This document contains 10 questions about engineering economics concepts and cash flow analysis. It asks students to prove relationships using graphs, explain the principles of engineering economics, distinguish between direct and indirect costs, and draw cash flow diagrams for various investment scenarios involving things like machine overhauls, car loans, inheritance bequests, and promissory notes.
This document contains 10 questions about engineering economics concepts and cash flow analysis. It asks students to prove relationships using graphs, explain the principles of engineering economics, distinguish between direct and indirect costs, and draw cash flow diagrams for various investment scenarios involving things like machine overhauls, car loans, inheritance bequests, and promissory notes.
This document contains 10 questions about engineering economics concepts and cash flow analysis. It asks students to prove relationships using graphs, explain the principles of engineering economics, distinguish between direct and indirect costs, and draw cash flow diagrams for various investment scenarios involving things like machine overhauls, car loans, inheritance bequests, and promissory notes.
This document contains 10 questions about engineering economics concepts and cash flow analysis. It asks students to prove relationships using graphs, explain the principles of engineering economics, distinguish between direct and indirect costs, and draw cash flow diagrams for various investment scenarios involving things like machine overhauls, car loans, inheritance bequests, and promissory notes.
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Activity for June 12, 2018
(in lieu of holiday)
CO1 1. From the 2 graphs below, prove that (10 pts) 2. What is the importance of studying Engineering Economics? 3. What are the 7 principles of Engineering Economics? Explain each one through a practical application. 4. What is the difference between direct cost and indirect cost? 5. How is dividends and stocks affecting engineering economics? 6. ABC Corporation had an investment of $10,000 produces an annual revenue of $5,310 for five years and then have a market value of $2,000 at the end of year five. Annual expenses will be $3,000 at the end of each year for operating and maintaining the project. Draw a cash flow diagram for the five-year life of the project. Use the corporation’s viewpoint. 7. You borrowed $15,000 from your credit union to purchase a used car. The interest rate on your loan is 0.25% per month and you will make a total of 18 monthly payments. Draw the cash flow diagram. 8. If a certain machine undergoes a major overhaul now, its output can be increased by 20%- which translates into additional cash flow of $20,000 at the end of each year for five years. Draw a cash flow diagram for the five-year life of the project. 9. Charlie wishes to bequeath his youngest son P200,000 ten years from now. What amount should he invest now if it will earn interest of 6% compounded annually during the first 5 years and 8% compounded quarterly during the next 5 years? 10. An employee has a promissory note, due 5 years hence, whose maturity value is P70,000. If the rate of interest is 12% compounded semi-annually, what is the value of this note now?