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1(DBUS 01)

M.B.A.(Previous) DEGREE EXAMINATION, MAY 2006PAPER - I - MANAGEMENT PROCESS AND BEHAVIOUR

Time: Three hours Maximum: 75 marks PART - A (3 X 5 = 15 marks)

Answer any THREE questions

1. (a) Management systems. (b) Importance of decision making. (c) Management by objectives. (d) Organisation culture. (e) Delegation of authority. (f) Nature of group dynamics.

PART - B (3 X 15 = 45 marks)Answer any THREE questions

2. Discuss the responsibilities of a professional manager in an organisation.

3. �Decision making is the essence of Management� - Discuss.

4. Explain the various decision making techniques.

5. What is the influence of leadership styles on organisational climate?

6. Examine the factors that influence the choice of organisation structure.

7. What are the specific stages involved in developing interpersonal relationship in an organisation?

PART C - (15 marks)Compulsory

8. Case Study:

Saagar Travels is a large Travel Agency with an employee population of 140 having branches

in five metropolitan cities: Delhi, Bombay, Calcutta, Madras and Hyderabad. Each branch has

separate counters for rail and air reservations. The Agency is known for its excellent service. Over

the years, it has built up good reputation and has carved out a niche for itself in travel business. In

recent years, the head office in Delhi is finding it increasingly difficult to monitor the information

especially on air tickets received from other centres through manual operations. To avoid delay and

inconvenience to customers and to improve accounting operations, the Agency is seriously thinking

of introducing computers on a gradual basis. Now this move is resisted by employees working in

various centres vehemently, fearing retrenchment. In spite of repeated requests from management,

they are planning to go on strike.

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Questions:(a) How to resolve the impasse?(b) Discuss the reasons for employee resistance to change in the light of the information

provided above.(c) Outline an appropriate change strategy that satisfy the expectations of both management

and workers.* * * * * *

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(DBUS 02)M.B.A.(Previous) DEGREE EXAMINATION, MAY 2006

PAPER - II - BUSINESS ENVIRONMENT

Time: Three hours Maximum: 75 marksSECTION - A (3 X 5 = 15 marks)

1. Write any THREE of the following:(a) What are the functions of Investment Commission?(b) What are the objectives of Tenth Five Year Plan?(c) Explain dualism in Indian society.(d) What are the major provisions of FEMA?(e) Contribution of service sector in total GDP in India.(f) Restrictive Trade Practices.

SECTION - B (3 X 15 = 45 marks)Answer any THREE of the following.

2. Explain the concept of Business Environment. Also explain how political environment can influence business.3. Give an account of comparison of various economic systems.4. Examine the role of Small Scale Industry in promoting Balanced Regional Development?5. What is Professionalism? Does it exist in Indian public sector?6. Outline the salient feature of the latest EXIM Policy of our country.7. Elucidate the second phase of Financial Sector Reforms in India.

SECTION - C (1 X 15 = 15 marks)This Question is Compulsory.

8. The Government policy in respect of disinvestment of public sector has taken a �U� shape suddenlywith the influence of coalition political parties in the Government led by the United ProgressiveAlliance (UPA). Do you consider that this change is in the right direction? Critically review the policyof disinvestment initiated and implemented since 1991 to 2004. Present a coming road map for thenext five years in respect of disinvestment.

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PAPER - III - MANAGERIAL ECONOMICS

Time: Three hours Maximum: 75 marks SECTION - A (3 X 5 = 15 marks)


1. (a) Significance of Managerial Economics.(b) Concept of Demand Forecasting.(c) Short run cost function(d) Cost plus pricing.(e) Sales Revenue maximisation model(f) Capital budgeting.

SECTION - B (3 X 15 = 45 marks)Answer any THREE questions

2. Discuss the nature and scope of Managerial Economics.3. State the concept of Law of demand. What are the exceptions to it?4. The following data relates to a manufacturing firm:

225.09125 QQTC

Where TC = Short run total cost.Q=Output

You are required to calculate(a) Average Fixed Cost (AFC)(b) Average Variable Cost (AVC).(c) Average Total Cost (ATC)(d) Marginal Cost (MC).

5. Explain how price is determined under perfect competition.6. Examine the profit maximization theory of a firm.7. Compare and contrast the NPV method and IRR method of capital budgeting.

SECTION - C (15 marks)Compulsory.

8. A Shipping Company is committed to an initial outlay of Rs.60,000. Its economical life is expected to be 4 years. The Cash flows are expected to be as follows:

The cost of capital is 10%.

5

Year Cash flow1 12,0002 15,0003 22,0004 10,000

Calculate:(a) NPV (b) IRR.

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PAPER - IV - ACCOUNTING FOR MANAGERS


1. Answer any THREE of the following questions:(a) Functions of Accounting(b) Distinguish between Funds Flow Statement and Income Statement.(c) What do you mean by a capital reserve?(d) Importance of inflation accounting.(e) Assumptions of break even analysis.(f) Limitations of variance analysis.

SECTION B - (3 X 15 = 45 marks)Answer any THREE of the following

2. What are the fundamental accounting assumptions? Are these different from accounting poli-cies? Explain.3. Give the main limitations of financial statements. What safeguards can be provided for thepreparation of false statements?4. Prepare in a summarised for the Balance Sheet of a company as per Companies Act, 1956, takingimaginary figures.5. From the following Balance Sheet of Delight Ltd. Prepare funds flow statement for the year ended31-12-2004.Liabilities 2003 2004 Assets 2003 2004

Rs. Rs. Rs. Rs.Equity share Goodwill 1,15,000 90,000Capital 3,00,000 4,00,000 Land & Buildings 2,00,000 1,70,0008% preference share capital 1,50,000 1,00,000 Plant 80,000 2,00,000General reserve 40,000 70,000 Stock 77,000 1,09,000Profit & Loss a/c. 30,000 48,000 Debtors 1,60,000 2,00,000Proposed dividend 42,000 50,000 Bills receivable 20,000 30,000Creditors 55,000 83,000 Cash in hand 15,000 10,000Bills payable 20,000 16,000 Cash at bank 10,000 8,000Provision for taxation 40,000 50,000

6,77,000 8,17,000 6,77,000 8,17,000

Additional information:

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(a) Depreciation of Rs.10,000 and Rs.20,000 have been charged on plant and land andbuildings respectively in 2004.

(b) An interim dividend of Rs.20,000 has been paid in 2004.(c) Rs.35,000 income-tax was paid during the year 2004.

6. The Godavari Chemical Works Ltd. issued for public subscription 5,00,000 equity shares of Rs.100each of a premimum of Rs.20 per share payable as under:

On application Rs.20 per shareOn allotment Rs.50 per share (including premium)On first call Rs.20 per share andOn final call Rs.30 per share.Applications were received for 7,50,000 shares. The shares were allotted pro-rata to the

applicants for 6,00,000 shares, the remaining applications being rejected. Money overpaid on appli-cation was utilised towards sums due on allotment.

Phani, to whom 4,000 shares were allotted, failed to pay allotment and calls money andMurali, to whom 5,000 shares were allotted failed to pay the two calls. These were subsequentlyforfeited after the second call was made.

All the forfeited shares were sold to Venkat as fully paid up at Rs.80 per share.

