1OMES4 USN [_ Time:3Hrs Instructions: |. Answer one full question from each unit. oe V SEMESTER END EXAMINATION (2014 ~ 2015) Mechanical Engineering ENGINEERING ECONOMICS(10MES4) 2. Any missing Data can be suitably assumed. UNIT-1 What is the idea behind law of Returns? State the Laws of Returns with an example. List the factors influencing Demand and Supply. Explain the following Terms: (i) intuition (ji) analysis (i) Tact (iv) strategy A loan at Rs, 200 is made for a period of 13 months from January 1 to January 31", the following years at a simple interest rate of 10%. What future amount is due at the end of bof the loan period considering ordinary and exact simple interest? A person invests a sum of Rs. 50000 in a bank at « nominal interest rate of 18% for 15 years. The compounding is done monthly. Find the maturity amount of the deposit after 15 years, \ person is planning for his retired life. He has 15 more years of service. He would like to leposit 20% of salary, which is Rs. 15000 at the end of 1* year and thereafter he wishes to increase his deposit by Rs, 2500 more every year along with Rs. 15000 for the next 14 years. What will he the maturity amount of this deposit, ifthe interest rates are 10% and 14% per year? What nominal interest rate compounded monthly yields on effective annual rate of 19.56%? UNIT-IL Explain the basic concept of Future worth comparison with help of cath flow diagram, Explain in brief the pay back comparison method. A construction company receives two bids for an elevator to be installed in their newly constructed apartment, the details of which is given in the following table Bidding Construction Company Estimates Company |Tnitial Costin [Service life in| Annual operation and = neuen ears senance cost i 580,000 15 29,500 2 640,000 ase 30,800 Determine the best bid based on the present worth method of comparison assuming 12% inntervst rate compound annually, Define the following with respect to life of an Asset: (i) ownership life (ii) accounting life (iii) economic life Two models of small machines perform the same funetion. Type 1 machine has a low initial cost of Rs.9500, relatively high operating eost of Rs. 1900 per year more than those of the type 2 machines and short life of 4 years, The more expensive type 2 machine cost 1.25100 and ean be kept in service economically for 8 years. The scrap value from either machine at the end of its life will barely cover its removal cost, Which is referred when. ‘nininvum attractive rate of return is 8%? UNIT-IIL Explain the objectives of costing? Explain (i) MARR (ii) IRR (iii) ERR (iv) Depreciation Explain the kinds of Taxes (i) direct taxes (ii) indirect taxes. Wha are the various Indirect Expenses / overheads which are essential in estimating the total cost? Explain briefly the ‘standard cost’ and the ‘Marginal cost’ Wik a flow diagram, show how the selling price of a component is determined. Max. Marks: 100 08 Marks 609 06 Marks cos oeMarks cos (04 Marks co2 04 Marke coz o8Marks coz o4marks coz (08 Marke coz (04 Marke coz oeMarks coz 10 Marks coz 10 Marks coz 08 Marks cos oe Marks coz oeMarks cor 06 Marks cos o4Marks cos sOMarks coo Page 1 of 2 Possession of any kind of written material, mobile/ electronics gadgets & scribbling on QP, amounts to Malpractice10MES4 usn [| | 10 Possession of any kind of written material, mobile/ electronics gadgets & UNIT-IV What are the sources of finance and financial information? Explain the following terms: |) Preferential shares fi) Assents v) Sundry ereditors The company °° having reserves and surplus has the following details as on December “Description Value in Re | Description Value in Fe [Dividend 72000 | Debtors 160000 Bank Bal [10000 Bills Payable 20000 Equity 200000 | Plant & Equipment 0000 | Provision for Taxes 40000 | Bills receivable 20000 ak ~ 777000-| Greditors 35000 ‘preference shares 735000 | General Reserve 40000 200000" | Cash in hand 15000 Iheet as on 31* December 2012. ‘The following are the items of the profit and loss account for voltas limited for the year ‘nuled on 316 March 2003. You are required to arrange them systematically and indicate 3) Profit before taxation and ii) Profit after taxation VOLTAS LIMITED Profit & Loss Account For the year ended 31* March 2008 Re. In Lakhe Operating and administrative expenses 10,440.60 Depreciation 1,382.80 Provision for Income Tax 210.00 Interest 2595.30 Cost of sales & services 54,773.90 Sales & service 69,552.90 Provision for wealth Tax 3.50 Other income 517.60 Excess provision of tax in previous years 143.00 Proposed dividend. 643.80 Des vibe the essentials of profit planni plain the advantages and limitations of Budgeting. List out different types of financial ratios used for analyzing the health of an organization anid explain any two in brief, ‘Two firms A and B each have total assets worth Rs. 50 lakhs and average net profit of 10% each. Firm ‘A" has a sale of Rs. 40 lakhs while firm B has aggregate sales of Rs. 400 lakhs. Determine the earning power of firm A & B. t0Marks cot 10 Marks cot s0Marks cot 40Marks cot s2Marke cos oemarks coz s0Marks cot s0Marke cot Page 2 of 2 bling on QP, amounts to Malpractice