MS-9 Managerial Economics Previous Exam Paper

MBA - Master of Business Administration

Note: Attempt any five questions. All questions carry equal marks.

1. Explain how short run and long run cost functions can be used by firm for profit maximization and cost control decisions. Support your answer with diagrams.

2. a) What do you understand by price discrimination? Explain the conditions which make it possible and profitable.

b) What are the main features of monopoly? How does it differ from perfect competition.

3. What are the various factors which may influence the demand for intermediate goods like cables? Explain the most appropriate method of forecasting the demand for such an item.

4. Distinguish between any five of the following:

a) Accounting and economic profit

b) Demand function and production function

c) Direct and indirect costs

d) Trend and regression methods of forecasting

e) Business risk and financial risk

f) Price elasticity and gross price elasticity of demand

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

6. Suppose that you manage a business and have to make a business trip of two to four days at least once in a month. Discuss the factors that determine the total cost of the trip?

7. Discuss the relevance of Baumol's Model of sales revenue maximization in the present context.