1 (a) Explain the Law of Supply and Demand. (a) Murugan & Co.Ltd.

has
1. 1 (a) the cash
The following details:
flows of two project proposals are as given below.
DAIT
or
(b) Explain in detail the elements of cost.
2. Fixedof the
Each cost = has
project Rs.an expected life of 10 years. Select the
4000000
best project based on present worth method of comparison
1 (a)B.E/B.TECH.
(i) From the following
Degree information, find out the amount of profit
Examination- Variable cost per unit
2. using an interest rate of 18%, compounded annually.
April/May
earned during the- 2016-17
year using marginal cost technique. = Rs. 300
Eighth
Fixed cost Semester
= Rs. 500000 Selling price per unit =
Variable cost =Test
Unit - I per unit
Rs. 10
Mechanical Engineering
Selling Price = Rs. 15 per unit
Rs. 500 DAIT
MG6863 - Engineering Economics, Find:
Output level set-A
= 150000 units B.E/B.TECH. Degree
(a) The break-
Examination-April/May - 2016-
Time: 3 Hrs even sales
(ii) Maximum:
Marginal cost
100 = Rs. 2400, Selling price = Rs. 3000.
marks 17
quantity Eighth Semester
Calculate P/V ratio.
PART A - (10 X 2or = 20 (b) The break- Unit Test - I
Marks) even sales Mechanical Engineering
(b) (i) ESSAAR Industries has the following details:
(c) If the actual MG6863 - Engineering
Fixed cost = Rs. 2000000 Economics, set-A
1. What is revenue dominated cash flow? production
Variable cost per unit = Rs. 100 Time: 3 Hrs
2. What is cost dominated cash flow? quantity is
Selling price per unit = Rs. 200 Maximum: 100 marks
3. What is annual equivalent method of comparing alternatives?
Find the 120000, find
4. Mention thebreak-even sales
various rate quantity
of return and the break-even sales.
method.
the following: PART A - (10 X 2 = 20
5. What is rate of return?
(ii) is
From the following details find out margin of safety. (i) Contrib Marks)
6. What present worth method?
7. What Sales = Rs. 100000
is future worth analysis? ution
1. What is elasticity of demand?
8. What Totalis cost
annual equivalent
= Rs. 80000 method? 2. Margin of safety
What is opportunity cost? by all
9. What Fixedis replacement
cost = Rs. 20000analysis? 3. methods.
What do you mean by marginal cost?
10 What Netisprofit
meant by maintenance?
= Rs. 20000 4. What is meant by marginal revenue?
13 . (a Initial Annual Salvage 5. What is meant by sunk cost?
. ) outlay equivalent value after 6. Differentiate value analysis and value engineering.
PART
(Rs.)B - (5 X revenue 10 years 7. What is present worth factor?
16 = 80 Marks) 8. What is sinking fund factor?
(Rs.) (Rs.)
1 (a) A project involves an initial outlay of Rs. 3000000 and with the 9. What is uniform gradient conversion?
Project 1 -750000 200000 50000 10 What is effective interest rate?
1. following transactions for the next five years. The salvage
Project 2 -950000 225000 100000
value at the end of theor life of the project after five years is Rs. .
(b An200000.
engineerDraw a cash flow
is considering twodiagram
types ofofpressure
the project and for
sensors finda its
PART B -
) lowpresent
pressure worth by assuming
steam line. Thei = 15%,are
costs compounded
shown below.annually.
Which (5 X 16 = 80
should End of yearbased on
be selected Maintenance Revenue
a present worth comparison at an Marks)
interest rate of 16% per year? and operating (Rs.)
expense
Type X Type Y
First cost (Rs.)
Rs. 76000 Rs. 129000
Maintenance1 200000 900000
2 Rs. 12000
250000 Rs.1000000
9000
cost/year
3
Salvage value 300000
0 1200000
20000
4
Life, years 300000
2 1300000
4
14 (a A company must 5 decide whether 400000
to buy machine A1200000
or machine
. ) B. or
(b) Find the present worth of the following cash flow series.
Machine A Machine B
Assume i = 15% compounded annually.
Initial Cost Rs. 400000 Rs. 800000
End life
Useful of (years)
0 1 5 2 3 45 5
year
Salvage value at
Cash
the end of - 30000 30000 30000 Rs.30000
Rs. 200000 55000030000
flow
machine life10000
(Rs.)
Annual
Rs. 40000 0
maintenance cost