Pass necessary Journal entries and also prepare the Balance Sheet, after the transactionsare complete.7. The standard material cost to produce a tonne of Chemical Z is:

200 kg of material A @ Rs.10 per kg.300 kg of material B @ Rs.5 per kg.400 kg of material C @ Rs.7 per kg.

During the period, 100 tonnes of mixture Z were produced from the usage of30 tonnes of material A at a cost of Rs.9,000 per tonne40 tonnes of material B at a cost of Rs.6,000 per tonne50 tonnes of material C at a cost of Rs.7,000 per tonne.Calculate various material variances.

SECTION - C (15 marks)This question is compulsory.

8. From the following data, calculate:(a) Break-even point expressed in amount of sales in rupees.(b) Number of units that must be sold to earn a profit of Rs.60,000 per year.(c) How many units must be sold to earn a net income of 10% of sales?

Rs.Selling price 20 per unitVariable manufacturing cost 11 per unitVariable selling cost 3 per unitFixed factory overheads 5,40,000 per yearFixed selling costs 2,52,000 per year.

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PAPER - V - QUANTITATIVE TECHNIQUES FOR MANAGERIAL DECISIONS


Answer any THREE of the following.

1. (a) Explain different methods of collecting primary data. (b) Give any two definitions of probability. (c) What is complex conjugate of matrix? (d) What is the measeares of dispersion? (e) Briefly explain the methods of studying correlation. (f) Explain the procedure generally followed in testing of a hypothesis.

SECTION - B (3 X 15 = 45 marks)Answer any THREE of the following.

2. A manufacturer produces 3 products A, B and C which are sold in Delhi and Calcutta. The annual sales of these products are given below:

A B CDelhi 5,000 7,500 15,000Calcutta 9,000 12,000 8,700

If the sales prices of the products A, B and C per unit are 2, 3 and 4 respectively. Calculate

the total revenue in each centre by using matrix.

3.A stall producing co., produces �X� tons of stell at a total cost of .5011173

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xxx

c Find the

output levels at which the marginal cost attains its minimum.4. Consider the following data which relate to the mean daily sales and standard deviation for 3 salesman.

Salesmen Mean Daily Sales S.D.(Rs.) (Rs.)

A 86,000 104.5B 45,000 58.6C 72,000 95.4

Determine which salesman is most consistant in terms of daily sales.5. Explain what is meant by an estimate of a population parameter. A random sample of 500 appleswas taken from a large consignment and 60 were found to be bad. Obtain the 98% confidencelimits for the percentage number of bad apples in the consignment.

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6. The average age of students on an M.B.A. course is thought to be 35 years. A sample of 36M.B.A. students had an average age 37 years with a standard deviation of 6 years. Does the samplesupport the hypothesis that the average age is 35 years; use a 5% level of significance. If a 1 percentlevel of significance is considered, what will be the conclusion?7. Below are given the figures of production (in thousand tones) fertilizer factory:

Year : 1998 1999 2000 2001 2002 2003 2004Production : 70 75 90 98 84 91 100(a) Fit a straight line trend and find the trend values(b) What is the monthly icrease in the production of fertilizer?

SECTION - C (15 marks)Compulsory

8. The following data pertains to length of service (in years) x and annual income (in thousandrupees) y for a sample of ten employees of an industry:

x : 6 8 8 10 11 12 14 16y : 14 17 15 18 16 22 25 26

Compute the correlation coefficient and interpret the value.

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10(DBUS 06)

M.B.A.(Previous) DEGREE EXAMINATION, MAY 2006PAPER - VI - INFORMATION MANAGEMENT AND COMPUTER APPLICATIONS


1. Answer any THREE of the following:(a) Distinguish between main memory and secondary memory.(b) What are the differences between a computer and an interpreter?(c) Explain APPEND command.(d) Describe the actions of different function keys supported by Lotus 1-2-3.(e) Describe �lead time� and �demand forecast�.(f) Describe the costs of operating the information system.

SECTION - B (3 X 15 = 45 marks)

2. Explain the role of computer-aided decision making in management of an organisation and itsadvantages.3. Explain the characteristics of Inventory. Design Inventory system files and data relationships for aretail sales enterprise.4. Define computer virus. Describe the general methods used in case of virus infection and attackon personal computers.5. Explain the role and relevance of MIS for an effective decision making.6. Explain the major reasons for ever increasing need for data processing.7. Explain �advanced file structures� and �report writer� features of COBOL.

SECTION - C (15 marks)8. This question is compulsory.

When a major Andhra Pradesh state agency purchased 25 pieces of computer equipment,little did it realize that a year later it would end up with �50 non-working machines from the originalvendor, 25 machines that work from a new vendor, and a legal dispute on its hands�. Problemsstarted a few weeks after installation of 25 PCs when 5 machines broke down and were sent back tothe vendor for repair. The vendor fixed the five machines and provided instructions on how to fix othermachines. When problems persisted with the remaining machines the vendor sent 25 replace-ments. However the replacements had the same problems. By then a year had passed and themachines were no longer covered under warranty. Fed up with the whole state of affairs the managerpurchased 25 machines from a different vendor. The agency is now holding the 50 machines hos-tage (25 replacements and 25 old PCs that the vedor claims to have fixed) and the dispute is in

litigation.

(a) Discuss how the situation could have avoided. Are there any ethical violations in this

case?

(b) What measures should organizations take to avoid such legal disputes?

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(DBUS 21)M.B.A.(Second Year) DEGREE EXAMINATION, MAY 2006

PAPER - I - FINANCIAL MANAGEMENT

Time: Three hours Maximum: 75 marks PART - A (3 X 5 = 15 marks)

Answer any THREE of the following

1. (a) Profit maximisation (b) Dividend Payout Ratio (c) Financial Leverage (d) Benefit - Cost Ratio (e) Lock-Box System (f) EOQ.

SECTION - B (3 X 15 = 45 marks)Answer any THREE of the following

2. �Financial Decision Making is the hall mark of the financial management� . Examine in the light ofthis statement, the important financial decisions in a firm.3. From the following Balance Sheets of Power Ltd. Prepare a cash flow statement for the yearending 31st December 2004.Liabilities 2003 2004 Assets 2003 2004

Rs. Rs. Rs. Rs.Share capital 2,00,000 2,00,000 Buildings at cost 75,000 90,000Profit & Loss a/c. 23,500 52,000 Land 10,000 10,000Debentures 40,000 35,000 Machinery at cost 25,000 40,000Creditors 33,000 40,000 Investments 50,000 30,000Outstanding expenses 3,500 4,500 Debtors 80,000 90,000Depreciation: Cash 41,000 54,000Machinery 3,000 7,500 Prepaid Expenses 2,000 3,000Buildings 12,000 18,000 Stock 32,000 40,000

3,15,000 3,57,000 3,15,000 3,57,000

4. The sales and profits of a firm for the last two years is as below:

2004 2005

Rs. Rs.

Sales 1,40,000 1,60,000

Profit 15,000 20,000

Compute:

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(a) P/v ratio (b) BEP (in Rs.)(c) Sales to earn a profit of Rs.40,000 (d) Profit when sales are Rs.1,20,000

5. The Credit Manager of Balu Ltd. is examining the question relaxing the credit policy. It sells atpresent 20,000 units at a price of Rs.100 per unit, the variable cost per unit is Rs.88 and average costper unit at the current sales volume is Rs.92. All the sales are on credit, the average collection periodbeing 36 days. A relaxed credit policy is expected to increase sales by 10 percent and the averageage of receivables to 60 days.

