Engineering Economy - Dec 2013
Mechanical Engg. (Semester 7)
TOTAL MARKS: 100
TOTAL TIME: 3 HOURS (1) Question 1 is compulsory.
(2) Attempt any four from the remaining questions.
(3) Assume data wherever required.
(4) Figures to the right indicate full marks. 1 (a) Distinguish between strategy and tactics with suitable examples(5 marks) 1 (b) Explain the law of demand and supply with suitable example(5 marks) 1 (c) Determine the effective interest rate for a nominal annual rate of 6% that is compounded i) Semi - annually ii) Quarterly iii) Monthly iv) Daily(6 marks) 1 (d) A person invests a sum of Rs 50.000/- in a Nationalized Bank at a Nominal interest rate of 18% for 15 years. The compounding is monthly. Find the maturity amount of the deposit after 15 years?(4 marks) 2 (a) State the conditions for present worth comparisons.(6 marks) 2 (b) Determine the equivalent present worth of the following series of year and cash flows extending over 8 years using annual interest rate of 20% (4 marks) 2 (c) What do you understand by present month by T2 rule?(3 marks) 2 (d) An Entrepreneurs intending to start a New Business knows that the first few years are the most difficult. To Lesson the chance of failure a loan plan for start up capital is proposed in which interest paid during the first two years will be at 3%, 6%. For the next 2 years if 12% For the last 2 years of the 6 years loan. How large a loan can be justified for proposed repayments at the end of 2,4 and 6 respectively for Rs 20,000/- . Rs 30,000 and Rs 50,000/- for 2nd 4 th and 6th year respectively(7 marks) 3 (a) Two types of power converter Alpha and Beta are under consideration for a particular application. An economic comparison is to be made at an interest rate of 10%. Following cost estimation has been obtained. Determine the Annual Equivalent c the two systems, select the best converter
|Purchase price||Rs 10,000/-||Rs 25,000/-|
|Estimated service life||5 years||9years|
|Salvage value||Rs 3,00/-||Rs 5,000/-|
|Annual operating cost||Rs 2,500/-||Rs 1,200/-|
1. Raw Material used = 40,000 2.Direct wages = 24.000
3. Machine hours worked - 9,500 hour 4. Machine hour rate @Rs 41hr
5. Office overhead 20% of works cost 6. Selling overhead @ Rs 1/unit
7. Units produced - 20,000 8. Units sold 18,000 (0] Rs 10/unit.(12 marks) 6 (a) What do you understand by the following Financial terms:
i) Preferential shares ii) Assets iii) Liabilities iv) Sundry debtors v) Sundry creditors.(10 marks) 6 (b) Following is the Financial status of a company as on 31th March 2005. prepare a Balance sheet as on 31" March 2005.
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|Cash in hand||22000|
|Land & Buildings||50000|
|Plant & Machinery||90000|
i) Stock turnover =7 5 times ii) Stock at the end = 5000 more than the stock at the beginning iii) Sales - Rs 2.00.000/- iv) Gross profit ratio = 20% v) Currer liabilities = Rs 60;000 vi) Quick ratio = 0.75.(10 marks) 8 (a) Briefly explain the objectives of profit planning(5 marks) 8 (b) On 2006 June Abhilash Enterprises has Rs 10,000 cash balance. The expected sales are t- the value of Rs 7,000/-. Rs 12.000/- and Rs 15.000/- respectively. It is estimated that th disbursement is to be made in 3 months are Rs 15,000!- . Rs 16.0ool- and Rs 12,000!- Whenever a shortage occurs Bank loan is assumed to be raised to a value of Rs 5,000/- Prepare a cash budget and show the cash balance at the beginning of September(8 marks) 8 (c) Prepare a purchase budget from the following particulars when the estimated price/kg is X-Rs.2. Y-Rs.3. Z-Rs.4.
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|Material||Estimated consumption of Materials in kgs|
<colgroup width="152"> </colgroup> <colgroup width="281"> </colgroup> <colgroup width="169"> </colgroup>
|Material||Stock at the Beginning||Stock at the end Estimated|