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MCQ in Engineering Economics Part 2 | ECE Board Exam

(Last Updated On: July 22, 2021)

MCQ in Engineering Economics Part 2 | ECE Board Exam

This is the Multiples Choice Questions Part 2 of the Series in Engineering Economics as one of the General Engineering and Applied Sciences (GEAS) topic. In Preparation for the ECE Board Exam make sure to expose yourself and familiarize in each and every questions compiled here taken from various sources including past Board Questions in General Engineering and Applied Sciences (GEAS), Engineering Economy Books, Journals and other Engineering Economy References.

Continue Practice Exam Test Questions Part 2 of the Series

MCQ in Engineering Economics Part 1 | ECE Board Exam

Choose the letter of the best answer in each questions.

51. What is defines as the analysis and evaluation of the monetary consequences by using the theories and principles of economics to engineering applications, designs and projects?

A. Economic Analysis

B. Engineering cost analysis

C. Engineering economy

D. Design cost analysis

View Answer:

Answer: Option A

Explanation:

52. What is considered as the standard unit which forms the basis of a country’s domestic money supply?

A. Monetary unit

B. Currency

C. Foreign exchange

D. Cash or check

View Answer:

Answer: Option C

Explanation:

53. What is defined as any tangible economic product that contributes directly or indirectly to the satisfaction of human want?

A. Services

B. Goods

C. Commodities

D. Goods or commodities

View Answer:

Answer: Option D

Explanation:

54. What is defined as any tangible economic activity that contributes directly or indirectly to the satisfaction of human want?

A. Services

B. Goods

C. Commodities

D. Goods or commodities

View Answer:

Answer: Option A

Explanation:

55. What are the two classifications of goods and services?

A. Local and imported

B. Raw and finished

C. Consumer and producer

D. Ready-made and made-to-order

View Answer:

Answer: Option C

Explanation:

56. What refers to the goods and services that are required to support human life, needs and activities?

A. Producer products

B. Consumer products

C. Luxury

D. Necessity

View Answer:

Answer: Option D

Explanation:

57. What refers to the goods and services that are desired by human and will be acquired only after all the needs have been satisfied?

A. Producer products

B. Consumer products

C. Luxury

D. Necessity

View Answer:

Answer: Option D

Explanation:

58. What refers to the exchange mechanism that brings together the sellers and the buyers of a product, factor of production or financial security?

A. Mall

B. Market

C. Store

D. Office

View Answer:

Answer: Option B

Explanation:

59. What is considered as the basic consuming or demanding unit of a commodity?

A. Seller

B. Manufacturer

C. Producer

D. Buyer or consumer

View Answer:

Answer: Option D

Explanation:

60. What is defined as an entity which makes product, good or services available to buyer or consumer in exchange of monetary consideration?

A. Seller

B. Manufacturer

C. Producer

D. Buyer or consumer

View Answer:

Answer: Option C

Explanation:

61. What is a market situation whereby there is only one buyer of an item for which there is no goods substitute?

A. Monopsony

B. Monopoly

C. Oligopoly

D. Oligopsony

View Answer:

Answer: Option A

Explanation:

62. What market situation exists where there are few sellers and few buyers?

A. Oligopoly

B. Oligopsony

C. Bilateral oligopoly

D. Bilateral Oligopsony

View Answer:

Answer: Option C

Explanation:

63. What market situation exists where there is only one buyer and only one seller?

A. Monopsony

B. Monopoly

C. Bilateral monopsony

D. Bilateral monopoly

View Answer:

Answer: Option D

Explanation:

64. What is the market situation exist when there are many buyers and many sellers?

A. Perfect competition

B. Oligopoly

C. Oligopsony

D. Monopoly

View Answer:

Answer: Option A

Explanation:

65. If there is only one seller and many buyers, the market situation is ________ .

A. Duopsony

B. Oligopoly

C. Oligopsony

D. Monopoly

View Answer:

Answer: Option D

Explanation:

66. If there are many sellers and few buyers, the market situation is _________ .

A. Duopsony

B. Oligopoly

C. Oligopsony

D. Monopoly

View Answer:

Answer: Option C

Explanation:

67. Oligopoly exists when 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

View Answer:

Answer: Option B

Explanation:

68. 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

View Answer:

Answer: Option C

Explanation:

69. 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 seller and few buyers

View Answer:

Answer: Option B

Explanation:

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

A. Atomistic competition

B. No-limit competition

C. Free-for-all competition

D. Heterogeneous market

View Answer:

Answer: Option A

Explanation:

71. 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

View Answer:

Answer: Option A

Explanation:

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

A. Homogeneous product

B. Free market entry and exit

C. Perfect information and absence of all economic friction

D. All of these

View Answer:

Answer: Option D

Explanation:

73. What is the opposite of perfect competition?

A. Monopsony

B. Oligopoly

C. Oligopsony

D. Monopoly

View Answer:

Answer: Option D

Explanation:

74. Perfect monopoly exists only if:

A. the single vendor can prevent the entry of all other vendors in the market

B. the single vendor gets the absolute franchise of the product

C. the single vendor is the only one who has the permit to sell

D. the single vendor is the only one who has the knowledge of the product

View Answer:

Answer: Option A

Explanation:

75. A ______ is a market situation where economies of scale are so significant that cost are only minimized when the entire output of an industry is supplied by a single producer so that the supply costs are lower under monopoly that under perfect competition.

