Question 1

As a University student, when you look for a new apartment, what economic criteria consistent with the subject matter of engineering economics do you apply?

Accepted Answer

You have to understand your budget in terms of cash inflows and outflows. Cash inflows may include:a fellowship, a grant, a loan, an allowance provided by parents and others. Cash outflows to consider are:costs of utilities, transportation cost, cost of textbooks, tuition fee, food expenses, and others. As well, time should be explicitly introduced into your economic analysis. Therefore, for example, a more expensive apartment closer to the University can be preferred to a cheaper one far away, based on transportation costs.

Question 2

In engineering economics, sensitivity analysis

Accepted Answer

A) addresses risk in engineering projects. 
B) addresses inflation in a country. 
C) involves random variables with their probabilities. 
D) assesses the effect of uncertainty on a decision. 
E) involves cash flows that are known with certainty. 
A) addresses risk in engineering projects. 
B) addresses inflation in a country. 
C) involves random variables with their probabilities. 
D) assesses the effect of uncertainty on a decision. 
E) involves cash flows that are known with certainty. D

Question 3

Engineering economics is

Accepted Answer

A) a body of knowledge to determine which of several alternative is technically best. 
B) a collection of techniques for quantitative analysis to select a preferable alternative from several technically viable ones. 
C) a set of tools to calculate an engineering project's costs. 
D) a set of rules to evaluate an engineering project. 
E) a set of methods to determine an engineering project's costs in terms of time value of money. 
A) a body of knowledge to determine which of several alternative is technically best. 
B) a collection of techniques for quantitative analysis to select a preferable alternative from several technically viable ones. 
C) a set of tools to calculate an engineering project's costs. 
D) a set of rules to evaluate an engineering project. 
E) a set of methods to determine an engineering project's costs in terms of time value of money. B

Question 4

From an economic standpoint, any engineering project can be thought of in terms of

Accepted Answer

A) its costs and benefits over time. 
B) its constraints. 
C) its receipts and disbursements. 
D) its revenues and profits over time. 
E) its investment and costs over time. 
A) its costs and benefits over time. 
B) its constraints. 
C) its receipts and disbursements. 
D) its revenues and profits over time. 
E) its investment and costs over time.

Question 5

An owner of a small company is deciding to sell her business. She received several options specified bellow. Which one should the company's owner accept?

Accepted Answer

A) $600 000 in cash 
B) $500 000 in government bonds earning a 5% rate of return over 10 years 
C) $400 000 in securities earning an 8% rate of return over 8 years 
D) 15% of the future profits earned by the next owner during first 10 years 
E) It is impossible to compare these offers due to uncertainty about basic economic variables over time. 
A) $600 000 in cash 
B) $500 000 in government bonds earning a 5% rate of return over 10 years 
C) $400 000 in securities earning an 8% rate of return over 8 years 
D) 15% of the future profits earned by the next owner during first 10 years 
E) It is impossible to compare these offers due to uncertainty about basic economic variables over time.

Question 6

Based on your intuition and experience, which of the following options has the highest value?

Accepted Answer

A) $100 government bond earning a 5% annual rate of return 
B) $100 invested in a fund with a 10% annual rate of return 
C) $200 government bond earning a 5% annual rate of return 
D) $200 invested in a fund earning a 10% annual rate of return 
E) $150 invested in a fund earning a 7% annual rate of return 
A) $100 government bond earning a 5% annual rate of return 
B) $100 invested in a fund with a 10% annual rate of return 
C) $200 government bond earning a 5% annual rate of return 
D) $200 invested in a fund earning a 10% annual rate of return 
E) $150 invested in a fund earning a 7% annual rate of return

Question 7

Which of the following items has negligible maintenance costs?

Accepted Answer

A) computer 
B) building 
C) ruler 
D) shoes 
E) fur hat 
A) computer 
B) building 
C) ruler 
D) shoes 
E) fur hat

Question 8

Susan is evaluating an engineering project. She assumes zero inflation for the duration of the project. With respect to this situation, which statement is consistent with the subject matter of engineering economics?

