4046B 3 conditions

2 4046B Simon-Hawkins
1. (a) An amount of 65,000 is invested in hree
investments at the rate of interest ) Determine the technology matrix and test
of 6%, 8% and 9% P.a. respectively. The total
annual income is 4,800. for the yiability of the system.
The income from the third investment is 2600 more than the
income from respectively,
the second investment. Find the investment is each, using 40 and 30 units
matrix algebra. (ü) If the domestic demand changes to meet the
(5) esch sector in order to
what should be the gross output of
OR
demand?
The equilibrium conditions for three related markets are given by feasible?
is 180 bours. is the solution
() If the total labour available
lp, - P, - P, = 31; -P, +p, - 2p, 26; --P, - 2p, t 7p, = 24
U_ing matrix inversion, find the equilibrium prices for cach market. (iv) Find the valuce added in each sector.

(b) For a threc-sector economy, the input-output coefficients are a, 0.)

() Find the equilibrium prices, if wage rate is (200.
s o -tu=0.2, &,, =0.1, 4,, =0.1, a,, =0.6, a, =0.2, a,, =0:1, a,, =0.2, a, =0.6.
020 bo o Usin Simon-Hawkins conditions, test whether the system is viable. 2, (a) A firm assembles and sells two different types of outboard motors, A
>() Determine the gross output for the three sectors when the final demand and B using four resources. The production process can be described as
.values for them are 21,000, 42,000 and 63,000 units respoctively. follows:

demand increases by 1500,

(c) Determine the new level of output if the final (7)
Resources Capacity per month
3000 and 4500 units,
(i) Motor unit shop
400 Type A or 25S0 Type B units or
OR
*any linear combination of two
of three industries is given as under:
The inter-industry flow of the products
(ii) Type A gear and drive 175 type A units
Domestic Total
Production Consumption shop resource
Sector Demand Output
Sector
Y Z (iü) Type B gear and drive
X 225 type B units
83 50
X 45 12 10 shop resource
32 120
30 48 10
(iv) Final assembly
15 12 30 13 100 resource 200 Type A or 3S0
Type B units or
20 any lincar
Labour (hours) 75 48
combination of two

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4046B
Type A units brIng n a profit of 90 cach and Type B units 260 cach 4046B

Formulate the above as a lincar programming problem to maximize profit OR

and &solve the same by graphic
method. (6
Given below is the simplex table for a maxímization problem of LP

OR C ’ Basic 10 6 4
variable
Obtain the dual of the tollowing linear programming problem :
s,
Minimize Z= -3x, - 2x, X 5/6 S3 -1/6 200/3
Subject to 3x, - x, + 2x, s7 1 1/6 1/6 100/3
2x, 4x, > 12 0 4 -2 100

74x,+ 3x, +8x,= 10 Answer the following questions, gíving

reasons in brief:
X,, X,. 2 0; x,: unrestricted in sign (i) Does the tableau represent an
optimal solution?
(b) A firm produces three products A, B and C. Unit (iü) Is this solution feasible?
contributions of the products
are 5, 10, and 8 respectively. Each unit of product A requires 3 kg of
(iii) Does the problem have alternative optimal solution?
material A, 4 machine hours and 2 labour hours; each unit of product B
requires S kg of material A, 4 machine hours and 4 abour hours and each (iv) Is this
solution
unit of product C requires 2 kg of material A, 4 machine hours and 5 labour
degenerate?
(v) Write the optimal product mix and the profit
hours. Everyday 60 Kg of material, 72 machine hours and 100 labour hours
are available. Use simplex method to find out the best production strategy.
above solution. contribution shown by the
Also, investigate the effect on the solution of the following: (vi) Indicate the
12) shadow prices of the three
(i) An increase of 12 machine hours. (vii) If the
resources?
company wishes to expand the
(ü) A decrease of 6 kg of material.
three production capacity, which of the
resources should be given priority?
(viiü) If a custoner is
(iüi) 3 units of product A are to be produced.
the price be
prepared to pay higher price for
increased so that the company's proftx,, how mnuch should
(ix) Write
down the objective
remains unchanged?
function of above
problem.
4046B 6
3. (a) The demand function for a monopolist product is p= 400- 2x and the 4046B 7

