General Aspects of Energy Management & Energy Audit Available here with full solutions — 41 questions recovered from the 2019 exam:
Objective (1 mark)
41 of 50
Short (5 marks)
0 of 8
Long (10 marks)
0 of 6
This is not the complete paper. The questions below are the ones we could recover and verify; the rest of that year’s paper is not reproduced here. Every answer shown is checked against the 2014 BEE guidebook and carries its book section reference and an explanation.
Full paper pattern: Section-I 50×1 = 50 marks · Section-II 8×5 = 40 · Section-III 6×10 = 60 · Total 150, pass mark 75, 3 hours. ▶ Practice these interactively
Other years
Objective questions (1 mark) — 41
📖 §7.5 Sensitivity and Risk Analysis
1. In project financing, sensitivity analysis is applied because
almost all the cash flows involve uncertainly
it evaluates how sensitive the project is to change in the input parameters
it assesses the impact of ‘what if one or more factors are different from what is predicted’
it is applicable to all the above situations
Answer: D) it is applicable to all the above situations
Confirmed vs Book-1 §7.5 — Book, Section 7.5: cash flows contain uncertainty; sensitivity analysis asks 'How sensitive is the project's feasibility to changes in the input parameters?' and 'What if one or more of the factors is not as favourable as predicted?'
All three statements are drawn from the same passage, so 'all of the above'.
2. Which of the following statement is true regarding the EC act?
Designated consumers have to appoint Energy managers with prescribed qualifications.
State Designated Agencies have to appoint Energy auditor with prescribed qualifications.
Designated consumer has to get an energy audit conducted by a certified energy Manager.
Designated consumer has to get an energy audit conducted by the State Designated Agency
Answer: A) Designated consumers have to appoint Energy managers with prescribed qualifications.
Confirmed vs Book-1 §2.3.6 — The book states: 'Designated consumers have to appoint Energy managers with prescribed qualifications' and 'the designated consumer has to get an energy audit conducted by an accredited energy auditor'. Hence (c) and (d) are wrong — neither a certified energy manager nor the SDA may conduct the mandatory audit — and (b) is wrong because SDAs are not required to appoint auditors.
📖 §11.3 Solar Thermal Energy (Evacuated Tube Collector)
3. Which of the following statements regarding evacuated tube collectors (ETC) are true?
i) ETC can reach high temperatures upto 150°C
ii) Because of the vacuum between the two concentric glass tubes, a higher amount of heat is retained in the ETC
iii) Heat loss due to conduction back to the atmosphere from the ETC is high
iv) Performance of the evacuated tube is highly dependent upon the ambient temperature
i & iii
ii & iii
i & iv
i & ii
Answer: D) i & ii
Confirmed vs Book-1 §11.3 Solar Thermal Energy (Evacuated Tube Collector) —
Book: ETC ‘can reach high temperatures upto 150°C’ (statement i true) and the vacuum between the two concentric glass tubes traps more heat than a flat plate collector (statement ii true).
Statement iii is false — ‘since conduction cannot take place in vacuum, heat loss due to conduction back to atmosphere is also prevented’ (heat loss <10% vs 40% for FPC).
Statement iv is false — the ETC ‘is less dependent upon ambient temperature unlike flat plate collector’. Hence i & ii, answer d.
4. How much power you would expect to generate from a river-based mini hydropower with flow of 40 litres/second, head of 12 metres and system efficiency of 55%.
872 kW
2.59 KW
264 kW
none of the above
Answer: B) 2.59 KW
Confirmed vs Book-1 §11.7 Hydro Power (Water into Watts) —
Book formula: P (kW) = 9.81 × Q × H × η, with Q in m³/s and H in m.
Q = 40 l/s = 0.040 m³/s, H = 12 m, η = 0.55.
P = 9.81 × 0.040 × 12 × 0.55 = 2.59 kW. Answer b.
📖 §1.7 Indian Energy Scenario — Natural Gas Sector
5. Which among the following has the highest flue gas loss on combustion due to Hydrogen in the fuel?
Natural gas
furnace oil
coal
light diesel oil
Answer: A) Natural gas
Confirmed — natural gas is essentially methane (CH4) and has by far the highest hydrogen content per kg of the fuels listed. Hydrogen burns to water vapour, and the latent heat carried away by that vapour is the loss due to hydrogen in fuel, so gaseous fuel gives the largest such flue-gas loss. Coal has the least hydrogen and hence the smallest H2 loss.
