Summer 2008 - Quiz 3

Summer 2008 - Quiz 3 - VERSION 1 FAMILY NAME / INITIAL...

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VERSION 1 1 FAMILY NAME / INITIAL STUDENT ID # SOLUTI ONS MIME 310 ENGINEERING ECONOMY – QUIZ #3 May 15, 2008 – 8:30 to 9:15 PART 1. True or False Statements – Circle the correct answer on this paper and re- cord it on the computer answer sheet. (0.5 of a point each for a total of 2) Note : There are no penalties for incorrect answers. 1. All other factors held constant, the present value of a given annuity increases as the num- ber of compounding periods per year increases. A) True B) False 2. You hold a winning ticket from your provincial lottery. It entitles the bearer to receive pay- ments of $50 000 at the end of each of the next 20 years. Whatever the market interest rate (above zero), you should be able to sell this ticket for more than $1 million in the open market. A) True B) False 3. The objective of a sinking fund is to accumulate funds to pay off a future cash obligation. A) True B) False 4. The Theory of the Business Firm assumes perfect market competition, i.e. it assumes that the selling price is independent of the production rate. A) True B) False PART 2. Multiple-choice Statements and Short Problems – Circle the correct answer on this paper and record it on the computer answer sheet. (1 point each for a total of 8) Note : There are no penalties for incorrect answers.
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This note was uploaded on 01/22/2012 for the course MIME 310 taught by Professor Bilido during the Summer '08 term at McGill.

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Summer 2008 - Quiz 3 - VERSION 1 FAMILY NAME / INITIAL...

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