JNTU Managerial Economics and Financial Analysis Question Paper Nov 2008



(Electronics & Telematics, Electronics & Computer Engineering and Instrumentation & Control Engineering) SET-1


1. What is meant by Elasticity of demand? What are the factors governing the potential demand for a product as either Elastic or Inelastic? [8+8]

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. What is a Market? Explain, in brief, the different Market structures. [4+12]

5. Explain the merits and demerits of different forms of Business organization and

their suitability with different types of business Activities. [16]

6. Define ‘Accounting rate of return’ ‘and Pay back period method’? Compare and contrast the two.Illustrate with assumed data. [16]

7. Jounalise the following transactions and post them to ledger. [16]

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


8. The following are the extracts from the financial statements of Blue and Red Ltd.,

as on 31st March 2001 and 2002 respectively.

31 March 2001 31 march 2002


Rs.                                       Rs.

Stock                                               10,000                                  25,000

Debtors                                            20,000                                  20,000

Bills receivables                              10,000                                      5,000

Cash in hand                                   18,000                                   15,000

Bills payable                                    15,000                                    20,000

bank overdraft                                    –                                           2,000

9%debentures                               5,00,000                                5,00,000

Sales for the year                          3,50,000                                3,00,000

Gross profit                                      70,000                                  50,000


Compute for both the years the following:

(a) Current ratio

(b) Acid ratio

(c) Stock turnover ratio. Also interpret the results. [5+5+6]




Leave a Comment