A. Perfect monopoly

B. Bilateral monopoly

C. Natural monopoly

D. Ordinary monopoly

View Answer:

Answer: Option C

Explanation:

76. “When one of the factors of production is fixed in quantity or is difficult to increase, increasing the other factors of production will result in a less than proportionate increase in output”. This statement is known as the:

A. Law of diminishing return

B. Law of supply

C. Law of demand

D. Law of supply and demand

View Answer:

Answer: Option A

Explanation:

77. What refers to the need, want or desire for a product backed by the money to purchase it?

A. Supply

B. Demand

C. Product

D. Good

View Answer:

Answer: Option B

Explanation:

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

A. Supply

B. Demand

C. Product

D. Good

View Answer:

Answer: Option A

Explanation:

79. “Under conditions of perfect competition, the price at which any given product will be supplied and purchased is the price that will result in the supply and the demand being equal.” This statement is known as the:

A. Law of diminishing return

B. Law of supply

C. Law of demand

D. Law of supply and demand

View Answer:

Answer: Option D

Explanation:

80. 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

View Answer:

Answer: Option C

Explanation:

81. What is defined as the interest on a load or principal that is based only on the original amount of the loan or principal?

A. Effective rate of interest

B. Nominal rate of interest

C. Compound interest

D. Simple interest

View Answer:

Answer: Option D

Explanation:

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

A. 300

B. 360

C. 365

D. 366

View Answer:

Answer: Option B

Explanation:

83. One banker’s year is equivalent to ______ days.

A. 300

B. 360

C. 365

D. 366

View Answer:

Answer: Option B

Explanation:

84. What refers to the cumulative effect of elapsed time on the money value of an event, based on the earning power of equivalent invested funds capital should or will earn?

A. Present worth factor

B. Interest rate

C. Time value of money

D. Yield

View Answer:

Answer: Option C

Explanation:

85. 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

View Answer:

Answer: Option A

Explanation:

86. 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

View Answer:

Answer: Option D

Explanation:

87. 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

View Answer:

Answer: Option A

Explanation:

88. 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

View Answer:

Answer: Option B

Explanation:

89. What is defined as the investment of loan or principal which is based not only on the original amount of the loan or principal but the amount of loaned or principal plus the previous accumulated interest?

A. Effective rate of interest

B. Nominal rate of interest

C. Compound interest

D. Simple interest

View Answer:

Answer: Option C

Explanation:

90. 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

View Answer:

Answer: Option C

Explanation:

91. A uniform series of payment occurring at equal interval of time is called ______.

A. Annuity

B. Amortization

C. Depreciation

D. Bond

View Answer:

Answer: Option A

Explanation:

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

A. Ordinary annuity

B. Perpetuity

C. Annuity certain

D. Annuity due

View Answer:

Answer: Option C

Explanation:

93. 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

View Answer:

Answer: Option A

Explanation:

94. 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

View Answer:

Answer: Option C

Explanation:

95. 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

View Answer:

Answer: Option B

Explanation:

96. 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

View Answer:

Answer: Option D

Explanation:

97. 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.

View Answer:

Answer: Option C

Explanation:

98. 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

View Answer:

Answer: Option C

Explanation:

99. 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

View Answer:

Answer: Option D

Explanation:

100. 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

View Answer:

Answer: Option A

Explanation:

Online Questions and Answers in Engineering Economics Series

Following is the list of practice exam test questions in this brand new series:

Engineering Economics MCQs
PART 1: MCQ from Number 1 – 50                        Answer key: PART 1
PART 2: MCQ from Number 51 – 100                   Answer key: PART 2
PART 3: MCQ from Number 101 – 150                 Answer key: PART 3
PART 4: MCQ from Number 151 – 200                 Answer key: PART 4
PART 5: MCQ from Number 201 – 250                 Answer key: PART 5
PART 6: MCQ from Number 251 – 300                 Answer key: PART 6
PART 7: MCQ from Number 301 – 350                 Answer key: PART 7
PART 8: MCQ from Number 351 – 400                 Answer key: PART 8
PART 9: MCQ from Number 401 – 450                 Answer key: PART 9
PART 10: MCQ from Number 451 – 500                 Answer key: PART 10

Complete List of MCQs in General Engineering and Applied Sciences per topic

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