ANNA UNIVERSITY: CHENNAI 600 025

MBA DEGREE EXAMINATIONS , MAY- 2014

REGULATIONS R-2013
BA7211 : Data Analysis and Business Modeling
SEMESTER : 02

DURATION : 3 Hrs

MAX MARKS : 100

( In a batch of 20 students , each student will get any two questions from this set)
Descriptive statistics

1. Calculate the frequency distribution. Create a data file with the following variables .
Label for the variables
Age: 1 (< 20),

2 (20-25),

(50 Marks)
3 (25-30),

4 (30-40),

5 (>40).

Gender: 1 (Male), 2(Female).

Education: 1 High school, 2 Graduate in Arts and Science degree
professional degree, 4-Post graduate degree.
Working Experience (years) :
4(10-20),
5(>20).

1 (< 1 year)

2(1-5 years ),

3- Graduate in

3(5-10Year),

Enter your own data set (minimum 25 data set ) in the data view of SPSS than Calculate the
frequency distribution. Graphically represent the variables in the form of BAR Chart.

2. Calculate the measures of central Tendency. Create a data file with the following variables.
( 50 marks)
Label for the variables
Age: 1 (< 20),

2 (20-25),

3 (25-30),

4 (30-40),

5 (>40).

Gender: 1 (Male), 2(Female).

Education: 1 High school, 2 Graduate in Arts and Science degree
professional degree, 4-Post graduate degree.
Working Experience (years) :
4(10-20),
5(>20).

1 (< 1 year)

3- Graduate in

2(1-5 years ),

3(5-10Year),

Enter your own data set (minimum 25 data set ) in the data view of SPSS than Calculate the
frequency distribution. Graphically represent the variables in the form of BAR Chart.

Correlation
3.

(50 marks)

Twenty students have taken their common entrance test after their graduation. The selection
committee wants to see the relationship between the scores of CET and the percentage achieved
in graduation through correlation analysis.
Frame a hypothesis and show the type of relationship (positive or negative relationship) between
the variables.
CET
scores

70

60

65

68

70

75

87

89

90

96

97

65

80

86

77

% in UG 71
degree

82

73

64

75

69

75

88

90

90

88

82

73

74

65

Hypothesis : Parametric
4.

(50 marks)
The life time of tube for a random sample of 20 provides following figures:

Item

1 2

3 4

5 6

8 9

10

11 12

13

14 15 16 17

18

19 20

Life
(in
years)

5 5.5

6 5.4

2 3.4

6.5

7 5.4

5.9

5.7

5.9

5.8

8.7

4.9

Null hypothesis: Average Life of tube is 5 years.

Analyze the above problem through T test.

5.
(50 Marks )
The height of males and the height of females were compared
Research question : Does height create a significant difference between the male and female.
Analyze the problem using independent sample t test.
Label : Male : 1, Female :2

Gender

Height
in cms

140

146

156

149

154

156

151

148

158

150

151

159

153

148

155

146

150

152

149

156

6.
(50 Marks)
A researcher wants to compare the pretest scores and posttest scores of 30 students who has
undergone training in an institution.
Research Question is: Does the training have any impact in the scores of the students. Analyze
the problem using paired sample T test

pretest

53

54

57

68

66

74

63

71

74

75

59

71

69

55

52

61

76

81

61

69

posttest

88

96

98

103

108

122

112

120

123

124

97

115

111

85

79

94

93

96

87

77

7.
(50 Marks)
Gupta wants to compare the scores of CBSE students from four metro cities of India i.e Delhi,
Kolkata, Mumbai, Chennai. He Obtained 10 participant scores based on random sampling from
each of the four metro cities, Collecting 40 responses. He made the following hypothesis
NULL HYPOTHESIS : There is no significant difference in scores between different metro
cities of India.
ALTERNATE HYPOTHESIS: There is significant difference in scores between different
metro cities of India.
Note: This is an independent design, since the respondents are from different cities. Use One
way between groups ANOVA.
Label For City
City
1
400
2
389
3
488
4
450

: 1 Delhi , 2 Kolkata, 3-Mumbai, 4 Chennai

Scores of the Student
450
499
480
495
300
350
398
399
498
457
400
300
469
425
450
399
385
299
400
428
398
359
360
310

356
298
298
295

269
369
389
322

298
348
390
365

8.
(50 marks)
Sekar Kapoor wants to know the sales in four different metro cities of India in Diwali season. He
assumes the sales contrast of 2:1:-1:-2 for Delhi: Kolkata: Mumbai: Chennai, respectively. He
collects sales data from 10 respondents each from the four metro cities. Frame the required
hypothesis, do the analysis using the One-way between groups ANOVA with planned
Comparisons and show the result. Calculate F ratio along with Post Hoc analysis.

