I

•• V. M. PATEL INSTITUTE OF MANAGEMENT Ganpat University

Mid-Semester Examination, MBA Semester- IV WORKING CAPITAL MANAGEMENT

Time: 2.5 Hrs. Date: 26-03-2010 Wt: 30%

Instructions: 1. This is a closed book examination. 2. All questions are compulsory. 3. Figures to the right indicate weightage of each question. 4. Be precise and to the point in your answers. Substantiate your answers with suitable

examples. ·

Q#l ABC Ltd is a manufacturing company. The treasurer of the company is considering 5% the use of lock box system for the collection of their remittances. Their customers fall into two categories: single outlets and regional chains. During a typical month

r they receive an average of 5,000 cheques with an average face amount of Rs. 300 from single outlet customers and 2,000 cheques with an face amount of Rs. 2500 from the regional chain customers. Currently it takes a total of 7 days for ABC to receive the payments, process the payments and receive available funds. The XYZ has offered a lock box service that ~ould reduce the total to 3 days. The cost of the lockbox would be a fixed charge of Rs. 500 and a processing fees of Re .50 per cheque. Currently ABC Ltd pays Re .05 per cheque. ABC Ltd. Has an opportunity cost rate of 10% per annum.

1) If the company uses lock box should they have both classes of customers send their remittance to the lockbox .

2) Determine if ABC should use the lockbox at all. Q#2 It is January and XYZ Ltd wishes to prepare a monthly cash forecast over the next 5%

four months. Sales for the month ofDecember were Rs I 1,00,000. The expected sale for the next four months are

Month January February March April - t----'----------1

Expected Sale 6,00,000 8,00,000 11.00,000 8,00,000

30% of the firms sales are in cash. The remainder are collected in the month following the sale( there are no bad debts). Disbursements consisted of payments for raw materials, direct labour, other operating expenses. purchase of fixed assets and taxes. Cost of sales are 75% of sales. Of those cost of sales 38% are raw material costs and 62% are direct labour costs. Direct labour costs are paid in the month incurred, while raw materials are purchased on net 30 days term. Other operating expenses total 1,50,000 .eer month. Expenditure for fixed assets of 75,000 are to be made in February and April and tax payment of Rs. 1,10,000 are to be made in January and March. As of January 1 there is cash balance of Rs. 83,000. The firm keeps a cash balance equal to 1 0% of months cost of sales. Generate a monthly cash forecast for upcoming four months.

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Q#3 s cYo - ~

(A) Discuss the profitability versus risk tradeoffs associated with aitemative levels of working capital investment

(B) Premier Manufacturing company pays accounts payable on the 1 01h day after

purchase. The average collection period is 30 days and the average age of inventory is 40 days. The firm currently spends Rs 36 crore on operating cycle investments. The firm is considering a plan that would stretch its account payable by 20 days . If · the firm pays 12% per year for Its financing what annual saving can it realise by this plan? Assume no discount for early payment of trade credit and 360-day year.

Q#4 5% (A) What are the objective functions of a cash concentration system? What is meant by

balance averaging and why it is important in managing efficient concentration system?

(B) Explain how a lockbox works and how the use of a lockbox can increase the present value of a company?

Q#5 Brief the different methods used for determining material requirements in inventory 5% management.

Q#6 Burger paint company uses 60,000 gallons of pigment per year. The cost of ordering is 5% Rs.400 per order, and the cost of carrying the pigment in inventory is Rs.2 per gallon per year. The firm uses pigment at a constant rate every day throughout the year.

• Calculate the EOQ • Calculate thy total cost of the plan suggested by the EOQ • Determine the total number oforders suggested by this plan • Assuming that it takes 20 days to receive an order once it has been placed,

determine the reorder point in terms of gallons of pigment by using 360-day year.

( ...

V M PATEL INSTITUTE OF MANAGEMENT Ganpat University

Mid Semester Examination, MBA Semester IV _ International Financial Management- FM 206

Time: 2.5 Hrs. Date: 27-03-2010 Wt: 30% Instructions:

I. This is a closed book examination.

2. All the questions are compulsory.

3. figures to the right indicate weightage of an individual question.

Q. 1 Explain how liberalization and globalization have raised the importance of 05% international finance.

Q. 2 Explain in detail the components of Balance of payments and the importance to study 05% BOP.

Q. 3 What d<_? you mean by transaction exposure? Discuss the techniques to hedge 05% transaction exposure using financial contracts.

Q. 4 (A) In London a dealer quotes:

£/CHF Spot 3.5250/55

(B)

£/JPY Spot 180.80/181.30

What do you expect the CHF/JPY rate to be in Geneva?