Accepted Answer

A) A zero inflation assumption is always a good one. 
B) A zero inflation assumption is not realistic but it is better than assuming some uncertain inflation rate. 
C) A zero assumption is not a bad one for the base case, but then the project should be evaluated under different values in some range to see how inflation affects the project. 
D) Since in Canada inflation is low, it is possible to neglect it. 
E) The highest historical inflation rate must be chosen instead. 
A) A zero inflation assumption is always a good one. 
B) A zero inflation assumption is not realistic but it is better than assuming some uncertain inflation rate. 
C) A zero assumption is not a bad one for the base case, but then the project should be evaluated under different values in some range to see how inflation affects the project. 
D) Since in Canada inflation is low, it is possible to neglect it. 
E) The highest historical inflation rate must be chosen instead.

Question 9

When evaluating an engineering project, what types of constraints does a decision maker face?

Accepted Answer

A project might be technically feasible

Question 10

Suppose that in order to finance your studies at the University, three options are available to you: (i)a student loan, (ii)a student line of credit, and (iii)a part-time job at minimum wage. In making your decision, what factors should be taken into account and why?

Accepted Answer

Both a student loan and a student line o

Question 11

In which of the following problems do you need engineering economics?

Accepted Answer

A) to choose a course in your program 
B) to chose the right textbook 
C) to decide whether to borrow money from parents or from a bank 
D) to decide whether or not to buy a car 
E) to decide where to spend summer vacation 
A) to choose a course in your program 
B) to chose the right textbook 
C) to decide whether to borrow money from parents or from a bank 
D) to decide whether or not to buy a car 
E) to decide where to spend summer vacation

Question 12

Sensitivity Analysis has sometimes been referred to as "what if" analysis. Explain why.

Accepted Answer

Sensitivity Analysis begins with a base

Question 13

Suppose that you want to buy a used car for $3 000, but you don't have enough cash. List some of the (legal)strategies that you might consider.

Accepted Answer

Possible alternatives for financing the

Question 14

Most of the economic values we use in our evaluation of engineering projects are

Accepted Answer

A) precise and very descriptive. 
B) approximate. 
C) based on robust statistical estimation. 
D) derived from natural experiments. 
E) results of precise statistical surveys. 
A) precise and very descriptive. 
B) approximate. 
C) based on robust statistical estimation. 
D) derived from natural experiments. 
E) results of precise statistical surveys.

Question 15

Explain the role of a mathematical model in engineering economics.

Accepted Answer

When one describes something, one does s

Question 16

If you are asked to choose between $100 today and $150 one year from now, you are being asked to

Accepted Answer

A) make a guess. 
B) reveal your implied interest rate. 
C) compare two values which are not comparable in principle. 
D) reveal your private financial information. 
E) make a choice under uncertainty. 
A) make a guess. 
B) reveal your implied interest rate. 
C) compare two values which are not comparable in principle. 
D) reveal your private financial information. 
E) make a choice under uncertainty.

Question 17

Suppose that you are asked to evaluate a project of building a new bridge. Which of the following factors is the least important in terms of engineering economics?

Accepted Answer

A) service life of the bridge 
B) value added by the bridge 
C) cost structure 
D) vehicle stock in your city 
E) current interest rate 
A) service life of the bridge 
B) value added by the bridge 
C) cost structure 
D) vehicle stock in your city 
E) current interest rate

Question 18

Suppose that you are about to start a new business: You will provide consulting services for those who want to launch their own web-sites. What major decisions based on the subject matter of engineering economics should be made before you set up your business activities?

Accepted Answer

You have to evaluate the expected future

Question 19

What is the subject matter of Engineering Economics?

Accepted Answer

Engineering economics deals with techniq

Question 20

Analyze the following statement: "There is 50% probability of raining." This statement concerns

Accepted Answer

A) extrapolation. 
B) risk. 
C) precise description. 
D) abstraction. 
E) expected scenario. 
A) extrapolation. 
B) risk. 
C) precise description. 
D) abstraction. 
E) expected scenario.

