JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD B.Tech III BUSINESS ECONOMICS AND FINANCIAL ANALYSIS Previous Question Paper (July - 2023 - R16)
Answer any five questions. Part A is compulsory. Answer any one question from each unit in Part B.
Part A
Define Business Economics.
Answer
Business Economics, also known as Managerial Economics, is a branch of economics that applies economic theory and methods to business and administrative decision-making. It bridges the gap between theoretical economics and practical business problems. It helps managers in making rational decisions regarding issues such as production, pricing, resource allocation, and market analysis. Essentially, it uses economic principles to solve business challenges and achieve organisational objectives.
Difference between Micro Economics and Macro Economics?
Answer
The fundamental difference between Microeconomics and Macroeconomics lies in their scope of study:
- Microeconomics: Focuses on the economic behaviour of individual economic units such as households, firms, and industries. It examines how these units make decisions regarding the allocation of scarce resources. Key topics include supply and demand, price determination, consumer behaviour, market structures (perfect competition, monopoly, etc.), and the theory of the firm. It analyses specific markets and industries.
- Macroeconomics: Deals with the economy as a whole. It studies aggregate economic phenomena such as national income, employment, inflation, economic growth, and the business cycle. It examines the behaviour of large economic aggregates and the interrelationships between them. Key topics include fiscal policy, monetary policy, international trade, and aggregate demand and supply.
In essence, microeconomics is about the trees, while macroeconomics is about the forest.
Discuss the determinants of Demand?
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What is Demand forecasting?
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Write a short note on Isocosts and Isoquants.
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What are the Least cost combination Inputs?
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What are the conventions of Accounting?
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Draw a format of Profit and Loss Account?
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Give a short note on types of Ratio’s.
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What are the Leverage Ratios?
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Unit I
What is the meaning of Business Cycle and what are the phases of Business Cycle?
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What are the sources of Capital for a Company and what are the non-conventional sources of finance?
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Define a joint stock company and explain its basic features, advantages and disadvantages.
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Evaluate the Multidisciplinary nature of Business Economics.
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Unit II
What do you understand by elasticity of demand? Explain the factors governing it, its different types of elasticity of demand and their measurements?
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Is it necessary to accurately estimate the future demand for a product? How can you measure future demand in respect of services?
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What is cross elasticity of demand? Is it positive for substitute or complements? Show in a diagram relating to the demand for coffee to the price of tea?
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Discuss briefly various factors determining Demand Forecasting.
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Unit III
Explain Law of returns with appropriate examples and discuss the economies of scale that accrue to a firm.
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Explain the different cost concepts used in the process of cost analysis.
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What is Break Even Analysis (BEA)? What are the assumptions of BEA and what is the significance and what are the limitations of BEA?
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Explain features and price-output determination in monopolistic completion.
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Unit IV
Prepare Trail Balance from the following information in the Books of Hrishikesh: Sundry debtors - 14,000; Hrishikesh Capital A/c - 15,000; Interest from bank A/c 750; Discount received – 100; Sales returns a/c - 100; Purchase returns a/c - 200; Bank A/c - 9,500; Rent A/c - 1,000; Salaries A/c - 400; Wages A/c - 50; Purchase A/c - 2000; Sales A/c - 11,000.
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Journalize the following in the books of Rama Krishna Ltd for the year ended 31-Mar-2012 and also prepare ledger accounts for the same.
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In the books of Kishore, prepare Trading and profit and loss account for the year ended 30th June, 2003: Stock (1.7.2002) 1,06,000 Purchases 3,00,000 Wages 2,50,000 Office salaries 60,000 Discount on sales 20,000 Carriage inwards 20,000 Carriage outwards 60,000 Stationery 3,000 Rent (¾ to Factory) 48,000 Postage 3,500 Transport and conveyance 25,000 General charges 3,500 Commission 26,000 Power 55,000 Rebate on purchases 10,000 Sales 10,00,000.
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Current liabilities of a company are Rs. 75,000. If current ratio is 4:1 and liquid ratio is 1:1, calculate value of current assets, liquid assets and inventory.
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Unit V
Difference between Cash Flow Analysis and Funds Flow Analysis?
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What do you mean by the term Fund? Explain the significance of Funds Flow Analysis.
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A firm has current assets for Rs 1,25,000 including an inventory for Rs 63,000. The current liabilities, on the other hand, amount to Rs 68,000. Find out the current ratio and the quick ratio, with a given industry norm of 2/1 and 1/1 respectively.
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Explain the major Cash Inflows and outflows from investing activities.
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