THE INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF BANGLADESH CMA JUNE, 2017 EXAMINATION
KNOWLEDGE LEVEL
SUBJECT: IE 02. PRINCIPLES OF BUSINESS ECONOMICS
Time: Three hours Full Marks: 100
All questions are to be attempted.
Show computations, where necessary.
Answer must be brief, relevant, neat and clean.
Start answering each question from a fresh sheet.
Q. No. 1
(a) Define marketing environment. Briefly explain the impact of technological changes on marketing activities in a developing country like Bangladesh.
(b) What do you mean by marketing promotion? Mention the elements of promotion mix.
[Marks: (5+5) = 10]
Q. No. 2
(a) The rise in price and rise in supply are directly proportional to each other. Explain.
(b) Explain the equilibrium condition of a firm under monopoly?
[Marks: (6+4) = 10]
Q. No. 3
(a) What are the key difference between Profit Maximization and Wealth Maximization?
(b) Define the term “Business Plan”. What are the major contents of a business plan? Explain with examples.
[Marks: (5+5) = 10]
Q. No. 4
(a) What do you mean by Management? What are the three major skills of management?
Explain.
(b) What is Authority? Through delegation of authority can we held the subordinate(s) accountable for superior’s job? Defend your answer with logic.
[Marks: (5+5) = 10]
Q. No. 5
(a) How does International Business play a vital role in the National Economy? Explain it in the context of the economy of Bangladesh.
(b) Define “International Trade Barriers” with examples. Explain the reasons behind restricting foreign products.
[Marks: (5+5) = 10]
Q. No. 6
(a) Explain the Circular Flow of Inputs and Outputs model.
(b) Starting business through franchise reduces entrepreneur’s independence on business decisions – Explain the reasons of reduced independence.
[Marks: (5+5) = 10]
Q. No. 7
(a) Let us assume that you are receiving Tk. 1,000.00 every year for the next five years, and you invested each payment at 5%. Please calculate the future value of the annuity.
(b) What is time value of money? Why is it important in investment decision? Explain.
(c) What are the different sources of financing of a business?
[Marks: (8+6+6) = 20]
Q. No. 8
(a) Sometimes a company will continue production even when it is making a loss. Why?
(b) Explain the difference between monopoly and perfect competition.
(c) Explain the demand and supply curves. How do they assist in a firm’s decision making?
(d) Explain the concept of ‘marginal utility’. How does it impact upon demand for a firm’s products?
[Marks (5+5+5+5) = 20]
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