Rajiv Gandhi University of Knowledge Technologies -

Srikakulam
Department of CIVIL ENGINEERING
E2 _Sem1_Mid 1, AY 2021-22(JAN-22)
Year/Sem: E 2/E3/Sem 1 Date: 27/01/2021
Subject: MEFA Time: 2 Hours
Subject Code: 20BM2101 Max. Marks: 40 M

Answer any four of the following questions. Each question carries ten marks. (4 X
10 = 40 M)

1. “Manager follows the microeconomics concepts” justify this statement. What is the
importance of Managerial Economics in decision making?

2. What importance elasticity of demand in our day-to-day life? What are the different
mesurments of elasticity? What is its importance? Use graph.

3. a) Mr. X, a coffee shop owner who provided his consumption of sugar and
coffee data to understand effect of price hike of sugar on his business. Here
is the data fillows:

Q1= 1000cups (coffee before) P1y=20(price of sugar before)

Q2= 900 cups (coffee after) P2y= 30 (price of sugar after)

b) Mr. z, a perfume producer has provided his data regarding his sales
before and after cut-off his advertisement cost. Analyze his products
elasiticity.

Q1= 80000 (units) A1=10000 (rupees on advertisement before)

Q2= 60000 (units) A2=8000 (rupees on advertisement after)
4. a) Why law of diminishing return operates? Justify your answer with appropriate
example.

b) Suppose that the market demand for potatoes is given by Q = 1000 – 250P and the
market supply of potatoes is given by Q = 150P, where P is the price per bag of
potatoes and Q is the number of bags per month.

5. a) Company ABC lunched a new COVID testing Kit. They what to know whether
their product is accepted by public or not? which forecasting method will be
appropriate for this situation.

b) State and explain some of the Quantitative forecasting methods. Which one is
 more efficient in your point of view?

6. Law of variable proportion define the short-run production function, explain it with
example.

Returns to Scale refer to the future production forecasting, explain statement with
7 appropriate example and graph.

8 a) Fill this cost table (need to follow the formula only)

output TFC TVC TC AFC AVC ATC MC
0 1500 * * * *
1 100
2 90
3 580
4 60
5 330

Prepare table and fill it up with values.

b) Write Short notes on:

i) Equi- marginal utility

ii) Opportunity cost

iii) Laws of variable proportion