KiiT INTERNATIONAL SCHOOL

Class XII
Subject - Business Studies
Sample Question Paper - 3
Time Allowed: 3 hours Maximum Marks: 80

General Instructions:

1. This question paper contains 34 questions.

2. Marks are indicated against each question.

3. Answers should be brief and to the point.

4. Answers to the questions carrying 3 marks may be from 50 to 75 words.

5. Answers to the questions carrying 4 marks may be about 150 words.

6. Answers to the questions carrying 6 marks may be about 200 words.

7. Attempt all parts of the questions together.

1. The difference between successful and unsuccessful organisations is that successful organisations do not [1]
rely on chance but follow deliberate process to synchronise the activities of different departments to
ensure that planned objectives are achieved with a minimum of conflict.
The process mentioned above is:

a) Planning b) Organising

c) Management d) Coordination
2. Fayol points out the danger and costs of unnecessary labour turnover in one of his Principles. Name the [1]
principle.

a) Stability of personnel b) Initiative

c) Division of work d) Esprit De Corps

3. Assertion (A): Motivation is an internal feeling. [1]
Reason (R): The urge, drives, desires, aspirations, striving or needs of human being, which are internal,
influence human behaviour.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

4. Statement I: The degree of centralisation will depend upon the circumstances in which the company is working. [1]
In general, large organisations have more centralisation than small organisations.
Statement II: An organisation consists of superiors and subordinates. The formal lines of authority from highest
to lowest ranks are known as scalar chain.

a) Both the Statements I and II are not correct. b) Both the Statements I and II are correct.
 c) Statement I is correct and Statement II is not d) Statement II is correct and Statement I is not
correct. correct.
5. Social/Affiliation/Belongingness needs are concerned with ________. [1]

a) Salary b) Affection and friendship

c) Stability of income d) Pension

6. The complete awareness and understanding of the business environment are called ________. [1]

a) Privatisation b) Technological advancement

c) Environmental awareness d) Liberalisation

7. ________ makes flexibility available. [1]

a) Personal Selling b) Sales Promotion

c) Publicity d) Advertisement
8. The main basis of setting standards is ________. [1]

a) Quality b) All of these

c) Time d) Quantity
9. Identify the external source of recruitment illustrated by the picture given below: [1]

a) Employment Exchange b) Campus Recruitment

c) Recommendation of Employees d) Labour Contractors

10. Identify the correct sequence of steps involved in the communication process. [1]

a) Sender, Decoding, Receiver, Feedback, b) Sender, Message, Encoding, Media,

Message, Encoding, Media Decoding, Receiver, Feedback

c) Sender, Message, Feedback, Media, d) Sender, Media, Decoding, Receiver,

Decoding, Receiver, Encoding Message, Encoding, Feedback
11. Money market is a market for dealing in: [1]
i. Long term fund
ii. Medium-term fund
iii. Short term fund
iv. Both Long term fund and Medium-term fund

a) ii and iii b) i and ii

c) iv and i d) only iii

12. ________ ensures that goods belong to a particular quality and helps in realising higher prices for high quality [1]
 output. (Standardisation/Grading).

a) Grading b) Branding

c) Product designing and development d) Standardisation

13. Match the columns to identify the importance of coordination. [1]

Column I Column II

(a) Functional (i) When all departments have their own objectives, policies and their own style of
differentiation working.

(b) Specialisation (ii) When organisation is performing on large scale and more people are employed.

(iii) When more complexities of modem technology and diversity of tasks is to be

performed.

a) (a) - (ii), (b) - (i) b) (a) - (i), (b) - (ii)

c) (a) - (i), (b) - (iii) d) (a) - (iii), (b) - (i)

14. Plans are prepared for a specific period of time, may be for a month, a quarter or a year. At the end of that [1]
period, there is a need for a new plan to be drawn on the basis of new requirements and future conditions. The
feature of planning reflected in the above lines is:

a) Planning is a mental exercise b) Planning is futuristic

c) Planning is continuous d) Planning is pervasive

15. ________ is a very useful source of recruitment for hiring casual or badli workers to whom compensation is [1]
provided on a daily wage basis.

