B.E. (Civil Engineering) Eighth Semester (C.B.S.

)
Construction Economics & Finance

P. Pages : 2 NIR/KW/18/3630
Time : Three Hours *1339* Max. Marks : 80
_____________________________________________________________________
Notes : 1. All questions carry marks as indicated.
2. Solve Question 1 OR Questions No. 2.
3. Solve Question 3 OR Questions No. 4.
4. Solve Question 5 OR Questions No. 6.
5. Solve Question 7 OR Questions No. 8.
6. Solve Question 9 OR Questions No. 10.
7. Solve Question 11 OR Questions No. 12.
8. Due credit will be given to neatness and adequate dimensions.
9. Assume suitable data whenever necessary.
10. Illustrate your answers whenever necessary with the help of neat sketches.

1. a) Explain the importance of construction and infrastructure in economic development in 7

India.

b) An entrepreneur is planning a new business. The initial outlay and cash flow pattern for 6
the business is listed below. The expected life of business is five years. Find the rate of
return for the business
Period 0 1 2 3 4 5
Cash Flow (`) 1,00,000 40,000 40,000 40,000 40,000 40,000

OR

2. a) Explain the term Time value of money and discounted cash flow. 7

b) A company is diversifying its business to make a new product. The life of the project is 15 6
years with no salvage value at the end of its life. The initial outlay of project is
`. 35,00,000. The annual net profit is `. 7,50,000. Find the rate of return.

3. a) Discuss the importance and nature of Turnkey construction projects. 7

b) A marble company is planning to buy fully automated cutting machine If t is purchased on 6

down payment the cost of machine is ` 18,00,000. If t is on instalment the company has to
pay 15 percent of the cost at the time of purchase and the remaining amount in 10 annual
instalment of ` 2,50,000 each. Suggest the best alternative for the company using the present
worth basis at i = 12 percent compounded annually

OR

4. a) What is division of Labour. Explain the advantages and disadvantages of it. 7

b) A company ABC is planning to replace a present facility after 20 years at an outlay of 6

` 8,00,000. It plans to deposit an equal amount at the end of every year for the next 20 years
at an interest of 8 percent compounded annually. Find the equivalent amount that must be
deposited at the end of every year for the next 20 years.
NIR/KW/18/3630 1 P.T.O
5. a) Explain the causes and remedies to control inflation in an economy. 7

b) Explain the features of monopolistic competition. 7

OR

6. a) State the features and characteristics of oligopolistic competition. 7

b) Explain the impact of stagflation on construction industry. 7

7. a) What are the various sources of finance available for construction industry. 7

b) State the significance of equity shares and debentures, in construction companies. 6

OR

8. a) Explain the type of foreign direct investment in infrastructure development in India. 7

b) What do you understand by project cash flow? Explain in details. 6

9. a) Prepare and explain the outline of Balance sheet 7

b) Consider the following data - 6

Current Assets ` 18,00,000
Current liabilities ` 9,00,000
Stock (Inventories) ` 5,00,000
Calculate current ratio and Acid test Ratio

OR

10. a) Discuss the affordable housing schemes floated by government of India. 7

b) A company has a debt of ` 370 crores and equity of ` 7.5 crores. Calculate its debt equity 6
ratio.

11. a) Explain the factors determing working capital. 7

b) Explain the meaning and considerations ascertaining cost of capital. 7

OR

12. a) Explain the concept and practice of CIBIL in finance. 7

b) Discuss the relevance of capital structure planning. 7

******

NIR/KW/18/3630 2
 B.E. (Civil Engineering) Eighth Semester (C.B.S.)
Construction Economics & Finance

P. Pages : 2 NJR/KS/18/4685
Time : Three Hours *0618* Max. Marks : 80
_____________________________________________________________________
Notes : 1. All questions carry marks as indicated.
2. Solve Question 1 OR Questions No. 2.
3. Solve Question 3 OR Questions No. 4.
4. Solve Question 5 OR Questions No. 6.
5. Solve Question 7 OR Questions No. 8.
6. Solve Question 9 OR Questions No. 10.
7. Solve Question 11 OR Questions No. 12.
8. Due credit will be given to neatness and adequate dimensions.
9. Assume suitable data whenever necessary.
10. Illustrate your answers whenever necessary with the help of neat sketches.

