1.

Analysis and evaluation of the factors that will affect the economic success of
engineering projects to ensure the best use of capital.
a. Engineering practice c. Engineering economy
b. Engineering projects d. Engineering management
2. Products or services that are required to support human life and activities.
a. luxuries b. demand c. necessities d. supply
3. Quantity of a certain commodity that is offered for sale at a certain price at a given place
and time.
a. luxuries b. supply c. demand d. necessities
4. Quantity of a certain commodity that is bought at a certain price at a given place and
time.
a. luxuries b. demand c. necessities d. supply
5. An amount of money paid for the use of borrowed capital or the income produced by
money which has been loaned.
a. interest b. capital c. money d. profit
6. The interest for an interest period is calculated on the principal plus total amount of
interest accumulated in previous periods.
a. compound interest b. simple interest c. ordinary interest d. exact interest
7. The actual rate of interest on the principal for one year.
a. ordinary interest c. nominal rate of interest
b. effective rate of interest d. simple interest
8. Setting the sum of the values on the certain comparison of one set of obligations to the
sum of values on the same date of another set of obligations.
a. cash flow diagram c. focal date
b. disbursements d. equation of values
9. It is the difference between the present worth and the worth of a property at some time.
a. discount b. interest c. rate of discount d. rate of interest
10. A graphical representation of cash flows on a time scale.
a. cash flow diagram b. disbursementc. equation of values d. focal date
11. The sum of the first cost and the present worth of all costs of replacement, operation and
maintenance for a long time or forever.
a. capitalized cost b. bond c. cost of repair d. maintenance cost
12. Series of equal payments occurring at equal periods of time.
a. annuity b. profit c. amortization d. interest
13. It refers to payments that occur indefinitely.
a. perpetual interest b. perpetuity c. ordinary annuity d. simple interest
14. This occurs when the first payment is made several periods after the beginning of
annuity.
a. perpetual interest b. deferred annuity c. ordinary annuity d. perpetuity
15. It occurs when the payment is made at the beginning of each period.
a. ordinary annuity b. deferred annuity c. annuity due d. perpetuity
16. It is the amount of property would sell if disposed of as a junk.
a. market value b. salvage value c. scrap value d. book value
17. The discount on one-unit negotiable substance in one unit of time.
a. rate of interest b. present worth c. rate of discount d. future worth
18. It refers to the decrease in value of physical property due to the passage of time.
a. scrap value b. depletion c. salvage value d. depreciation
19. A series of payments with common ratio occurring at equal period or interval of time.
a. annuity due b. perpetuity c. bond d. geometric gradient
20. An article or substance used as a medium of exchange, means of payment or measure of
wealth.
a. profit b. discount c. interest d. money
21. It occurs when payments are made at the end of each period.
a. ordinary annuity b. annuity due c. deferred annuity d. perpetuity
22. It is the rate of interest that specifies the number of interest periods in one year.
a. ordinary interest c. effective rate of interest
b. nominal rate of interest d. simple interest
23. It is sometimes called depreciated value, a worth of property as shown on the accounting
records of an enterprise.
a. book value b. resale value c. salvage value d. market
value
24. The interest earned by the principal alone over a given period of time.
a. ordinary interest c. nominal rate of interest
b. simple interest d. effective rate of interest
25. It refers to the decrease in the value of a property due to the gradual extraction of its
content.
a. salvage value b. depreciation c. depletion d. scrap value
26. It refers to the decrease in value of physical property due to the passage of time.
a. salvage value b. depletion c. book value d. depreciation
27. It is the price obtained from the sale of the property as second hand.
a. fair value b. use value c. salvage value d. scrap value
28. The method used in determining the depreciation charge of an asset that varies year to
year.
a. declining balance method c. straight line method
b. sinking fund method d. sum-of-year-digit method
29. It is the amount of an asset which cannot be recovered due to certain reasons. It could
result in trading an asset without knowing the current book value.
a. sunk cost b. resale value c. scrap value d. salvage value
30. A method used in determining the depreciation of an asset wherein the loss is directly
proportional to the age of the property.