a) Labour contractor b) Placement agencies and management

consultant

c) Direct recruitment d) Advertising on television

16. When the stock market is bullish, a company must go for which of the following? [1]

a) Equal mix of debt and equity b) Less equity

c) More equity d) More debt

17. The risk of default on payment of interest on borrowed funds and the repayment of debt is known as ________. [1]

a) operating risk b) leverage risk

c) financial risk d) business risk

18. Which is the major part of financial system? [1]

a) Financial institutions b) Financial market

c) Financial securities d) All of these

19. The primary aim of financial management is ________. [1]

a) optimal procurement as well as the usage of b) to maximise shareholders wealth

finance

c) to see that the firm does not raise resources d) to ensure availability of enough funds
unnecessarily whenever required
20. Statement I: The most important criterion of capital budgeting decisions is the rate of return of the project. [1]
Statement II: Suppose, there are two projects, A and B (with the same risk involved), with a rate of return of 10
percent and 12 percent, respectively, then under normal circumstance, project A should be selected

a) Statement II is correct and Statement I is not b) Statement I is correct and Statement II is not
correct. correct.

c) Both the Statements I and II are not correct. d) Both the Statements I and II are correct.
21. Geetika is working in a private sector bank. One of her key function relates to the formulation of the overall [3]
organizational goals and strategies of the bank. Identify the level of management at which she is working? State
any three other functions that she has to perform at this level.
OR
Mr. Kunal is working as the Finance Manager of XYZ Ltd. At what level of management is he working? State any
two functions being performed by him?
22. Neela Ayurved Ltd, a new and leading manufacturer of herbal and ayurvedic medicines and grocery products has [3]
captured a large share of the market in a short span of time. The Research and Development (R & D) department
of the company spends considerable time and effort in developing eco-friendly, chemical free and healthy
alternatives for a variety of products of daily use, like toothpaste, biscuits, noodles, soaps, shampoos and
detergents etc. Their business orientation differs from competitors who are short sighted and serve only
consumers needs. Instead Neela Ayurved Ltd. considers larger issues of long term social welfare, paying
attention to social, ethical and ecological aspects of marketing.
Identify and explain the marketing management philosophy adopted by Neela Ayurved Ltd.
23. Distinguish between Capital Market and Money Market on the basis of: [3]
i. Instruments
ii. Liquidity
iii. Safety
OR
State any three regulatory functions of the Securities and Exchange Board of India.
24. XYZ Ltd. is a management oriented company. Time and again all the employees learn from their seniors various [3]
ways of dealing with diverse situations. They are provided training whenever required. They are also given
incentives both financial as well as non financial. The result is employees see their development in the
organisation. The organisation tries to behave as a responsible constituent of society and always creates
good quality products. It has a very good image in the market. The training modules are superb and the
employees always try to find unique ways of providing solutions in the context of rapidly changing business
environment. This has helped the organisation to adjust frequently in a very good manner.
Which importance of management is highlighted here? Also identify the lines.
25. Differentiate between Advertising and Personal Selling on any four bases. [4]
OR
Distinguish between Product and Production concepts of marketing philosophies on the followings bases :
i. Starting Point
ii. Main Focus
iii. Means
iv. Ends
26. Give the meaning of ‘policy’ and ‘strategy’ as types of plans. [4]
OR
Why are the planning premises required in the planning?
27. Paytm is an Indian e-payments and e-commerce brand based out of Delhi NCR, India. Launched in August [4]
2010, it is a consumer brand of parent company One97 Communications. The name is an acronym for "Payment
Through Mobile". The company employs over 13,000
employees as of January 2017 and has 3 million offline merchants across India. It also operates the Paytm
payment gateway and the Paytm Wallet. Starting from March 2017, Paytm expanded its services to Canada with
the launch of Paytm Canada. Paytm has targeted each and every person irrespective of age, income, gender or
status as its target customer because it wants to penetrate in every nook and comer of India. Some of its major
competitors are JioMoney, Airtel Money, Mobikwik and Freecharge. It acts as a portal to shop for multiple
products from apparel to electronic items. The government is propagating the cashless economy system and this
has helped Paytm in its endeavour. In the year 2015 Reserve Bank of India granted it a license to start the first
payment bank in India. Demonetization of currency notes has also worked
heavily in favor of the company and led to a substantial increase in inactive users.
