B.E./B.Tech.

DEGREE EXAMINATION, NOVEMBER/DECEMBER 2010 Fifth Semester

Information Technology

MG 2452 ENGINEERING ECONOMICS AND FINANCIAL ACCOUNTING

(Regulation 2008) Time : Three hours Maximum : 100 Marks Answer ALL questions

PART A (10 2 = 20 Marks)

1. Define Managerial Economics. 2. Define the concept of Firm. 3. State law of supply with diagram. 4. Define Elasticity of Demand. 5. What do you mean by Money cost and Real cost? 6. Give two examples for implicit cost and explicit cost. 7. State Capital Budgeting and Investment with example. 8. Explain Internal Rate of Return. 9. When do firm adopt Marginal Cost pricing? 10. Mention any two advantages of cost plus pricing.

PART B (5 16 = 80 Marks) 11. (a) (i) Explain the relationship of Managerial Economics with other disciplines. (4) (ii) Discuss in detail the Nature of Managerial Economics. (12) Or (b) (i) "Managerial Economics is Economics applied in Decision Making" Discuss. (8) (ii) Explain the goals of the firm. (8)

12. (a) (i) Define law of demand and explain types of demand with diagram.(10) (ii) Why does the demand curve slopes downward? (6) Or (b) (i) What are the reasons for the exceptions of the Demand Curve? Explain. (8)

(ii) Describe the Elasticity of Supply. (8)

13. (a) (i) Write a short note on Isoquant and its types. (10) (ii) Elucidate the returns to scale. (6) Or (b) (i) Describe cost of production in the long run average cost curve. (8) (ii) What are the factors affecting production function? Discuss. (8)

14. (a) (i) Write a note on cost-oriented pricing. (10) (ii) Explain common pricing practices in Retail Trade. (6)

Or (b) (i) Describe price Discriminations. (7) (ii) Explain the limitations of the Marginal cost pricing. (9)

15. (a) (i) Write briefly on the limitations of financial statements. (8) (ii) Give the meaning of Ratio analysis and its significance. (8) Or (b) (i) What are the steps involved in Net Present Value Method(NPV)? (8) (ii) Explain Pay Back method in detail. (8)

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 decisions? 10. What is pay back or pay off period?

PART B (5 16 = 80 marks) 11. (a) Analyze the scope of managerial economics and its relationship with other disciplines.

Or (b) What are isoquants? What are its types? What are the properties of isoquants? 12. (a) What is concept of Elasticity of demand? Discuss the various types of elasticity of demand with illustrations. Or (b) Discuss various methods of demand forecasting and their merits and de-merits. 13. (a) Discuss cost-output relationship in both short-run and long-run. Or (b) What are all the factors that determine the price of the product? Explain their influence on the price of the product? 14. (a) Following is the Balance Sheet of M/s. . Ltd. Liabilities Amount in Rs. Assets Amount in Rs. Equity share capital 1,25,000 Fixed assets 2,30,000 10% preference share capital 75,000 Cash 20,000 8% Debentures 50,000 Bills receivables 40,000 Reserves and surplus 60,000 Debtors 25,000 Overdraft 20,000 Stock 35,000 Creditors 15.000

Outstanding expenses 5,000 Total 3,50,000 Total 3,50,000 Net profit before interest and tax = Rs. 20,000. Calculate : (i) Current ratio (ii) Liquidity ratio (iii) Proprietary ratio (iv) Debt-Equity ratio. Or (b) From the following balances sheets of Ranjit Ltd. prepare fund flow statement. Balance Sheet (Figures in 000) 15. (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%. Assume that there is no scrap value. Particulars Proposals A (in Rs.) Proposal B (in Rs. ) Investment 10,000 20,000 Expected life in years 3 4 Net Income Year 1 3,000 10,000 Year 2 2,500 7,500 Year 3 500 5,000 Year 4 2,500 Or (b) M/s. Sreedharan Ltd. is considering the purchase of a machine which cost Rs. 1,50,000. Expected cash flows from the above investment are as follows : Year Cash flow in Rs.

1 50,000 2 50,000 3 50,000 4 50,000 5 50,000 Assuming the discount rate as 10% suggest whether purchase of that machine is worth or not?