27 real Plant Design & Economics Basics questions from the Chemical Core bank, as asked in Indian campus drives and tech interviews. Every question has a verified answer and an AI-tutor explanation on placd — free to start.
1. What is Fixed capital investment?
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A.size that minimises the sum of annualised capital cost, which rises with diameter, and pumping cost, which falls with diameter
B.capacity scaling where cost is proportional to the capacity ratio raised to about 0.6, so doubling capacity raises cost by roughly 52%
C.total cost of equipment, installation, piping, buildings and utilities ready for start-up, excluding working capital
D.Chemical Engineering Plant Cost Index used to escalate historical equipment costs to the present year by the ratio of index values
A.Fixed capital investment — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
B.Fixed capital investment — size that minimises the sum of annualised capital cost, which rises with diameter, and pumping cost, which falls with diameter
C.Fixed capital investment — capacity scaling where cost is proportional to the capacity ratio raised to about 0.6, so doubling capacity raises cost by roughly 52%
D.Fixed capital investment — total cost of equipment, installation, piping, buildings and utilities ready for start-up, excluding working capital
5. Which term means: "money tied up in raw-material inventory, product stock, receivables and cash, typically 10–20% of total investment and recovered at project end"?
A.Working capital — time for cumulative cash flow to recover the fixed capital investment, ignoring the time value of money
B.Working capital — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
C.Working capital — money tied up in raw-material inventory, product stock, receivables and cash, typically 10–20% of total investment and recovered at project end
D.Working capital — multiplier on delivered equipment cost giving total plant cost, about 3.1 for solids, 3.6 for solid-fluid and 4.7 for fluid-processing plants
11. Which term means: "multiplier on delivered equipment cost giving total plant cost, about 3.1 for solids, 3.6 for solid-fluid and 4.7 for fluid-processing plants"?
A.Lang factor — multiplier on delivered equipment cost giving total plant cost, about 3.1 for solids, 3.6 for solid-fluid and 4.7 for fluid-processing plants
B.Lang factor — discount rate that makes net present value zero, compared against the minimum acceptable rate to rank competing projects
C.Lang factor — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
D.Lang factor — Chemical Engineering Plant Cost Index used to escalate historical equipment costs to the present year by the ratio of index values
14. Which term means: "capacity scaling where cost is proportional to the capacity ratio raised to about 0.6, so doubling capacity raises cost by roughly 52%"?
A.Six-tenths rule — discount rate that makes net present value zero, compared against the minimum acceptable rate to rank competing projects
B.Six-tenths rule — time for cumulative cash flow to recover the fixed capital investment, ignoring the time value of money
C.Six-tenths rule — size that minimises the sum of annualised capital cost, which rises with diameter, and pumping cost, which falls with diameter
D.Six-tenths rule — capacity scaling where cost is proportional to the capacity ratio raised to about 0.6, so doubling capacity raises cost by roughly 52%
17. Which term means: "sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive"?
A.Net present value — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
B.Net present value — discount rate that makes net present value zero, compared against the minimum acceptable rate to rank competing projects
C.Net present value — multiplier on delivered equipment cost giving total plant cost, about 3.1 for solids, 3.6 for solid-fluid and 4.7 for fluid-processing plants
D.Net present value — Chemical Engineering Plant Cost Index used to escalate historical equipment costs to the present year by the ratio of index values
20. Which term means: "Chemical Engineering Plant Cost Index used to escalate historical equipment costs to the present year by the ratio of index values"?
A.CEPCI — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
B.CEPCI — money tied up in raw-material inventory, product stock, receivables and cash, typically 10–20% of total investment and recovered at project end
C.CEPCI — Chemical Engineering Plant Cost Index used to escalate historical equipment costs to the present year by the ratio of index values
D.CEPCI — time for cumulative cash flow to recover the fixed capital investment, ignoring the time value of money
A.Internal rate of return — time for cumulative cash flow to recover the fixed capital investment, ignoring the time value of money
B.Internal rate of return — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
C.Internal rate of return — capacity scaling where cost is proportional to the capacity ratio raised to about 0.6, so doubling capacity raises cost by roughly 52%
D.Internal rate of return — discount rate that makes net present value zero, compared against the minimum acceptable rate to rank competing projects
26. Which term means: "size that minimises the sum of annualised capital cost, which rises with diameter, and pumping cost, which falls with diameter"?
A.Economic pipe diameter — Chemical Engineering Plant Cost Index used to escalate historical equipment costs to the present year by the ratio of index values
B.Economic pipe diameter — sum of all future cash flows discounted to today at the company's cost of capital; a project is acceptable when it is positive
C.Economic pipe diameter — size that minimises the sum of annualised capital cost, which rises with diameter, and pumping cost, which falls with diameter
D.Economic pipe diameter — capacity scaling where cost is proportional to the capacity ratio raised to about 0.6, so doubling capacity raises cost by roughly 52%
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