1. a) Explain the time value of money. Illustrate your answer with the help of numerical 7
examples.

b) A company is trying to diversity its business in a new product line. The life of the project 6
is 10 years with no salvage value at the end of its life. The initial outlay of the project is
` 20,00,000. The annual net profit is ` 3,50,000. Find the rate of return for the new business.
OR
2. a) Explain the importance of construction and infrastructure in economic development and 7
growth of India.

b) Explain how construction has become a key industry of India? 6

3. a) What is division of labour? Discuss the merits and demerits of division of labour in a 7
construction industry.

b) A granite company is planning to buy a fully automated granite cutting machine. If it is 6

purchased under down payment, the cost of machine is ` 16,00,000. If it is purchased under
installment basis the company has to pay 25 percent of the cost at the time of purchase and
the remaining amount in 10 annual instalment of ` 2,00,000 each. Suggest the best
alternative for the company using the net present worth basis at compounded annually.
OR
4. a) What is capital formation? Discuss the stages of capital formation with reference to 7
construction industry.

b) Explain how is Joint Stock company incorporated? 6

5. a) Explain the features of monopolistic competition in the context of construction and 7

infrastructure industry.

b) What is inflation. Explain the methods to control it. 7

OR

NJR/KS/18/4685 1 P.T.O
6. a) Discuss the features of oligopoly market structure in the context of construction industry. 7

b) What is stagflation? Discuss its impact on construction industry? 7

7. a) Explain the sources of long term finance for construction industry. 7

b) What is Foreign Direct Investment? Explain its role in infrastructures development of 6

India.

OR

8. a) Enumerate the short term sources of finance with reference to construction and 7
infrastructure sector.

b) What do you understand by project cash flow? Illustrate your answer with example. 6

9. a) What is Balance Sheet. Explain the contents of balance sheet. 7

b) Calculate the current ratio and Acid test ratio from the following data - 6
Current assets ` 10,00,000
Current Liabilities ` 5,00,000
Stock (Inventories) ` 3,00,000

OR

10. a) What do you understand by profit / loss account? Explain it with a specimen. 7

b) From the data given below, calculate the profitability ratio namely Net profit margin, 6
Operating profit margin and operating ratios.
Rs.
Sales 15,00,000
Less cost of goods sold 10,00,000
Gross profit 5,00,000
Less operating expenses 3,00,000
Profit before Taxes 2,00,000
Less Taxes 1,00,000
Net profit 1,00,000

11. a) Explain the factors influencing working capital. 7

b) M/s. S. S. Organics Ltd. expects its cost of goods sold for 2016 - 17 to be ` 612 lacs. The 7
expected operating cycle is 90 days. It wants to keep a minimum cash balance of ` 1 lac.
What is the expected working capital requirement (Assume 360 days in a year)

OR

12. a) What are the consideration of ascertaining cost of Capital. 7

b) Explain the concept and practice of CIBIL in finance. 7

**************

NJR/KS/18/4685 2
 B.E. (Civil Engineering) Eighth Semester (C.B.S.)
Construction Economics & Finance
P. Pages : 2 NRJ/KW/17/4685
Time : Three Hours *0176* Max. Marks : 80
_____________________________________________________________________
Notes : 1. All questions carry marks as indicated.
2. Solve Question 1 OR Questions No. 2.
3. Solve Question 3 OR Questions No. 4.
4. Solve Question 5 OR Questions No. 6.
5. Solve Question 7 OR Questions No. 8.
6. Solve Question 9 OR Questions No. 10.
7. Solve Question 11 OR Questions No. 12.
8. Due credit will be given to neatness and adequate dimensions.
9. Assume suitable data whenever necessary.
10. Diagrams and chemical equations should be given whenever necessary.
11. Illustrate your answers whenever necessary with the help of neat sketches.

1. a) What is the importance of construction industry for economic development of country. 7

b) Explain backward and forward linkages of construction industry. 6

OR
2. a) Explain Discounted cash flow and time value of money. 7

b) What do you understand by turn-key projects state the various steps involved in turn-key 6
projects.

3. a) M/S Elecon Engineering company is planning to expand its business activities. It has two 7
alternative plans for the expansion programe and corresponding cash flows tabulated below.
Each alternative has a life of 5 years and negligible salvage value.
The minimum attractive rate of return for the company is 12%. Suggest the best alternative
plan to the company.
Initial investment Yearly Revenue
Alternative 1 Rs. 6,00,000 Rs. 1,60,000
Alternative 2 Rs. 8,00,000 Rs. 2,80,000
b) Explain various factors of production and their relative characteristics. 6
OR
4. a) Explain the various advantages of division of labour. 7

b) Explain what is foreign direct investment (FDI) state its importance for economic 6
development.