Assuming 15 percent return, Advice the Credit Manager of Balu Ltd.6. What do you understand by �Budgeting�? Mention the types of budgets that are normally preparedin an organisation.7. Explain briefly the Net Income Approach on capital structure.

SECTION C (15 marks)Compulsory

8. A firm whose cost of capital is 10% is considering two mutually exclusive projects X and Y, thedetails of which are

Project X Project Y Rs. Rs.

Investment 70,000 70,000Cash flows at the end of

Year 1 10,000 50,000Year 2 20,000 40,000Year 3 30,000 20,000Year 4 45,000 10,000Year 5 60,000 10,000

Compute NPV, IRR and PI of each project and advice the firm which project should beaccepted.

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PAPER - II - OPERATIONS MANAGEMENT

Time: Three hours Maximum: 75 marksPART - A (3 X 5 = 15 marks)


1. (a) Operations management (b) Product selection (c) Capacity planning (d) Batch production (e) Value engineering (f) Inventory control.

PART - B (3 X 15 = 45 marks)Answer any THREE questions

2. Discuss the nature and scope of operations management in terms of production decisions.3. Explain the product selection and stages involved therein.4. Explain the process for capacity planning.5. What are the various kinds of production systems? Discuss the nature of Mass Production.6. Discuss in brief how do you organise value engineering function in an electronic industry?7. Define �Purchase Systems�. What are the common objectives of the purchasing function?

PART - C (15 marks)Compulsory.

8. Design an assembly line for a cycle time of 10 minutes for the following 10 work elements:

Elements : 1 2 3 4 5 6 7 8 9 10Immediate predecessor : 0 1 2 2.3 4 5 6 5 7.9 9Duration in minutes : 5 10 5 2 10 7 5 2 5 7

Use the method of Kilbridge and Wester.

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(DBUS 23)M.B.A.(Second) DEGREE EXAMINATION, MAY 2006

PAPER - III - MARKETING MANAGEMENT


1. Answer any THREE questions:(a) Marketing V/s. Selling(b) Market segmentation(c) Consumer behaviour(d) Product packing(e) Advertising.(f) Sales forecasting.


2. Discuss the role of marketing in a developing economy like India.3. Define �Marketing Research�. Examine its application in the marketing field.4. Explain the factors that determine consumer behaviour.5. Discuss how branding is important in the product development phenomenon?6. Define �Marketing communication�. What are the means of commuication and their advantages?7. Explain different distribution strategies under Marketing Management.


8. Dental care, a toothpaste was test marketed by XYZ company. The brand was similar to Colgatein taste and packaging. The Media advertising highlighted the hebal properties of Dental care whichwere akin to promise. Two months after the lauach tracking study revealed that Dental care hasachieved 12% trial rate and a 1% repeat purchase rate. The results were not as per expectations ofthe company as they had targeted a market share of 10%. After due analysis it was revealed thatwhile the initial trail and repeat rate was satisfactory for the product category yet it was felt that mediaadvertising has not been able to induce enough people to try the product. It was therefore felt that iftrail rate could be increased to 40% and repeat purchase rate to 25% the brand could achieve itstargeted market share of 10%. Dependence purely on advertising was ruled not being very expen-sive.Questions:

(a) What are the alternatives available to XYZ. company?(b) How do you plan for achieving 10% market share for Dental care?

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PAPER - IV - HUMAN RESOURCE MANAGEMENT


1. Answer any THREE questions:(a) Human Resource Development(b) On the job training(c) Performance appraisal(d) Employee compensation(e) Industrial relations(f) Industrial conflict.


2. Discuss the personal management environment in India.3. State the need and importance of training and development of staff in an organisation.4. Examine the factors that govern employee compensation and salary administration.5. Discuss the methods employed in measuring performance appraisal.6. What are the various channels to over come employee grievance in an organisation?7. Discuss the role of union in maintaining Industrial Democracy.


8. Mr. Das is a final year MBA student. He has done well in exams and practical work. During thecampus recruitment he was selected by a well known company in Delhi. Firm�s representativesinvited him to visit their factory. Mr. Das spent one full day in the factory meeting key officials andvisiting various sections. Before hearing the personal manager confided that they are willing to hirehim subject to passing certain selection tests and formal interviews. He was asked to report to thefactory after his final examination. Having back to the college, Mr. Das wrote to the firm thankingthem for the offer but regretted his inability to join them.Questions:

(a) What made Mr. Das to refuse the job offer?(b) If you were the director of the management institute what type of counselling would you

like to give to Mr. Das(c) Comment on this case in the light of human resource management.

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(DBUS 25)M.B.A.(Second) DEGREE EXAMINATION, MAY 2006

PAPER - V - RESEARCH METHODOLOGY FOR MANAGEMENT DECISIONS


Answer any THREE of the following1. (a) What is exploratory research? (b) What is Random Sampling? (c) Rank Order Correlation. (d) Executive summary (e) Likert�s scale. (f) State the advantages of non-parametric test.


2. Discuss the scientific method in social research. How do you handle bias in research?3. List different scaling techniques. Explain them in brief.4. What is sample plan? what are its steps? How do you determine the sample size of a researchstudy?5. A die is thrown 132 times with following results.

Number turned up : 1 2 3 4 5 6Frequency : 16 20 25 14 29 28

Is the die unbiased?6. What is ANOVA? Illustrate its application for experimental design with an example.7. Describe the precautions that the researcher should take while interpreting his findings.

SECTION-C (15 marks)Compulsory.

8. The following are the kilometers per gallon which a test driver got for ten tankfuls each of threekinds of gasoline:

Gasoline A : 30 41 34 43 33 34 38 26 29 36Gasoline B : 39 28 39 29 30 31 44 43 40 33Gasoline C : 29 41 26 36 41 43 38 38 35 40

Use the Kruskal - Wallis test at the lend of significance 05.0 . To test the null hypothesisthat there is no difference in the average kilometer yield of the three types of gasoline.

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PAPER - VI - BUSINESS POLICY AND STRATEGIC MANAGEMENT



1. (a) Strategic management. (b) Corporate management (c) SWOT Analysis. (d) Cost Analysis (e) Organisational change (f) Evaluation of strategy.


2. Describe the strategic management process.3. What are the legal and managerial roles of Board of Directors?4. Discuss which segment of the environment has the most impact on the organisation.5. What are the causes of high cost levels of Indian products and what are their consequences?6. Explain the screening process for merger and acquisition.7. What is strategy implementation? Why is the task implementation is complex?


8. Case Study:

In a market dominated by behemoths like SAIL and TISCO, finding a niche is of crucialimportance for a small player. What could a Lloyds do with a meagre annual capacity of making sixlakh tonnes of HR coils while SAIL sold over 1,600 lakh tonnes in the same time? Should Lloydsfollow the market leader or adopt its own unique approach to its business strategy? It is in thecontext of such questions that Lloyds� attention came to rest on the manufacturing process.

Almost all steel producers adopt the blast furnace technology. In this, the process startswith a clear differentiation among the ultimate products to be manfactured. So, manufacturingbatch size has to be large enough to take up customised orders. The raw material, iron ore, has topass through several complex stages of manufacturing.

