ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.13 (CORRECTION) : (i) In the Present Value Multiplication Rule, let PV = present value, Ra = interest rate for first discount, A = duration for first discount; Rc = interest rate for second discount, C = duration for second discount. Let PV = [ 1 / (1 + Ra) ^ A ] [ 1 / (1 + Rc) ^ C ] where ^ is the symbol of power : 3 ^ 2 = 3 x 3, 2 ^ 3 = 2 x 2 x 2. (a) For discounts involving 8 % / year for 3 years and 10 % / year for 9 years, find the value of PV. (b) If Re = interest rate for third discount, E = duration of third discount, form a mathematical equation of PV as a function of A, C, E, Ra, Rc, Re. Note : Discounts are available in the purchase of certain biochemical engineering instruments. (ii) Let R = nominal interest rate related to growth rate of money, r = real interest rate related to growth rate of purchase power. If I = inflation, where the unit of R, r and I is %, find the mathematical relationship of r as a function of R and I.
ACCOUNTING AND FINANCIAL ENGINEERING - ANSWER 34.13 (CORRECTION) : (i) (a) Let Ra = 0.08, A = 3; Rc = 0.1, C = 9. Then PV = [ 1 / (1 + Ra) ^ A ] [ 1 / (1 + Rc) ^ C ] = [ 1 / (1 + 0.08) ^ 3 ] [ 1 / (1 + 0.1) ^ 9 ] = 0.33666. (b) PV = [ 1 / (1 + Ra) ^ A ] [ 1 / (1 + Rc) ^ C ] [ 1 / (1 + Re) ^ E ]. (ii) r = R - I. The answer is given by Kang Chuen Tat; PO Box 6263, Dandenong, Victoria VIC 3175, Australia; SMS +61405421706; chuentat@hotmail.com; http://kangchuentat.wordpress.com.
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PETROLEUM ENGINEERING - QUESTION 25.1 : Fact 1 : Dry air contains 20.95 % oxygen, 78.09 % nitrogen, 0.93 % argon, 0.039 % carbon dioxide, and small amounts of other gases by volume. Fact 2 : Volume occupied is directly proportional to the number of moles for ideal gases at constant temperature and pressure. Fact 3 : 12.5 moles of pure oxygen is required to completely burn 1 mole of pure octane. Fact 4 : Air-fuel ratio (AFR) is the mass ratio of dry air to fuel present in a combustion process such as in an internal combustion engine or industrial furnace. Fact 5 : Molecular weight of oxygen gas is 31.998 g / mole and molecular weight of nitrogen gas is 28.014 g / mole. (a) Find the molar ratio of nitrogen and oxygen, or (moles of nitrogen) / (moles of oxygen) in dry air, by assuming ideal features of nitrogen and oxygen gases. (b) How many moles of nitrogen are available if dry air is used to completely burn the 1 mole pure octane? (c) Find the mass of fuel of 1 mole of octane with molecular weight of 114.232 g / mole. (d) Find the mass of dry air with 12.5 moles of pure oxygen by assuming only oxygen and nitrogen gases exist in the air. (e) Find the air-fuel ratio (AFR) when octane is used as fuel. (f) Find the fuel-air ratio (FAR) when octane is used as fuel.
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