Test your basic knowledge |

Principles Of Engineering: Economics

Subject : engineering
Instructions:
  • Answer 21 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Past costs are irrelevant in engineering economic analyses - unless they impact future costs






2. To move money backward one time unit - DIVIDE by one plus the discount or interest rate






3. To move money forward one time unit - MULTIPLY by one plus the discount or interest rate






4. Money has a time value






5. Identify the investment alternatives






6. Marginal revenue must exceed marginal cost






7. Money has a time value






8. Money should continue to be invested as long as each additional increment of investment yields a return that is greater than the investor's time value of money






9. Two investment alternatives are equivalent if they have the same economic worth






10. Risks and returns tend to be positively correlated






11. Compare the alternatives






12. Define the planning horizon






13. Money cannot be added or subtracted unless it occurs at the same point(s) in time






14. Make investments that are economically justified






15. Consider only differences in cash flows among investment alternatives






16. Choose the mutually exclusive investment alternative that maximizes economic worth






17. Estimate the cash flows






18. Specify the discount rate






19. Perform supplementary analyses






20. Compare investment alternatives over a common period of time






21. Select the preferred investment