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Lloyds looked for an alternative technology that could suit its requirements. The solution layin the Electric Arc Furnace technology where the unique feature was that initial manufacturing stagesneed not differentiate among different products. Such a differentiation came at a much later stage.Translated into a business proposition, what it meant was that Lloyds could operate with a muchsmaller batch size of, say 100 tonnes and deliver quickly. For instance, a 1,000-tonnes small orderof specialised product custommade to buyer�s specification could be delivered in as little as 15 days.Such a quick delivery schedule would not be possible for a large, integrated steel manufacturer. Inthis manner, analogous to small gunboats that could effectively torpedo a large, slow-moving ship,Lloyds carved out a niche in the highly competitive steel market.Question:

Comment on the nature of the business strategy of Lloyds. What are the conditions in whichsuch a strategy would succeed? Could fail?

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PAPER - VII - MANAGEMENT OF INFORMATION SYSTEMS



1. (a) List the different criteria which can be used in decision making. (b) What is information overload? (c) What are the components of a system? (d) How do you classify the systems? (e) What is Bus Topology? (f) What is the difference between database and Data Warehouse in the organisation?


2. It is said that an information system will avail you nothing unless it is backed up by a man-age- ment system. Explain.3. Requirement analysis and definition is the foundation for any systems development. It isinde- pendent of the approach you take for analysis and design. Explain.4. What additional factors must be considered during the information-level design process ifthe design is for a distributed database?5. How is seamless integration achieved when network has different hardware-software platformsoperating together?6. Which are the three models of database? Which is mostly used and why?7. Why is SQL important in database management?

SECTION-C (15 marks)Compulsory

8. The Snocan Company:At present, the Snocan Company, which manufactures 25 products has 103 sales offices

throughout the United states with an average of 10 sales representatives per office. Every week, thesales reports in each office are tabulated by a clerk on a rotary calculating machine. The reportsdivide sales according to sales representative, product, and customer. The reports are mailed toheadquarters where they are combined by clerks using calculating machines. The results are thentypes and given to marketing research and to management. While top management is studyingthe reports, marketing research analyzes them and forecasts sales for the next six months. Unfor-tunately, by the time management receives the reports, they are from three to six weeks old.

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A new system has been devised in which daily sales by salesperson, product, and customerare sent over a data communication line from each office to headquarters. A new electronic com-puter is to be installed to compile and analyze the data and forecast sales. The computer will alsohandle payroll calculations and replace three clerks in payroll.

The detailed design has been approved by management. The company�s system designer isnow ready to detail plans for implementation. Nobody in the company has had any experience withcomputers or computer languages. About 2000 square feet of floor space is available at present forthe computer centre. The kind of data transmission equipment and the computer have not yet beenspecified.

Provide the Snocan Company with a through set of plans for implementing their new MIS.

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(DBUS 31)M.B.A.(Third) DEGREE EXAMINATION, MAY 2006

(A - Financial Management)PAPER - I - SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT

Time: Three hours Maximum: 75 marksPART A - (3 X 5 = 15 marks)


1. (a) Zero Coupon Bonds. (b) Yield-to-maturity. (c) Underwriters (d) Technical Analysis (e) Sweat Equity. (f) Return on equity

PART B - (3 X 15 = 45 marks)Answer any THREE questions out of the following:

2. What is meant by fundamental analysis? How does fundamental analysis differ from technicalanalysis?3. Explain the Sharper Index Model? How does it differ from Markowitz model?4. Explain CAPM theory and its validity in the stock market.5. What are the statistical tools used to measure the risk of securities return? Explain.6. Discuss the relationship between fundamental analysis and efficient market hypothesis.7. The Company ABC�s next year dividend per share is expected to be Rs.3.50. The dividend insubsequent years is expected to grow at a rate of 10% per year. If the required rate of return is 15%per year, what should be its price? The prevailing market price is Rs.75.

PART C - (15 marks)

8. The following information is available.Stock A Stock B

Expected return 16% 12% Standard deviation 15% 8%

Coefficient of correlation 0.60.

(a) What is the covariance between stocks A and B?(b) What is the expected return and risk of a portfolio in which A and B have weights of 0.6

and 0.4?

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(A - Financial Management)PAPER - II - MANAGEMENT OF FINANCIAL SERVICES



1. (a) Capital Market (b) Stock Broking (c) Project financing (d) ICRA. (e) Forfeiting. (f) Credit cards.

PART B - (3 X 15 = 45 marks)Answer any THREE questions

2. Explain the structure of the Indian Financial system. Discuss the important financial sector reforms.3. Comment on the developments and trends in merchant banking in India.4. Write a critical note on the growth of mutual funds in India.5. Describe the significance and growth of financial services in India.6. Define leasing. Distinguish between hire purchase and leasing.7. Bring out the role of venture capital in the development of industry? What are its characteristics?

PART C - (15 marks)Compulsory

8. The under mentioned facts relate to lease proposal before the Hypothetical leasing Ltd (HLL)

The initial cost of equipment to be leased out is Rs.300 lakhs, on which 10 percent centralsales tax would be levied. At the end of the lease term after 5 years, the solvage value is estimated tobe Rs.33 lakhs. The other costs associated with the lease proposal payable in advance (front-ended) are initial direct cost, Rs.3 lakhs and management fee Rs.5 lakhs. The marginal cost of fundsto the HLL is the percent while the marginal of tax is 35 percent. What is the break-even rental for HLLif the tax relevant rate of depreciation is 25 percent?

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(A - Financial Management)PAPER - III - PROJECT MANAGEMENT

Time: Three hours Maximum: 75 marksSECTION A - (3 X 5 = 15 marks)

Section A consists of Six questions out of which thecandidate has to write THREE questions.

1. (a) What do you mean by Technical Analysis? (b) Explain briefly Project Management Information System. (c) What do you mean by Network analysis? (d) What is Project Evaluation? (e) What is a Project Report? (f) What is computerisation?

SECTION B - (3 X 15 = 45 marks)Section B consists of Six questions out of which the

candidate has to write THREE questions.2. Why is a project feasibility study undertaken? Discuss.3. Explain integrated project management control system.4. Describe the features of one integrated project management software package.5. Discuss the critical success factors in project management.6. Discuss the steps in Technical Analysis of a project with suitable illustrations.7. Discuss the importance of financial analysis with respect to project management.

SECTION C - (15 marks)Section C consists of ONE compulsory question carrying 15 marks

PROBLEM:8. If a project requires the expenditure of Rs.1,00,000 new and will yield RS.2,00,000 in six years,how will the manager evaluate whether or not this is viable? (Assume 10% discount rate) Discuss.

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(B-Marketing Management)PAPER - I - SALES AND ADVERTISING MANAGEMENT

Time: Three hours Maximum: 75 marksSECTION A - (3 X 5 = 15 marks)Answer any THREE questions

1. (a) Selling skills. (b) Definition of sales management (c) Line Organisation (d) Performance appraisal. (e) Media use. (f) Cost analysis.

SECTION B - (3 X 15 = 45 marks)Answer any THREE questions

2. Describe the process of selling and explain its importance.3. Explain the various methods of compensating sales force.4. Explain the steps for setting up sales organisation and discuss the various types ofsales organisation.5. Discuss the promotional scenario in India.6. Explain the process of planning and scheduling media and communication process.7. How to manage agency - client relations? Critically evaluate in Indian context.