a. sinking fund method c. declining balance method
b. straight line method d. double declining balance method
31. It exists when there are so few suppliers of a product or service that action by one will
almost envitably result in similar action by the other.
a. market b. oligopoly c. monopoly d. competition
32. It is the amount which a willing buyer will pay to a willing seller for the property where
each has equal advantage and is under no compulsion to buy or sell.
a. market value b. fair value c. salvage value d. scrap value
33. Compute the equivalent rate of 5% compounded semi-annually to a rate compounded
quarterly.
a. 5.96% comp. quarterly c. 5.89% comp. quarterly
b. 4.97% comp. quarterly d. 4.37% comp. quarterly
34. A man pays 1.5% interest on his loan four times a year. Find the effective annual interest
rate.
a. 6.14% b. 4.97% c. 3.99% d. 4.06%
35. Determine the ordinary simple interest on P700.00 for 8 months and 15 days if the rate of
interest is 15%.
a. P36.70 b. P57.78 c. P74.38 d. P79.88
36. How much will a deposit of P1,000.00 be in 20 years at an interest of 6% compounded
annually?
a. P3,207.14 b. P3,500.00 c. P5,000.00 d. P5,479.18
37. A man borrowed P2,000.00 from his friend and agreed to pay the at the end of 6 months.
His friend, discounted the loan and gave him P1,920.00 in cash. What was the rate of
discount?
a. 3% b. 4.5% c. 4% d. 5%
38. From problem 37, what was the rate of interest?
a. 4.17% b. 4.98% c. 3.98% d. 3.15%
39. How long will it take P500.00 to be four times its value if invested at the rate of 10%
compounded semiannually?
a. 20.15 years b. 40.3 years c. 15. 24 years d. 27.35 years
40. From problem 39, what was the effective rate of interest?
a. 11.30% b. 10.25% c. 5.18% d. 4.79%
41. Find the effective rate of interest equivalent to 12% compounded continuously.
a. 12.75% b. 15.50% c. 12.10% d. 15.75%
42. Determine the accumulated amounts after 5 years of P1,000.00 invested at the rate of
10% compounded monthly.
a. P1,645.31 b. P1,628.90 c. P1.638.92 d. P1,610.51
43. From problem 42, if compounded daily?
a. P1,628.90 b. P1,648.61 c. P1,645.31 d. P1,610.51
44. Find the interest per month of the loan at the nominal rate of 20% compounded monthly.
a. 1.5% b. 1.67% c. 24% d. 0.6%
45. Find the equivalent effective rate of interest if a financing company charges 1.53% per
month on the loan.
a. 21% b. 19% c. 20% d. 18%
46. A nominal rate of 15% compounded monthly is equal to what effective rate of interest.
a. 18.95% b. 15.75% c. 16.08% d. 17.50%
47. Convert 20% compounded semi-annually to equivalent nominal rate compounded daily.
a. 19.83% b. 18.57% c. 19.07% d. 18.10%
48. Find the accumulated amount of P1,000.00 after 7.5 years when deposited in a bank at
the rate of 12% compounded monthly.
a. P2,997.48 b. P2,778.29 c. P2,129.98 d. P2,448.63
49. How long in years will it take the money to triple its amount when deposited at the rate of
12% compounded monthly.
a. 9.8 years b. 10 years c. 8.7 years d. 9.2 years
50. How much should be deposited in a bank at the rate of 5% compounded continuously for
5 years if the accumulated amount is P12,840.25?
a. P9,756.10 b. P9,975.10 c. P10,795.35 d. P10,000.00
51. A 10% effective rate of interest is equivalent to what percent if compounded
continuously?
a. 9.53% b. 8.75% c. 9.02% d. 8.23%
52. How much is expected to receive from a loan of P800.00 which is payable at once if the
discount is 5%?
a. P730.00 b. P760.00 c. P675.00 d. P840.00
53. Find the accumulated amount of the ordinary annuity paying an amortization of
P1,500.00 per month at a rate of 10% compounded monthly for 5 years.
