1. This is known as the policy issue resolved by the top management of an organization in view of numerous considerations. . IRR . MARR C. ERR D. ROR 2. This is the other term for MARR. A. Hurdle rate B. Hamper rate C. Deficit rate D. Hustle rate 3. This method is based on the concept of equivalent worth of all cash flows relative to some base or beginning point in time. . Future Worth B. Annual Worth C. Present Worth D. Perpetuity 4. It refers to an agreement where for a specified length of time, the borrower is required to pay periodically and upon maturity, he is further required to pay an additional amount of money. Debit . B. Investment C. Lease D. Bond 5. One special variation of the PW method involves determining the PW of all revenues or expenses over an infinite length of time. What is this method called? A. Bond Value . IRR C. Annual Worth D. B-C Ratio For FW Method, if FW (i=MARR) > 0, then the project is economically A. justified 6. B. barely justified C. sometimes justified D. unjustified 7. The CR amount for a project is the equivalent uniform annual cost of the capital invested. It is an annual amount that covers the following two items. One of them is loss in value of the asset. What is the other one that is related to the capital itself? A. Unexpected expenses B. Total Revenue C. Indebtedness D. Interest This is the most widely used rate-of-return method for performing engineering economic analyses. IRR Method 8. . B. ERR Method C. AW Method D. B-C Ratio 9. What is the other term for payback method? A. Capital recovery method B. Simple payout method C. Rate of Return method D. Sinking Fund method 10. In reality, B-C ratio is actually a ratio of discounted benefits to discounted costs. C. Sometimes true . True B. False D. Often true 11. Which of these is a fact? A. In calculating the payback period, the increasing expenses due to interest must be considered. In solving for the IRR, it is necessary to know the MARR prior to computation. C. If AW is positive, so should FW, given the same MARR. . D. If B-C Ratio is equal to 1, then the profit is equal to the cost of the project.