FE Exam Practice CEE 4200 Fall 2017

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2.115. Yejen Industries Ltd. Invested $10,000,000 in manufacturing equipment for producing small wastebaskets. If the company uses an interest rate of 15% per year, the amount of money it will have to earn each year to recover its investment in 7 years is closest to: $2,403,600 $3,530,800 $3,941,800 $4,256,300

4. 67. The cost of maintaining a public monument in Washington, D. C 4.67. The cost of maintaining a public monument in Washington, D.C. occurs as periodic outlays of $10,000 every 5 years. If the first outlay is 5 years from now, the capitalized cost of the maintenance at an interest rate of 10% per year is closest to: $-1,638 $-16,380 $-26,380 $-29,360

Above 1,047 units Above 2,793 units Equal to 2,793 units 8.67. To make an item inhouse, equipment costing $250,000 must be purchased. It will have a life of 4 years, an annual cost of $80,000, and each unit will cost $40 to manufacture. Buying the item externally will cost $100 per unit. At i=15% per year, it is cheaper to make the item inhouse if the number per year needed is: Above 1,047 units Above 2,793 units Equal to 2,793 units Below 2,793 units

12.49. An industrial robot depreciated by the MACRS method has B = $60,000 and a 5-year depreciable life. If the depreciation charge in year 3 is $8,640, the salvage value that was used in the depreciation calculation is closest to: $0 $10,000 $20,000 $30,000

Answers (in Appendix C) Problem Answer 2.115 A 4.67 B 8.67 12.49 See Appendix C for answers to many more FE Practice Exam and textbook problems