6. Energy in one Tonne of Oil Equivalent (toe) corresponds to
4.187 GJ
1.162 MWh
10,000 kcal
none of the above
Answer: D) none of the above
Confirmed vs Book-1 §3.5 — 1 toe = 10^7 kcal = 4.187 x 10^7 kJ = 41.87 GJ = 11,630 kWh = 11.63 MWh. Option (a) 4.187 GJ, (b) 1.162 MWh and (c) 10,000 kcal (= 1 kg oil equivalent) are all too small, so the answer is 'none of the above'.
📖 §10.5 CO2 avoided = energy saved × emission factor
7. Assume CO2 equivalent emissions by the use of a 40 W fluorescent lamp are of the order of 60 g/hr. If it is replaced by a 20 W LED lamp then the equivalent CO2 emissions will be
nil, as LED does not emit CO2
30 g/hr
20 g/hr
1200 g/hr
Answer: B) 30 g/hr
Confirmed vs Book-1 §10.5 — CO2 emission from lighting is proportional to the wattage drawn. 40 W → 60 g/hr, so per watt = 1.5 g/hr. A 20 W LED therefore emits 20 × 1.5 = 30 g/hr. LEDs do emit indirect CO2, because the electricity they use is generated from fossil fuel.
8. Under the Energy Conservation Act, the designated consumer is required to get the mandatory energy audit conducted by
certified energy manager
certified energy auditor
accredited energy auditor
BEE
Answer: C) accredited energy auditor
Confirmed vs Book-1 §2.3.6 — The Act requires the DC's mandatory audit to be done by an ACCREDITED energy auditor — accreditation is granted by BEE under Sec 13(o)/(p) over and above certification. A certified energy manager or a merely certified energy auditor does not qualify, and BEE itself does not conduct audits.
📖 §4.12 Energy audit instruments — Speed Measurements
9. Stroboscope is an instrument for measuring
steam flow
composition of flue gas
speed
pressure
Answer: C) speed
Confirmed vs Book-1 §4.12 — Book §4.12: "A stroboscope uses this principle for measurement of RPM" — flashes of light at a precise frequency make periodic motion appear stopped. It is a speed instrument only; flue-gas composition needs a Fyrite/gas analyser, pressure a manometer and steam flow a flow meter.
📖 §3.4 Latent heat of fusion / vaporization — Qₗ = m · h
10. If 1 kWh of electrical energy is used to heat 10 kg of ice at 0o C, what will be the temperature of water after melting? (Latent heat of fusion of ice is 80 kcal/kg)
0°C
6°C
86°C
none of the above
Answer: B) 6°C
Confirmed vs Book-1 §3.4 — 1 kWh = 860 kcal. Melting 10 kg of ice needs 10 x 80 = 800 kcal, leaving 860 - 800 = 60 kcal. Warming the 10 kg of melt water: dT = 60/(10 x 1) = 6 degC, so the final temperature is 6 degC.
📖 §5.5 Example 5.6 — evaporator solids (tie-component) balance
11. If feed of 15 tonnes per hour at 6% concentration is fed to an evaporator, the product obtained at 30% concentration is equal to ____ tonnes per hour.
3
9
0.9
4.5
Answer: A) 3
Confirmed vs Book-1 §5.5 Ex.5.6: Solids are conserved. Solids in feed = 15 × 0.06 = 0.9 t/h. Product at 30% solids = 0.9/0.30 = 3 t/h. (Water evaporated = 15 − 3 = 12 t/h.) Option (a).
📖 §7.3 Comparison between Net Present Value and Internal Rate of Return
12. The discount rate is used as an input in determining _________.
NPV
IRR
payback period
all of the above
Answer: A) NPV
Confirmed vs Book-1 §7.3 — Book: 'In the net present value calculation, NPV of the project is determined by ASSUMING that the discount rate (cost of capital) is KNOWN. In the internal rate of return calculation, we set the net present value equal to zero and DETERMINE the discount rate.'
So the discount rate is an INPUT to NPV, while for IRR it is the OUTPUT; simple payback ignores discounting altogether.
📖 §3.4 Heat transfer — conduction, convection, radiation (rate in Watts)
13. The rate of energy transfer from a higher temperature to a lower temperature is measured in
kcal
Watt
Watts per second
none of the above.