5. a) Consider the following cash flow of a project. 7

Year - 0 1 2 3 4 5
Cash flow - 10,000 5,000 6,000 5,000 6,000 5,500
Find the rate of return of the project.

b) Explain various laws of returns to the scale. 7

OR
NRJ/KW/17/4685 1 P.T.O
6. a) What is oligopoly state its various characteristics. 7

b) What is monopoly state various types of monopoly. 7

7. a) What is inflation state monetary measures to control it. 7

b) What is recession state its impact on economy. 6

OR
8. a) Find out the present worth of the following cash flows series assume i = 15% compounded 7
annually.
End of years 0 1 2 3 4 5
Cash Flow series 10,000 30,000 25,000 30,000 30,000 30,000

b) Explain how foreign capital can help achieve economic development of the country. 6

9. a) Explain various sources of financing the business. 7

b) Explain the components of balance sheet. 6

OR

10. a) What is working capital How it is managed. 7

b) Explain the features of monopolistic competition. 6

11. a) Consider the following data 7

Items Rs.
Net Sales 12,00,000
Fixed assets 10,00,000
Inventory 3,00,000
Net worth 8,00,000
Calculate
1) Net sales to net profit
2) Operating ratios
3) Net sales to fixed assets

b) What is CIBIL state its importance. 7

OR

12. a) What is technical, marketing and financial viability of a project. 7

b) Explain the various steps involved in a construction project of a real estate. 7

********

NRJ/KW/17/4685 2
 B.E. Eighth Semester (Civil Engineering) (C.B.S.)
Construction Economics & Finance

P. Pages : 3 NKT/KS/17/7547
Time : Three Hours *0525* Max. Marks : 80
_____________________________________________________________________
Notes : 1. All questions carry marks as indicated.
2. Solve Question 1 OR Questions No. 2.
3. Solve Question 3 OR Questions No. 4.
4. Solve Question 5 OR Questions No. 6.
5. Solve Question 7 OR Questions No. 8.
6. Solve Question 9 OR Questions No. 10.
7. Solve Question 11 OR Questions No. 12.
8. Due credit will be given to neatness and adequate dimensions.
9. Assume suitable data whenever necessary.
10. Diagrams and chemical equations should be given whenever necessary.
11. Illustrate your answers whenever necessary with the help of neat sketches.

1. a) Explain the following : 3

i) Discounted cash flow.

ii) Time value of money. 4

b) A company is planning to expand its present business activity. It has two alternative plans 6
for the expansion programme and corresponding cash flows are tabulated below. Each
alternative has a life of 5 years and a negligible salvage value. The minimum attractive
rate of return for the company is 12% suggest the best alternative to the company.
Initial Investment Yearly Revenue
Alternative 1 ` 5,00,000 ` 1,70,000
Alternative 2 ` 8,00,000 ` 2,70,000

OR

2. a) Explain the importance of construction and infrastructure in economic development and 7

growth of India?

b) Consider the following cash flow of a project. 6

Year 0 1 2 3 4 5
Cash flow 10,000 4,000 4,500 5,000 5,500 6,000
Find the rate of return of the project.

3. a) What do you understand by Turnkey construction projects ? Discuss its nature and 7
importance.

NKT/KS/17/7547 1 P.T.O
 b) A company has two alternatives for satisfying its daily travel requirements of its 6
employees for the next five years :
Alternative 1 : Renting a vehicle at a cost of ` 10,00,000 per year.
Alternative 2 : Buying a vehicle for ` 5,00,000 with an operating and maintenance cost of
` 3,50,000 per year. The salvage value of the vehicle after five years is ` 1,00,000
Select the best alternative based on the present worth method of comparison using the
interest of 8% compound annually.

