# Financial analysis and case studies - Electrical Engineering (MCQ) questions and answers

1)   A person purchases a lathe for Rs. 8000 the freight and haulage cost Rs 150 and the charges for installation it is Rs 200. Its life is 20 years and the scrap value is Rs 250. Then the annual depreciation charges by straight line method is

a. Rs 405
b. Rs 452.6
c. Rs 438.9
d. Rs 523.8
 Answer  Explanation ANSWER: Rs 405 Explanation: No explanation is available for this question!

2)   A sum of money is deposited in a SB account. If it is compounded annually at the rate of 8%, after 10 years it will become Rs 2,00,000. Then the sum of money is

a. Rs 92638.7
b. Rs 95233.1
c. Rs 96924.5
d. Rs 98888.1
 Answer  Explanation ANSWER: Rs 92638.7 Explanation: No explanation is available for this question!

3)   To save energy, Washington DC, has developed an investment analysis software package, ENVEST. This program can be run on an

a. IBM PC
b. PCXT
c. PCAT
d. All of these
 Answer  Explanation ANSWER: All of these Explanation: No explanation is available for this question!

4)   A tax credit substantially

a. Increases the investment merit of the investment
b. Decreases the investment merit of the investment
c. Does not cause any effect on the investment merit of the investment
d. None of these
 Answer  Explanation ANSWER: Increases the investment merit of the investment Explanation: No explanation is available for this question!

5)   Which method provides cash for the replacement of asset at the end of its useful life?

a. Straight line depreciation
b. Sum of years digits depreciation
c. Declining balance depreciation
d. Sinking fund depreciation
 Answer  Explanation ANSWER: Sinking fund depreciation Explanation: No explanation is available for this question!

6)   If L is the value of equipment at the end of its useful life, n is the number of years of useful life equipment and P is the initial cost than the annual depreciation rate is given by

a. ( P - L ) / n
b. ( p - n ) / L
c. ( L - n ) / P
d. n / ( L - P )
 Answer  Explanation ANSWER: ( P - L ) / n Explanation: No explanation is available for this question!

7)   The pay period is defined as the ratio of

a. Net investment to the net annual cash flow
b. Net investment to the capital cost
c. Net annual cash flow to the capital cost
d. Net annual savings to the capital cost
 Answer  Explanation ANSWER: Net investment to the net annual cash flow Explanation: No explanation is available for this question!

8)   The future value of one dollar in “n” periods at interest rate of “I” present is known as

a. Single payment compound amount
b. Single payment present worth
c. Uniform series compound amount
d. Sinking fund payment
 Answer  Explanation ANSWER: Single payment compound amount Explanation: No explanation is available for this question!

9)   The sum of money received or paid in annual in one or more installments, for a given period of time is known as

a. Time value of money
b. Annuity
c. True compounding
d. Cash flow
 Answer  Explanation ANSWER: Annuity Explanation: No explanation is available for this question!

10)   The capital cost of generating equipment, transmission system and distribution system comes under

a. Fixed capital
b. Running capital
c. Both fixed and running capital
d. All of these
e. None of these
 Answer  Explanation ANSWER: Fixed capital Explanation: No explanation is available for this question!