Answer: B) Watt
Confirmed vs Book-1 §3.4 — Book-1 §3.4 Heat transfer: 'The energy transferred is measured in Joules. The rate of energy transfer, more commonly called heat transfer, is measured in Watts (J/s).' kcal is a quantity, not a rate; 'Watts per second' is not a unit of rate of heat flow.
📖 §7.3 Financial Analysis Techniques — Simple Payback Period
14. The cost of an economizer is Rs. 2 lakhs. The simple payback period (SPP) in years considering annual savings of Rs 1,10,000 and annual maintenance cost of Rs 10,000 is ___________.
1.8
2.5
2
0.5
Answer: C) 2
Confirmed vs Book-1 §7.3 — Annual net savings = 1,10,000 - 10,000 = Rs.1,00,000/yr (O&M must be subtracted first).
SPP = 2,00,000 / 1,00,000 = 2 years. (Using the gross Rs.1.10 lakh gives the distractor 1.8 yr.)
📖 §5.5 Material balance — moisture + water formed from hydrogen
15. 1 kg of wood contains 15% moisture and 5% hydrogen by weight. How much water is evaporated during complete combustion of 1kg of wood?
0.6 kg
200 g
0.15 kg
none of the above
Answer: A) 0.6 kg
Confirmed vs Book-1 §5.5 (component mass balance): Free moisture = 1 × 0.15 = 0.15 kg. Hydrogen burns as H2 + ½O2 → H2O, so 2 kg H gives 18 kg water, i.e. 9 kg water per kg of hydrogen: 9 × 0.05 = 0.45 kg. Total water evaporated = 0.15 + 0.45 = 0.60 kg. Option (a).
16. In an industry the average electricity consumption is 10 lakh kWh for a given period. The average production is 90,000 tons with a specific electricity of 10 kWh/ton for the same period. The fixed electricity consumption for the plant is
1,00,000 kWh
9,90,000 kWh
10,000 kWh
none of the above
Answer: A) 1,00,000 kWh
Confirmed vs Book-1 §9.6 — variable energy = 10 kWh/ton × 90,000 tons = 9,00,000 kWh. Fixed C = 10,00,000 - 9,00,000 = 1,00,000 kWh, i.e. the base load that persists at zero production. Answer (a).
17. The theoretical amount of electricity required to heat 500 litres of brine solution with a specific gravity of 1.2 and specific heat of 1 kcal/kg K from 30°C to 70 °C through resistance heating is_________
27.9 kWh
23.3 kWh
20 kWh
none of the above
Answer: A) 27.9 kWh
Confirmed vs Book-1 §3.5 — Mass = 500 litres x 1.2 (sp. gr.) = 600 kg. Q = m·Cp·dT = 600 x 1 x (70-30) = 24,000 kcal. Electricity = 24,000/860 = 27.9 kWh (1 kWh = 860 kcal).
The internal rate of return is the discount rate for which the NPV is Zero
NPV is the internal rate of return for which the discount rate is Zero
The discount rate is the internal rate of return for which NPV is positive
NPV is the discount rate for which internal rate of return is positive
Answer: A) The internal rate of return is the discount rate for which the NPV is Zero
Confirmed vs Book-1 §7.3 — Book: IRR is the discount rate that makes NPV equal to zero - statement (a) exactly.
The other three statements invert the roles of NPV and the discount rate and are meaningless.
📖 §6.4 Energy Policy and Planning - Develop an Energy Policy
19. Having energy policy _____________
satisfies regulations
shows top management commitment
indicates energy audit skills
Ensures ISO 50001 certification
Answer: B) shows top management commitment
Confirmed vs Book-1 §6.4 Energy Policy and Planning — A formal written energy policy is 'a public expression of an organisation's commitment to energy management' and is formally adopted and ratified by the head of the organisation - so it demonstrates top management commitment. It is not a regulatory requirement (a), says nothing about audit skills (c), and by itself does not confer ISO 50001 certification (d), which requires a full management system and audit.