OR

4. a) Explain the merits and demerits of division of labour in the construction industry ? 7

b) Find the net present worth of the following cash flow series Assume i = 15% compounded 6
annually.
End of Year 0 1 2 3 4 5
Cash flow (`) 10,000 30,000 30,000 30,000 30,000 30,000

5. a) Distinguish between Oligopoly and monopoly market structure with reference to 7

construction industry.

b) What is inflation state it's impact. 7

OR

6. a) Write explanatory notes on recession and stagflation. 7

b) Explain the features of monopolistic competitive market structure. 7

7. a) Explain the sources of finance to the construction companies. 7

b) Assess the need of FDI in infrastructure development of India. 6

OR

8. a) What do you understand by project cash flow ? Explain in details. 7

b) What is technical & marketing feasibility study. 6

9. a) Consider the following data : 7

Current Assets ` 10,00,000
Current liabilities ` 7,00,000
Stocks (inventories) ` 4,00,000
Calculate current ratio and acid test ratios using above data.

b) Discuss the affordable housing schemes of government of India with their special features. 6

OR

NKT/KS/17/7547 2
10. a) Consider the following data : 7
Items `
Net Sales 12,00,000
Fixed assets 10,00,000
Inventory 3,00,000
Net worth 8,00,000
Calculate (I) Net sales to net profit (II) operating ratios (III) Net sales to fixed assets.

b) Explain the elements of balance sheet in the context of construction industry with the help 6
of a specimen.

11. a) What do you understand by working capital ? Discuss the factors which influence working 7
capital.

b) Projected profit and loss account of ABC company. 7

Particulars ` In lacs.
Sales 21.00
Cost of production
Raw material 12.00
Wages 3.00
Other production overheads 1.80
Depreciation 1.20 18.00
Gross profit 3.00
Administration & selling overhead 1.80
------------
Net profit 1.20
Stock holding period and credit period 2 months
Raw material 0.5 months
WIP (Work in progress) 1 month
Credit allowed to Debtor 2 month
Credit enjoyed from supplier 1.5 month
Calculate working capital requirement.

OR

12. a) What is capital structure ? Discuss the relevance of capital structure planning. 7

b) Explain short term and long term financing. 7

************

NKT/KS/17/7547 3 P.T.O
NKT/KS/17/7547 4
 B.E. Eighth Semester (Civil Engineering) (C.B.S.)
Construction Economics & Finance

P. Pages : 2 KNT/KW/16/7547
Time : Three Hours *0329* Max. Marks : 80
_____________________________________________________________________
Notes : 1. All questions carry marks as indicated.
2. Solve Question 1 OR Questions No. 2.
3. Solve Question 3 OR Questions No. 4.
4. Solve Question 5 OR Questions No. 6.
5. Solve Question 7 OR Questions No. 8.
6. Solve Question 9 OR Questions No. 10.
7. Solve Question 11 OR Questions No. 12.
8. Assume suitable data whenever necessary.
9. Illustrate your answers whenever necessary with the help of neat sketches.
10. Use of non programmable calculator is permitted.
11. Interest tables are allowed.

1. a) Explain the significance of construction industry in economic growth of the country. 7

b) M/S Elecon Engineering Company wants to diversity its business into new product line. 6
The life of the project is 10 years having no salvage value. The initial investment of the
new project is Rs. 25,000. Calculate. The net annual rate of return for the new business.

OR

2. a) Describe why construction industry is called a key industry of India. 7

b) Explain what are the various factors of production used in construction industry. 6

3. a) M/S Neco group of industries is planning a new project. The initial outlay and cash flow 6
pattern for the new project are listed below. The expected life of the project is five years.
Find the rate of return for the new business.

Period  0 1 2 3 4 5
Cash flow (`) 1,50,000 40,000 40,000 40,000 40,000 40,000.

b) Explain the various stages involved in turn key projects. 7

OR

4. a) A finance company advertises two investment plans. In plan a the company pays Rs. 12,000 7
after 15 years for every Rs. 1000 invested now.
In plan b company pays Rs. 4,000 after 10 years. For every Rs. 1000 invested now. Select
the best alternative plan from investors point of view using present worth method at i = 12%
compounded annually.

b) What is monopoly? State the various types of monopoly. 7

5. a) what is oligopoly state the various characteristics of oligopoly. 7

KNT/KW/16/7547 1 P.T.O
 b) What is inflation? Describe the various monetary measures to control inflation. 6

OR

6. a) Explain the various characteristics of monopolistic market structure. 7

b) Explain the importance of Foreign Direct investment (F.D.I) for economic growth of the 6
country.

