Chemical Engineering Plant Economics
Chemical engineering plant cost index is used for finding the present cost of a particular chemical plant, if the cost of similar plant at some time in the past is known. The present cost of the plant = original cost x (index value/(index value at original cost was obtained) The most major component of this cost index is

Electrical equipments and material
Pumps and compressor
Fabricated equipment and machinery
Process instruments and control

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Chemical Engineering Plant Economics
Depreciation

Costs (on annual basis) are constant when the straight line method is used for its determination
All of these
Is the unavoidable loss in the value of the plant, equipment and materials with lapse in time
Does figure in the calculation of income tax liability on cash flows from an investment

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Chemical Engineering Plant Economics
The depreciation during the year 'n', in diminishing balance method of depreciation calculation, is calculated by multiplying a fixed percentage 'N' to the

Book value at the end of (n - 1)th year
Difference between initial cost and salvage value
Depreciation during the (n - 1)th year
Initial cost

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