Plus One Business Studies Previous Year Question Papers and Answers ( Question Paper 5 )

 

                                    Model Question Paper

Answer the following questions from 1 to 7. Each carries 1 score.

Question 1.
Identify the type of business organization to which the registration is compulsory.
a. Sole proprietorship
b. Partnership business
c. Joint stock company
d. Hindu Undivided Family Business

Question 2.
Find the odd one from the following,
a. Banking
b. Mining
c. Warehousing
d. Advertising

Question 3.
Identify the type of warehouse where imported goods can be kept prior to the payment of duties and taxes.
a. Bond Warehouses
b. Government warehouses
c. Public Warehouses
d. Private warehouses

Question 4.
A business firm decided to help the affected people in Okhi cyclone. It belongs to the responsibility of the business.
a. Discretionary
b. Legal
c. Economic
d. Ethical

Question 5.
Which of the following is known as the birth certificate of a joint stock company?
a. Certificate of Incorporation
b. Memorandum of Association
c. Table A
d. Articles of Association

Question 6.
Fill up the series as per hint given:
a. Capital required for the day to day activities of the business working capital.
b. Capital required for acquisition of fixed assets…………..? ………………

Question 7.
The apex banking institution set up to promote agriculture and rural development in India is …………..

Question 8.
Buying and selling of goods and services within the geographical boundaries of a nation is
a. External trade
b. Internal trade
c. Entrepot trade
d. International trade

Question 9.
Identify the import document from the following
a. Letter of credit
b. Bill of lading
c. Bill of entry
d. Certificate of origin

Answer any 6 questions from 10 to 16. Each carries 2 scores.

Question 10.
Write any two merits of a government company.

Question 11.
Identify the type of E-business transaction referred to in the following cases.
a. A dealer in Kerala places an order through email to Marathi Udyog LTD. for a supply of 20 cars.
b. Ms. Anasooya placed an order for a smartphone through online.

Question 12.
Explain the concept of business ethics with the help of an example.

Question 13.
List out any two problems faced by a small-scale business of India.

Question 14.
Name any two products which are suitable for a vending machine.

Question 15.
Write a short note on export processing Zone.

Question 16.
Stae any two objectives of the small-scale business.

Answer any 4 questions from 17 to 21. Each carries 3 scores.

Question 17.
Identify the types of manufacturing industries mentioned below.
a. Production of cement by combining various ingredients like limestone, silicon etc.
b. Production of petrol, diesel, and kerosene from crude oil.
c. Manufacturing of computers using different components.

Question 18.
Explain any three features departmental undertakings.

Question 19.
List out any three differences between Memorandum of Association and Articles of Association.

Question 20.
Write any three ways in which a business organization can enter into international Business.

Question 21.
Explain any three schemes announced by the Government of Indian in Export-Import policy (EXIM policy) for the promotion of foreign trade.

Answer the following questions which carry 4 scores.

Question 22.
Match the following:

Answer any 3 questions from 23 to 26. Each carries 4 scores.

Question 23.
Identify the type of partners in the following cases:
a. Mr. Nirmal contributed Rs.l lakh as capital in Maithri Traders but do not participate in the day to day activities.
b. A well-known person allows Maithri Traders to use his name but doesn’t contribute capital or share profits.
c. Mr.Deepu pretends to be a partner in Maithri Traders, but actually, he is not.
d. Mr. Rajesh contributed Rs 1 lakh as capital in Maithri Traders and participate s in the conduct of business.

Question 24.
Write any four benefits of E-banking.

Question 25.
Classify the following into long term and short term sources of finance.
a. Factoring
b. Retained earnings
c. Preference Shares
d. Bank overdraft
e. Commercial papers
f. Debentures
g. Trade credits
h. Equity shares

Question 26.
“Outsourcing of non-core activities are beneficial to business units.”Do you agree? Comment on this statement by highlighting your views.

Answer any 3 questions from 27 to 30. Each carries 5 scores.

Question 27.
“Risk is an essential part of every business.” Explain its causes.

Question 28.
State any three responsibilities of business towards employees and any two towards consumers.

Question 29.
Who are promoters? Briefly explain any four functions performed by them.

Question 30.
Write any five advantage of equity shares as sources of finance.

Answer any 2 questions from 31 to 33. Each 4 carries 8 scores.