📖 §1.7 Indian Energy Scenario — Energy Supply (India R/P ratios)
20. Which of the following has the highest Reserve to Production (R/P) ratio in India?
Lignite
Petroleum
Coal
Natural gas
Answer: C) Coal
Confirmed vs Book-1 §1.7 — the book states 'India's oil and gas reserves are estimated to last just 17.5 years and 40.2 years respectively at the current R/P ratio. Coal is likely to last for 100 years.' Coal's 100 years is therefore the highest; petroleum (17.5 years) is the tempting wrong pick because it is the fuel most discussed, but it has the lowest R/P.
📖 §3.2 Work, Energy and Power — W = F·s, P = W/t, 1 kWh = 3.6 MJ
21. SI unit for energy is_____________
Watt
Kilogram
Newton
Joule
Answer: D) Joule
Confirmed vs Book-1 §3.2 — Book-1 §3.2: 'The unit of work or energy is the joule (J), where one joule is one Newton metre.' Watt is power (J/s), kilogram is mass and Newton is force.
📖 §3.1 Energy forms — background from Book-1 Ch.1 Energy Scenario
22. Which of the following industries has the highest Specific Electrical Energy Consumption?
Aluminum
Sugar
Paper & Pulp
Cement
Answer: A) Aluminum
Confirmed vs Book-1 §3.1 — Primary aluminium smelting (Hall-Heroult electrolysis) needs roughly 14,000-16,000 kWh per tonne of metal - far above sugar, paper or cement - so aluminium has the highest specific electrical energy consumption.
Energy Efficiency and Energy Conservation are distinct and interrelated
Unscheduled power interruption is an Energy conservation measure
Productivity improvements leads to energy conservation
Energy Efficiency is an integral part of energy conservation
Answer: B) Unscheduled power interruption is an Energy conservation measure
Confirmed vs Book-1 §1.15 — the book defines energy conservation as reducing the growth of energy consumption, achievable through productivity increase or technological progress, and states that energy efficiency is an integral part of energy conservation. An unscheduled power interruption is a supply failure that cuts output as well as energy, so it is not a conservation measure — statement (b) is the wrong one.
📖 § 2.2 / Sec 15(d) — BEE at Centre, SDA in States
24. _____ in Centre and______ _ in States are mandated to implement the provisions of The Energy Conservation Act, 2001
BEE and NPC
BEE and DISCOM
BEE and SERC
BEE and SDA
Answer: D) BEE and SDA
Confirmed vs Book-1 §2.2 — BEE is the nodal implementing body at the Centre; within a State the Designated Agency (SDA), designated by the State Government under Sec 15(d), coordinates, regulates and enforces the Act. NPC, DISCOMs and SERCs have no implementing mandate under the EC Act — SERCs act under the Electricity Act 2003.
📖 § 2.3.1 Energy Conservation Building Codes (ECBC)
25. Energy Conservation Building Code (ECBC) sets;
Minimum Energy Efficiency Standards for design and Construction of Buildings
Green Building Rating System
Municipal DSM Regulations
Incentives for energy efficient buildings
Answer: A) Minimum Energy Efficiency Standards for design and Construction of Buildings
Confirmed vs Book-1 §2.3.1 — ECBC 'sets minimum energy efficiency standards for design and construction of commercial buildings' and defines norms of energy requirement per square metre by climatic region. It is a statutory code — not a voluntary green-building rating system, not a DSM regulation and not an incentive scheme.
📖 §11.1 Concept of New and Renewable Energy (cross-reference: Book-1 Ch.2 — EC Act 2001, BEE schemes)
26. Which of the following is one of the schemes of BEE under Energy Conservation Act ?
Standards and Labelling
Availability based Tariff
Standard of Performance of DISCOMs
Renewable Energy Certificates
Answer: A) Standards and Labelling
Confirmed vs Book-1 §11.1 Concept of New and Renewable Energy (cross-reference: Book-1 Ch.2 — EC Act 2001, BEE schemes) —
Standards & Labelling is one of the thrust-area schemes of BEE under the Energy Conservation Act, 2001.
Availability Based Tariff and DISCOM standards of performance are CERC/regulatory instruments and RECs come under the electricity/RE regulatory framework, not BEE schemes under the EC Act.
Answer a.
27. Which one of the following is not a Designated Consumer category under PAT ?
Paper and Pulp Industries
Cement Plants
Chlor Alkali Plants
Sugar Plants
Answer: D) Sugar Plants
Confirmed vs Book-1 §2.3.6 — PAT's first cycle covered 478 designated consumers in eight sectors: Aluminium, Cement, Chlor-Alkali, Fertilizer, Iron & Steel, Pulp & Paper, Textile and Thermal Power. Sugar plants are not among them. (Note the related trap: Railways is a notified DC but is outside the PAT-8.)
