15 lakh The simple payback period SPP in years considering annual savings of Rs

15 lakh the simple payback period spp in years

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Cost of a new heat exchanger is Rs. 1.5 lakh. The simple payback period (SPP) in years considering annual savings of Rs 60,000 and annual maintenance cost of Rs 10,000 is a) 0.4 b) 2.5 c) 3 d) 6 34 The cost of replacement of inefficient compressor with an energy efficient compressor in a plant costs Rs. 8 lakhs. The net annual cash flow is Rs. 2 lakhs. The return on investment a) 18% b) 20% c) 15% d) none of the above 35 An investment of Rs 96,000 has a simple payback period of two years. The monthly savings must be a) Rs 8,000 b) Rs 4,000 c) Rs 9,600 d) Rs 12,000 36 For an investment which has fluctuating annual savings over its project life, which of the following financial analysis techniques is the best? a) Simple payback period b) ROI c) NPV d) IRR 37 The present value of equipment is Rs. 10,000 and discount rate is 10%. The future value of the cash flow at the end of 2 years is: a) Rs. 10000 b) Rs. 12,100 c) Rs. 8100 d) Rs. 8264 38 A sum of Rs 10,000 is deposited in a bank at the beginning of a year. The bank pays 10% interest annually. How much money is in the bank account at the end of the fifth year, if no money is withdrawn? a) 16105 b) 15000 c) 15500 d) 16000 39 A contract in which the costs are paid from all or part of the energy cost savings is called a) performance contract b) traditional contract c) extended technical guarantee contract d) guaranteed savings performance contract 40 The annual electricity bill for a plant is Rs 10 lakhs and accounts for 38% of the total energy bill. Furthermore the total energy bill increases by 5% each year. How h igh is the plant’s annual energy bill at the end of the third year? a) Rs 30.46 lakhs b) Rs 26.32 lakhs c) Rs 38.42 lakhs d) none of the above 41 Which of the following Financial Analysis Techniques fails to consider the time value of money a) Simple Payback Period (SPB) b) Internal Rate of Return (IRR) c) Net Present Value (NPV) d) none of the above 42 Assume project A has an IRR of 85% and NPV of Rs 15,000 and project B has an IRR of 25% and NPV of 200,000. Which project would you implement first if financing is available and project technical life is the same? a) B b) A c) cannot be decided d) question does not make sense
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43 A waste heat recovery system costs Rs. 54 lakh and Rs. 2 lakh per year to operate and maintain. If the annual savings is Rs. 20 lakhs, the payback period will be a) 8 years b) 2.7 years c) 3 years d) 10 years 44 The ratio of annual net cash flow to capital cost is ____________ a) net present value b) internal rate of return c) return on investment d) discount factor 45 Which of the following is not true of IRR? a) it takes into account time value of money b) it considers the cash flow streams in its entirety c) does not distinguish between lending and borrowing d) none of the above 46 To judge the attractiveness of any investment, the project manager must consider: a) Initial capital cost b) Net operating cash inflows c) salvage value d) all the above 47 ROI must always be ________ borrowing interest rate for economic feasibility of any project a) lower than b) higher than c) equal to d) no relation 48 A factor that reflects the risk of the project while evaluating the net present value for the expected future cash flow is: a) Discount rate b) Internal rate of return c) Capital cost d) All of the above
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  • Winter '15
  • venkatesan

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