Suppose that in Geneva you get a quote CHF/JPY Spot 51 .1530/51.2550, is there an

arbitrage opportunity? Ifyes then, explain with required assumption.

Assume you are a trader with Deutsche Bank. From the quote screen on your

computer terminal, you notice that Dresdner Bank is quoting € 1.0242/$ and Credit

Suisse is offering SF 1.5030/$. You learn that UBS is making a direct market

between Swiss Franc and the Euro, with a current €/SF quote of .6750. Show how

can you make triangular arbitrage profit by trading at these prices. (fgnore bid-ask -

spread for this problem) Assume you have$ 500000 with which to conduct arbitrage.

What happen if you will initially sell dollars for Swiss Francs? What €/ SF price will

eliminate triangular arbitrage.

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05%

Q. 5 Calculate the forward rates and annualized forward premium/ discount with the use 05%

of following spot rates and swaps points

Spot Rate I month 2 month 3 month 9 month

Rs.42.5000-5200/$ 0030-0040 0040-0035 0045-0055 0055-0060

Rs.82.52-53 /£ I 000-1200 1300-1100 1400-1500 1600-1500

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V M PATEL INSTITUTE OF MANAGEMENT Ganpat University

Time: 2.5 Hrs.

Instruction-s:

Mid Semester Examination, MBA Semester IV Strategic Financial Management

Date: 29.03.2010

I. This is a closed book examination. 2. All questions are compulsory. 3. Figures to the right indicate weightage of each qu·estion. 4. Be precise and to the point in your answers. Substantiate your answers with suitable

examples. Make necessary assumpti c·1 if required .

Q#l 10%

A) List different powerful change forces for increasing pace of M&A.

B) List types of mergers from an economic standpoint with definition .

C) Explain real option analysis for case of M&A with proper example.

D) Leasing Vs. Hire-purchase

Q#2 10%

A) An arbitrage [Irm A TC Ltd notes that a bidder IOC Ltd whose stock is selling at Rs.404 makes an offer for a target BRP Ltd selling at Rs.42 to exchange 4 shares of IOC Ltd. for 37 share of BRP Ltd. Shares of BRP Ltd. rise to Rs.44 on expectation of merger completion within 3 months; B stays at Rs.404. Both stocks of IOC Ltd and BRP Ltd available in F&O segment with lot size of 612 and 4500 respectively. Is there any arbitrage opportunity if Future contract price for three month is same as spot price? If yes then what is percentage gain to A TC Ltd. Assume Required margin for taking position and carry over it in F&O is around 50 percent of total value and cost of fund is 8 percent. Also transaction cost of deal is 1 percent of deal value.

B) The HIL has an investment plan amounting to Rs.l 08 lakh. The tax relevant rate of depreciation of HIL is 25 percent; its marginal cost of capital and marginal cost of debt are 16 percent and 20 percent respectively. It is in 35 pereent tax bracket. A Proposal from HFL to HlL is as follow: a). Hire-purchase option : Flat Interest Charged is 16 percent, 36 equated monthly installment required in advance, 20 percent down payment required on total deal, charged for cre<;lit is based on SOYD method, net salvage value at end of 5111 year is Rs.33 lakh b) Leasing Option : Rental payable is Rs.28 ptpm (per thousand per month) in advance, lease period is 5 years

You are asked to advice HIL for choosing best alternative out of proposal given by HFL.

Q#3

Acquisition of ABC Ltd by XYZ Ltd.

Company XYZ Ltd. is in the business of manufacturing of Four-wheeler -vehicle. XYZ Ltd wants to acquire business of tyre manufacturing company. XYZ Ltd target to buy ABC Ltd. for same.

For that similar type of past mergers are required to analyze. There are three major acquisition of A, B and C tyre companies occurred in last five year. Data of same are as follow:

All data is in lakh Rs. ·oata is for Company A, B, and C respectively • Total paid value= 4 7.1, 35.8 and 15.2 • Market value= 39.1, 30.4 and 15.2 • Market value of combined entity= 113.3, 85.4 and 34.9 • Book value = 15.7, 12.8 and 6.6 • NI (Net Income)= 2.1, 2.3 and 2.0 • Sales = 34.2, 46.4 and 40.6

Actual data oftarget company ABC Ltd -. Sales = 63 • Book Value= 19

- • Nl = 2.9 . • Marke't value = 58.7 • Market value of combined entity = 233.7

Current data as percent of revenue for future cash flow expectation are as follow:

• Revenue= 63 (For current year; other data as percent of revenue) • Cost = 80 percent • NOI = 20 percent • _Tax = 8 percent (40 percent of NO!) • NI = 12 percent • NWC = 4 percent (incremental up to 3 years then 0 incremental) • Net Asset = 6 percent (incremental up to 3 years then 0 incremental) • Growth in revenue = 20 percent up to 3 years then constant • Cost of capital= 10 percent

You are required to calculate value of ABC Ltd based on comparable approach and spread sheet projection approach. Also, you are required to explain importance of both. approaches with your advice to XYZ Ltd for fair valuation of ABC Ltd.