SECTION C - (15 marks)CASE STUDY

8. CARTER OIL COMPANYManufacturer of Petroleum Products -Evaluating performance of Sales Personnel.Carter Oil Company was a regional producer of oil products located in Midland, Texas,

Selling gasoline, fuel oil and related products under the Carter brand. Total sales in 1985 werein excess of $ 1 billion. Carter�s sales organisation was comprised of full-line sales personnel whosold in five districts throughout most of Southern and Southwestern United States. The full-linesales people sold to oil wholesalers, distributors, commercial users and domestic fuel oil consum-ers. The sales force was responsible for developing all new accounts. Carter sales personnelwere evaluated according to a single criterion - sales volume.

District sales managers determined each salesperson�s volume from the weekly salesreports. Each report showed the previous week�s sales, both in amount and percentage of totalpurchases by name of account. The district managers summarized the sales reports into monthlyand annual summary sales reports. The amount and percentage of gain or loss was shown onboth the monthly and annual summary sales reports. The amount and percentage of gain or losswas shown on both the monthly and annual reports. In addition, each salesperson�s sales volume

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performance was compared with that of other sales personnel in the district and region. Finally,each salesperson�s sales volume was compared with his or her output the previous year and thetrend of his or her sales volume was shown over the past several years.

Jack Binswonger had recently been promoted from manager of the New Orleans district tovice-president of sales. When he was district manager, he had believed that the method ofevaluating sales performance based solely on sales volume was an inaccurate appraisal of aperson�s effectiveness. He felt it was especially unfair to the salespeople who spent a portion oftheir time assisting dealers with problems such as special promotions, inventory control,merchandising and administration activities that had no direct effect on sales. He also believed thatevaluation based on sales volume alone ignored some fairly wide differences in the sales potentialof individual territories. He found support for his long-held opinions in an article in the May 1985edition of the Journal of Marketing Research, which reported that sales executives in a samplestudied tended to evaluate their salespeople solely on the basis of effort exerted with no adjustmentfor differences in the difficulty of the task (as measured by differences in territorial potential).

As a result of the deficiencies he saw, Binswonger suggested that the present method ofpersonnel evaluation should be supplemented by a merit-rating plan. This plan would incorporatesuch factors as work habits; effectiveness in merchandising work; cooperation with management,dealers and other sales personnel ; promotability; and differences in territory potential. The merit-rating plan, its objectives and procedural aspects, was presented to all the district managers at ameeting in Dallas in June.

The district managers would rate the salespeople semiannually; then Jack Binswongerwould review the ratings. The numerical scores assigned to each performance factor (which hadnot yet been determined). would be totaled to yield a merits score for each salesperson. Finally,district sales managers would discuss this appraisal with each salesperson, counseling on strengthsand weaknesses and making suggestions for improvement. And, before the plan was put intooperation, each district manager would explain the new evaluation method to the salespeople in thedistrict.

Reaction to Binswonger�s proposal was mixed. Bill Schultz, manager of the Atlanta district,was strongly opposed to the idea. He thought the new method of evaluation was too complex andhence, too time consuming for the district manager. He also thought the sales� personnel would beunhappy with an evaluation system that was based on so many subjective factors. He argued thatsalespeople would feel that ratings were based on personal favoritism and other non-objectivefactors over which they had no control.

Was the Carter Oil Company�s present method for evaluating personnel performanceadequate?

How can Binswonger answer Schultz� objections?

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(B-Marketing Management)PAPER - II -MARKETING OF SERVICES


1. (a) Definition of services marketing. (b) Characteristics of services. (c) Hospitality services (d) Advertising agencies. (e) Family Planning

(f) Tourism Market Audit.


2. Explain the steps to designing service strategy.3. How can marketing of financial service be done? Give a relevant example.4. Explain the management and marketing of Tourism in India.5. Explain the marketing of Health services at a reputed hospital of your choice.6. How should marketing of professional services be done?7. Describe in detail the concept of marketing of logistics.

SECTION C - (15 marks)(Case Study)

8. ICICI Bank, a new generation MNC bank with its registered office in Chennai occupies the topposition in the ASIN financial markets. The bank has a world-leading Internet banking ande-commerce operation with 12.8 million customers and the largest customer base of any financialservices group in the Asian region. Bank serves a total of 10.6 m Internet users, most of whom useits pioneering Solo service. From the beginning, Solo allocated its users a continuous list ofpasswords, each to be used only once. To boost security, the fixed password system has to beconfirmed by a program on the user�s computer, confining the user to a single computer. Banksare engaged in a battle to maintain their supremacy and consolidation offers make them customerfriendly. To compete in a market transformed by globalization and technological revolution, bankshave been forced to seek alliance and establish joint ventures to maintain their competitivenessand efficiency.

1. Pioneering e-banking ideas

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Solo has always been accessible from home, the office or abroad. Today, Solo servicesare equally accessible from a normal telephone, a mobile phone, a WAP phone, a PC or a televi-sion. Transactions and balances can be checked without a password from a GSM phone, and theservice can also be reached via invoice payment ATMs. The range of Solo services are availableanywhere, offering equity, mutual funds, bond and life insurance investments, and foreign pay-ments, among other services.

Customers can also sign agreements using their Solo ID as a signature. Solo customersare an ideal target group, with modern attitudes and purchasing power, who are familiar with onlineoperations. By accepting Solo payments, a company can eliminate invoicing and credit risks, andthus achieve significant savings. A personal digital phone is a very suitable medium for managingand monitoring payments and financial matters.

With this in mind, in May 2003, ICIC together with Nokia and VISA International, announceda pilot project, involving the use of wireless application technology and mobile phones, to makepayments over the Net, an open network, or at a merchant point of sale - Electronic MobilePayment Service (EMPS). Using a Nokia WAP GSM phone, WAP technology, authenticated card

payment, EMV and the VISA Open Platform customers will be able to make secure remote

payments, or pay at a merchant point of sale.

2. The new initiative - Mobey think Forum

In September 2003, major financial institutions, together with leading mobile phone

manufacturers, announced the creation of a global forum to encourage the use of mobile

technology in financial services, and to promote the adoption of open standards in the financial

services field. This new forum is called the Mobey think Forum, and its founding members include

Nordea, ABN AMRO Bank, Hispano, HDFC, Deutsche Bank, HSBC Holdings, UBS, VISA interna-

tional, Ericsson, Nokia and Siemens.

Mobey think Forum�s activities are promoting a sustainable business environment for mo-

bile financial services, such as the open provision of services in a mass market, the use of mobile

phones, open standards and non-proprietary security concepts like client identification, dual chip

(EMPS), and mobile PKI.

E banking has become a necessary survival weapon for many banks and is fundamentally

changing the banking industry worldwide. The role of Mobey Forum is to promote mobile financial

services based on open-architecture solutions or mass - market use. This solution capitalizes on

recent developments in handset technology to provide a software-based solution with no additional

hardware requirement for the user, and therefore presents no delay banking solutions to market. It

is extremely simple to implement, convenient and immediate.

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3. Mass adoption of new technology

Achieving a critical mass is a key factor in electronic banking. Satisfied users will,themselves, market the service. As the number of users rises, there is increasing demand forspecialist services from a fast - growing number of modern-minded customers who are preparedto use e-commerce and invoicing. Wired banking is becoming more wireless. This is due to thefact that mobile phones are perfectly suited to banking and making payments.

CASE DISCUSSION QUESTIONS:

(a) Comment on the company strategy of extracting customer information for their contin-

ued success by way of floating Mobey think Forum and specialised e-banking system, Solo.