a. P116,155.61 b. P121,157.00 c. P110,234.45 d. P122,222.22
54. What amount of money deposited 25 years ago at 10% interest now provide a perpetual
payment of P5,000.00 per annum?
a. P4,900.80 b. P4,614.80 c. P3,997.25 d. P3,225.05
55. Determine the accumulated amount of P10,000.00 being paid at the start of each month
worth 12% compounded monthly for the period of 5 years.
a. P875,650.95 b. P896,696.90 c. P806,696.70 d. P825,575.80
56. Determine the amount to be pay for a bond if an investor desires a 6% return on his
investment and bond will return P1,000.00 per year for 15 years and P25.000.00 par after
15 years.
a. P15,150.15 b. P12,456.75 c. P10,150.15 d. P15,629.49
57. Find the capitalized cost of an equipment that costs P55,000.00 if the annual maintenance
cost and operational cost is P10,000.00 and money worth 5% per annum.
a. P270,000.00 b. P250,000.00 c. P255,000.00 d. P265,000.00
58. An equipment costs P100,000.00 and the salvage value is 15% of the original cost after
25 years. Find the total depreciation of equipment after 10 years by straight line method.
a. P200,000.00 b. P35,000.00 c. P212,500.00 d.
P34,000.00
59. From problem 58, find the book value of equipment after 10 years.
a. P66,000.00 b. P65,000.00 c. P112,500.00 d.
P100,000.00
60. A genset costs P32,000.00 and the salvage value is 5,000.00 after 15 years, find the
depreciation charge per year if money worth 10%.
a. P977.10 b. P849.79 c. P775.00 d. P790.00
61. A car costs P800,000.00 and the salvage value is 10% of the original cost after 15 years.
Find the depreciation charge at the 8th year by sum of the years digit method.
a. P50,000.00 b. P48,000.00 c. P52,000.00 d. P60,000.00
62. A property has a cash value of P150,000.00. The buyer agreed to pay P30,000.00 cash
plus equal yearly payments for 15 years. If the money is worth 14% to the owner of the
property, how much must the buyer pay yearly?
a. P19,537.08 b. P17,837.08 c. P18,439.90 d. P17,549.20
63. A television set can be bought by 12 monthly payments of P800.00. Money to the
appliance store is 24% compounded monthly. What is the cash value of the appliance?
a. P7,820.50 b. P8,460.27 c. P8,990.22 d. P7,330.25
64. A man invested P5,000.00 in a bank that pays 12% every year. Find the interest he
receives after 3 years.
a. P1,800.00 b. P2,000.00 c. P1,750.00 d. P1,900.00
65. P8,000.00 is invested at 9% for 4 months. Find the accumulated amount
a. P8,900 b. P8,120 c. P8,240 d. P9,480
66. How long would it take P6,000 to become P10,000 if placed in a time deposit which
gives 4% compounded quarterly?
a. 12.83 years b. 11.45 years c. 10 years d. 12 years
67. An appliance costing P12,800 is to be paid by 20 equal monthly payments starting
immediately. If money to the seller is worth 15% compounded monthly, find each
payment.
a. P615.12 b. P668.22 c. P718.32 d. P799.99
68. A man deposits P200 at the beginning of each month in a bank credits savings account
with 5% compounded quarterly. How much is in the savings account at the end of 4 years
assuming he never withdrew any amount nor failed to make his deposit?
a. P10,642.53 b. P10,447.35 c. P10,135.12 d. P10,920.20
69. A company deposits P50,000 at the beginning of each 6 months in a bank for the purpose
of accumulating a fund to purchase machinery in case of a breakdown in its plant. How
much is in the fund when it is needed at the end of 6 years if money accumulates at 5%
compounded semi-annually?
a. P707,022.09 b. P710,909.00 c. P708,348.90 d. P707,890.45
70. An equipment was bought for P56,000 and other expenses including installation
amounted to P4,000. It is expected to have a 16-year life and the salvage value is 10% of
the original cost. Determine the annual cost of depreciation of the equipment.
a. P3,500 b. P3,375 c. P3,255 d. P3,750