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Time: 2.5 Hrs. Instructions:

V. M. PATEL INSTITUTE OF MANAGEMENT GANPAT UNIVERSITY

Mid-Semester Examination, MBA Sem- IV, Batch: 2008-2010 MM 205 SERVICES MARKETING

• This is a closed book Quiz. • Write to the point ·precise answers.

Wt.: 30%

Q.l (A)What distinguishes service offerings from customer service? . Provide specific examples. 5%

(B) One of the underlying frameworks for the services marketing is the services marketing

mix. Discuss why each of the three new mix elements (process, people, and physical

evidence) is included.

Q.2 (A) Can provider gap 4 be closed prior to closing any of the other three provider gaps? 5%

How?

(B) What are some differences in service choice, purchase, and consumption processes for

organizations and households compared to individuals? What are some similarities?

Q.3 What are examples of services that are high in credence properties? How do high credence 5%

properties affect consumer behavior for these services? Why are consumer experiences so

important in the evaluation process for services?

Q.4 Explain strategies for effective service recovery with examples of what does and does not 5%

work. Discuss service guarantees-what they are, the benefits of guarantees, and when to

use them-as a particular type of service recovery strategy.

Q.5 Discuss the sources of customer expectations and perceptions of service, including those 5%

that are controllable and uncontrollable by marketers.

Q.6 Explain relationship marketing, its goals, and the benefits of long-term relationships for 5%

firms and customers. Explain why and how to estimate customer relationship value.

I('

V M PATEL INSTITUTE OF MANAGEMENT Ganpa t University

M id-Semester Examination, MHA Sem- IV, Batch: 2008-2010

Strategic Marketing And Brand Management

Time: 2.5_ Hrs. Date: 27-03-2010 Wt: 30%

Instruction: 1. It is a closed book examination 2. All the questions are compulsory 3. Be precise and to the point in your answers. Substantiate answers with examples.

Q-1 By the late 1980s IBM had recast its approach in its market driven quality campaign along the 5% lines: 'if we can be the best at satisfying the needs and wants of customers in those markets ~e

Q-2

choose to serve, everything important will follow '. Evaluate the statement in the context of different marketing approaches.

"Customer based brand equity is defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand. " - Critically evaluate the statement and support your argument with suitable example.

5%

Q-3 Focused eompetitors dominate their target segments - by fending off broad-coverage 5% competitors who have to compromise to serve the segment, and outperforming rivals with the same focus - elaborate the statement with suitable example.

Q-4 Extensive market segmentation is a relatively recent phenomenon. Until about the middle of this 5% century many firms offered a single basic product aimed at the entering mass market. But in the recent years many firms - including industrial goods manufacturers and services producers as well as consumer products companies - have begun segmenting their markets and developing different products and marketing programmes targeted at different segments. Which environmental changes have _helped spark this increased interest in market segmentation? What . advantages or benefits can a firm gain from properly segmenting its market?

Q-5 What do you _mean by Brand Extension? Explain the factors affecting the success of brand 5% extension with suitable example. Also explain the impact of brand ext~nsion on core brands.

Q-6 How celebrity endorsement is helpful in building the brand? What type of the potential threats 5% associated-with it? Suggest the strategies to overcome these threats .

V M PATEL INSTITUTE OF MANAGEMENT Ganpat University

Time: 2.5 Hrs.

Instructions:

Mid Semester Examination, MBA Semester IV Retail Management

Date:29.03.2010

1. Thi s is a closed book examination . 2. All questions are compulsory. 3. Figures to the right indicate weightage of each question.

Wt: 30%

4. Be precise and to the point in your answers. Substantiate your answers with suitable examples.

Q # 1 Discuss the factors that affect the buying behaviour of a retail shopper and their (5%) impact in the formulation of retail mix strategies.

Q # 2 Which of the following types of retailers do you think would benefit most from {5%) instituting customer relationship management: (a) Supermarkets (b) Consumer electronics retailers? Why?

Q # 3 Elaborate on the significance of location decisions. Moreover, as a leading (5%) footwear brand, what factors would you consider in the evaluation of a location?