(b) Critically analyse the merit of inter-linking technology and communication devices as a

strategic tool for gaining competitive advantage for banking operations in India.

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(B-Marketing Management)PAPER - III - RURAL MARKETING


1. (a) Concept of rural marketing (b) Types of reference groups (c) Package decision (d) Message design (e) Physical intra structure (f) Product argumentation.


2. Discuss the Rural Environment in India.3. Explain the influential aspects of Buyer Behaviour.4. Discuss the importance of branding decisions to rural marketing.5. Explain the steps to understand rural media.6. Describe the participants in rural distribution process.7. Explain the process of rural marketing in India.

SECTION C - (15 marks)8. Case Study.

The �McDonald�s Home Delivery� campaign

The concept per se, is not new, as the delivery business has been running successfully incountries like Brazil, Egypt, Indonesia, Singapore. It is also in line with the international strategy ofgrowing its customer base instead of increasing the number of restaurants. Furthermore, thedelivery model is based on the company�s own international standards and is therefore different insome ways than other local chains. McDonald�s is the first in India to have a single toll-free numberwhich customers call to place their order. The call centre determines which restaurant the ordershould be directed.

According to Mr. Amit Jatia, Joint Venture Partner and Managing Director, McDonald�s [West-ern India], �Research conducted by McDonald�s has shown that people were ready to try some-

30thing new and convenient, which would also be value for money.� This encouraged the company tolaunch kiosks in Mumbai in 2004.

Kiosks are a point of sales with a limited menu and have been introduced to offer aconvenient option for people who wish to purchase only desserts. Currently, there are three kiosksin Mumbai at CST, Colaba and Vashi. These kiosks offer a unique new range of desserts and coldbeverages, which are 100 per cent vegetarian. The menu comprises of aerated beverages,non-aerated beverages such as iced tea and cold coffee, soft serves, flavour bursts and floats.

SERVING THE SOCIETYIn keeping with its international policy of serving the society, McDonald�s India has also

participated in and supported health initiatives like the Pulse Polio Immunisation programme since1998.

In the year 1998, McDonald�s also started McDonald�s Spotlight, an annual inter-schoolperforming arts competition to provide students with an atmosphere for healthy competition. Sinceits inception, more than 400 schools across Mumbai and Pune have participated in this event.

Other initiatives include its association with the Nehru Science Centre in the year 2000, tobring to the schools of Mumbai a science quiz and partnering with the Nalanda Foundation, in theyear 2002, for its Blue Dot Education Initiative for the underprivileged girl child.

Questions:

In the near future the company aims to focus on core markets, get the scale there and thenlook at further expansion. This context outlines the current market strategy adopted by McDonald�s.It plans to add 10-15 restaurants each year [2004 and 2005] and estimates to total revenue growthof 40-45 per cent over 2003 of which deliveries will contribute 15-20 per cent. Can this strategyhelp the organisation sustain growth in the long term? What are the changes and challenges thatmay need to be addressed in the future?

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(C- HUMAN RESOURCE MANAGEMENT)PAPER - I - HUMAN RESOURCE PLANNING AND DEVELOPMENT


1. (a) Concept of Human Resource Planning. (b) Demand forecasting. (c) Aspects of HRD. (d) HRD in voluntary organisations (e) Approach to IR. (f) Counselling.


2. Explain the process of Human Resource Planning.3. Give a brief overview of Human Resource Development.4. Explain the role of Line Managers in HRD.5. Examine the concept of HRD in service Industry.6. What are the main Issues of HRD culture is an organisation?7. What are the emergining trends and prospectives of Human Resource Development?

SECTION - C (15 marks)(Case Study)

Workmen�s Compensation

8. Mr. Nandkishore is a workman employed in the despatch department of a cement factory. Thefactory is located in one of the towns of a politically sensitive state. It employs about 1,500employees besides the managerial staff. The annual turnover of the company is around Rs.150crores and its capacity utilisation is 75 per cent.

The factory has three unions besides a security staff association and a managementassociation. For eight years, only one union has been recognized on the basis of its �claim� that ithas the largest following of workmen. Continued recognition of a single union led to strained relationsbetween the two unrecognized unions and the management and also among the unions them-selves.

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Mr. Nandkishore is an office bearer of one of the unrecognized unions. The industrialrelations situation in the factory has been fluctuating from periods of hamony to periods of distur-bances.

On December 10, 1998, Mr. Nandkishore fell down from the ladder, while working during thesecond shift. Teh accident resulted in serious injury to his right arm. He was admitted in agovernment hospital for treatment. An accident report was sent to the commissioner underWorkmen�s Compensation Act, to determine the amount of compensation, if any, to be paid toMr. Nandkishore for the loss of any advance to the injured workman for covering medical expenses.It also stated that the above amount may be deducted from the compensation which Mr. Nandkishoremay get, according to the commissioner�s decision. The management paid Rs.3,000 as advance,after obtaining a written under taking from the union that this amount will be deducted from thecompensation payable. The union also agreed to this condition. It also arranged for the release ofRs.2,000 from the Labour Welfare Fund.

The medical officer treating the workman submitted a report in February, 1989. Themedical report did not mention any kind of disablement (Full/partial, temporary/Permanent) to theworkman. The commissioner, after processing the case and studying the report, ruled that theworkman, Mr. Nandkishore shall be paid only half-monthly wages for these two months against hisrequest for compensation as there was no permanent or partial disablement.

On receipt of this report from the commissioner, the management asked the workman torepay Rs.3,000 given as an advance and requested the union to do the needful in this regard. Theunion, however, contended that since the accident occurred during and in the course ofemployment, the management must treat it as ex-gratia payment and that it should not demand itsrepayment as the money was used for treatment. The management, however, pointed out that atthe time of taking advance, both the union and workman had agreed that this amount will berecovered from the compensation payable and since no compensation is payable, the workmanshould pay back the advance. The management further pointed out that it cannot waive therecovery of the above advance as it is bound by the rules.

The union, however, insisted that management should not proceed on the recovery ofadvance from the workman. The management also heard rumours that the said union may stagea �Show down� over this issue.

Questions:(a) What is the problem in the case?(b) Analyse the causes which led to the problem.(c) How should one deal with such a situation?

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(C- HUMAN RESOURCE MANAGEMENT)PAPER - II - MANAGING CHANGE IN ORGANISATIONS


1. (a) Concept of organisational change. (b) Culture (c) Diagnositc methodology. (d) Process consultation. (e) Change agent. (f) Work Redesign Model.

SECTION B - (3 X 15 = 45 marks)Answer any THREE questions.

2. Describe the key process in organisational change.3. Explain how orgnisations manage resistance to change?4. Differentiate between Qualitative and Quantitative diagnostic methods.5. Elucidate the evaluation of organisational change programmes.6. Explain the skills required to be as an agent of change.7. Examine the process of organisational development in an NGO.

SECTION C - (15 marks)

8. Case Study:Damned if you do; Damned if you don�t.

Fran Gilson has spent 15 years with the Thompson Grocery Company. Starting out as apart-time cashier while attending college, Fran has risen up through the ranks of this 50-storegrocery store chain. Today, at the age of 34, she is a regional manager, overseeing seven storesand earning approximately $95,000 a year. Fran also thinks she�s ready to take on more responsi-bility. About five weeks ago, she was contacted by an executive-search recruiter inquiring abouther interest in the position of vice president and regional manager for a national drugstore chain.She would be responsible for more than 100 stores in five states. She agreed to meet with therecruiter. Thisled to two metings with top executives at the drugstore chain. The recruiter calledFran two days ago to tell her she was one of the two finalists for the job.

