dealer uniform sum at the end of each year for 5 years at 8% interest compounded annually, that the final payment will cancel the debt for principal and interest. What is the annual payment ?

What annuity is required over 12 years to equate with a future amount of P 20,000? Assume i= 6% annually ?

What is the present worth of a P500 annuity starting at the end of the third year and continuing to the end of the fourth year, if the annual interest rate is 10 % ?

The institute of Electronics and Communications Engineers of the Philippines (IECEP) is planning to put up its own building. Two proposals being considered are below.