City
1
2
3
4

500
500
421
289

498
428
410
269

478
389
389
259

499
378
359
299

Sales in Rs (Lacs)
450
428
498
469
369
359
389
349

500
428
349
350

498
412
349
301

486
410
359
297

469
421
400
279

9.
( 50 marks)
Deepak wants to know the sales in four different cities of India in Christmas Season. He assumes
the sales contrast of 5: 3: 4: -4 for Delhi: Bangalore: Mumbai: Hyderabad, respectively. He
collects sales data from 10 respondents each from the four cities, collecting a total of 40 sales
data.
City
Delhi
Bangalore
Mumbai
Hyderabad

Sales in (Rs Crores)

50,48,47,49,40,42,50,98,86,69
40,38,43,38,39,87,69,48,41,40
41,10,89,39,36,39,49,29,59,40
28,29,59,99,39,34,30,31,29,39

Frame the required hypothesis, Analyses through One-way between groups ANOVA with
planned comparisons, Calculate F ratio along with Post Hoc analysis.

Hypothesis Non Parametric

10.
(50 marks)
Neha gupta wants to research that whether sales (dependent) of the respondents depend on their
place (independent) and education (independent). She assigns 10 respondents from each metro
city.
Labels
Place: 1 (Delhi), 2 (Kolkata), 3(Chennai)
Education: 1 (Under graduate), 2(Graduate), 3(Post Graduate).
She wants to know which variable shows significant effect on sales
Whether the location influences sales?
Whether the education influences the sales?
Whether the influence of education on sales depends on location of respondent?
Use two ways between groups Anova to determine the significant effect between variables.

11.
(50 marks)
Mohit Rajan wants to research that whether sales (dependent) of the respondents depend on their
place (independent) and age (independent). He assigns 10 respondents from each metro city.
Each respondent can select from 3 age levels.
Place : Ram Nagar, Jyoti Colony, Vivek Vihar
Ram Nagar 10 respondents
Jyoti Colony 9 respondents
Vivek Vihar 10 respondents
Age : 1 (below 25 years), 2 (25-35 years), 3 (above 35 years).
Place
Ram nagar

Jyoti Colony

Vivek Vihar

Age
1
2
3
1
2
3
1
2
3

Sales (Rs. Lacs)

20,40,44,35
30,34,50,40
60,55
15,25,30
35,40,45,70
65,80
80,75,30,10
100,90,75
150,89,99

Analyze through Two-way between groups ANOVA. Find the variable that has significant effect
on sales.
12.
(50 marks)
Mathu Gupta wants to know whether the serial preference was dependent on location of the
respondent. The responses indicate, 75 respondents each have seen serial crorepathi and Big
Boss. His responses indicate 66 respondents from Delhi and 84 respondents from Mumbai. The
frequency table is shown below.
Serial

Place

Frequency

Crorepathi

Delhi

40

Crorepathi

Mumbai

35

Big Boss

Delhi

26

Big Boss

Mumbai

49

Conduct a chi square test for independence or relatedness (Based on weigh cases)

13.
(50 marks)
Pawan wants to see the relationship between monthly household income and retail purchase by
20 respondents through Spearmans rank order correlation.
Sl.No
1
Household 1
income
(Rs
in
Lac)
Retail
10
purchase
(Rs.
In
thousand)

Sl.No
11
Household 0.30
income (Rs
in Lac)
Retail
6
purchase
(Rs.
In
thousand)

2
5

3
0.50

4
10

5
3

6
3

7
7

8
8

9
10

10
0.40

25

10

100

35

30

100

100

150

12
0.20

13
0.10

14
0.15

15
0.80

16
5

17
6

18
7

19
8

20
1

10

30

30

20

60

10

14.
(50 marks)
The sales of two retails stores of Delhi(store1) and Mumbai(store2) are compared by ganesh. The
sales are in Rs.Lacs. There are 20 respondents, 10 from each store. Apply Mann Whitney nonparametric t-test of independent groups to prove the hypothesis
Null hypothesis: There exists no significant difference in the sales of two retails shop
Alternative hypothesis: There exists significant difference in the sales of two retails shop.
Retail store
Sales (Rs
Lacs)