28. Which of the following has highest Global Warming Potential?
SF6
CO2
CH4
N2O
Answer: A) SF6
Confirmed vs Book-1 §10.5 — 'Sulfur hexafluoride is the most potent greenhouse gas.' Table 10.1: SF6 GWP = 22,000 against CO2 = 1, CH4 = 23 and N2O = 300.
Primary energy is converted to secondary energy in industries
Secondary energy is converted to primary energy in industries
Coal is primary energy
Electricity is secondary energy
Answer: B) Secondary energy is converted to primary energy in industries
Confirmed vs Book-1 §1.2 — 'Primary energy sources are mostly converted in industrial utilities into secondary energy sources; for example coal, oil or gas converted into steam and electricity.' The conversion runs primary → secondary, never the reverse, so statement (b) is the untrue one. Coal is primary and electricity secondary, so (c) and (d) are true.
📖 §3.1 Energy forms — background from Book-1 Ch.1 Energy Scenario
30. Which primary energy is used as a feedstock in fertilizer industry?
Steam
Natural gas
Electricity
All of the above
Answer: B) Natural gas
Confirmed vs Book-1 §3.1 — Natural gas is the primary energy source used as FEEDSTOCK (raw material) in fertilizer plants, where it is reformed to hydrogen for ammonia/urea. Steam and electricity are secondary (derived) energy carriers.
📖 §11.6 Biomass Energy (Biomethanation of Biomass — Anaerobic Process)
31. Bio-gas generated through anaerobic process mainly consists of
only methane
Methane and carbon dioxide
only ethane
only carbon dioxide
Answer: B) Methane and carbon dioxide
Confirmed vs Book-1 §11.6 Biomass Energy (Biomethanation of Biomass — Anaerobic Process) —
Book: bio-methane produced by anaerobic digestion ‘is composed mainly of methane and carbon dioxide’; gobar gas is ‘typically comprising of around 60% methane and 40% carbon dioxide’.
It is therefore not pure methane, not ethane and not pure CO₂.
Answer b.
📖 §3.1 Energy forms — primary/secondary, high- vs low-grade energy
32. Which of the following statements are true? Rice husk is a source of secondary energy ii) nuclear energy is non-renewable energy iii) electricity is basically a convenient form of primary energy iv) steam is a convenient form of secondary energy
(ii) & (iii)
(i) & (iii)
(ii) & (iv)
(ii) & (i)
Answer: C) (ii) & (iv)
Confirmed vs Book-1 §3.1 — (ii) Nuclear energy is non-renewable - TRUE; (iv) steam is a convenient secondary energy form - TRUE. (i) is false because rice husk is a PRIMARY energy source, and (iii) is false because electricity is a SECONDARY (converted) form. Hence (ii) & (iv).
📖 §1.5 Global Primary Energy Reserves — Natural Gas (Table 1.5)
33. Trillion cubic meters is a unit normally used for
Crude oil
Lignite
Bituminous coal
Natural Gas
Answer: D) Natural Gas
Confirmed vs Book-1 §1.5 — Table 1.5 reports proven natural-gas reserves in trillion cubic metres (world 185.7 tcm). Crude oil reserves are quoted in billion barrels/tonnes and coal and lignite in million tonnes, so volume units in trillion cubic metres belong to natural gas.
📖 §1.7 Indian Energy Scenario — Natural Gas Sector
34. Which of the following is not true of natural gas?
Requires more excess air compared to oil
Consists mainly of methane
Becomes liquefied when cooled to -161°C
All of the above
Answer: A) Requires more excess air compared to oil
Confirmed vs Book-1 §1.7 — the book states natural gas consists primarily of methane and becomes LNG when cooled to −161 °C, so (b) and (c) are true. Being a gas it mixes readily with air and needs the LEAST excess air of all fuels (far less than liquid oil), so 'requires more excess air compared to oil' is the untrue statement.
