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APJ ABDUL KALAM TECHNOLOGICAL UNIVERSITY
THIRD/FOURTH SEMESTER B.TECH DEGREE EXAMINATION, DECEMBER 2018

Course Code: HS200
Course Name: BUSINESS ECONOMICS

Max. Marks: 100 Duration: 3 Hours
PART A
Answer any three questions, each carries10 marks. Marks
1 2) With the help ofa figure demonstrate the relationship between total and marginal (5)
utility.

b) Marginal analysis is the basis for several theories in Business Economics. Do you (5)
support this view?
2 a) Mention the relevance of the concept of scarcity in business economics. (5)
b) Mark the point on a graph of the PPC, showing underutilization of resources. (5)
Using the PPC, explain the concept of trade off.
3 ஐ Ifthe production function of a firm is Q= 10 L’’K"”, find out the maximum
output that can be produced, if 144 units of labour is combined with 169 units of — (5)
capital. Also calculate the average and marginal product of labour from the
function
b) In July, Parle sold 40,000 bottles of their mango juicewhen the price of (5)
Tropicana was Rs.35 per bottle. In August, they sold 45,000 bottles when the
price of Tropicana was Rs.40. Calculate the cross elasticity of demand of mango
juice for Parle.
4 a) State and explain the law of variable proportions (4)
b) The following schedule shows the number of laptops purchased by offices and
homes at different market prices.

Purchased by
homes(units)
2500

purchased by
offices(units )
3400

(6)

50000

As the price of laptops increases from 55000 to 60000, what is the price elasticity
of demand for (i) offices and (ii) homes?
PART B
Answer any three questions, each carries 10 marks.
5 93) Define average and marginal revenue. With the help of a figure demonstrate the (6)
relationship between average and marginal revenue.
b) Distinguish between Perfect Competition and Monopoly. (4)
6 a) Drawa diagram showing AFC, AVC and TC curves. (4)
b) A_ small-scale company, engaged in the production of manufacturing (6)
biodegradable carry bags has total sales of Rs. 20000. Its fixed cost is Rs. 6000,
while its variable cost is at Rs.12000. Calculate (i) the P/V ratio (ii) breakeven
point (iii) Margin of safety at this level of sales (iv) If it sells each bag for Rs.5,
how many bags should the company sell to break even? (v)Find out the sales
required to earn a profit of Rs. 4000.
7 a) Examine the various phases of a trade cycle. Draw a neat diagram to substantiate (5)

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