The only person at Thompson who knows Fran is looking at this other job is her good friendand colleague, Ken Hamilton. Ken is director of finacne for the grocery chain. �It is a dream job�,

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Fran told Ken. �It�s a lot more responsibility and it�s a good company to work for. The regional officeis just 20 miles from here so I wouldn�t have to move and the pay is first rate. With the performancebonus, I could make nearly $200,000 a year. But best of all, the job provides terrific visibility. I�d betheir only female vice president. The job would allow me to be a more visible role model for youngwomen and give me a bigger voice in opening up doors for women and ethnic minorities in retailingmanagement�.

Since Fran considered Ken a close friend and wanted to keep the fact that she was lookingat another job secret, she asked Ken last week if she could use his name as a reference. SaidKen, �Of course. I�ll give you a great recommendation. We�d hate to lose you here, but you�ve gota lot of talent. They�d be lucky to get someone with your experience and energy�. Fran passedKen�s name on to the executive recruiter as her only reference at Thompson. She made it veryclear to the recruiter that Ken was the only person at Thompson who knew she was consideringanother job. Thompson�s top management is conservative and places a high value on loyalty. Ifanyone heard she was talking to another company, it might seriously jeopardize her chances forpromotion. But she trusted Ken completely. It�s against this backdrop that this morning�s incidentbecame more than just a question of sexual harasssment. It became a full-blown ethical andpolitical dilemma for Fran.

Jennifer Chung has been a financial analyst in Ken�s department for five months. Fran metJennifer through Ken. The three have chatted together on a number of occasions in the coffeeroom. Fran�s impression of Jennifer is quite positive. In many ways, Jennifer strikes Fran as a lotlike she was ten years ago. This morning, Fran came to work around 6 : 30 A.M. as she usuallydoes. It allows her to get a lot accomplished before �the troops� roll in at 8 A.M. At about 6 : 45,Jennifer came into Fran�s office. It was immediately evident that something was wrong. Jenniferwas very nervous and uncomfortable, which was most unlike her. She asked Fran if they couldtalk.. Fran sat her down and listened to her story.

What Fran heard was hard to believe, but she had no reason to think Jennifer was lying.Jennifer said that Ken began making off-color comments to her when they were alone within amonth after Jennifer joined Thompson. From there it got progressively worse. Ken would leer ather. He put his arm over her shoulder when they were reviewing reports. He patted her rear. Everytime one of these occurrences happened, Jennifer would ask him to stop and not do it again, but itfell on deaf ears. yesterday, Ken reminded Jennifer that her six-month probationary review wascoming up. �He told me that if I didn�t sleep with him that I couldn�t expect a very favourable evalu-ation�. She told Fran that all she could do was go to the ladies� room and cry.

Jennifer said that she had come to Fran because she didn�t know what to do or whom toturn to. �I came to you, Fran, because you�re a friend of Ken�s and the highest ranking womanhere. Will you help me?�. Fran had never heard anything like this about Ken before. About all sheknew regarding his personal life was that he was in his late 30s, single and involved in a long-term

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relationship.

Questions:(a) Analyze Fran�s situation in a purely legalistic sense. You might want to talk to friends or

relatives who are in management or the legal profession for advice in this analysis.(b) Analyze Fran�s dilemma in political terms.

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(C- HUMAN RESOURCE MANAGEMENT)PAPER - III - ORGANISATIONAL DYNAMICS


1. (a) What are informal groups? (b) Conformity. (c) Social responsibility (d) Cross cultural dynamics (e) Transformational leadership (f) Role flexibility


2. Explain the process of formation of groups.3. Explain the concept of decentralisation is an organisation.4. How are organisational ethics and values relevant to an organisation?5. Explain the bases of power in an organisation.6. What are strategic alliances? Explain the relevance.7. Explain the importance of learning organisations to organisational dynamics.

SECTION C - (15 marks)

8. Case Study:Trying to Do the impossible at GM?

Few companies have had a rougher time adapting to a changing environment than GeneralMotors. The company is truly a textbook example of corporate entrenchment. As far back as the1960s, the writing was on the wall that GM�s way of operating-slow, deliberate decision making;layer-upon-layer of hierarchy; focus on cost-cutting rather than on new product design; andmanagement-by-committee - was failing. From a U.S. automobile market share of nearly 50 per-cent in the late 1950s, the company was down to under 30 percent by the year 2000. GM�s rigid andinsular culture, driven by financial considerations, allowed both foreign and domestic competitiorsto steal away customers with new products-like fuel-efficient compacts, minivans, SUVs and eye-catching roadsters.

A good part of GM�s culture can be explained by the company�s historic selection and pro-

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motion policies. It hired its future executives fresh out of school. They then shaped these recruitsinto the GM mentality. The company resisted ideas and innovations that were �not developed here�.Executives firmly believed, to the point of arrogance, that the GM system was superior to all others.Promotions favoured financial and engineering types and individuals with these backgrounds roseto fill the company�s top spots. GM rarely hired senior executives from outside the company ranks.In addition, GM encouraged its executives to socialize off the job with other GM people. This furtherinsulated top executives and resulted in a senior management team that saw the world throughsimilar lenses.

In the fall of 2001, GM Chief Executive Richard Wagoner hired former Chrysler executiveRobert Lutz as vice chairman. His primary task? To change GM�s organizational culture. Wagoneracknowledged that GM�s culture - dominated by finance - types, engineers and manufacturingpersonnel-was content to turn out unimaginative cars. The committee system (stacked to favorthe company�s accounting mentality) further hindered creative endeavors. For instance, wheneverdesigners and engineers would disagree about a design, the engineers (and their obsession withcost minimization) would always win. This largely explained why the company�s cars looked boxyand so similar. Wagoner has essentially given Lutz a free hand to do whatever he needs to changetradition-bound GM.

Lutz faces a formidable task. This is a huge company. Sales are $180 billion a year. Itemploys 363,000 people. This is also the place where the �GM nod� is endemic: GM lifers usuallyjust nod at the new guy and go on doing things as they were. But Lutz has the advantage of comingto GM with a sterling reputation. He is a true �car guy�, who single-handedly pushed through excit-ing new products at Chrysler like the Viper, the Prowler and the PT Cruiser.

Lutz has chosen an incremental strategy for implementing change. He isn�t chopping headsand bringing in loyalists. Rather, he is relying on the same designers and engineers who have beenturning out duds for years. But he�s giving more clout to the designers and marketing people. He�soverseen a reorganization that has engineering and design divisions now reporting to just oneperson. He�s encouraging people to question past practices, to speak out on issues and challengecompany doctrine. And GM brass is now spending more time driving competitors� cars than theirown-while Lutz points out how most of them best GM.

Questions:(a) Describe the �old� GM culture.(b) What specific forces created this culture?(c) Describe the new culture that Lutz is trying to create.

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(D-INTERNATIONAL MANAGEMENT )PAPER - I - INTERNATIONAL BUSINESS


1. (a) Explain how international business is different from domestic business. (b) Compare between FDI and contractual entry mode. (c) Explain neo-factor proportions theory. (d) What are different levels of Economic Integration? (e) What is Matrix structure? (f) What are merits of employing expatriates?


