R05220201-managerial-economics--and--financial-analysis

Set No. 1

Code No: R05220201

II B.Tech Supplimentary Examinations, Aug/Sep 2008 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Electrical & Electronic Engineering, Electronics & Instrumentation Engineering, Bio-Medical Engineering, Electronics & Control Engineering, Mechatronics and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. Explain the Law of Demand. What do you mean by shifts in demand curve. [16] 2. What is meant by Elasticity of demand. What are the factors that determine the elasticity demand? [16] 3. (a) Distinguish between the following: i. ii. iii. iv.

Average cost and Marginal cost Explicit cost and implicit cost Short run Average cost and Long run Average cost Variable cost and semi variable cost

[4 × 2]

(b) Diagrammatically represent the relationship between Average Fixed Cost, Average variable cost, Unit cost and Marginal cost. [8] 4. (a) What are the principal differences between monopoly and perfect competition? (b) Supplement your answer with appropriate diagrams in both the cases. [8+8] 5. What are the pros and cons of privatisation?

[16]

6. Explain different types of working capital.

[16]

7. (a) How can you make use of data available in the trial balance for finalizingaccounts? (b) Explain the procedure to be followed while preparing Trading Account, Profit and Loss Account and Balance Sheet with the help of a trial balance. [8+8] 8. Discuss the importance of Ratio Analysis for inter firm and intra-firm comparison, including circumstances responsible for its limitations, if any. [16] ⋆⋆⋆⋆⋆

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Set No. 2

Code No: R05220201

II B.Tech Supplimentary Examinations, Aug/Sep 2008 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Electrical & Electronic Engineering, Electronics & Instrumentation Engineering, Bio-Medical Engineering, Electronics & Control Engineering, Mechatronics and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. Managerial Economics is the application of Economic Theory to business management. Discuss. [16] 2. Explain the concept cross elasticity of demand. Illustrate your answer with suitable examples. How is it different from price elasticity of demand? [16] 3. (a) Define ‘Cost’. How are costs classified? (b) Explain any five important cost concepts useful for managerial decisions. [6+10] 4. (a) Define Market and explain how markets are classified? (b) What are the important features in any market structure?

[12+4]

5. (a) Explain the features of a company. (b) What are its advantages and disadvantages?

[8+8]

6. Write short notes on the following: (a) Shares (b) Bonds and debentures (c) Working capital (d) Current liabilities.

[4×4]

7. From the following trial balance of Anwesh, prepare Trading and Profit and loss

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Set No. 2

Code No: R05220201

A/c for the year ending 31st March 2005 and Balance Sheet as on that date: [16] Debit. Rs. Credit Rs. Drawing and capital 3,250 15,000 Opening stock 17,445 Purchases and purchase returns 12,970 840 Sales returns and Sales 554 27,914 Carriage 1,240 Wages 3,100 Rent 820 Advertisement 954 Bad debts 400 Discounts allowed 1,084 Interest received 130 Debtors and creditors 3,000 Provision for doubtful debts 4,000 1,200 Cash on hand 1,792 Cash at bank 475 48,084 48,084 Adjustment (a) Closing stock was valued at Rs.20,000. 8. (a) A company has furnished the following information regarding its Current Assets and Current Liabilities. [8+8]

Cash Book Debts Bills Receivable Stock in trade Prepaid expenses

Rs. Rs. 2,000 Creditors 16,000 12,000 Bills Payable 4,000 4,000 Provision for Tax 7,000 35,000 1,000

Comment upon the liquidity position of the company (b) From the following particulars, you are required to compute i. current ratio ii. net profit ratio and iii. Gross profit ratio. Stock 50,000 Cash on hand 30,000 Debtors 40,000 Creditors 60,000 Bills receivable 10,000 Bill payable 40,000 Advances offered 4,000 Bank overdraft 4,000 Net sales 7,00,000 Gross profit 50,000 Net profit 30,000 2 of 3

Set No. 2

Code No: R05220201

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Set No. 3

Code No: R05220201

II B.Tech Supplimentary Examinations, Aug/Sep 2008 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Electrical & Electronic Engineering, Electronics & Instrumentation Engineering, Bio-Medical Engineering, Electronics & Control Engineering, Mechatronics and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. How does the study of managerial economics help a business manager in decisionmaking? Illustrate your answer with examples in production and pricing issues. [16] 2. What are the needs for demand forecasting. Explain the various steps involved in demand forecasting. [16] 3. (a) State and explain Breakeven analysis and explain its importance. (b) Discuss the significance of profit-volume ratio, angle of incidence and margin of safety in Breakeven analysis. [10+6] 4. ‘A competitor under conditions of perfect competition is only price taker and quantity adjustor’ - In the light of the above statement, discuss clearly the important features of perfect competition and how price output decisions can be taken. [16] 5. “In the changing business environment the public sector enterprises should follow the principles of business” Is it true? [16] 6. Explain different types of working capital.

[16]

7. (a) Define the concepts ‘Accounting’ Financial Accounting, and Accounting system’. (b) Explain the main objectives of Accounting and its important functions.[8+8] 8. (a) From the following information, calculate

[8+8]

i. Inventory ? Turnover ratio, and ii. Operating ratio. Rs. Opening stock 14,000 Closing stock 11,000 Purchases 23,000 Sales 40,000 Sales returns 5,000

Rs. Office expenses 2,000 Capital 1,00,000 Carriage Inwards 2,000 Selling & Distribution expenses 1,000

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Set No. 3

Code No: R05220201

(b) Calculate Current ratio and Debt-Equity ratio from the given data Rs. Rs. Equity share capital 1,00,000 Long term investments 15,000 Accumulated profits 10,000 Stock 30,000 Current liabilities 40,000 Amounts Receivable 50,000 12% Debentures 30,000 ⋆⋆⋆⋆⋆

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Set No. 4

Code No: R05220201

II B.Tech Supplimentary Examinations, Aug/Sep 2008 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Electrical & Electronic Engineering, Electronics & Instrumentation Engineering, Bio-Medical Engineering, Electronics & Control Engineering, Mechatronics and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. Define Managerial Economics. Explain its nature and scope.

[16]

2. What is meant by Elasticity of demand. What are the factors that determine the elasticity demand? [16] 3. (a) What is a production function and explain its importance. (b) Briefly explain Cobb-Douglas production function and its significance. [8+8] 4. (a) What are the salient features of Monopoly? (b) In what different aspects monopoly is distinct from perfect competition. [8+8] 5. Analyze the factors that help in choosing a suitable form of business organization in public and private sectors. [16] 6. A company is considering two investment opportunities (A and B) that cost Rs. 4,00,000 and Rs. 3,00,000 respectively. The first project generates Rs. 1,00,000/- a year for four years. The second generates Rs.60,000/-, Rs. 1,00,000/, Rs. 80,000/Rs, 90,000/- and Rs. 70,000 over a five year period. The company’s cost of capital is 8%. Which project would you choose under NPV method? [16] 7. Explain the following concepts and illustrate their treatment with imaginary data. [16] (a) Depreciation (b) Prepaid expenses (c) Reserve for bad and doubtful debts (d) Income received in advance. 8. Discuss the importance of Ratio Analysis for inter firm and intra-firm comparison, including circumstances responsible for its limitations, if any. [16] ⋆⋆⋆⋆⋆

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