ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.21 : The cost of building a biochemical processing plant is increasing due to inflation. Let I = inflation rate, R = nominal interest rate, r = real interest rate. According to Fisher Equation, (1 + r)(1 + I) = (1 + R). According to General Inflation Equation, R = r + I. (a) By assuming that both r and I are fairly small, prove by mathematical calculations that complicated Fisher Equation could be simplified into the General Inflation Equation. (b) By using 2 first order Taylor expansions in the linear approximation, namely 1 / (1 + x) ≈ (1 - x), (1 + x)(1 + y) ≈ 1 + x + y, show by mathematical calculations that (1 + r) = (1 + R) / (1 + I) could be approximated by r ≈ R - I.
ACCOUNTING AND FINANCIAL ENGINEERING - ANSWER 34.21 : (a) Let (1 + R) = (1 + r)(1 + I) = 1 + r + I + rI, R = r + I + rI. When r ≈ I ≈ fairly small, R ≈ r + I (proven). (b) Let 1 / (1 + I) ≈ (1 - I), then (1 + r) ≈ (1 + R)(1 - I) ≈ 1 + R - I, then r ≈ R - I (shown). 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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ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.31 : In a biochemical engineering company, let the actual revenue generated = A, actual cost incurred = B. According to the standard budget, the revenue generated = C, cost incurred = D. (a) Find the profit according to : (i) actual situation; (ii) standard budget. (b) Calculate the Variance Due to Price and Efficiency in : (i) revenue generated; (ii) cost incurred; (iii) profit. (c) If E > F where > represents : more than, find the 4 pairs of values of E and F in favorable conditions.
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Question 88 - In the calculation of the growth of bacteria, colony forming unit (CFU) in serial dilution is used. In a laboratory, viable count assay is used to estimate CFU. Formula applied is CFU / mL = (number of colonies x dilution) / (amount plated, in unit mL). Acceptable plate count is either between 20 and 200 or between 30 and 300 according to 2 different references. A wastewater sample of 200 ml is added to and mixed with 1.8 L of sterile water. Another 200 ml of the mixture is added to and mixed with 1.8 L of sterile water. (a) Calculate the dilution of first mixture and the dilution of the second mixture. (b) 100 microlitres of wastewater samples from the first mixture and the second mixture are placed separately on 2 different alga plates. The first plate has 250 colonies and the second plate has 23 colonies. Calculate the average CFU / mL.
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Chemical Engineering Unit Operation - Which of the sequence below represent a feasible flows of ethanol processing plants using cellulose as starting material? A. raw material --> heat exchanger --> distillation column --> reactor. B. reactor --> distillation column --> raw material --> heat exchanger. C. heat exchanger --> raw material --> distillation column --> reactor. D. raw material --> heat exchanger --> reactor --> distillation column. E. distillation column --> raw material --> reactor --> heat exchanger.
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ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.16 : An engineer would like to invest his money in a home, business and bond. The implicit interest payment frequency is monthly for home loans, quarterly for business loans; semi annually for bonds. A generalized mathematical formula to calculate I = interest rate equivalence is I = (1 + i / N) ^ N - 1 where i = annual interest rate, N = number of payment per year. (a) Calculate the value of N for : (i) home loans; (ii) business loans; (iii) bonds. (b) For i = 0.08, find the value of I for : (i) home loans; (ii) business loans; (iii) bonds.
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