1
40

2
30

1
60

1
45

2
55

2
25

2
60

1
80

2
100

1
20

Retail store
Sales (Rs
Lacs)

2
10

1
80

1
85

2
90

1
120

1
85

2
60

2
55

1
56

2
25

15.
(50 marks)
A showroom manager compares the laptop sales for the year in two parts. He wants to compare
the sales of first half and second half of the year. He recorded the sales from 20 showrooms and
saved their sales in Rs.Lacs. Apply Wilcoxon signed-rank test of non-parametric , paired-test to
prove the hypothesis.
Null hypothesis: There exists no significant difference in the showroom sales for the first and
second half of the year.
Alternative hypothesis: There exists significant difference in the showroom sales for the first
and second half of the year.
Sale 1 (Rs
10
20
25
50
45
30
50
60
100
20
Lacs)
Sale 2 (Rs
20
50
60
35
65
90
110
25
20
35
Lacs)
Sale 1 (Rs
Lacs)
Sale 2 (Rs
Lacs)

50

90

60

40

20

45

65

56

38

28

64

69

95

85

76

68

59

120

60

30

Linear programming
16.
Solve the following linear programming problem using Graphical Method.
Maximize Z = 2 X1 + 3 X2
Subject to
X1 + X2 > 6
7 X1 + X2 > 14
X1, X2 > 0

(50 marks)

17.
Solve the following linear programming problem using Simplex Method.
Maximize Z = 6 X1 + 8 X2
Subject to
5 X1 + 10 X2 < 60
4 X1 + 4 X2 < 40
X1, X2 > 0

(50 marks)

Transportation Problem
18.
(50 marks)
Find the feasible solution for the transportation problem using North West Corner rule:
To
D
E
F
Supply
From
A
6
4
1
50
B

40

60

Demand

20

95

35

150

19.
(50 marks)
Find the feasible solution for the transportation problem using Least cost method:
D

Supply

From
A

To

50

40

60

Demand

20

95

35

150

20.
(50 marks)
Find the basic feasible solution for the following transportation problem using vogel
approximation method
D1

D2

D3

D4

Supply

From
O1

To

11

13

17

14

250

O2

16

18

14

10

300

O3

21

24

13

10

400

Demand

200

225

275

250

950

Assignment Problem
21.
(50 marks)
The following matrix gives the cost involved to perform jobs 1,2 and 3 operators A,B and C.
Assign the operators and jobs to minimize the total time taken to complete the jobs
Operator

Job1

Job2

Job 3

10

16

17

13

22.
(50 marks)
A firm wants to purchase three different types of equipment and five manufactures have come
forward to supply one or all the three machines. However , the firms policy is not to accept more
than one machine from any of the manufactures. The data relating to the price (in lakhs of
rupees) quoted by the different manufactures are given below.

MACHINES
Manufacturers
1

2.99

3.11

2.68

2.78

2.87

2.57

2.92

3.05

2.80

2.82

3.10

2.74

3.11

2.90

2.64

Determine how best the firm can purchase three machines.

Networking Models
23.
(50 marks)
A project schedule has the following characteristics as shown in Table given below
Activity

Name

Time
( Activity
days)
1-2
A
4
5-6
1-2
B
1
5-7
2-4
C
1
6-8
3-4
D
1
7-8
3-5
E
6
8-10
4-9
F
5
9-10
1. Compute Te and TL for each activity.
2. Find the critical path.
3. Calculate the project duration.

Name
G
H
I
J
K
L

Time
(days)
4
8
1
2
5
7

24.
(50 marks)
R and D project has a list of tasks to be performed whose time estimates are given in the table.
Draw the network diagram for the R&D project.
Activity

Activity
name

1-2
1-3
1-4
2-4
3-4
3-5
4-6
4-7
5-7
6-7

A
B
C
D
E
F
G
H
I
J

Time
(days)
To
4
2
6
1
6
6
3
4
2
2

Time
(days)
Tm
6
3
8
2
7
7
5
11
4
9

Time
(days)
TP
8
10
16
3
8
14
7
12
6
10

Inventory Models
25.
( 50 marks)
Alpha industry needs 15,000 units/year of a bought out component which will be used in its main
product. The ordering cost is Rs. 125 per order and the carrying cost per unit per unit per year is
20% of the purchase price per unit which is Rs 75.
Find a. Economic order quantity
b. Number of orders per year
c. Time between successive orders

26.
( 50 marks)
A product is to be manufactured within the company , the details of which are as follows:
R=36000 units/year,
K = 72000 units/year,
set up cost, Co = Rs. 250 per set-up
Carrying Cost Cc = Rs 25/unit/year
Find the EBQ and cycle time.

