Prerna International School Vihirgaon, Nagpur

XI COMMERCE (CBSE) 2021-22

SUBJECT: BUSINESSSTUDIES(054)
TERM -1

Maximum Marks: 40 Time Allowed: 90 minutes

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General Instructions:

1. The Question Paper contains 3 sections.

2. Section A has 24 questions. Attempt any 20 questions.
3. Section B has 24 questions. Attempt any 20 questions.
4. Section C has 12 questions. Attempt any 10 questions.
5. All questions carry equal marks.
6. There is NO negative marking.

Section A
1. An economic activity which is conducted by a person having special knowledge and
special skills which is used to serve different sections .
a. Profession
b. Employment
c. Business
d. None of these
2. Mrs. Tiwari started a voluntary association of 10 people, who are also consumers,she collected
the capital by selling shares to members and opened a retail shop so that they can eliminate
middlemen and gets goods at lower price. State the type of organization stated above?
a. Farmer cooperative society
b. Credit cooperative society
c. Consumer cooperative society
d. Producer cooperative society
3. A prospectus is issued by:
a. A private company
b. A public enterprise
c. A public company seeking investment from public
d. None of these
4. Which Bank service permits withdrawal of money more than the balance in the account?
a. Savings Account
b. Banker’s cheque
 c. Bank Overdraft
d. Fixed deposit Account
5. E-Business includes:
a. E-Commerce
b. Product development
c. Production
d. All of these

6. `To adopt fair trade practices’ .It is an example of responsibility of business towards-------------:
a. Owners
b. Workers
c. Government
d. Consumers
7. Which of the following is an economic activity?
a. Mother cooking food for family
b. Kids are lighting candles and diyas on diwali
c. Doctor attending to a patient at his clinic
d. All of the above
8. In which type of company there is no restriction on the transfer of shares?
a. One person company
b. Public company
c. Private company
d. None of these
9. In 2001 only industries were reserved exclusively for the public sector.
a. 12
b. 9
c. 3
d. 5
10. Import-export bank is :
a. Commercial bank
b. Central bank
c. Cooperative bank
d. Specialized bank
11. E-commerce does not include:
a. A business’s interactions with its suppliers
b. A business’s interactions with its customers
c. Interactions among the various departments within the business
d. Interactions among the geographically dispersed units of business
12. That an enterprise should avoid any type of pollution is an example of its responsibility towards:
a. Owners
b. Consumers
c. Workers
d. Community
13. Which of the following does not characterize business activity?
a. Production of goods and services
b. Presence of risk
 c. Sale or exchange of goods and services
d. Salary or wages
14. Every partner acts in the capacity of:
a. An agent as well as a principal
b. Only principal of the firm
c. Only agent of the firm
d. None of these
15. A private company is related with Public Sector
a. Mixed Sector
b. Private Sector
c. Government Sector
16. A bank, which occupies a central position in the monetary and banking system of the
country and has a superior financial authority, is .
a. Co-operative bank.
b. Commercial bank
c. Central bank
d. Exchange bank
17. Quikr and Olx are examples of which of the following category of e-business.
a. Intra-B commerce
b. B2B commerce
c. C2C commerce
d. B2C commerce
18. Use of synthetic fertilizers and pesticides in agricultural leads to:
a. water pollution
b. air pollution
c. noise pollution
d. land pollution
19. Automobile and computer industry are the example of :
a. Processing industry
b. Assembling industry
c. Synthetical industry
d. None of these
20. The business assets of a firm amount to ₹ 22,000 but the liabilities stand at ₹ 47,000. What
course of action can the creditors take if it is a sole proprietorship firm?
a. Creditors can settle their account only to the extent of the owner's personal assets available
b. Creditors can settle their account only to the extent of business assets available i.e. ₹ 22,000
c. Besides using business assets of ₹ 22,000, creditors can use the personal property of the owner to
the extent of ₹ 25,000
d. None of these
21. All the sick public sector units were referred to:
a. Board of Financial Reconstruction
b. Board of Industrial and Financial Reconstruction
c. Board of Industrial Reconstruction
d. None of these
22. In the 1956 resolution on industrial policy industries were reserved for the public sector.
a. 17
 b. 12
c. 35
d. 21
23. ATM facility to withdraw money is an example of:
a. C2C commerce
b. B2Bcommerce
c. B2C commerce

