KHALSA MONT.

SENIOR SECONDARY SCHOOL

TEST SERIES (2024)
NAME:- SUBJECT – BUSINESS STUDIES ROLL NO.____
PAPER CODE:- KMSSS/EC/211224 CLASS – XII
Time : 3 hrs. MM: 80
NOTE:- ATTEMPT ALL QUESTIONS
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.
Section A
1 M. Tech Ltd. is a company producing IT services. The company’s profits are enough for the [1]
survival and growth. The management of the company believes that a satisfied employee creates
a satisfied customer, who in turn creates profits that lead to satisfied shareholders. So, it pays
competitive salaries and perks to all its employees. All the employees are happy working in the
organisation because of personal growth and development. The company has a strong sense of
social responsibility. It has set up an engineering college in which one - third of the students are
girls to whom the company gives 50% scholarship.
Which of the following objective of management is highlighted in the above case?
a) Social Objectives b) All of these c) Organisational Objectives d) Personnel Objectives
2 ________ has been established with the specific objective of providing a ready market for money [1]
market instruments.
a) Reserve Bank of India b) State Bank of India
c) Discount Finance House of India d) Securities and Exchange Board of India
3 Which one of the following is a step of planning? [1]
a) Analysis of environment b) Analysis of employee morale
c) Analysis of employee behavior d) Analysis of organisation structure
4 Stock owners expect a rate of return form the equity which is commensurate with the risk they [1]
are assuming. This is called ________.
a) Cost of equity b) Business risk c) Cost of debt d) Financial risk
5 An efficient control system helps to: [1]
a) Efficient use of resources b) Boost employee’s morale
c) All of these d) Achieve objectives
6 Identify the principle of management followed in the following pictorial representation. [1]

a) Cooperation, Not individualism b) Remuneration

c) Harmony, not discord d) Discipline
7 Secondary market deals with the ________ of existing securities. [1]
a) Purchase - sale b) Stock c) Purchase d) Sale
8 An organisation provides security services. It requires such candidates who are reliable and [1]
don’t leak out the secrets of their clients.
Which step in the selection process will help to ensure this?
a) All of these b) Personality Tests
c) Employment Interview d) Reference and Background Checks

(P.T.O)
9 Which of the following statement is false? [1]
1. Capital structure decision is essentially optimisation of risk - return relationship.
2. The cost of debt is lower than the cost of equity for a firm.
3. High interest coverage Ration (ICR) is an adequate measure to determine whether a
company may use more debt.
4. Equity is risk less for the business.
a) option (a) b) option (b) c) option (c) d) option (d)
10 Assertion (A): Functional heads do not get training for top management positions. [1]
Reason (R): Because they are unable to gather experience in diverse areas.
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.
11 Which of the following is included in the financial assets? [1]
a) Treasury bill b) Debentures c) Shares d) All of these
12 The statement of Profit and Loss of Arun Ltd. shows huge profits but the company is short on [1]
cash. So, it can pay less dividend. The factor affecting dividend decision highlighted here is
________.
a) Amount of earning b) Cash flow position c) Stability of dividend d) Stability of earning
13 Statement I: District commission has a jurisdiction to entertain complaints where value of goods [1]
or services paid as consideration does not exceed twenty lakh rupees.
Statement II: If any of the parties is not satisfied by the order of District Commission, it can
appeal against such order to the State Commission on the grounds of facts or law within a period
of thirty days from the date of order.
a) Statement II is correct and Statement I is not correct.
b) Both the Statements I and II are correct.
c) Statement I is correct and Statement II is not correct.
d) Both the Statements I and II are not correct.
14 Pawan decided to start a chocolates manufacturing business. He set the target of earning 10% [1]
profit on sales in the first year. As a good businessman, he was concerned about the future of the
business, which was uncertain. He gathered information that the demand for chocolates is
increasing day - by - day. He used this information as the base for future planning and shared it
with his team. On the basis of the gathered information, he scheduled a meeting in the following
week to find innovative ways to achieve the objectives. List the first two steps, which have been
followed by Pawan that are related to the process of one of the functions of management.
1. Setting Objectives
2. Developing Premises
3. Identifying alternative courses of action
4. Evaluating alternative courses
a) c and d b) b and c c) a and b d) a and d
15 That part of management which is connected with the financial activities is called ________ [1]
management.
a) Working capital b) Personnel c) Production d) Financial
16 Statement I: Market offering refers to a complete offer for a product or service, having given [1]
features like size, quality, taste, etc; at a certain price; available at a given outlet or location and
so on.
Statement II: A good market offer is the one which is developed after analysing the needs and
preferences of the potential buyers.
a) Both the Statements I and II are not correct.
b) Statement I is correct and Statement II is not correct.
c) Statement II is correct and Statement I is not correct.
d) Both the Statements I and II are correct.
17 Rahim wanted to start with a stationery app to help students of schools and colleges to provide [1]
stationery to them. He felt that students were not able to get the needed stationer at easy and
hence wanted to provide the stationery directly to students in the school.
(P.T.O)
 He lists out the various ways of setting up this business and finally selected the best way to set
up this business is by developing an app. Suggest what should be the next step of him:
1. Developing premises
2. Identifying the alternative course of action
3. Implementation of plan
4. Follow up action
a) iv and I b) only iii c) i and ii d) only ii
18 Match the features of management as an art in Column I with their respective explanation in [1]
Column II:

