Principles and Practice of Engineering Exam (PE) PE Exam Framework, Licensure, and Professional Practice Flashcards

24 sample cards from the PE Exam Framework, Licensure, and Professional Practice deck

Sampled from the end of the deck, so these are different cards from the ones shown on the syllabus page.

1. Who has the authority to initiate disciplinary action against a licensed PE, and on what grounds?

   The state licensing board, on grounds such as fraud/deceit in obtaining a license, negligence or incompetence, violation of rules of professional conduct, criminal convictions related to practice, or practicing outside competence.

2. List several disciplinary sanctions a state board can impose on a PE.

   Letter of reprimand/admonishment, civil fines/penalties, probation, mandatory continuing education, suspension of license, and revocation of license.

3. What is the typical sequence of a board disciplinary process?

   Complaint filed → board review/investigation → if cause found, formal charges/notice → respondent given opportunity to respond → hearing (due process) → board decision/order with sanctions → possible appeal.

4. What due process rights does a PE generally have during a disciplinary proceeding?

   Notice of the charges, the right to respond and be heard at a hearing, the right to present evidence and counsel, and the right to appeal the board's decision.

5. What is Continuing Professional Development (CPD), and how is it commonly measured?

   Ongoing education required to maintain licensure, measured in Professional Development Hours (PDH) or Continuing Education Units (CEU), where $1\text{ CEU} = 10\text{ PDH}$.

6. Roughly how many PDH are typically required per renewal cycle, and how long is a cycle?

   Commonly about 15 PDH per year, or roughly 30 PDH per 2-year renewal cycle (requirements vary by state).

7. How is one Professional Development Hour (PDH) generally defined?

   One PDH equals one contact hour (nominally 50–60 minutes) of instruction or qualifying professional development activity.

8. State the future worth formula given a present amount $P$ at interest rate $i$ for $n$ periods (single payment compound amount).

   $$F = P(1+i)^{n}$$

9. State the present worth (single payment present worth) formula to find $P$ from a future amount $F$.

   $$P = \frac{F}{(1+i)^{n}} = F(1+i)^{-n}$$

10. What is the formula for the future worth $F$ of a uniform series of payments $A$ (uniform series compound amount)?

    $$F = A\left[\frac{(1+i)^{n}-1}{i}\right]$$

11. What is the capital recovery formula giving the uniform payment $A$ equivalent to a present amount $P$?

    $$A = P\left[\frac{i(1+i)^{n}}{(1+i)^{n}-1}\right]$$

12. What is the formula relating the present worth $P$ of a uniform series $A$ (series present worth factor)?

    $$P = A\left[\frac{(1+i)^{n}-1}{i(1+i)^{n}}\right]$$

13. How do you convert a nominal annual interest rate $r$ compounded $m$ times per year into the effective annual interest rate $i_{e}$?

    $$i_{e} = \left(1+\frac{r}{m}\right)^{m} - 1$$

14. What is the effective annual rate under continuous compounding at nominal rate $r$?

    $$i_{e} = e^{r} - 1$$

15. Define Net Present Worth (NPW) and the decision rule for accepting a project.

    NPW is the sum of all cash flows discounted to the present: $NPW = \sum_{t=0}^{n} \frac{C_{t}}{(1+i)^{t}}$. Accept the project if $NPW \geq 0$ (or choose the alternative with the highest NPW).

16. Define the Internal Rate of Return (IRR) and its accept/reject criterion.

    IRR is the interest rate $i^{*}$ at which the net present worth equals zero ($NPW = 0$). A project is acceptable if $IRR \geq MARR$ (the minimum attractive rate of return).

17. What is MARR, and how is it used in economic decision analysis?

    Minimum Attractive Rate of Return — the lowest rate of return an organization will accept on an investment, used as the discount rate and as the hurdle rate against which IRR is compared.

18. What is the benefit-cost ratio (B/C) and its decision rule?

    $$B/C = \frac{\text{PW of benefits}}{\text{PW of costs}}$$ A project is economically justified if $B/C \geq 1$.

19. What is the difference between simple payback period and discounted payback period?

    Simple payback is the time for undiscounted cumulative cash inflows to recover the initial investment; discounted payback uses present-worth (discounted) cash flows, so it is always longer and accounts for the time value of money.

20. Write the straight-line depreciation formula for annual depreciation $D$ of an asset.

    $$D = \frac{B - S}{n}$$ where $B$ is the initial cost/basis, $S$ is the salvage value, and $n$ is the useful life in years.

21. How is the double-declining-balance (DDB) depreciation in year $t$ calculated?

    $$D_{t} = \frac{2}{n}\,BV_{t-1}$$ where $BV_{t-1}$ is the book value at the start of the year; salvage value is not subtracted from the basis, but depreciation stops once book value reaches salvage.

22. What is MACRS, and how does it differ from straight-line depreciation for tax purposes?

    Modified Accelerated Cost Recovery System — the U.S. tax depreciation method using IRS-prescribed percentage tables and property class lives. It accelerates depreciation (larger early deductions) and ignores salvage value, unlike straight-line.

23. How is after-tax cash flow related to before-tax cash flow, taxable income, and the tax rate $t$?

    Taxable income $=$ (before-tax cash flow $-$ depreciation). Taxes $=t\times$ taxable income. After-tax cash flow $=$ before-tax cash flow $-$ taxes. Depreciation is a non-cash deduction that shields income, reducing taxes.

24. In project controls, what does Earned Value (EV) represent, and how are Cost Variance (CV) and Schedule Variance (SV) calculated?

    EV (Budgeted Cost of Work Performed) is the budgeted value of completed work. $CV = EV - AC$ (actual cost) and $SV = EV - PV$ (planned value). Negative values indicate over budget / behind schedule, respectively.

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PE Exam Framework, Licensure, and Professional Practice flashcards FAQ