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Return to Engineering Economic Analysis 4Ce Student Resources
Practice Quiz Chapter 06
Quiz Content
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A chemical recovery system costs $25,000 and saves $5,280 each year of its 6 year life. The salvage value is estimated at $6,500. The MARR is 10%. What is the net annual benefit or cost of purchasing of the chemical recovery system?
a) $4544.9
correct
incorrect
b) $4655.2
correct
incorrect
c) $4897.6
correct
incorrect
d) $4779.1
correct
incorrect
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Suppose you are in the market for a new car worth $17,000. You want to make a $1,700 down payment now and take an auto loan from a bank at 11% compounded monthly. What would be your monthly payment to pay off the loan in 5 years?
a) $444.345
correct
incorrect
b) $347.553
correct
incorrect
c) $789.456
correct
incorrect
d) $332.585
correct
incorrect
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Hailey wants to buy a used car priced at $11,000. She is able to make a $1,500 down payment. The rest will be borrowed from her line of credit at an interest rate of 7.5% compounded daily .The loan should be paid in 36 equal payments. What is her monthly payment? What is the total amount of interest Hailey has to pay over the life of the loan?
a) $214.76 and $1231.2
correct
incorrect
b) $195.5 and $897.7
correct
incorrect
c) $295.15 and $1125.4
correct
incorrect
d) $315.34 and $1100.2
correct
incorrect
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Please see the PDF attachment to answer this question. Consider the following cash flow diagram. What is the equivalent annual worth at i=8%?
a) $1708.47
correct
incorrect
b) $2134.55
correct
incorrect
c) $-1708.47 (P.180-81)
correct
incorrect
d) $-2134.55
correct
incorrect
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Please see the PDF attachment to answer this question. Which project should be adopted given the opportunity cost of capital is 10%?
a) Project X
correct
incorrect
b) Project Y
correct
incorrect
c) Both of them have the same cost
correct
incorrect
d) Both of them have different cost
correct
incorrect
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Mr. Bean has borrowed $180,000 at annual interest rate of 7.5% and promised to pay 10 equal annual payments beginning one year from now. How much is the annual payment?
a) $13,500
correct
incorrect
b) $16,200
correct
incorrect
c) $18,624
correct
incorrect
d) $26,224
correct
incorrect
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Mobile Tech Ltd has just borrowed a business loan of $100,000. The loan has an annual interest rate of 5% and will be paid monthly for 5 years. What is the balance at the end of the second year?
a) $37,034.81
correct
incorrect
b) $45,290.96
correct
incorrect
c) $54,709.04
correct
incorrect
d) $62,965.19
correct
incorrect
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Mobile Tech Ltd has just borrowed a business loan of $100,000. The loan has an annual interest rate of 5% and will be paid monthly for 5 years. What is the principal payment at the end of the third year?
a) $1,470.46
correct
incorrect
b) $1,539.27
correct
incorrect
c) $1,618.03
correct
incorrect
d) $1,700.81
correct
incorrect
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Mobile Tech Ltd has just borrowed a business loan of $100,000. The loan has an annual interest rate of 5% and will be paid monthly for 5 years. What is the total interest payments paid?
a) $13,227
correct
incorrect
b) $18,527
correct
incorrect
c) $20,871
correct
incorrect
d) $25,000
correct
incorrect
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Mobile Tech Ltd has just borrowed a business loan of $100,000. The loan has an annual interest rate of 5% and will be paid monthly for 5 years. What is the total principal payments paid at the end of the fourth year?
a) $18,445.88
correct
incorrect
b) $22,043.91
correct
incorrect
c) $77,956.09
correct
incorrect
d) $81,554.12
correct
incorrect
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