27.

( 50 marks)

The annual demand foe an automobile component is 36000 units. The carrying cost is Rs.
0.50/unit/year, the ordering cost is Rs 25.00 per order and the shortage cost is Rs 15.00/unit/year.
Find the optimal values of the following.
1. EOQ
2. Maximum inventory
3. Maximum Shortage Quantity
4. Cycle time
5. Inventory period(T1)
6. Shortage Period (T2)

Queuing Theory
28.

(50 Marks)

Customers arrive at a booking office window, being manned by a single individual at a rate of 25
per hour. Time required to serve a customer has exponential distribution with a mean of 120
seconds. Find the mean waiting time of a customer in the queue.

29.

(50 Marks)

A belt snapping for conveyors in an open cast mine occur at the rate of 2 per shift. There is only
one hot plate available for vulcanizing. And it can vulcanize on an average 5 belts snap per shift.
a. What is the probability that when a belt snaps, the hot plate is readily available?
b. what is the average number of belts in the system?
c. What is the waiting time of an arrival?
d. What is the average waiting plus vulcanizing time?

30.

(50 Marks)

A repairman is to be hired to repair machines which breakdown at an average rate of 6 per hour.
The breakdowns follow Poisson distribution. The non-production time of a machine is
considered to cost Rs. 20 per hour. Two repairmen, Mr.X and Mr.Y have been interviewed for
this purpose. Mr.X charges Rs. 10 per hour and he services breakdown machines at the rate of 8
per hour. Mr. Y. demands Rs. 14 per hour and he services at an average of 12 per hour. Which
repairman should be hired?
MS- EXCEL
31.

(50 Marks)

The operating costs of the vehicle used by your companys sales people are too high. The major
component of operating expense is fuel cost; to analyze fuel costs, you collect mileage data from
the companys two wheelers for the previous month. Use Excel sheet for calculation.
MPL 27 29 33 21 21 12 16 25 8 17 24 34 38 15 19 19 41

Summary statistics.
Histogram analysis.
Rank and Percentile analysis tool.

Financial Management
32.

(50 Marks)

Suppose we have availed a loan of Rs.1, 00,000 that is to be paid off in 48 monthly installments
of rupees 3,000 each. Find out the rate of interest charged on this loan.

33.

(50 Marks)

You deposit Rs.1,000 each and every month in your bank account. The bank pays 12% annual
rate that is compound every month. Find out how much money will be in your account at the
end of 24 months.
34.

(50 Marks)

You expect to receive Rs.800/- every month over next 24 months. If the current discount rate is
12% per annum. What is the present value of these future payments?
35.

(50 Marks)

You can afford only Rs.500/- per month. If you are crediting this amount in a bank that pays an
annual interest of 12% compounded monthly. How long will it take for your investment to
accumulate to Rs.50, 000?
36.

(50 Marks)

Suppose if you want to take a loan of Rs.2, 00,000 at an annual interest rate of 14%. The loan
has to be repaid in 15 years in equal monthly installments. Find out the EMI.

37.

(50 Marks)

You are expected to get 5 monthly payments of Rs.500, 900, 550, 478, 950 respectively. At the
discount rate of 10% per annum. Find the Net Present Value (NPV).
38.

(50 Marks)

Assuming that an initial investment of Rs.1, 00,000. Results in 12 annual cash outflows as given
below.
13200,
15,000,
13,000,
2,000, 12,400,
16,000,
14,000,
16,450,
17,690,
16,550,
16,500
and 12,200.
Find the Internal Rate of Return (IRR).

39.

(50 Marks)

A leading financial services company wants to find if there is association between Investment
preference and geographic region. The Business analyst interviews a random sample of 250
individual investors from the three states -Tamilnadu, Kerala and Karnataka - and the records of
the observed frequencies are as shown below.
Bank

Instrument

Gold

Land

Stock market

State
Tamilnadu
72
8
12
23
Kerala
26
10
16
33
Karnataka
7
10
14
19
Using Chi-Square test, find out if there is association between investment instrument and region.
40.