2. Elaborate on the factors contributing to rapid growth in internationa business during the past one decade.3. Discuss this statement: �An understanding of the causes and consequences of performance ambiguity is central to the issue of organsiational design in multinational firms�.4. Discuss the process of recruitment and training of expatriates.5. Explain how cultural diversity is managed with suitable examples.6. Explain the conceptual framework of various types of regional trade agreements.7. Explain in brief the functions of World Trade Organisation. What are the major principles of multilateral trading system?

SECTION C - (1 X 15 = 15 marks)(Compulsory)

8. Strategic R & D by TNCs in Developing Countries

TNCs have had long units in developing host countries for adapting products and processesto the local conditions, and in a few cases, to products for local markets. Since the min-1980s,however, they have also started locating strategic R & D centres in some developing countries, fordeveloping generic technologies and products for regional or global markets. The main incentivesfor this are : (a) access to highly qualified scientists as shortages of research personnel emerge incertain fields in industrialised countries, (b) Cost differentials in research salaries betweendeveloping and industrialised countries, and (c) rationalisation of operations, assigning particular

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affiliates the responsibility for developing, manufacturing, and marketing particular productsworldwide. Th new trends are more visible in industries dealing with new technologies, such asmicroelectronics, biotechnology, and new materials. In these technologies, the location of R & Dcan be geographically de-linked more easily from the location of manufacturing. It is also possibleto separate R & D in core activities from that in non-core activities. Consequently, countries likeIndia, Israel, Singapore, Malaysia or Brazil serve TNCs as good locations for strategic R & D.

For instacne, Sony Corporation of Japan has around nine R & D units in Asian developingcountries. It has three units in Singapore conducting R & D on core components such as opticaldata shortage devices, integrated chip design for audio products and CD-ROM drives, and multi-media and microchip software. It has three units in Malaysia working on video design, derivativemodels and circuit blocks for new TV chases, radio cassettes, discman and hi-fi receiver designs.It has one unit in Republic of Korea focussing on the design of compact discs, radio cassettes,tape recorders, and car stereos. It has one in Taiwan designing and developing video tape-record-ers, minidisk players, video CDs, and duplicators. Finally, it has one unit in Indonesia focussing onthe design of audio products.

Such units often work in collaboration with science and technology institutes in the hostcountry. For instance, Daimler Benz has established such a unit in Bangalore, India, in collabora-tion with the Indian Institute of Science to work on projects related to its vehicles and avionicsbusiness. Current work includes interface design of avionics landing systems and smart GPSsensors for use by the group�s business worldwide.

Source: World Investment Report 1999.

Questions:(a) Explain why MNCs have located R & D centres in developing countries?(b) Mention the areas where R & D activities can easily be decentralised.

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(D-INTERNATIONAL MANAGEMENT )PAPER - II - INTERNATIONAL FINANCIAL MANAGEMENT



1. (a) ADRs (b) Compensatory financing facility (c) Cross-hedging (d) Currency diversification (e) Floating - rate notes (f) Non-deliverable forward contracts.

PART B - (3 X 15 = 45 marks)Answer any THREE questions

2. Describe typical reasons that MNCs expand internationally.3. How can government restrictions affect international payments among countries?4. Discuss some reasons for the popularity of the Eurobond market.5. Why would an MNC consider examining only its �net� cash flows in each currency whenassessing its transaction exposure?.6. Is international working capital management more complex than the domestic working capital management?7. The treasurer of an insurance company expects to have a surplus of £ 5 million 6-months fromnow. She has decided to park the funds in a 3-months euro sterling deposit. The current 3-monthsdeposit rate is 9%. A 6/9 £5 million FRA is being quoted at 8.75/9%. The treasurer sells an FRA toprotect herself from falling rates. Compute an effective rate of return on her investment if on day182.

(a) The 3-months deposit rate is 9.5%(b) The rate is 8%.

PART C - (1 X 15 = 15 marks)(Compulsory)

8. A US multinational is planning to set up a subsidiary in India. The initial project cost is estimatedto be US $10 billion. The working capital requirement would be Rs.2 billion. The project is togenerate a cash inflow of Rs.7 billion/year in first 3 years and then a growth of 5 percent per year isexpected up to the 8th year. Thereafter, there will be a decline of 7 percent in growth per year and

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the project will be closed down at the end of 12 years.

Consider a discount factor of 12 percent and depreciation of rupee against dollar at the rateof 1 percent per year. Is this project worth while? Tax rate in India is 35%. Study the project fromthe point of view of both the US multinational and the Indian subsidiary. The current exchange rateis Rs.35/US $.

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(D-INTERNATIONAL MANAGEMENT )PAPER - III - INTERNATIONAL MARKETING


1. (a) Distinguish between International Trade and International Marketing. (b) Explain Process of Internationalisation. (c) Define Political Risk. (d) What are the characteristics of culture? (e) What do you mean by dual adaptation? (f) What are the major challenges to International Marketing Research?


2. �International Marketing has become indispensable in the economic development of a developing country�. Comment with respect to the Indian Situation.3. What are trade barriers? Explain these in detail with examples from the Indian scenario.4. Explain the concept of FTZs and identify the constraints in their effective operation.5. Describe briefly IPLC theory and its marketing implications.6. Explain the criteria for selection of distributors in international markets.7. Explain segmentation of international markets on the basis of marketing opportunities.

SECTION C ( 1 X 15 = 15 marks)(Compulsory)

8. Case:McDonald�s Adapting to Cross-border Culture.

The foreign operations of McDonald�s, one of the leading restaurant chains at the globallevel, witnessed very fast growth since 1980, and especially during 1990s. There are a host offactors behind the rapid growth. However, it is McDonald�s effort to adapt to the host countryculture that is the most important factor. It is a well established fact that consumers in the hostcountry would desire that a foreign firm entering their country should not undermine the local cul-ture, tastes, and beliefs. If it does it, they will resist its entry. Perhaps this was the reason that thestart of McDonald�s was a bit late because their architecture did not conform to the local one.Similarly, in India, where the majority of population is Hindu and the Hindu religion does not permit

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eating of beef, McDonald�s had to change the main component of their hamburger from beef tomutton. Only then, were they able to flourish in India and compete with the local fast food chains.Similarly, one of the reasons McDonald�s succeeded in Quebec, Canada, is that they have modi-fied their menu to suit the local population. The provide cheese curds and hot gravy along withFrench fries, which is similar to a local dish called poutine.

Yet again, in Israel, where the local population prefers that food should be prepared accord-ing to Jewish salary laws, McDonald�s effort to was to change the menu according to the require-ments of the local food dish Jews dislike mixing of meat products with dairy products. As a result,McDonald�s did not go for other hamburgers, rather, they preferred to serve fast food, cheesebur-gers, and milkshake.

Sources: The New York Times, April 16, 1993; Business Week, March 1, 1993; Wall StreetJournal, March 8, 1990.

Questions:(a) Is it true to say that McDonald�s prefer to transplant its home-country culture in different

host countries?(b) Why did McDonald�s adapt their product in India?(c) Are India and Israel diverse in respect of culture?

mba

Documents

section b

marks maximum

marks compulsory

marks tc

c management

functions of accounting

section c compulsory

cost of capital