d. Intra B commerce
24. It is not an application of e-business:
a. Online bidding
b. Online procurement
c. Online trading
d. Contract R & D
Section B
25. Which of the following is not a characteristic of business?
a. Creation of utilities
b. Entrepreneurship
c. Regularity of dealing
d. Non economic activities
26. A partner who allows the use of his name and goodwill for the benefit of the firm and can be
represented as a partner is known as:
a. Active Partner
b. Nominal Partner
c. Sleeping partner
d. Secret partner
27. ------------------is suitable when national security is concerned:
a. Statutory Corporation
b. Government company
c. Departmental Undertaking
d. All of these
28. ------------------is financed by the Government through allocation of funds in the Annual
General Budget ofParliament.
a. Statutory Corporation
b. Government company
c. Departmental Undertaking
d. None of these
29. Following can be used to make payment in case of Online shopping:
a. Credit Card
b. Debit Card
c. Net-banking Transfer
d. All of these
30. That an enterprise must behave as a good citizen is an example of its responsibility towards:
a. Owners
b. Workers
c. Consumers
 d. Community
31. The basic principle of cooperation each for all and all for each is followed by one of these
business organizations. Which is that?
a. Sole Proprietorship
b. Partnership
c. Cooperative Societies
d. Company
32. Primary industry engaged in the activity of breeding and reproducing plants and animals is
known as---
-----------------.
a. Extractive industry

b. Processing industry
c. Genetic industry
d. Analytical industry
33. Which of the following element is present in the case of Life Insurance?
a. Security, Investment
b. Security
c. Investment
d. Profit
34. The possibilities of inadequate profits or even losses due to uncertainties are known as -------- --.
a. Business contingencies
b. Business risks
c. Business ventures
d. None of these
35. Which of the following is a responsibility of a business towards the workers?
a. Providing opportunities to the workers for meaningful work
b. Fair wages
c. Right kind of working conditions
d. All of these
36. The board of directors of a Joint stock company is elected by:
a. General public
b. Government bodies
c. Shareholders
d. Employees
37. Which of the following is an economic course of business risks?
a. Demand for goods
b. Competition
c. Price
d. All of these
38. A company is an artificial person. Which of the following is not true about an artificial person?
a. It exists independent of its members
b. It can sue and be sued
c. It is created by law
d. It cannot own property
39. Social responsibility is:
 a. Same as legal responsibility
b. Broader than legal responsibility
c. Narrower than legal responsibility
d. None of them
40. Which of the following is an example of Departmental undertakings?
a. Post and Telegraph dept.
b. Railways
c. Defence and atomic power
d. All of these
41. Pankaj is running a Chemist Shop under the name of `Bansal Medicos’ in Ashok Vihar
Market. He takes all the decisions about business himself and there is no interference from
others.He also earns good profit as a direct reward for his risk bearing .Identify the form of
business organization in which Pankaj is engaged
a. Sole proprietorship
b. Partnership
c. Company
d. Joint Hindu family business
42. Mr. kamal Mehra is a practicing Chartered Accountant .His wife is a Bank Manager in Punjab
National Bank and his son ,Arnav has a factory in Muradabad where manufactures shoes.
Name the economic activity in which Mrs. Mehra is engaged:
a. Business
b. Profession
c. Employment
d. None of these
43. Samarjit has a sweet shop . During the season of Diwali, he purchased adulterated khoya and
paneer at very low rates in order to make huge profits. As a result, many people fell sick after
consuming the sweets because of food poisoning. Identify whose interest is being ignored by
Samarjit?
a. Consumers
b. Community
c. Both (a) and( b)
d. None of these
44. Three Doctors (Dr.Sahil Gupta ,Dr Mayur Agarwal and Dr. vikas Jaiswal) decide to start a
Charitable Clinic. Will it be considered a Partnership firm?
a. Yes
b. No
c. Can’t say
d. None of these
45. The capital of the company is divided into number of parts each one of which are called:
a. Dividend
b. Profit
c. Interest
d. Share
46. Which of the following is not the advantage of the sole trade?
a. Easy Formation
b. Quick Decision
 c. Personal Control
d. Unlimited Liability
47. According to , the insurer gets all the rights against the third party with respect to the
subject- matter insured, after compensating the loss of the insured.
a. Principle of Subrogation
b. Principle of Contribution
c. Principle of Mitigation
d. Principle of Indemnity
48. Assertion (A): Transport removes the hindrances of place.
Reason (R): It moves the goods from the place of production to the markets for sale.
a. Both A and R are true and R is the correct explanation of A.
b. Both A and R are true but R is not the correct explanation of A.
c. A is true but R is false.
d. A is false but R is true.