7. a) Project A having a total cost of Rs. 2,00,000. and project B having a total cost of 6
Rs. 4,00,000. both have expected life span of 10 years. Uniform cash inflow is expected to
be like for project A Rs. 40,000 Per/annum. and for project B Rs. 80,000 Per/annum.
Salvage value expected are for A Rs. 1,40,000 declining at an annual rate of Rs. 20,000
and B Rs. 1,60,000 declining at an annual rate of Rs. 40,000. Select the project which is
most economically viable.

b) Explain what is credit Information Bureau of India Ltd. (CIBIL) State its significance. 7

OR

8. a) Explain what is working capital management state the important elements of it. 7

b) Explain what is cost structure. 6

9. a) Explain what are the various sources of financing the company. 7

b) Describe affordable housing project launched by govt of India. 6

OR

10. a) Explain what is cost of capital. 7

b) Explain short-term & long term financing for business. 6

11. a) Explain what is cash flow. State its importance for the survival of the company. 7

b) Describe the various factors which influences the working capital. 6

OR

12. a) What is recession how it impacts the economy as a whole. 7

b) What is stagflation. Describe the stagflation scenario. 6

*********

KNT/KW/16/7547 2
 B.E. (Civil Engineering) Eighth Semester (C.B.S.)
Construction Economics & Finance
P. Pages : 2 TKN/KS/16/7633
Time : Three Hours *0423* Max. Marks : 80
_____________________________________________________________________
Notes : 1. All Question carry marks as indicated.
2. Solve Question 1 OR Questions No.2.
3. Solve Question 3 OR Questions No.4.
4. Solve Question 5 OR Questions No.6.
5. Solve Question 7 OR Questions No.8.
6. Solve Question 9 OR Questions No.10.
7. Solve Question 11 OR Questions No.12.
8. Assume suitable data whenever necessary.
9. Illustrate your answers whenever necessary with the help of neat sketches.
10. Use of non-programmable calculator is permitted.
11. Interest tables are allowed.

1. a) Explain the importance of construction and infrastructure in economic development & 8

growth in India.

b) A person is planning a new business. The initial outlay and cash flow pattern for the new 5
business are listed below. The expected life of business is five years. Find the rate of return
for the new business.
Period 0 1 2 3 4 5
Cash flow (Rs.) 1,00,000 30,000 30,000 30,000 30,000 30,000

OR

2. a) Explain how construction has become a key industry in India in recent times. 8

b) The midcap company is trying to diversify its business in a new product line. The life of the 5
project is 10 years with no. salvage value at the end of its life. The initial outlay of project
is Rs. 20,00,000. The annual net profit is Rs. 3,50,000 find the rate of return for the new
business.

3. a) Explain the importance and nature of turnkey construction projects. 8

b) A company ABC wants to setup a reserve which will help the company to have an annual 5
equivalent amount of Rs. 10,00,000 for the next 20 years towards its employee measures.
The reserve is assumed to grow at the rate of 15 per cent annually. Find the single payment
that must be made now as the reserve amount.

OR

4. a) What is labour? Explain merits and demerits of division of labour with reference to the 8
construction industry.

b) The company xyz is planning to replace the present facility after 15 years at an outlay of 6
Rs. 5,00,000. It plans to deposit an equal amount at the end of every year for the next 15
years at an interest of 9 percent compounded annually. Find the equivalent amount that
must be deposited at the end of every year for the next 15 years.

TKN/KS/16/7633 1 P.T.O
5. a) Make a comparison between monopoly and oligopoly market structures. 8

b) What is inflation? Explain how inflation is controlled? 5

OR

6. a) Write a brief note on the following. 8

a) Recession b) Stagflation.

b) Explain the features of monopolistic competition. 5

7. a) What are the major sources of finance for construction industry in India? Explain. 8

b) Explain in detail as to what do you understand by project cash flows. 5

OR

8. a) Explain the types of foreign direct investment in infrastructure development in India. 7

b) Explain the institutional sources of finance for construction industry. 7

9. a) What do you understand by Balance sheet and profit / loss account? Explain both with the 8
specimen.

b) From the following data calculate the Debt equity ratio. 5

Debt = Rs. 13,500 Lakhs
Equity = Rs. 6,500 Lakhs.

OR

10. a) From the following data. Calculate liquidity ratio. 5

Quick assets = Rs. 11,000 crores
Quick liabilities = Rs. 10,000 crores.

b) Discuss the affordable housing schemes floated by government of India. 8

11. a) Explain the meaning and cost of capital. Explain the considerations ascertaining cost of 6
capital.

b) What are factors influencing working capital? Explain. 7

OR

12. a) What do you understand by working capital? How does working capital is affected by 7
product and production process and nature of business?

b) Explain the relevance of capital structure. 7

***********

TKN/KS/16/7633 2