Briefly explain peak load pricing. - MES COLLEGE



II SEMESTER SUPPLEMENTARY EXAMINATION, MAY/JUNE 2019MANAGERIAL ECONOMICS II – CC7Duration: 2 Hours Max. Marks: 80Instructions: All Questions are compulsory, however internal choice is available.Answer sub- questions in Question No. 1 and Question No. 2 in not more than 100 words each.Answer Question No. 3 to Question No. 6 each in not more than 400 words. Figures to the right indicate marks assigned to each question/ sub-question.Paper carries maximum of 80 marks.Q.1. Answer ANY FOUR of the following:(4x4= 16)Write a short note on penetrating pricing. Explain features of administrative pricing. Briefly explain peak load pricing.Explain any two kinds of profit. Explain the concept profit forecasting.What do you mean by safety margin?Q.2. Answer ANY FOUR of the following: (4x4= 16)What do you mean by social cost benefit analysis?Explain the meaning of payback method. Briefly explain any two approaches in determining the size of capital budget.Write a short note on Nash equilibriumMention any four applications of game theory.Write a short on risk premiums.Q.3 (A) Discuss in detail multi product pricing method (12)ORQ.3 (B) Explain competition based pricing methods.(12)Q 4. (A) Explain the nature of capital budgeting problem. (12)ORQ 4 (B) Computex Company Pvt. Ltd is considering purchase a machine. Three machine X, Y and Z are available, each costing Rs. 6, 00,000. In comparing the profitability of the machine, a discounted rate of 10% is to be used. Earning after taxation to be as under. There is no scrap value. (12) YearMachine XMachine YMachine Z1st2,00,00080,000 1,10,0002nd2,40,0001,50,000 1,90,0003rd1,40,0003,00,0002,00,0004th1,00,0001,80,0001,20,0005th80,00090,00065,000Select the most profitable machine using the following methods: Payback method (B) Net Present Value Method. Q 5 (A) Enumerate the managerial uses of breakeven point. (12)ORQ. 5 (B) Three Firms A, B, and C manufacture same product. The selling price is Rs. 18 per unit of the product for all the firms. The fixed costs of the firms respectively are Rs. 1, 30,000, Rs 3, 50,000, and Rs. 5, 00,000 and the variable cost per unit are Rs. 14, Rs. 10 and Rs. 8. (12) Find outBreak-even point in physical units for each firmsProfit of the firm if each of them sells 1,00,000 unitsPercentage impact on profits if the firms increase their sales by 10 %.Q. 6 (A) Outline the sources of business risk.(12) ORQ.6 (B) The cost of producing a product X is Rs. 50 per unit and its selling price is Rs. 70. Any unit unsold is worthless. The table below gives the demand for the product and the respective probabilities. (12)Demand303540455055Probability0.100.200.300.250.100.05Determine the optimum number of units to be producedCalculate EVPI and interpret. II SEMESTER END EXAMINATION, APRIL 2019MANAGERIAL ECONOMICS II (CC-7)Duration: 2 Hours Max. Marks: 80Instructions: All Questions are compulsory, however internal choice is available.Answer sub- questions in Question No. 1 and Question No. 2 in not more than 100 words each.Answer Question No. 3 to Question No. 6 each in not more than 400 words. Figures to the right indicate marks assigned to each question/ sub-question.Paper carries maximum of 80 marks.Q.1. Answer ANY FOUR of the following: (4x4= 16)Write a short note on seal bid pricing.Explain the concept of transfer pricing.Explain any four advantages of cost plus pricing. Briefly explain any two concepts of profit.List any four limitations of break even analysis.Write a short note on profit volume analysis.Q.2. Answer ANY FOUR of the following: (4x4= 16)Briefly explain two factors influencing investment decision.Explain the meaning of internal rate of return.Briefly explain the concept of cost of debt.Write a short note on pure strategy.Mention any four limitations of game theory.Write any two sources of business risks.Q.3 (A) Discuss in detail competition based pricing methods.(12)ORQ.3 (B) Explain product life cycle based pricing methods.(12)Q 4. (A) Enumerate various profit limiting factors of the firm. (12)ORQ 4 (B) Three Firms A, B, and C manufacture same product. The selling price is Rs. 20 per unit of the product for all the firms. Further, the variable cost per unit is Rs. 16 for firm A, Rs. 12 for firm B and Rs. 10 for firm C. The fixed costs of the firms respectively are Rs. 1, 50,000, Rs 3, 75,000 and Rs. 5,10,000. (12) Find outa)Break-even point in physical units for each firm.b)Profit of the firm if each of them sells 2, 00,000 units.c)Percentage impact on profits if the firms increase their sales by 10 %. Q 5 (A) Explain the steps in capital projects evaluation under capital budgeting. (12)ORQ. 5 (B) Global Tech Pvt. Ltd is considering to purchase a machine. Three machine A, B and C are available, each costing Rs. 7, 00,000. In comparing the profitability of the machine, a discounted rate of 10% is to be used. Earning after taxation to be as under. There is no scrap value. (12)YearMachine XMachine YMachine Z1st2,00,00090,000 1,20,0002nd2,80,0001,60,000 1,70,0003rd1,60,0003,00,0002,00,0004th1,00,0001,70,0001,40,0005th90,00080,00075,000Select the most profitable machine using the following methods: (A)Payback method (B) Net Present Value MethodQ. 6 (A) Outline the steps involved in analysis of risky decisions.(12) ORQ.6 (B) The cost of producing a product X is Rs. 50 per unit and its selling price is Rs. 70. Any unit unsold is worthless. The table below gives the demand for the product and the respective probabilities. (12)Demand354045505560Probability0.200.100.300.200.150.05a)Determine the optimum number of units to be producedb)Calculate EVPI and interpret. ................
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