Section C

Question No. 49 to 54 are based on the given text. Read the text carefully and answer the
questions:

Manish, Rahul and Madhav live in the same locality. They used to meet and discuss their ideas. After
discussing about the recent fire breakout in their area, they decided to take fire insurance for their
house or work area.
Manish gets his house insured against fire for ₹1 lakh and during the policy period, his house gets
damaged due to fire and the actual loss amounts to ₹2.5 lakh. Insurance company acquired the burnt
material and approved his claim.
Rahul gets his godown insured against fire for ₹1 lakh but does not take enough precautions to
minimize the chances of fire like installing fire extinguishers in the factory. During the policy, a
fire take place in his godown and he does not take any preventive steps like throwing water and
calling the employees from the fire fighting department to control the fire. He suffered a loss of ₹1,
20,000.
Madhav took a fire insurance policy of ₹20 lakh for his factory at the an annual payment of
₹24,000. In order to reduce the annual premium, he did not disclose that highly explosive
chemicals are being manufactured in his factory. Due to a fire, his factory gets severely
damaged. The insurance company refused to make payment for the claim as it becomes aware
about the highly explosive chemicals.

49. How much can Manish claim from the insurance company?
a. 2.5 Lakhs
b. 1 Lakh
c. 2 Lakhs
d. None of the above

50.How much compensation can Rahul get from the insurance

company?
a. 2,00.000rs
 b. 1,20,000rs
c. 1,00,000rs
d. Nil
51. Which principle is violated in case of Rahul?
a. Mitigation
b. Insurable Interest
c. Utmost Good Faith
d. Indemnity
52. How much amount is the insurance company liable to pay to Madhav if he files a case
against it?
a. 24,000
b. Nil
c. Insufficient information
d. 20 lakh
53. Which principle of Insurance is violated by Madhav?
a. Utmost Good Faith
b. Insurable interest
c. Subrogation
d. Proximate Cause
54. The insurance company acquired the burnt material and approved his claim. Which
principle of insurance is highlighted in the given statement.
a. Mitigation
b. Indemnity
c. Proximate Cause
d. Subrogation
55. ABC Ltd. Is a company in India, the company issues shares for rs.100000
Out of which shares amounting to Rs:
30000 were held by the Gujarat state Government,
21000 were held by the central Government,
49000 were held by the General Public
ABC Ltd is a company:
a. Private
b. Government
c. Associate
d. Subsidiary
56. Upon the completion of incorporation of a company, Which of the following is allotted to the
company by the registrar of companies?
a. PAN
b. CIN
c. DIN
d. TIN
57. Nikhil wants to start a whole sale business of stationery items .But he is hesitating as it will
involve
hindrances related to finding consumers, moving goods from place of production to market,
storing goods because of time gap between production and consumption, risk of theft, fire,
accident, procurement of capital to finance above activities, providing information to the
consumers about products etc.
 He approaches his friend Anant to discuss his problems, Anant, who himself imports the
electric appliances for the purpose of exporting them to other countries, advises Nikhil to carry
on with his plan explains to him various functions performed by the second limb of business i.e.
commerce.
Anant elaborates on various advantages of `Trade’ and `Auxiliaries to Trade’. After getting
convinced by the advice given by Anant, Nikhil starts the business named Nikhil Ltd.and finds
no major problems at all in converting his desire into a business venture .Nikhil gets his
company registered under the Companies Act 2013.
Answer the questions given below by reading the above text:
Name the part of commerce which exclusively helps in the process of trading the goods and
services.
a. Trade
b. External trade
c. Warehousing
d. Transport
58. Which of the following is a false statement?
a. The scope of commerce is narrower than business
b. Commerce includes trade and a auxiliaries to trade
c. Foreign trade is purchase and sale by the traders of the same country
d. Traders serve as a link between producers and consumers
59. Name the type of trade under which Anant was doing his business.
a. Trade
b. External trade
c. Warehousing
d. Transport
60. Name the service which helps Nikhil to remove the hindrance of storing the stationery items.
a. Trade
b. External trade
c. Warehousing
d. Transport