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Managerial Economics

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Managerial Economics Question bank

 

Q. 1 Define Management Economic. Discuss the nature and scope of Managerial economics.

Q.3 What do you mean by discriminating monopoly. Explain the price and output determination is discriminating monopoly.

Q. 4 Write short  note on:-

(i)       Opportunity cost

  1. Replacement and Historical cost
  2. Incremental costs and Sunk costs
  3. Past and Future cost
  4. Short run vs Long run Costs.

Q. 5  Distinguish between Accounting Profit and Economic Profit

Q. 6 Write short note on break even analysis

Q.7 What factors do you think affect Price elasticity of demand?

Q.8 What is oligopoly? Explain price rigidity under oligopoly in terms of kinked demand curve

Q.9 Explain the pay back Period method of Project appraisal. Describe its merits and limitations

Q. 10 Define cross elasticity of demand

Q.11 How does monopolistic competition differs from perfect competition? Illustrate with some example

Q. 12 Explain the cost-Plus method of pricing. What are its limitations?

Q. 13 What are the different classifications of market structure> Discuss their characteristics.

Q. 14 How would a monopolist fix his Price and output? Explain with diagrams.

Q.15 There are two firms in an industry. Profits of each are dependent on both its output and the output of its rival, thus

Q.16  From the following data you are required to calculate break-even point and net sales value at this point:

Q.17 Discuss the various managerial uses of estimated Production function.

Q.18 What are the criteria of a good forecasting method?

Q. 19 Explain how Managerial Economics is related to Economics, Mathematics, Statistics and Accounting.

Q. 20. Explain important economic theories which are applied to Managerial Economics.

Q,21.  Below are given the pay-offs of 3 investment projects

Q.22 What are the limitations of the break-even analise

Q. 23 The annual sales of a company are as follows

Q.24 The ABC Co. is currently operating at an annual production volume of 7,50,000 direct labour hours. Its annual operating capacity, which cannot be exceeded, is 10,00,000 direct labour hours. Recently, a private brand distributor has offered to buy 1,00,000 units of the companys products at a special price of Rs. 10.50 per unit. The regular selling price is Rs. 12.90 per unit. The standard cost sheet for one unit of the product appears as follows:

Q.25 Explain how Managerial Economics is related to Economics, Mathematics, Statistics and Accounting.

 

Q. 26. Explain important economic theories which are applied to Managerial Economics

Q27   Below are given the pay-offs of 3 investment projects: (new marical)

 

Q.28 What are the limitations of the break-even analysis

 

 

Q. 29 The annual sales of a company are as follows: .

 

Year                 1968                1969                1970                1971                1972

Sales                45                    56                    78                    46                    75

By the method of least squares, find the trend values for each of the five years. Also estimate the annual sales

Q 34. Explain the concept of Barriers to entry. Discuss its relevance taking into consideration the present economic scenario.

Q 35. Price leadership is an alternative cooperative method used to avoid tough competition. Comment.

Q 36. Define risk. What do you understand by diversification of risk? Illustrate your answer with some examples.

 

Q 37 Discuss the relevance of Baumols Model of sales revenue maximization in the present context.

Q 38 What is oligopoly?  Explain price rigidity under oligopoly in terms of kinked demand curve.

 

Q 39 State giving reasons whether the following statements are true, false or uncertain

Q 40 What factors would you like to consider in forecasting the company demand for room heaters?

 

Q 41    A shift in the demand curve for cigarettes is caused by a change in the     price of cigarettes.

 

 

Q 42. Compare and contrast and Behavioral Theory with the Economic Theory of a firm.

Q 43. Calculate break-even point from the following data:

Sales: 550 units

Sale Receipt : RS. 28,875

Total Fixed cost : RS. 16,, 000.

Total variable costs : RS.11,000

 

Q 44 Discuss the relevance of Baumans Model of sales revenue maximization in the present context

Q.45 What is oligopoly?  Explain price rigidity under oligopoly in terms of kinked demand curve

Q.46  State giving reasons whether the following statements are true, false or uncertain

Q 47. Briefly explain the concept of returns to scale.

 

Q.48 Below is given a demand equation:

Q=6P+400

Calculate price-elasticity of demand if price is (i) Rs. 4 , (ii) Rs. 10 and (iii) Rs. Is the demand at theses price elastic or inelastic?

 

Q.49 The annual sales of company are as follows:

 

Year

1968

1969

1970

1971

1972

Sales

45

56

78

46

75

By the method of least squares. Find the trend values for each of the five years, also estimate the annual sales of  1973

Q 50.             Compare and contrast and Behavioral Theory with the Economic Theory of a firm

Q 51. Calculate break-even point from the following data:

Sales:550 units

Sale Receipt : RS. 28,875

Total Fixed cost : RS. 16,, 000.

Total variable costs : RS.11,000

Q 52. Suppose the demand for a particular product is unitary elastic. What will you do as a manager to increase the total revenue? Discuss

Q 53 Explain the concept of

a)    Concentration ratios

  1. Heirfindhal index

Q 54. Discuss the concept of bundling giving examples.

Q 55. Briefly explain the concept of returns to scale

 

Q.56 Arm has to make a choice between buying a property or renting it. The firm

Can either pay Rs. 1, 00,000 and acquire the property permanently, or it can rent it for Rs. 10,000 per annum for years. Should the firm rent or buy property? Use a 15% discount rate for your calculations.

 

Q.57 if the levels of final demand are:

Agriculture                                      200         Industry        300

and the coefficient matrix is as given in the following table, find out the output level of each sector necessary to meet the demand

 

Agriculture

Industry

Agriculture

Industry

1/7

3/7

4/7

1/7

 

Q 58 Given Demand Function P=5000�30Q

Total Cost function TC =3000+800Q.

Calculate price, level of out put and profit for a firm seeking (a) profit maximization (b) total avenuemaximization and (C) total revenue maximization subject to profit constraint of Rs, 1,41,000.

 

Q.59 If the marginal cost function f(x) = find the total cost function it being given that the fixed cost is Rs. 10,000

 

Q.60 What is "Linear Programming" ? What is the purpose of using linear programming ? Explain the advantage of linear programming approach.

 

Q.61 What are the basic assumptions of linear programming ? Explain the limitations and applications of linear programming.

 

Q.62 Explain the graphic solution to the Linear Programming Problem

Q.63 Explain the graphic solution by !so-profit or Iso-cost method

Q.64 . Explain the main tools of cost controls. What are the areas of cost control Y.

 

Q.65 Define the Trade Cycle. Explain the main stages of Trade Cycle

Q.66 Critically examine the Climatic Theory, Psychological Theory and Over Investment Theory of Trade Cycle.

 

Q.67  Explain over-saving and Hawtrey Theory of Trade Cycle.

 

Q.68 Critically examine Keynesian Theory of Trade Cycle.

 

Q.69 Explain the main determinates of Proposal budgeting.

 

Q.70 Explain the modern techniques of investment appraisal. What are the limitations of this technique ?

 

Q.71  Explain the profitability index (B) Benefit -Cost ratio) and internal rate of return (yield of investment criterias. What are limitations ?

Q.72 Explain the traditional methods of investment appraisal What are their limitation?

 

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