As a University student, when you look for a new apartment, what economic criteria consistent with the subject matter of engineering economics do you apply?

In engineering economics, sensitivity analysis

Engineering economics is

From an economic standpoint, any engineering project can be thought of in terms of

An owner of a small company is deciding to sell her business. She received several options specified bellow. Which one should the company's owner accept?

Based on your intuition and experience, which of the following options has the highest value?

Which of the following items has negligible maintenance costs?

Susan is evaluating an engineering project. She assumes zero inflation for the duration of the project. With respect to this situation, which statement is consistent with the subject matter of engineering economics?

When evaluating an engineering project, what types of constraints does a decision maker face?

Suppose that in order to finance your studies at the University, three options are available to you: (i)a student loan, (ii)a student line of credit, and (iii)a part-time job at minimum wage. In making your decision, what factors should be taken into account and why?

In which of the following problems do you need engineering economics?

Sensitivity Analysis has sometimes been referred to as "what if" analysis. Explain why.

Suppose that you want to buy a used car for $3 000, but you don't have enough cash. List some of the (legal)strategies that you might consider.

Most of the economic values we use in our evaluation of engineering projects are

Explain the role of a mathematical model in engineering economics.

If you are asked to choose between $100 today and $150 one year from now, you are being asked to

Suppose that you are asked to evaluate a project of building a new bridge. Which of the following factors is the least important in terms of engineering economics?

Suppose that you are about to start a new business: You will provide consulting services for those who want to launch their own web-sites. What major decisions based on the subject matter of engineering economics should be made before you set up your business activities?

What is the subject matter of Engineering Economics?

Analyze the following statement: "There is 50% probability of raining." This statement concerns

Time Value of Money

Cash Flow Analysis

Comparison Methods: Part I

Comparison Methods: Part Ii

Financial Accounting and Business Plans

Replacement Decisions

Taxes

Inflation

Public Sector Decision Making

Project Management

Dealing With Uncertainty and Risk

Filters

Exam 1: Engineering Decision Making

As a University student, when you look for a new apartment, what economic criteria consistent with the subject matter of engineering economics do you apply?

In engineering economics, sensitivity analysis

Engineering economics is

From an economic standpoint, any engineering project can be thought of in terms of

An owner of a small company is deciding to sell her business. She received several options specified bellow. Which one should the company's owner accept?

Based on your intuition and experience, which of the following options has the highest value?

Which of the following items has negligible maintenance costs?

Susan is evaluating an engineering project. She assumes zero inflation for the duration of the project. With respect to this situation, which statement is consistent with the subject matter of engineering economics?

When evaluating an engineering project, what types of constraints does a decision maker face?

Suppose that in order to finance your studies at the University, three options are available to you: (i)a student loan, (ii)a student line of credit, and (iii)a part-time job at minimum wage. In making your decision, what factors should be taken into account and why?

In which of the following problems do you need engineering economics?

Sensitivity Analysis has sometimes been referred to as "what if" analysis. Explain why.

Suppose that you want to buy a used car for $3 000, but you don't have enough cash. List some of the (legal)strategies that you might consider.

Most of the economic values we use in our evaluation of engineering projects are

Explain the role of a mathematical model in engineering economics.

If you are asked to choose between $100 today and $150 one year from now, you are being asked to

Suppose that you are asked to evaluate a project of building a new bridge. Which of the following factors is the least important in terms of engineering economics?

Suppose that you are about to start a new business: You will provide consulting services for those who want to launch their own web-sites. What major decisions based on the subject matter of engineering economics should be made before you set up your business activities?

What is the subject matter of Engineering Economics?

Analyze the following statement: "There is 50% probability of raining." This statement concerns

Time Value of Money

Cash Flow Analysis

Comparison Methods: Part I

Comparison Methods: Part Ii

Financial Accounting and Business Plans

Replacement Decisions

Taxes

Inflation

Public Sector Decision Making

Project Management

Dealing With Uncertainty and Risk

Filters