Anna University B.E./B.Tech. DEGREE EXAMINATION, APRIL/MAY 2011 Fifth Semester Information Technology MG 2452 — ENGINEERING ECONOMICS AND FINANCIAL ACCOUNTING (Regulation 2008)

Time : Three hours Maximum : 100 marks (Note : Present value Table may be provided)

Answer ALL questions

PART A — (10 × 2 = 20 marks) 1. Define managerial economics. 2. How does managerial economics help in Business decision making? 3. List out the various demand determinants. 4. What is sales forecasting? 5. State any two managerial uses of production function. 6. What is a cost sheet? 7. How is price fixed under perfect competitive situation? 8. What is penetration pricing? 9. What is the information needed for the evaluation of capital budgeting


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Or (b) What are all the factors that determine the price of the product? Explain their influence on the price of the product? 14.com Page 2 . Assets Amount in Rs. (a) Analyze the scope of managerial economics and its relationship with other disciplines. Liabilities Amount in Rs. (a) Discuss cost-output relationship in both short-run and long-run.Vidyarthiplus.30.25. Ltd.Vidyarthiplus. Or (b) What are isoquants? What are its types? What are the properties of isoquants? 12.com decisions? 10.000 10% preference share www. (a) Following is the Balance Sheet of M/s. 13.000 Fixed assets 2. ………………. Or (b) Discuss various methods of demand forecasting and their merits and de-merits. What is pay back or pay off period? PART B — (5 × 16 = 80 marks) 11. (a) What is concept of Elasticity of demand? Discuss the various types of elasticity of demand with illustrations. Equity share capital 1.www.

000 8% Debentures 50.Vidyarthiplus.000 Creditors 15. Particulars Proposals A (in Rs.com capital 75. 20.com Page 3 . ) Investment 10.000 Bills receivables 40.000 Total 3. Assume that there is no scrap value.000 Stock 35.000 Total 3. Or (b) From the following balances sheets of Ranjit Ltd.000 Overdraft 20.000.www.000 www.000 20.000 Debtors 25.000 Outstanding expenses 5. Balance Sheet (Figures in ‘000) 15.000 Cash 20.000 Net profit before interest and tax = Rs. prepare fund flow statement.000 Reserves and surplus 60. Calculate : (i) Current ratio (ii) Liquidity ratio (iii) Proprietary ratio (iv) Debt-Equity ratio.) Proposal B (in Rs.50.Vidyarthiplus. (a) Find out accounting rate of return and suggest to the management regarding the selection of the proposals if the desired rate of return is 20%.50.

50.500 7.000 5 50.000 10. Expected cash flows from the above investment are as follows : Year Cash flow in Rs. is considering the purchase of a machine which cost Rs.000 3 50.500 Or (b) M/s.Vidyarthiplus.000 Year 2 2. 1 50. Sreedharan Ltd.000 Year 4 – 2.www.500 Year 3 500 5.000 4 50. 1.Vidyarthiplus.000.000 Assuming the discount rate as 10% suggest whether purchase of that machine is worth or not? www.000 2 50.com Page 4 .com Expected life in years 3 4 Net Income – Year 1 3.

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