(50 Marks)

With the following informations available for a company, calculate Weighted Average Cost of
capital
Equity Share ----- 25, 00,000
Debenture (12%) ---- 40,00,000
Pref Share (13%) ---- 20,00,000
Retained earnings ---- 10,00,000
The expected dividend for the equity shares are estimates at Rs. 4.50 for the share issued. Rs 10/the companys tax rate is 50%.
41.

(50 Marks)

Calculate EPS from the following informations made available to you.

Capital structure :10,000 equity shares of 100 each 10,00,00
14% Debenture

- 40,00,000

The expected EBIT of the company is estimated at Rs 15,00,000 per annum. The company is in
the tax bracket of 40%.

( In a batch of 20 students , each student will get any one questions from this set)(100 marks)

1. Calculate the frequency distributions and measures of central tendency from following table.
(100 marks)
Label for Gender 1 (Male),

2(Female)

Gender

Height
in cms

140

146

156

149

154

156

151

148

158

150

151

159

153

148

155

146

150

152

149

156

Weight
in kg

56

45

68

51

54

53

69

51

70

49

45

68

50

55

61

53

65

64

47

59

Graphically represent the variables in the form of Histogram Chart.

(100 Marks)

2.Twenty employees of different age group have taken their Exams for getting promotions in
their designation in the office. The appraisal committee wants to see the relationship between the
scores of Exam and the age through correlation analysis.
Frame a hypothesis and show the type of relationship (positive or negative relationship) between
the variables using correlation.
The appraisal committee also wants to calculate the Unit increase in the Exam score when there
is increase in age by applying regression. It also wants to predict the exam score of an employee
with the age of 21.
Age
of 24
Employees

34

27

26

30

34

45

43

48

51

46

30

38

42

32

Exam
scores

60

65

68

70

75

87

89

90

96

97

65

80

86

77

70

3.

(100 marks)

A Survey was taken among 25 students; the data collected was preparatory hours of the
student, Exam percentage of the student. The Researcher was to see the direction of
correlation between the preparatory hours and Exam percentage through correlation analysis. He
also wants to calculate the how much Exam percentage will increases when the preparatory time
is increased by 1 hour. Apply regression to calculate the Unit increase.

Preparatory 4
hours
of
the student
Exam
70
percentage

60

65

68

70

75

87

89

90

96

97

65

80

86

77

4. (100 marks)
Indian Oil has developed a formulation with increased use of ethanol in petroleum products,
which increases engine efficiency with less harmful emissions. 30 cars were test driven with and
without the ethanol and the number of kilometers per litre were recorded. The cars used for the
tests were having either automatic or manual transmission.
Label : Car Coding : 1 (Automatic ),

2 (Manual)

The earlier trial shows that mean number of kilometer per litre was 12. Indian Oil wants to
know:

1. Second trial efficiency of cars is better than the previous trial. (use one sample T test)
2. Whether efficiency of engine improves with added ethanol.(Paired T test)
3. Whether efficiency of engine with and without the ethanol differ between manual and
automatic cars. (Independent group T test)

Frame hypothesis and determine the significant difference between two set of scores

Car
1 1 2 2 1 2 1 2 1 2 1 2 1 1 2 1 2 1 1 2
With Ethanol 15 16 20 22 18 20 10 19 9 8 6 15 16 11 19 14 20 18 25 16
(in kms)
Without
15 15 19 18 15 18 11 20 9 8 6 14 13 10 18 12 19 17 20 15
Ethanol (in
kms)

Car

With
15
Ethanol
(in kms)
Without 14
Ethanol
(in kms)

12

20

19

24

11

10

16

26

28

20

19

11

16

23

13

19

20

22

10

17

20

20

19

15

10

13

21

(Marks 100)
5. Determine the initial basic feasible solution to the following transportation problem using
a) The least cost method
b) The Vogels approximation method
Destinations
Sources

Supply

D1

D2

D3

D4

S1

30

S2

50

S3

20

Demand

20

40

30

10

Ratio Analysis

(Marks 100)

6. The following financial details of Express Company Ltd are available. You are required to
calculate the following ratios:
Business profitability
Gross profit margin
Net Profit margin
Return on equity