Question 31.
Identify the business organization formed voluntarily by a group of people for mutual benefits, Following the principle of “one man one vote”. Also, explain its four merits and three limitations.

Question 32.
Explain the major principles of insurance.

Question 33.
Explain any four services each rendered by wholesalers to manufactures as well as to the retailers.

Answers

Answer 1.
Joint Stock Company

Answer 2.
Mining

Answer 3.
Bonded Warehouses

Answer 4.
Discretionary

Answer 5.
Certificate of Incorporation

Answer 6.
Fixed capital requirement

Answer 7.
NABARD

Answer 8.
Internal trade

Answer 9.
Bill of entry

Answer 10.
1. A government company can be established by fulfilling the requirements of the Indian companies act.

2. It has a separate legal entity, apart from the government.

Answer 11.
a. B2B Transaction
b. B2C Transaction

Answer 12.
Business Ethics
Ethics is the belief is what is right proper and just. It is to the socially determined moral principle which should give business activities. Business is the code of conduct followed and performed by the businessmen. Ethical business is good business. Ethical business behavior improves public image, earn people’s confidence and trust, and leads to greater success.

Answer 13.
1. Finance

One of the severe problems faced by SSIs is that of non-availability of adequate finance to carry out its operations. Many of the units in the small sector lack the creditworthiness required to rise as capital from the capital markets.

2. Raw Materials
Another major problem of small business is the procurement of raw materials. If the required materials are not available, they have to compromise on the quality or have to pay a high price to get good quality materials.

Answer 14.
Soft drinks, Chocolate

Answer 15.
Export Processing Zone

These are set up to increase production for exports. These are industrial estates which form enclaves within the national customs territory. They are usually located near the international airport or seaport. There are several export processing zones in India. They are

Answer 16.
1.Provide employment opportunity

They generate a number of employment opportunities per unit of capital invested compared to large industries.

2. Variety of Products

Small industries in our country supply an enormous variety of products which include mass consumption goods, readymade garments, hosiery goods, stationery items, soaps and detergents, domestic utensils, leather, plastic and rubber goods, processed foods and vegetables .wood and steel furniture, paints, varnishes, safety matches, etc

Answer 17.
a. Synthetical industry

b. Analytical industry

C. Assembling industry

Answer 18.
1. It is a large scale retail organization

2. It makes centralized purchasing

3. It is located in towns and cities

Answer 20.
1. Exporting and Importing

Export refers to the sending of goods and services for sale from the home country to foreign countries. Importing means purchasing of goods and services from foreign countries for domestic use. It is one of the methods to enter into International Business.

2. Contract Manufacturing.

It is a type of international business where a company enters into a contract with a local manufacturer in a foreign country. The contract is for getting certain components or goods produced as per specifications ‘ given. Contract manufacturing also called outsourcing can take the following three forms:

3. Licensing and Franchising

Licensing in international business is a contractual agreement in which one firm permits another firm in a foreign country to access its trademark, patents or technology for a fee called royalty. The firm which gives permission is called licensor and to whom it is given is called licensee. Franchising is somewhat similar to licensing.

The difference is that in the case former it is concerned with production and marketing of goods while franchising is connected with the provision of services. Franchising is relatively more stringent than licensing. The parent company is called the franchiser and the party to whom a franchise is granted is called the franchise.

Answer 21.
1. Export processing zones(EPZs)

EPZs have been set up to provide an internationally competitive duty-free environment for an expense. Govt has taken initiative to provide infrastructural facilities in these zones to produce goods at lower cost.

2. Cent percent export-oriented units

These units are set up for the export of the entire products. They can be set up anywhere in India. They get all the benefits provided to units in the EPZ

3. Special economic zones (SEZs)

It has been created to encourage free trade.
Its being treated as a deemed foreign territory for duty purposes. Goods going into the SEZs area from the domestic tariff area (DTA) are treated as deemed exports.

Answer 22.
a. Indian Railways Departmental undertaking
b. LIC of India Statutory corporation
c. BHEI Government company
d. Honda Ltd Multinational company
Answer 23.
a. Sleeping partner or dormant partner
b. Nominal partner
c. Partner by holding out
d. Active partner

Answer 24.
1. e-banking provides 24hours, 365 days a year services to the customers of the bank.

