Civil engineer objective questions – Engineering Economics (Section-6)

1.What is defined as the certificate of indebtedness of corporation usually for a period not less than 10 years and guaranteed by a mortgage on certain assets of a corporation?

a) Bond

b) T-bills

c) Stock

d) Promissory note

2.Which is NOT an essential element of an ordinary annuity?

a) The amounts of all payments are equal

b) The payments are made at equal interval of time

c) The first payment is made at the beginning of the first period

d) Compound interest is paid on all amounts in the annuity

3. What is the type of annuity that does not have a fixed time span but continues indefinitely or forever?

a) Ordinary annuity

b) Perpetuity

c) Annuity due

d) Deferred annuity

4.What is defined as a financial security note issued by business or corporation and by the government as a means of borrowing long-term fund?

a) T-Bills

b) Securities

c) Bond

d) Bank notes

5.What is the type of annuity where the first payment does not begin until some later date in the cash flow?

a) Ordinary annuity

b) Perpetuity

c) Annuity due

d) Deferred annuity

6.What is the type of annuity where the payments are made at the beginning of the each period starting from the first period?

a) Ordinary annuity

b) Perpetuity

c) Annuity due

d) Deferred annuity

7.What refers to the present worth of all the amount the bondholder will receive through his possession of the bond?

a) Par value of bond

b) Face value of bond

c) Redeemed value of bond

d) Value of bond

8.What is the type of annuity where the payments are made at the end of each period starting from the first period?

a) Ordinary annuity

b) Perpetuity

c) Annuity due

d) Deferred annuity

9.What is the term for an annuity with a fixed time span?

a) Ordinary annuity

b) Perpetuity

c) Annuity certain

d) Annuity due

10.A uniform series of payment occurring at equal interval of time is called annuity?

a) Annuity

b) Amortization

c) Depreciation

d) Bond

11.What refers to the ratio of the interest payment to the principal for a given unit of time and usually expressed as a percentage of the principal?

a) Return of investment

b) Interest rate

c) Yield

d) Rate of return

12.What refers to the cost of borrowing money or the amount earned by a unit principal per unit time?

a) Yield rate

b) Rate of return

c) Rate of interest

d) Economic return

13.What refers to the amount of money paid for the use of borrowed capital?

a) Interest

b) Rate of interest

c) Simple interest

d) Principal

14.What refers to the present worth of the probable future net earnings?

a) Total fair value

b) Total market value

c) Going concern value

d) Earning value

15.One banker’s year is equivalent to        ?

a) 300

b) 360

c) 365

d) 366

16.The difference between the present and future worth of money at some time in the future is called      ?

a) Discount

b) Deduction

c) Inflation

d) Depletion

17. Under ordinary simple interest, how many days in one year?

a) 300

b) 360

c) 365

d) 366

18.What do you call any particular raw material or primary product such as cloth, wool, flour, coffee, etc ?

a) Utility

b) Necessity

c) Commodity

d) Stock

19.What refers to the amount of a product made available for sale ?

a) Supply

b) Demand

c) Product

d) Good

20.Aside from many sellers and many buyers, which one is a characteristic of perfect competition ?

a) Homogeneous products

b) Free market entry and exist

c) Perfect information and absence of all economic friction

d) All of the above

21.What is the opposite of perfect competition?

a) Monopsony

b) Oligopoly

c) Oligopsony

d) Monopoly

22.Duopoly is a market situation where there is/are      ?

a) Few sellers and few buyers

b) Few sellers and many buyers

c) Many sellers and few buyers

d) One sellers and few buyers

23.What is another term for “perfect competition”?

a) Atomistic competition

b) Non-limit competition

c) Free-for –all competition

d) Heterogeneous market

24.What refers to the market situation in which any given product is supplied by a very large number of vendors and there is no restriction against additional vendors from entering the market ?

a) Perfect competition

b) Oligopoly

c) Oligopsony

d) Monopoly

25.Duopsony is a market situation where there is/are        ?

a) Few sellers and few buyers

b) Few sellers and many buyers

c) Many sellers and few buyers

d) One seller and few buyers

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