1. What is defined as the analysis and evaluation of the monetary
consequences by using the theories and principles of economics to
engineering appications, designs and projects? Engineering
economy
2. What is considered as the standard unit which forms the basis of a
country's domestic money supply? Monetary unit
3. What is defined as any tangible economic product that contributes
directly or indirectly to the satisfaction of human want? Goods or
commodities
4. What is defined as any tangible economic activity that contributes
directly or indirectly to the satisfaction of human want? Services
5. What are the two classifications of goods and services? Consumer
and Producer
6. What refers to the goods and services that are required to support
human life, needs and activities? Necessity
7. What is considered as the basic consuming or demanding unit of a
commodity? Buyer or consumer
8. What is defined as an entity which makes a product, good, or
services available to buyer or consumer in exchange of monetary
consideration? Producer
9. What is a market situation where there is only one buyer of an
item for which there is no goods substitute? Monopsony
10. What market situation exists when there are few sellers and few
buyers? Bilateral oligopoly
11. What market situation exists where there is only one buyer and
only one seller? Bilateral monopoly
12. What is the market situation exists when there are many buyers
and many sellers? Perfect competition
13. If there is only one seller and many buyers, the market situation is
Monopoly
14. If there are many sellers and few buyers, the market situation is
Oligopsony
15. Oligopoly exists when there is/are: few sellers and many buyers
16. Duopsony exists when there is/are: many sellers and two buyers
17. Duopsoly exists when there is/are: two sellers and many buyers
18. What is another term for \"perfect competition\"? Atomistic
competition
19. 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? Perfect
competition
20. Aside from many sellers and many buyers, which one is a
characteristic of perfect competition? homogenous product, free
market entry and exit, perfect information and absence of all
economic friction
21. What is the opposite of perfect competition? Monopoly
22. Perfect monopoly exists only if: The single vendor can prevent
the entry of all other vendors in the market
23. A _______ is a market situation where economies of scale are so
significant that costs are only minimized when the entire output of an
industry is supplied by a single producer so that supply costs are
lower under monopoly than under perfect competition. natural
monopoly
24. "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: Law of diminishing return
25. What refers to the amount of product made available for sale?
Supply
26. 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 demand being equal\" This statement is
known as the: Law of supply and demand
27. What do you call any particular raw material or primary product
such as cloth, wool, flour, coffee, etc.? Commodity
28. What is defined as the interest on a load or principal that is based
only on the original amount of the loan or principal? Simple interest
29. Under ordinary simple interest, how many days is one year? 360
30. One banker's year is equivalent to _______ days. 360
31. 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? Time value of money
32. The difference between the present and future worth of money
at some time in the future is called discount
33. What refers to the present worth of the probable future net
earnings? Earning value
34. 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? Interest rate
35. What is defined as the interest 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? Compound interest
36. What refers to the cost of borrowing money or the amount
earned by a unit principal per unit of time? Rate of interest
37. What is the term for an annuity with a fixed time span? Annuity
certain
38. What is the type of annuity where the payments are made at the
end of each period starting from the first period? Ordinary annuity
39. What is the type of annuity where the payments are made at the
beginning of each period starting from the first period? Annuity due
40. Which is NOT an essential element of an ordinary annuity? The
first payment is made at the beginning of the first period
41. What is defined as a financial security note issued by businesses
or corporations and by the government as a means of borrowing
long-term fund? Bond
42. What refers to the present worth of all the amounts the
bondholder will receive through his possession of the bond? Value of
bond
43. What is defined as the certificate of indebtness of corporation
usually for a period not less than 10 years and guaranteed by a
mortgage on certain assets of a corporation? Bond
44. What refers to a document that shows proof of legal ownership
of a financial security? Coupon
45. What type of bond is issued jointly by two or more corporations?
Joint bond
46. What type of bond whose guaranty is in line on railroad
equipment, such as freight and passenger cars, locomotives, etc?