35. In a boiler, substitution of coal with rice husk will definitely lead to__________.
energy conservation
energy efficiency
both energy conservation and energy efficiency
GHG reduction
Answer: D) GHG reduction
Confirmed vs Book-1 §10.5 — Rice husk is biomass; the CO2 released on burning it was recently absorbed from the atmosphere, so substituting coal with rice husk definitely cuts net greenhouse-gas emissions. It does not by itself guarantee lower energy consumption (conservation) or higher boiler efficiency — biomass has a lower GCV than coal.
📖 §1.11 Energy Intensity on Purchasing Power Parity (PPP)
36. For determining the Energy intensity at the national level, which of the following are not required? (i) Gross domestic product (ii) Total final consumption, (iii) R/P ratio in years (iv) Prevailing prices of various fuels
(i) & (iv)
(i) & (ii)
(iii) & (iv)
(ii) & (iii)
Answer: C) (iii) & (iv)
Confirmed vs Book-1 §1.11 (option (d) repaired — it duplicated option (a)) — energy intensity EI = total final consumption (toe) ÷ GDP (million US$), so only items (i) GDP and (ii) total final consumption are needed. The R/P ratio (iii) is a reserves-life measure and fuel prices (iv) do not enter the formula, so (iii) & (iv) are the items NOT required. Option (b) names exactly the two inputs that ARE required.
37. A building intended to be used for commercial purpose will be required to follow Energy conservation building code under Energy Conservation Act, 2001 provided its
connected load is 120 kW and above
contract demand is 100 kVA and above
connected load is 100 kW and above or contract demand is 120 kVA and above
connected load is 500 kW and contract demand is 600 kVA
Answer: C) connected load is 100 kW and above or contract demand is 120 kVA and above
Confirmed vs Book-1 §2.1 — The Act defines a building as one 'having a connected load of 100 Kilowatt (kW) OR contract demand of 120 Kilo-volt Ampere (kVA) and above' used or intended for commercial purposes. Options (a) and (b) swap the two figures — 100 goes with kW and 120 with kVA — and (d) invents 500/600 values.
📖 §1.13 Electricity Pricing in India — demand side management
38. Which of the following is true of DSM?
results in energy and/or demand reduction
enables end-users to better manage their load curve
can improve the profitability of power supply company
All of the above
Answer: D) All of the above
Confirmed — DSM shifts and trims load, so it produces energy and/or demand reduction, lets end-users flatten their own load curve, and by avoiding costly peaking power it improves the supply company's profitability. Since all three statements hold, 'All of the above' is correct; picking any single one would be incomplete.
📖 §3.3 Motor loads & motor loading — Examples 3.8 / 3.9 (nameplate kW = OUTPUT)
39. An induction motor with 11 kW rating and a rated power factor of 0.9 in its name plate means
it will draw 12.22 kW at full load
it will draw 11 kW at full load
it will draw 9.9 kW at full load
it will deliver 11 kW at full load
Answer: D) it will deliver 11 kW at full load
Confirmed vs Book-1 §3.3 — Book-1 §3.3: the nameplate kW/HP is the motor OUTPUT at full load; the volts, amps and PF are the INPUT conditions. So an 11 kW motor DELIVERS 11 kW at full load and draws more than 11 kW at its input.
40. The unit used for determining a designated consumer is ___________.
million tonnes of oil equivalent per year
metric tonnes of oil equivalent per month
metric tonnes of oil equivalent per year
million tonnes of oil equivalent per month
Answer: C) metric tonnes of oil equivalent per year
Confirmed vs Book-1 §2.3.6 — Designated-consumer thresholds are notified in metric tonne of oil equivalent PER YEAR (Textile 3,000; Aluminium 7,500; Chlor-Alkali 12,000; the rest 30,000 MTOE/yr), with 1 MTOE = 1 x 10^7 kcal. 'Million tonnes' and 'per month' are the two distractor errors.
📖 §7.3 Financial Analysis Techniques — Simple Payback Period
41. Which of the following statements are true regarding simple payback period?
considers impact of cash flow even after payback period
takes into account the time value of money
considers cash flow throughout the project life cycle
determines how quickly invested money is recovered
Answer: D) determines how quickly invested money is recovered
Confirmed vs Book-1 §7.3 — Book: payback 'is a measure of how long it will be before the investment recovers itself', i.e. how quickly the invested money comes back.
Its stated limitations are that it ignores the time value of money and ignores all savings after the payback period - so (a), (b) and (c) are false.