(c) Afirm produces two items X, and X,. The market prices are given by
average cost if AC =0.2x + 4 +Find the profit maximization level of P, = 100 - 2x, and p, = 125- 3x,. The cost of production is 12x, +1Ix,
X +4X,X,, 1for producing x, and x, units. How many units of each item should
output and price and determine the corresponding profit. If the government be produced to have maximum joint profir? Find the optimal prices that
imposes a tax of 22 per unit, find the new profit maximizing output and monopolist charges to maximize profit. (6)

price. (6) OR

OR Find out the degree of homogeneity and verify Euler's Theorem for the
function P= A[ak+(1-a)LË. (A, a, B are constants and L, K me
A company uses components at the rate of 500 a month which are bought
inputs).
at the cost of ?12 each from the supplier. The cost of placing an order is
200, irespective of the quantity ordered. The total holding cost is made up
per 4. (a) The marginal cost of producing x units of a commodity in a day is given as
of the capital cost of 10% per annum of the value of stock plus 30 paise
per annum for storage
MC = 16x- 1591. The selling price is fixed at 79 per unit and the fixed cost
items per annum for insurance plus 60 paise per item is 1800 per day. Determine (i) cost function (ii) revenue function, (iii) profit
the number of components
plus 30 paise per item for deterioration. Determine the total
function, and (iv) maximum profit that can be obtaincd in one day. (6)
year and
the number of orders per
the company should order,
inventory. OR
annual cost of the

= 3000e93 + 100. When price of the washing machine averaged (4000, ABC Co. Ltd. sold 20
function of a product is MC(x)
(b) The marginal cost when the fixed machines every month. When the price dropped to an average of ?1000,
total and average cost function
Determnine the corresponding additional cost
120 machines were sold every month. When the price was 4000, 200
units and the
find the total cost of 10 machines were available per month for sale. When the price reached 1000,
cost is 60,000. Also
using definite integral. (6) only 50 remained. Find the demand and supply functions, assuming both are
from 10 to 20 units,
when output increases linear. Also determine consumer's and producer's surplus.
OR
(b) Given the total cost function C(*) - 5x + 3x' + 2x + 25. Prove that the
when
supply function x - 2p² + 5.
of supply for the
(i) Find the elasticity income y is given by 30x = 10 +
slope of the average cost function is given by [MC - AC].
x as a function of (6
D=3. (iü) The demand elasticity of demand and its value
expression for the income
2y. Obtain the OR
when y= 250.

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4046B
8

After an advertising campajgn a product has sales rate f(t) given by

f(t) =100e 2", where t is the number of months since the close of
campaign.
Find (a) The total cumulative sales after 5 months, (b) the
sales during the
fourth month.

Attempt any three of the following:

(a) Mr. X deposited a certain
amount in a bank for 3 years, getting
the rate of 12% interest at
compounded quarterly during the first year, at the rate of
6% compounded half-yearly during
the second year and at 9%
continuously during third year. At the end of third year, he compounded
Find out the initial amount received 6,533.
deposited with the bank.
(b) A debt of 3000 due 6
years from now is instead to be
payments: 500 now, ?1500 in 3 years and a final paid off by three
end of n years. If the payment of {475 at the
interest rate is 6% compounded annualiy, find
of n. the value

(c) A couple wishes to

purchase a house for 12,00,000 with a
of 2,50,000. If they can down payment
amortize balance at 9% p.a.
the
monthly for 20 years, what is their compounded
monthly
interest paid? What is their equity after 10 payment? What is the total
years?
(d) Find the
purchase price of a 1000, 6%
bond, dividends
annually, redeemable at par in 10 payable semi
years, if the yield rate is to be 5%
compounded semi-annually.
(e) What is the
present value of a
year for four years at the continuous income stream of 3500 per
rate of interest of 5% p.a.
continuously? comnpounded
(5x3)