a) (a) - (ii), (b) - (i), (c) - (iii) b) (a) - (iii), (b) - (ii), (c) - (i)
c) (a) - (i), (b) - (iii), (c) - (ii) d) (a) - (i), (b) - (ii), (c) - (iii)
19 A decision is taken in financial management to distribute certain parts of the profit to [1]
shareholders after paying tax. This decision is called ________.
a) Financing decision b) Working capital decision
c) Dividend decision d) Investment decision
20 Controlling is a function which brings back the management cycle to: [1]
a) Management b) Planning c) Organizing d) Directing
21 Cortico Fabrics was started by Ashish in 2001 to sell bed sheets, towels, comforters, pillows, [3]
cushions, bath mats etc. It is now a famous name and its branches are across India. To manage the
work all over India, it has eight teams - two each for North, South, East and West India. Ashish
spends a considerable amount of time to develop an orderly pattern of group efforts among
different teams and to secure unity of action in pursuit of a common purpose.
To ensure suitable allocation of tasks to the various members of the teams and to see that the tasks
are performed with harmony among the members, he tries to balance the different teams at
different locations.
1. Identify and explain the concept of management discussed in the above para.
2. Also, explain any one point of importance of the concept identified in (a) above.
22 What do you mean by grapevine? Mention two types of grapevine along with diagram. [3]
OR
Blue Birds Ltd. offers to its employees to issue shares at a price which is less than the market price.
(i) Name and explain the type of incentive offered to the employees.
(ii) Explain one more incentive of the same category.
23 Explain the following as factors affecting Financing Decision: [3]
1. Fixed operating costs and
2. Cash flow position of the company
24 Consumer protection has a wide scope. Justify the statement. [3]
OR
Who is a consumer as per CPA?
25 Differentiate between ’Rules’ and ’Methods’ as types of plans. [4]
OR
How can (i) Political climate and (ii) Policies of competitors obstruct planning?
26 State any three points of importance of Controlling function of management. [4]
OR
Mr. Stanley Anthony is the Production Manager of ‘Coconut Oil and General Mills Ltd.His main
virtue is that prior to doing anything, he ponders over it. To explore and analyze different options
of each and every activity that is to be undertaken by him in the future has become his habit.
Besides, he quickly brings his subordinates under his own influence. They do what he wants.
(P.T.O)
 In spite of all this, for the last few months, the performance of his department failed to achieve the
expected level. This situation put him into a lot of worries. To counter this situation, he sought
help from some external specialists. Finally, he concluded that the poor performance was due to
two reasons:
First, the inefficiency of some newly recruited employees and Second, wear and tear of machines.
In order to remove these shortcomings he took the following corrective action:
1. To remove the inefficiency of the employees he established a training centre and gave its
charge to an expert trainer.
2. To deal with the wear and tear of machines he decided to replace them with new ones.
In thecontext of the above paragraph, answer the following questions:
a. Identify, by quoting the lines any two functions concerning management taken by
Mr. Anthony.
b. Identify the two steps of the controlling process mentioned here.
c. Identify the training method.
27 Renuka and Pawan are typists in a company having same educational qualifications. renuka is [4]
getting₹ 3,000 per month and Pawan ₹ 4,000 per month as salary for the same working hours.
Which principle of management is violated in this case? Name and explain the principle.
28 What is meant by ‘Directing’ as a function of management? Describe any four points of its [4]
importance.
29 Differentiate between Money Market and Capital Market on the following basis: [4]
1. Expected return 2. Safety 3. Liquidity 4. Instruments
30 Explain the role of consumer organisations and NGOs in protecting and promoting consumer’s [4]
interest.
31 Define staffing as a function of management and state its importance. [6]
OR
State the steps in the selection procedureafter the employment interview and before the job offer.
32 How would you characterise business environment? Explain, with examples, the difference [6]
between general and specific environment.
OR
With rapid advancements in the field of replacing manual work with machines, a Robot named
Sujan has been invented and developed and is likely to get the citizenship of the country of its
origin.
It has led to a stage where machines are being used in place of human beings. Sujan is doing all
types of work whether routine or hazardous and even answering the queries of people.
However, this issue has to be carefully looked into keeping in mind the consumer attitude towards
product innovations, problem of unemployment and its impact on the quality of life. Through the
orders and decisions of various commissions and agencies at Centre, State or Local level the Indian
Government is playing a very significant role in balancing the use of human and machine power.
Various dimensions of business environment are being discussed in the above para.
By quoting the lines from the above identify and explain any three dimensions.
33 What is meant by formal organisation? Explain any three features of formal organisation. [6]
34 Radhika was a student of Business Studies of class XII. Her father was a farmer who grew different [6]
varieties of rice and was well - versed about various aspects of rice cultivation. He was also
selected by the government for a pilot - project on rice cultivation.
As a project - work in Business Studies, she decided to study the feasibility of marketing good
quality rice at a reasonable price. Her father suggested her to use the internet to gather customers’
views and opinions. She found that there was a huge demand for packaged organic rice.
She knew that there were no pre - determined specifications in case of rice because of which it
would be difficult to achieve uniformity in the output. To differentiate the product from its
competitors, she gave it the name of ‘Malabari Organic Rice’ and classified it into three different
varieties namely—popular, classic and supreme, based on the quality. She felt that these names
would help her in product differentiation.
Explain the three functions of marketing, with reference to the above paragraph.

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