Code No: RR310106

Set No. 1

III B.Tech I Semester Supplementary Examinations, February 2007 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Civil Engineering, Mechanical Engineering, Metallurgy & Material Technology, Production Engineering and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. Elaborate the importance of managerial economics in decision making. 2. Explain and illustrate the following: and also mention why do they arise (a) The Law of constant Returns. (b) The Law of increasing Returns. [8+8] [16]

3. (a) What is meant by Break-Even Analysis? Explain the uses and limitations of BEP. (b) Appraise the usefulness of Break-Even Analysis for a multi product organization. [10+6] 4. Monopoly is disappearing from markets. Do you agree with this statement? Do you advocate for monopoly to continue in market situations? [8+8] 5. Explain the need for public enterprise in India? Do you think public enterprises as a whole have fulfilled that need? [16] 6. Define ‘Accounting rate of return’ ‘and Pay back period method’ ? Compare and contrast the two.Illustrate with assumed data. [16] 7. Prepare Trading and Profit and Loss account for the year ended 31.12.2003 and a Balance Sheet as on that date from the following Trial Balance.

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Code No: RR310106

Set No. 1

Debit Rs. Credit Rs. Purchases 45,000 Debtors 60,000 Interest earned 1,200 Salaries 9,000 Sales 96,300 Purchases returns 1,500 Wages 6,000 Rent 4,500 Sales returns 3,000 Bad debts written off 2,100 Creditors 36,600 Capital 31,800 Drawings 7,200 Printing and Stationery 2,400 Insurance 3,600 Opening stock 15,000 Office Expense 3,600 Furniture and fittings 6,000 1,67,400 1,67,400 Adjust the following (a) closing stock Rs.20,000 (b) Write off furniture @ 15% per annum. [16]

8. Write a brief note on the importance of ratio analysis to different category of users. [16] ⋆⋆⋆⋆⋆

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Code No: RR310106

Set No. 2

III B.Tech I Semester Supplementary Examinations, February 2007 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Civil Engineering, Mechanical Engineering, Metallurgy & Material Technology, Production Engineering and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. Discuss the utility of demand forecasting. What is the criteria of a good forecasting method? For [4+6+6] (a) new products (b) Existing products. 2. Explain and illustrate the following: and also mention why do they arise (a) The Law of constant Returns. (b) The Law of increasing Returns. [8+8]

3. What is opportunity Cost? Give some examples of opportunity cost. How are these costs relevant for managerial decisions? [5+5+6] 4. Define Markets? Elaborate how differently are markets classified? 5. Write a short notes on (a) Departmental undertaking (b) Government company (c) Public corporation. [5+6+5] [4+12]

6. What is the importance of Capital budgeting? Explain the basic steps involved in evaluating capital budget proposals. [16] 7. Prepare Trading and profit and loss account for the year ended 31.12.2001 and a Balance Sheet as on that date from the following Trial Balance.

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Code No: RR310106

Set No. 2
Furniture Plant and machinery Buildings Capital Bad debts Reserve for bad debts Sundry debtors Sundry creditors Stock(1.1.2001) Purchases Sales Bank overdraft Sales returns Purchases returns Advertising Interest Commision received Cash in hand Salaries General expences Car expences Taxes and insurence Dr, Rs. 6,500 60,000 75,000 1,750 3,000 40,000 24,000 34,600 54,750 1,54,500 28,500 2,000 1,250 4,500 1,180 3,750 6,500 33,000 7,820 9,000 3,500 3,40,000 3,40,000 [16] Cr Rs.

1,25,000

8. Write a brief note on the importance of ratio analysis to different category of users. [16] ⋆⋆⋆⋆⋆

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Code No: RR310106

Set No. 3

III B.Tech I Semester Supplementary Examinations, February 2007 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Civil Engineering, Mechanical Engineering, Metallurgy & Material Technology, Production Engineering and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. What are the contributions and limitations of managerial economics to business managers? [16] 2. Explain and illustrate the following: and also mention why do they arise (a) The Law of constant Returns. (b) The Law of increasing Returns. [8+8]

3. What is opportunity Cost? Give some examples of opportunity cost. How are these costs relevant for managerial decisions? [5+5+6] 4. Define Markets? Elaborate how differently are markets classified? [4+12]

5. Discuss the factors that help in choosing a suitable form of Business Organization in private,and public sector. [16] 6. Define ‘Accounting rate of return’ ‘and Pay back period method’ ? Compare and contrast the two.Illustrate with assumed data. [16] 7. Prepare a Trial Balance from the following data for the year 2003. Rs Free hold property 10,800 Capital 40,000 Return outwards 2,520 Sales 80,410 Purchases 67,350 Depreciation of furniture 1,200 Insurance 3,300 Stock (1-1-2003) 14,360 Creditors for Expenses 400 Creditors 4,700 Discount received Returns inward Office expenses Bad debts Carriages outwards Carriage inwards Salaries Book debts Cash at bank Rs 150 1,590 5,100 1,310 1,590 1,450 4,950 11,070 2,610 [16] 8. From the following extract of a balance sheet of an Airlines company calculate the debt equity ratio and interest coverage ratio. Given that the debt equity ratio is in the range of 10:1 , how do you interpret this ratio?

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Code No: RR310106 50,000, 10% preference shares of 2,00,000 equity shares of 10% ,30,000 debentures of Net profit during the year was Rs.100 each Rs.10 each Rs.100 each Rs. 10,00,000 ⋆⋆⋆⋆⋆

Set No. 3

[16]

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Code No: RR310106

Set No. 4

III B.Tech I Semester Supplementary Examinations, February 2007 MANAGERIAL ECONOMICS AND FINANCIAL ANALYSIS ( Common to Civil Engineering, Mechanical Engineering, Metallurgy & Material Technology, Production Engineering and Bio-Technology) Time: 3 hours Max Marks: 80 Answer any FIVE Questions All Questions carry equal marks ⋆⋆⋆⋆⋆ 1. (a) Define income - elasticity of demand. How does income - elasticity differ from price elasticity of demand? (b) How is cross elasticity of demand computed? [4+4+8]

2. Explain briefly the relationship between total physical product average, and marginal physical product. With the help of assumed data represent graphically. [8+8] 3. (a) What is meant by Break-Even Analysis? Explain the uses and limitations of BEP. (b) Appraise the usefulness of Break-Even Analysis for a multi product organization. [10+6] 4. Monopoly is disappearing from markets. Do you agree with this statement? Do you advocate for monopoly to continue in market situations? [8+8] 5. Write a short notes on (a) Departmental undertaking (b) Government company (c) Public corporation. 6. Explain the factors influencing the requirements of working capital. 7. Jounalise the following transactions and post them to ledger. 1. Ram invests Rs. 10,000 in cash. 2. He bought goods worth Rs. 2,000 from Shyam. 3 He bought a machine for Rs. 5,000 from Lakshman on account 4. He paid to Lakshman Rs. 2,000 5. He sold goods for cash Rs. 3,000 6. He sold goods to A on account Rs. 4,000 7. He paid to Shyam Rs. 1,000 8. He received amount from A Rs. 2,000 [5+6+5] [16] [16]

8. From the following extract of a balance sheet of an Airlines company calculate the debt equity ratio and interest coverage ratio. Given that the debt equity ratio is in the range of 10:1 , how do you interpret this ratio? 50,000, 10% preference shares of Rs.100 each 1 of 2

Code No: RR310106 2,00,000 equity shares of 10% ,30,000 debentures of Net profit during the year was Rs.10 each Rs.100 each Rs. 10,00,000 ⋆⋆⋆⋆⋆

Set No. 4
[16]

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