Please print this page and attach detail of your work Total Points 20
Late work will not be accepted
Please print this page and attach your detail work one- side of paper, typing is optional.
Exercises must be presented in a neat, well organized and professional manner as follows:
• The problem statement should include the essence of what is given and what is to be
determine, not the question as provided to you. Include figures as appropriate.
• Problem solution presented in a logical, orderly fashion, and sufficient but brief text
(such as headers) to clearly explain the procedure used. All calculations shown
separately, including units and conversions. And four decimal places.
• BOX your Answer; late work will not be accepted.
Appendix D Pages 654 –676 Fundamentals of Engineering (FE) Exam Practice Problems
of the book 14th Edition.
Explain and attach Typing Optional; in Detail of your selection answer; show your work and
calculation for each...question and put Your Final Answer with Capital Letter on cover page.
Problem
1) D-27
2) D-37
3) D-44
4) D-47
5) D-57
6) D-130
7) D-133
8) D-135
9) D-137
10) D-139
Answer Note
D
B
C
B
C
D
C
C
C
B
1) D-27: A company has major clients in all 50 states. Fifteen (15) of the states have 4 clients, 10 have 3 clients,
20 have 6 clients and 5 have 10. The total number of clients the firm has is closest to what number?
a. 23
b. 50
c. 250
d. 260
15(4) + 10(3) + 20(6) + 5(10) = 90 + 170 = 260 /012345
2) D-37: A machine will need to be replaced 15 years from today for $10,000. How much must be deposited now
into an account that earns 5% per year to cover the replacement cost?
a.
b.
c.
d.
$1486
$4810
$6139
$10,000
10000 = 6(1 + 0.05)!" = 6 = 10000/2.0789 = $4810.17
3) A rate of 2% per quarter compounded quarterly is closest to what annual compounded interest rate.
a. 2%
b. 8%
c. 8.24%
d. 24%
(1 +
2 #
) = 1.0824 − 1 = 0.08243216(100) = 8.24%
100
4) A deposit of $50,000 is made into an account that pays 10% compounded semiannually. How much would be in
the account after 10 years?
a. $81,445
b. $129,685
c. $132,665
d. $336,375
50000(1 +
10 !$
) = $129,687
100
5) Winners of the Power State Lottery can take $30 million now or payments of $2.5 million per year for the next 15
years. These are equivalent at what annual interest rate? The answer is closest to what value?
a. 1%
b. 2%
c. 3%
d. 5%
1(1 + 1)!"
2.5 >10 = 30(
− 1) = 2.5(1 + 1)!" − 2.5 = 301(1 + 1)!" = (2.5 − 301)(1 + 1)!" = 2.5 = 3
!"
(1 + 1)
6) If the projects have the following contingencies, what is the total number of possible investment strategies
(combinations) that the firm can use? Project A can be invested in only by itself; Project D is chosen only if
Project B is chosen.
Project
A
B
First Cost
12
18
PW
225
250
C
D
24
30
320
400
Options:
-
Selecting project, A only
Selecting project B
BC
C
BCD
BD
a.
b.
c.
d.
0
2
4
6
7) A firm is considering whether to buy specialized equipment that would cost $200,000 and have annual costs of
$15,000. After 5 years of operation, the equipment would have no salvage value. The same equipment can be
leased for $50,000 per year (annual costs included in the lease), payable at the beginning of each year. If the firm
uses an interest rate of 5% per year, the annual cost advantage of leasing over purchasing is nearest what value?
a. $2494
b. $8694
c. $11200
d. $12758
?@54 @A 2BC1D>234: $200F −> H33CI0 ?@54: $15J −> ?@54 @A 02I513K: $50F I4 54IL4 @A 2I/ℎ N2IL
−> 1342L254 LI42 5%
(1 + 0.05)" (0.05)
200000 O
P + 15000 = $61194.96 − $50,000 = $11194.96
(1 + 0.05)" − 1
8) Which of the following financial ratios provides insight into a firm’s solvency over the short term by indicating its
ability to cover current liabilities?
a. Acid-test ratio
b. Quick ratio
c. Current ratio
d. Net profit ratio
Current ratio because it tells you how much the firm has to pay in solvency over a short period of time.
9) A firm’s balance sheet has the following data:
Cash on hand
Market securities
New accounts and notes receivable
Retailers’ inventories
Prepaid expenses
Accounts and notes payable
$450,000
25,000
125000
560000
48500
700000
Accumulated liabilities
120000
The firm’s current ratio and acid-test ratio closest to what values?
a)
b)
c)
d)
1:42; 0.73
1:42; 0.79
1:47; 0.73
1:47; 0.79
450000 + 560000 + 125000 + 48500 + 25000 1160000
=
= 1.474
700000 + 120000
820000
450000 + 125000 + 25000 600000
=
= 0.732
700000 + 120000
820000
10) Annual manufacturing cost data (1000s) for four product lines are as follows:
Data
Annual production
Cost direct
materials
Cost of direct labor
Line 1
4000
800
Line 2
3500
650
Line 3
9800
1200
Line 4
675
2500
3500
3750
600
320
Rank the product lines from lowest to highest in terms of manufacturing cost per unit. Total indirect costs of $10.8
million are allocated based on total direct cost.
a)
b)
c)
d)
1-2-3-4
3-1-2-4
3-2-1-4
3-4-1-2
Annual
Production
Cost direct
materials
Cost of direct
labor
Total direct cost
Indirect cost
Total
Unit cost
Line 1 #2
4000
Line 2 #3
3500
Line 3- #1
9800
Line 4 #4
675
800
650
1200
2500
3500
3750
600
320
1800
$1,459.46
2820
$2,286.49
3259.46
0.33
5106.49
7.57
4300
4400
4300
$3567.57
(4300 + 4400 + 1800 + 2820)
∗ 10800
= $3486.49
4300+3486.49=7786.49
7967.57
1.85
3.19