(Gross profit)/Net Sales

(Net Profit after tax)/(Net Sales)
(Net Profit after tax)/(Owner's equity)

Financial Stability
Current Ratio
Debt/Equity Ratio
Quick Ratio

(Current assets)/Current Liabilities

(Total assets-Owner's equity)/Owner's equity
(Current assets less inventory)/(Current Liabilities)

Resource Utilization
Total Asset Turnover
Inventory Turnover
Debt Turnover

(Net sales)/Total assets

(Cost of goods sold)/Inventory
(Credit Sales)/Debtors

Calculate the above ratios for the Express Company Limited

Express company Ltd -Final Accounts

P & L Account
For Year ended

31st Dec 2010

Rs.'000

Sales
Cash
Credit
Less: Cost of Goods sold
Opening inventory
Purchases
Less closing inventory

150
330
200
60
260
30

Rs.'000

31st Dec 2011

Rs.'00
0
Rs.'000

480

180
420

600

230

195
80
275
10

265

Gross Profit
Less: Operating expenses
administrative expenses
75
financial expenses
18
selling and distribution
expenses
55

250

148

Net Profit before tax

Less: corporation tax
Net profit after tax (earnings)

102
25
77

335
70
20
60

150
185
47
138

Balance Sheet
As at

31st Dec 2010

Fixed Assets
Building and land
Equipment

Rs.'000
60
110

Current assets
Inventory
Debtors
Cash

30
50
150

Current liabilities & owner's equity

Creditors
Dividends
Overdraft
Owner's equity
Total liabilities & owner's equity

80
30
4

Rs.'000
170

230
400

114
286
400

Investment Appraisal

31st Dec 2011

Rs.'00
0
Rs.'000
90
85
175

10
90
100

55
42
20

200
375

117
258
375

(Marks 100)

7. Small Wonders Ltd is a small manufacturer of microcomputers. The Board of Directors of the
firm is faced with the problem of evaluating four proposals and deciding which, if any, of the
alternatives are acceptable. The table shows the expected cash flows of the project and available
capital (Rs.000s) over the next four years. Cash inflows are shown in positive and cash outflows
are shown in negative and cost of capital is assumed as 15% per annum.
Proposals
Year 1
1
-60
2
-50
3
-40
4
Capital available for each year
100
You are requested to compute the proportion of
the NPV for Small Wonders Ltd.

Year 2 Year 3
0
40
-30
50
-80
100
-35
110
100
50
investment in each

Year 4
70
100
90
-50
50
projects that will maximize

Portfolio Management

(Marks 100)

8. Eby Abraham has recently inherited some money which he would like to invest in stock. Eby
already holds stock in company A, and over the past ten years he has received an average annual
return of 7.48% on his investment. He would like to increase this and hence informed his
investment banker that an annual return of at least 12% is his desired objective. The banks
funds investment manager has forwarded details given below of two suitable companies B and
C, whose stock performances meet Edbys requirements.
Company
A
B
C

1
8.5
6.7
15.1

2
15.3
9.2
27.8

3
11.5
11.3
38.6

4
-1.6
17.7
-12

5
-3.6
7.4
-5.6

6
8.4
13
12.7

7
6.8
19.5
-2.1

8
11.9
15.1
12.8

9
6.1
19.4
36.8

10
11.5
15.2
22.7

Revenue Management
(Marks 100)
9. A hotel near a university always fills up on the evening before football games. History has
shown that when the hotel is fully booked, the number of last-minute cancellations has a mean of
5 and standard derivation of 3. The average room rate is Rs. 80. When the hotel is overbooked,
policy is to find a room in a nearby hotel any to pay for the room for the customer. This usually
costs the hotel approximately Rs.200 since rooms booked on such late notice are expensive. How
many rooms should the hotel overbook?
(Marks 100)
10. ABC company made an EPS of Rs.20. Confirm the above with the following data.

sale of Rs. 15,00000,

expenses Rs. 10,00000,
Fixed expenses Rs.2,00000,
Interest Rs.20,000 (10% of the fixed expenses )
Tax 84,000 (30%)
number of shares 10000.

As the sales manager of the firm, you need to know what would be the effect of sales on EAT
and EPS. What would be your target for the sales force so that the investors could earn an EPS
of Rs.30. Also find out what will be the effect of cost cutting measures that would result in 5%
and 10% reduction in the expenses respectively.