Equipment obligation bond
47. A type of bond to which are attached coupons indicating the
interest due and the date when such interest is to be paid is called
coupon bond
48. What bond whose security is a mortgage on certain specified
assets of the corporation? Mortgage bond
49. A bond without any security behind them except a promise to pay
by the issuing corporation is called debenture bond
50. A type of bond where the corporation pledges securities which it
owns such as the stocks or bonds of one of its subsidiaries. Collateral
trust bond
51. What type of bond where the corporation's owners name are
recorded and the interest is paid periodically to the owners with their
asking for it? Registered bond
52. What type of bond which can be redeemed before maturity date?
Callable bond
53. What is the feature of some bonds whereby the issuer can
redeem it before it matures? Callability
54. The price at which the callable bond will be redeemed from the
bondholder is called call value
55. What is defined as the reduction or fall of the value of an asset
due to constant use and passage of time? Depreciation
56. In what method of computing depreciation where it assumes that
the loss in value is directly proportional to the age of the equipment
or asset? Straight line method
57. In what method of computing depreciation where it assumes that
the annual cost of depreciation is a fixed percentage of the book
value at the beginning of the year? Declining balance method
58. In SYD method of computing depreciation, which of the ff is the
formula in finding the sum of years' digits? n(n+1)/2
59. The declining balance method is also known as ________.
Constant percentage method
60. What type of depreciation is due to the reduction in the demand
for the function that the equipment or asset was designed to render?
Functional depreciation
61. What type of depreciation is due to the reduction of the phyical
ability of an equipment or asset to produce result? Physical
depreciation
62. The functional depreciation is sometimes called Obsolescence
63. What is defined as the reduction of the value of certain natural
resources such as mines, oil, timber, quarries, etc. due to the gradual
extraction of its contents? Depletion
64. What are the common methods of computing depletion charge?
Unit method and percentage method
65. Under the depletion allowance method in computing
depreciation, the depletion charge is equal to either ________
whichever is smaller. fixed percentage of gross income or 50% of the
next taxable income
66. The depletion allowance method of computing depletion is
commonly known as percentage method.