In the context of the above case:
a. Identify and explain any three dimensions of the business environment being referred to them in the above
case by quoting lines from the paragraph.
b. Outline the concept of 'demonetization'.
28. How does controlling function of management ensures order and discipline and helps in judging accuracy of [4]
standards? Explain.
29. Scientific Management means knowing exactly what you want men to do and seeing that they do it in the best [4]
and the cheapest way. Taylor developed various techniques for application of Scientific Management principles
and was able to achieve a three-fold increase in productivity in Bethlehem Steel Company, where he worked.
One of the techniques helps to determine the number of workers to be employed; frame suitable incentive
schemes and determine labour costs. Another technique recognises those workers who are able to
accomplish/exceed the fair day’s work and is based on the premise that efficiency is the result of the joint efforts
of the managers and the workers.
Quoting the lines from the above paragraph, identify and explain the two techniques of Scientific
Management.
30. After passing his secondary school examination, David left the school at the age of 15 years and started getting [4]
training under his father. His father, a renowned electrician, had worked for many companies. He every day
started accompanying his father on work and watched him carefully while working. David was a good learner
and learnt the techniques of work quickly. Now his father started passing on the tricks of the trade to David.
With the passage of time David acquired a high level skill and became a well-known electrician in Indore. Big
business houses started calling him for electrical-wiring.
a. Name the method of training discussed in the above para.
b. State any three benefits which David could get on being trained.
31. A.M. Motors Ltd. is a leading company in car manufacturing. Due to the changing environment and initiatives [6]
taken by the Government of India, the company wants to enter into manufacturing of e-cars also. For this project
the company requires ₹ 2,000 crore. But before purchasing the machines and other assets, the finance manager
has to assess the degree of risk involved in the project as this type of decision affects the earning capacity of the
 business over the long run. Besides this, there are various other factors which may affect this decision of the
finance manager.
a. Identify and state the financial decision discussed in the above para.
b. State any two factors that may affect the decision of the finance manager identified in (i) above.
32. Neeraj has been working as a sewing machine operator in an export house for the past ten years. His basic work [6]
is to seam the parts of a garment together and attach buttons, hooks, zippers, and accessories to produce
clothing. Considering the fact that Neeraj is an experienced operator, he is well versed with the fundamentals of
industrial production and possesses good communication skills. The plant superintendent in the factory
recommends Neeraj's name to the production manager for the post of supervisor which will fall vacant after a
month on the retirement of the present supervisor. Consequently, Neeraj is assigned the post of supervisor and
his salary is increased accordingly. Moreover, as per the policy of the export house, he is offered free medical aid
and education to his two children.
In the context of the above case:
a. Identify the type of source of recruitment used by the export house to fill up the post of supervisor. Give any
two advantages of using this source.
b. Identify the types of financial incentives offered to Neeraj by quoting lines from the paragraph.
33. E-Solutions Ltd. started its operations in the year 2000. At the time of its inception, the company had only ten [6]
employees with two departments, a Production department and an Administration department. The products
supplied and the services provided by the company started gaining popularity over the years. The management
had faith in the abilities of the employees and thus they allowed them freedom of action. The management
recognised that the decision-makers at different levels of the organisation need to be given more autonomy. They
took a policy decision that there will be less control of superiors over subordinates. This increased the role of the
subordinates in the organisation and now they were in a position to take numerous as well as important
decisions. As a result, its business has diversified into many areas. Presently, it has its operations throughout the
country with seven branches overseas. Its organisational structure has now changed into divisional structure and
ten thousand people are working with the company.
a. Identify the concept of management which helped the company to diversify into many areas and branches
abroad.
b. Explain five points of importance of the concept identified in (a) above.
34. Explain the following rights of a consumer as per the Consumer Protection Act, 2019: [6]
i. Right to be Informed
ii. Right to be Heard
OR
Enumerate the various Acts passed by the Government of India which help in protection of consumer’s interests.