Q # 4 An assortmept plan indicates that a buyer can purchase 1000 units of fashion (5%) wristwatches. The buyer must choose between buying 20 styles of 50 units each or 5 styles of 200 units each. In terms of the store philosophy toward risk and space utilization (productivity), how does the buyer make this decision? Justify your answer.

Q # 5 What do you understand by the term wheel of retailing? Explain. (5%)

Q # 6 Briefly explain the key components of retail atmospherics, with suitable (5%) examples.

VM Patel Institute of Management Ganpat University

Mid Semester Examination, MBA Semester IV Legal Environment of HRM

Time: 2.5Hrs Date: 26.03.2010

Instructions: 1. Figures to the right indicate weight age of each question.

Wt: 30%

2. Substantiate your answers with practical examples as far as possible.

Q # 1 Write short notes on (6%) a. Medical Bonus b. Nursing breaks .

Q # 2 Outline the scope & objectives of the Equal Remuneration Act, 1976. (6%)

Q # 3 Justify the relevance of ·Retrenchment & Lay off as legal tools as (6%) provided under the Industrial Disputes Act, 194 7.

Q# 4 Briefly outline the major provisions of Registration of Trade Unions as (6%) specified under the Trade Unions Act, 1926.

Q # 5 What are the functions of Work Committees? Which functions can be (6%) performed by the Work Committees under the Industrial Disputes Act, 1947.

***All the Best***

•

V M PATEL INSTITUTE OF MANAGEMENT · Ganpat University

Mid Semester Examination, MBA Semester IV Strategic Human Resource Management (HR 206) Time: 2.5 Hrs. Date: 27/03/2010 Wt: 30%

Read the ~ase carefully, and answer the following questions (10% each):

1. Discuss the role of competition for organizational development. Shall organization be outward looking or inward looking for growth?

2. Discuss the role ofHuma,n Capital Development in intensifying critical situation.

3. Whom do you held responsible for disaster? Nat'ural environment or human incompetency in dealing with situation?

\

V. M. Patel Institute of Management Ganpat University

Mid Semester Examination, MBA Semester IV International Human Resource Management (HR 207)

Time: 2.5 Hrs. Date: 29/03/2010 Wt: 30%

Each question is compulsory. Each question carries 6 per cent. This is a close book examination.

1. Explain the difference between international organization, global organization, · and transnational organization?

2. Discuss the HR issues in international joint venture.

3. Suggest three changes in existing HR policies keeping m mind international assignment for your organization.

4. You organization want to start operation in Hungary. Draft HR action plan for the same.

5. Devise HR policy for ex-patriots pilots for Aviation Company.

..... .. V M PATEL INSTITUTE OF MANAGEMENT Ganpat University

Mid Semester Examination, MBA Semester IV Entrepreneurship and Management of Innovations

Time: 2.5 Hrs. Date:22-03-2010 Wt: 30%

Instructions: I. This is a closed book examination. 2. All questions are compulsory . 3. Figures to the right indicate weightage of each question. 4 . Be precise and to the point in your answers. Substantiate your answers with suitable

examples.

Q#l What is entrepreneurship? Explain the key contribution of entrepreneurs in the (5%) socio-economic development of a nation.

Q#2 What step-by-step process you as a small scale entrepreneur would adopt for (5%) opportunity scanning and identification

Q#3 Wrote short notes on the following (5%) a. Internal and external locus of control b. Need for achievement c. Difference between risk and uncertainty d. Asse1iiveness e. Entrepreneur and intrapreneur

Q#4 Explain the different types of innovation with suitable examples. (5%)

Q#5 How does an organisation establish innovative environment within firm? (5%)

Q#6 Explain the different m9dels of new product development. (5%)

-----------Best of Luck----------

V M PATEL INSTITUTE OF MANAGEMENT Ganpat University

Time: 2.5 Hrs.

Mid Semester Examination, MBA Semester IV Management Control Systems

Date: 23/0312010 Wt: 30%

Q # 1 Why behavioural dimensions are important in Management Control Systems? For (05%) understanding the behavioural dimensions in relation to MCS which styles of Management are crucial and under what condition?

Q # 2 Discuss the different models that could be used for formulating business unit (05%) strategies. Also explain the inter-linkages and interface between strategies and management control.

Q # 3 Explain (i) Administrative and support centre (ii) R & D centers and (iii) (05%) Marketing centers. What peculiar problems they present from management control point of view and why?

Q # 4 Study the case 'Industrial Product Corporation" and answer the questions given (15%) below the case.