67. What is another term for \"unit method\" for computing
depletion? Factor method
68. Using factor method, the depletion at any given year is equal to.
initial cost of property times number of units sold during the year
divided by the total units in property
69. What do you call the after-tax present worth of all depreciation
effects over the depreciation period of the asset? Depreciation
recovery
70. A mathematical expression also known as the present value of
annuity of one is called present worth factor
71. The amount of property in which a willing buyer will pay to a
willing seller for the property when neither one is under the
compulsion to buy nor sell is called Market value
72. Salvage value is sometimes known as Second-hand value
73. What refers to the value of an asset which a disinterested third
party, different from the buyer and seller, will determine in order to
establish a price acceptable to both parties? Fair value
74. What refers to the value of an intangible item which arises from
the exclusive right of a company to provide a specified product and
service in a certain region of the country? Franchise value
75. The first cost to be incurred if the piece of equipment now in
place had been bought for a second hand dealer or some other
business is called in-place value
76. In computing depreciation of an equipment, which of the ff
represents the first cost? The original purchase price and freight
charges, Installation expenses, Initial and permit fees
77. The process of determining the value or worth of a physical
property for specific reason is called valuation
78. The unrecovered depreciation which results due to poor
estimates as to life of the equipment is called sunk cost
79. What refers to the present worth of cost associated with an asset
for an infinite period of time? Capitalized cost
80. Capitalized cost of a project is also known as life cycle cost
81. What is normally used to compare alternatives that accomplish
the same purpose but have unequal lives? Annual cost method
82. What method is often used in municipal project evaluations
where benefits and costs accrue to different segments of the
community? Benefit-cost ratio
83. What refers to an imaginary cost representing what will not be
received if a particular strategy is rejected? Opportunity cost
84. What is the main reason why the sinking fund method of
computing depreciation is seldom used in the industry? The initial
depreciation is low
85. What is the factor name of the formula (1+i)^-n ? Single payment
present worth
86. What is the factor name of the formula [ i(1+i)^n ] / [(1+i)^n - 1] ?
Capital recovery
87. Is an artificial being created by operation of law, having the right
of succession and the process, attributes, and properties expressly
authorized by the law or incident to its existence. Corporation
88. What is the simplest form of business organization? Sole
proprietorship
89. Double taxation is a disadvantage of which business organization?
Corporation
90. In case of bankruptancy of a partnership. the partners personal
assets are attached to the debt of the partnership
91. Which is true about partnership? It will be dissolved if one of the
partners ceases to be connected to the partnership
92. Which is true about corporation? The stockholders of the
corporation are only liable to the extent of their investments
93. An aggregation of individuals formed for the purpose of
conducting a business and recognized by law as a fictitious person is
called corporation
94. An association of two or more persons for the purpose of
engaging into a business for profit is called partnership
95. What represents the ownership of stockholders who have a
residual claim on the assets of the corporation after all other claims
have been settled? Common stock
96. What stock represents ownership and enjoys certain preferences
than ordinary stock? Preferred stock
97. The amount of company's profit that the board of directors of the
corporation decides to distribute to ordinary shareholders is called
dividend
98. What refers to the residual value of a company's assets after all
outside liabilities (shareholders excluded) have been allowed for?
Equity
99. What refers to the claim of anyone to ownership? Equity
100. Cash money and credit necessary to establish and operate an
enterprise are generally called capital.
101. What represents the share of participation in business
organizations? Stock
102. The profit derived from a project or business enterprise without
consideration of obligations to financial contributors and claims of
others based on profit is known as economic return
103. ________ is the element of value which a business has earned
through the favorable consideration and patronage of its customers
arising from its well known and well conducted policies and
operations. Goodwill
104. Which of the ff is an example of an intangible asset? Patents
105. Lands. buildings, plants and machineries are examples of what
type of asset? Fixed asset
106. What refers to the interest rate at which the present work of the
cash flow on a project is zero of the interest earned by an
investment? Rate of return
107. What is another term for \"current assets\"? Liquid assets
108. What is an accounting term that represents an inventory
account adjustment? Cost of goods sold
109. What is the change in cost per unit variable change called?
incremental cost
110. What is used to record historical financial transactions?
Bookkeeping system
111. What is a secondary book of accounts, the information of which
is obtained from the journal called? "ledger
112. The original record of a business transaction is recorded in this
book. Journal
113. All the proceeds which are received by the business as a result of
the sale of goods is called gross income
114. All are classified under direct labor expenses EXCEPT one. Which
one? Supervision cost
115. What is a measure of the average speed with which accounts
receivable are collected? Receivable turnover
116. The ratio of the net income before taxes to net sales is called
Profit margin ratio
117. What do you call a one-time credit against taxes? Tax credit
118. What is used when quick estimate of the doubling time for the
invested money is needed? Rule of 72
119. What is the increase in the money value of a capital asset called?
Capital gain
120. What is the reduction in the money value of a capital asset
called? Capital loss
121. What refers to the negotiable claim issued by a bank in lieu of a
term deposit? Certificate of deposit
122. What denotes the fall in the exchange rate of one currency in
terms of the others? this term usually applies to the floating
exchange rate. Currency depreciation
123. The deliberate lowering of the price of a nation's currency in
terms of the accepted standard (Gold, American dollar or the british
pound) is known as Currency devaluation
124. What refers to the saving which takes place because goods are
not available for consumption rather than the consumer really want
to save? Forced saving
125. The flow back of profit plus depreciation from a given project is
called cash flow
126. As applied to capitalized asset, the distribution of the initial cost
by a periodic changes to operation as in depreciation or the reduction
of a debt by either periodic or irregular prearranged programs is
called amortization
127. Capitalized cost of any structure or property is computed by
which formula? First cost + cost of perpetual maintenance
128. The true value of interest rate computed by equations for
compound interest for a 1 year period is known as effective interest.