V M PATEL INSTITUTE OF MANAGEMENT Ganpat University

Mid Semester Examination, MBA Semester IV Insurance Management

Time: 2.5 Hrs. Date: 25.03.2010 Wt: 30%

Instructions: I. This is a closed book examination. 2. All questions are compulsory. 3. Figures to the right indicate weightage of each question. 4. Be precise and to the point in your answers. Substantiate your answers with suitable

examples.

Q#1 ~rite down short note for following:

A) Privatization Of Insurance Sector

B) 7 P's in Service Marketing and its applicability in Insurance Sector

Q#2

A) Write down the importance of Life Insurance

B) Brief the types of insurance with its importance

Q#3

Read following case carefully and explain the importance of house insurance with its advantage and disadvantage:

Assessing Losses Caused by Vandalism

"'lhc rents for houses in the city area are too high," said Ramesh Chatterji to hi s friend Vinod 'Mehra. To avoid paying high rent. Chatterji had taken a house almost on the outskirts of the city. "llmv is the rent tor the house in which you arc presently residing?" asked his friend Mehra. "'rherc is hardly any difference from ,:vhat is charged in the city area. r:vcn though it is little less than the rent charged in the city, it is compensated by the amount of money spent on commuting." said Chatterji. Chatterji was working as a SFA at Badia Finance Consultancy. situated in Navi Mumbai. ·rhe company was flying high on its recent achievements. The organization had recently helped a leading private commercial bank recover fl·om a financial disaster. The bank vvas able to recover by implementing the suggestions given by the team at Badia Finance Consultancy.

Chattcrji was a part of the team involved in developing a solution for the bank. Du~ to his valuable contribution to the team, he was recently promoted as SFA.

"Considering the rent I am to pay, I feel that it is high time I built a house of my mvn," said Cpatterji. "I will obviously agree vvith you as you are a financial consultant and would be sure to know what is best for you." said Mehra. A few months after this c<'Jnversation, Chatter:ji began constructing his house. Though he faced a Jot of hardship in the process. he was happy \vith the outcome. On an auspicious day, he arranged the Ciruhapravesam ceremony and invited all his near and dear ones for the function.

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10%

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·rhe function went \.veil. At.the end ofthe function, ivlehra called Chatterji aside and asked him whether he had insured the house. "I realize that this is not the right time to discuss insurance, but I feel that you should insure yom house against possible losses." said iv1ehra. "Yes. you are right. VinocL" replied Chatte1ji.

"The same thought had occutTcd to rne some time back. But. to tell you the truth. r could not spare-the time to go and talk to the insurance people and get my house insured." continued Challcr_ii. "l~ut better late than never." said Mehra. Chattcrji agreed and said he would get his house insured soon. /\Iter a few days, Chatte1~ji got his house insured against losses. He was happy that he was nmv able to save on rent. His good days were. however, short-lived . One day, disaster struck and his house .,:vas completely destroyed in communal riots .

The Gu_iarat riots were at their peak at that time. The disturbance had spread to the neighboring states too <md Maharashtra, being one ofthem, was affected by it. On that fateful day. the miscreants broke open the doors and looted the property and damaged the ·house. Fortunately. on th<it particular day Chatterji and his entire t~1m i ly had gone out of station. The next day. when they returned home, they were shocked to sec the destruction caused to the house. Chattc1~ji asked his neighbors about the cause of the da1nage. They explained what had happened during his absence. Immediately. he got in touch with the insurance oflice as well as his fl·icnd Mchra . noth ivlchra and the claims adjuster arrived at Chatte1ji's rlace at the same time.

The claims adjuster \Vent round the house assessing the damage. Chatterji was m a bad mood and didn't feel like talking to anyone.

"'fhis is the time when your active participation is required in helping the claims adjuster 111 evaluating your property." consoled Mehra.

"!low did it happen?" asked the claims adjuster. "Some miscreants broke in and damaged the property and they later damaged the house as well." said Chatte1ji.

Mehra intervened and informed the claims adjuster that Chattcrji had already intimated the police and they had registered the case.

He also said that the police vvere unahie to stop the destruction because a large number of people had broken into the house. So they had simply become silent spectators. "What is the estimated damage that has been caused?" Mehra asked the claims adjuster.

"The loss to the house itself will amount to around rupees two lakh," replied the claims adjuster. "But that is too little," shouted Chatterji. "l have spent nearly twenty five thousand rupees tor the entrance door alone." "It is made of teak wood," added Mehra. "l am not bothered about the amount you have spent on the door," replied the claims adjuster. He continued, "Tam more bothered about the cost of the property at the time of loss." "This is sheer injustice by you to th.e customer." replied Mehra.