129. Return on investment ratio is the ratio of the: net income to
owner's equity
130. Gross margin is the ratio of the gross profit to net sales
131. What is another term for \"acid-test ratio\? Quick ratio
132. What is a government bond which has an indefinite life rather
than a specific maturity? Consol
133. A form of business firm which is owned and run by a group of
individuals for their mutual benefit is called cooperative
134. What is a stock of a product which is held by a trade body or
govt as a means of regulating the price of that product? Buffer stock
135. The ability to meet debts as they come due is known as solvency
136. What is the basic accounting equation? Assets = Liability +
Owner's equity
137. The financial health of the company is measured in terms of:
liquidity, solvency, relative risk
138. What is an index of short term paying ability? Current ratio
139. The common ratio is the ratio of: current assets to current
liabilities
140. What is defined as the current assets minus inventories and
prepaid expenses? Quick ratio
141. What is the ratio of the quick assets to current liabilities? "Quick
ratio
142. Receivables turnover is the ratio of: net credit sales to average
net receivables
143. What is the ratio of the net income to owner's equity? Return of
investment ratio
144. What is the ratio of the market price per share to earnings per
share called? Price-earnings ratio
145. What is the profit-margin ratio? The ratio of net income before
taxes to net sales
146. What is a gross margin? The ratio of gross profit to net sales
147. Which of the ff is a book value share of common stock? The
ratio of common shareholders' equity to the number of outstanding
shares
148. What is an inventory turnover? The ratio of cost of goods sold
to average cost of inventory on hand
149. The average age of receivables is computed using which
formula? 365 / receivable turnover
150. What is a method of determining when the value of one
alternative becomes equal to the value of another? Break-even
analysis
151. The days supply of inventory on hand is calculated using which
formula? 365 / inventory turnover
152. What is defined as the length of time usually in years, for the
cumulative net annual profit to equal the initial investment? Payback
period
153. What is defined as the ratio of its return to its cost? Value of an
investment
154. Which of the ff is an accelerated depreciation method? Double
declining balance method and SYD method
155. What is an accelerated depreciation method? It is one that
calculates a depreciation amount greater than a straight line
amount
156. What refers to the reduction in the level of a national income
and output usually accompanied by a fall in the general price level?
Deflation
157. A formal organization of producers within an industry forming a
perfect collusion purposely formed to increase profit and block new
comers form the industry is called Cartel
158. The paper currency issued by the central bank which forms part
of the country's money supply is called bank notes
159. What is the ratio of the net income to owner's equity? Return
on investment
160. What refers to the buying or selling of goods between two or
more markets in order to take profitable advantage of any differences
in the prices quoted in these markets? Arbitage
161. The suspension of repayment of debt or interest for a specified
period of time is called moratorium
162. It is defined to be the capacity of a commodity to satisfy human
want. utility
163. It is the stock that has prior right to dividends. It is usually does
not bring voting right to the owners and the dividend is fixed and
cannot be higher than the specified amount. Preferred stock
164. It is the worth of a property as recorded in the book of an
enterprise. Book value
165. The value of the stock as stated on the stock certificate. par
value
166. A market situation in which two powerful groups or
organizations dominate commerce in one business market or
commodity. Duopoly
167. The amount which has been spend or capital invested which for
some reasons cannot be retrieved. sunk cost
168. An obligation with no condition attached is called Gratuitous
169. The amount received from the sale of an additional unit of a
product. marginal revenue
170. The amount that the property would give of sold for junk. scrap
value
171. The sum of the direct labor cost incurred in the factory and the
direct material costs of all materials that go into production is called
prime cost
172. The additional cost of producing another one more unit is
marginal cost
173. A written contract by a debtor to pay final redemption value on
an indicated date or maturity and to pay a certain sum periodically.
bond
174. Estimated value of the property at the end of the useful life.
Salvage value
175. Determination of the actual quantity of the materials on hand as
of a given date. physical inventory
176. This consists of cash and account receivable during the next
period or any other material which will be sold. current asset
177. A wrongful act that causes injury to a person or property and for
which the law allows a claim by the injured party to recover damages.
tort
178. These are products or services that are required to support
human life and activities that will be purchased in somewhat the
same quantity even though the price varies considerably. necessities
179. The quantity of a certain commodity that is offered for sale at a
certain price at a given place and time. supply
180. Parties whose consent or signature in a contract is not
considered intelligent. demented persons
181. This occurs in a situation where a commodity or service is
supplied by a number of vendors and there is nothing to prevent
additional vendors entering the market. perfect competition
182. These are products or services that are desired by human and
will be purchased if money is available after the required necessities
have been obtained . luxuries
183. Grand total of the assets and operational capability of a
corporation. authorized capital
184. The length of time which the property may be operated at a
profit. economic life
185. The right and priviledge granted to an individual or corporation
to do business in a certain region. franchise