2. It lowers the transaction cost.

3. Customers can make the transactions from the office, home or while traveling.

4. Greater customer satisfaction.

Answer 25.
Long-Term Sources
Retained earnings Preference Shares Debentures Equity Shares
Short Term Sources
Factoring Bank overdraft Commercial paper Trade creditors

Answer 26.
I agree with this statement. BPO (Business Process Outsourcing is a system of getting a business task accomplished through an outside agency. Eg, transportation of raw materials into the factory may be entrusted to a transport company.

Following are the importance of outsourcing
1. Focusing on attention

Outsourcing benefits the organization by focusing on core areas and contracting out non-core business.

2. Quest for excellence

Outsourcing enables the firms to pursue excellence through a division of labor and specialization.

3. Cost reduction
It helps the organization to get an expert and specialize services at competitive prices. It helps in improved service and reduction in costs.

4. Growth through alliance

To the extent you can avail of the services of others, your investment requirements are reduced, others have invested for you. Therefore you can expand rapidly.

5. Fillip to economic development

Outsourcing helps in stimulating entrepreneurship, employment, and exports in the host countries. This will result in economic development.

Answer 27.
1. Natural Causes

it includes natural calamities like earthquake, flood, lightning, heavy rains, famine etc.

2. Human Causes
It includes dishonesty, carelessness negligence of employees, stoppage of work due to power failure, riots, management inefficiency etc.

3. Economic causes:
demand, change in price, competition, technological changes etc.

4. Other causes:

It includes political disturbances, fluctuation in exchange rates, a change in govt, policies etc.

Answer 28.
The responsibility of business towards employees

1. It is the social and moral responsibility of the business to pay reasonable wage and salaries to Employees.

2. They must be provided with good work I ing conditions security of the job, medical benefits etc.

3. Respect democratic rights of workers to form unions. The responsibility of business towards consumers

1. Supply of right quality and quantity of goods and services to consumers at reasonable prices, They have the right of information about the product, price, the company etc

2. Avoiding unfair trade practices

Answer 29.
A Person who undertakes to form a company and take necessary steps for the same are called promoter.

Following are the functions of a promoter.
1. Identification of business opportunity: The first and foremost activity of a promoter is to identify a business opportunity and analysis of the same.

2. Feasibility studies: After identifying a business opportunity, promoter undertakes detailed feasibility studies such as technical feasibility, financial feasibility & economic feasibility studies to determine the viability and profitability of the proposed business.

3. Name approval: After selection of a name for the company, the promoters submit an application to the registrar of companies for its approval the selected name should not be same or identical to the name of an existing company.

4. Fixing up signatories to the memorandum of association: Promoters have to decide about the members who will be signing the memorandum of association of the proposed company.

Answer 30.
Equity shares The money raised by equity shares is called equity share capital. It represents the ownership of a company. Equity shareholders do not enjoy preferential right in the matter of the claim of dividend or repayment of capital. They do not get a fixed dividend. They have the right to vote.

Merits

• It is suitable for investors who are willing to assume the risk for higher returns
  
• Payment dividend is not compulsory
  
• It serves as permanent capital as it is to be repaid only at the liquidation of a company.
  
• Equity shares do not create any charge on the assets of the company
  
• They have the right to vote and participate in the management.
  

Answer 31.
COOPERATIVE SOCIETY
The cooperative society is a voluntary association of persons, who join together with the motive of the welfare of the members. It is compulsorily required to be registered under the Co-operative Societies Act. 1912. At least ten persons required to form a society. The capital is raised from its members through an issue of shares.

Merits
a. Equality in voting status The principle of ‘one man one vote’ governs the cooperative society. Each member is entitled to equal voting rights.

b. Limited liability

The liability of the member of co-operative society is limited to the extent of their capital contribution.

C. Stable existence the retirement, death, insolvency or insanity of the members do not affect the continuity of a cooperative society.

d. Support from government

Cooperative society gets support from the government in the form of taxes, subsidies, and low-interest rates on loans.

limitations
a. Limited resources Resources of cooperative society consist of social capital contribution by members.

b. Inefficiency in management

Cooperative societies are unable to attract and employ expert managers because of their inability to pay them high salaries.

C. Lack of secrecy

As a result of an open discussion in the meeting.

Answer 32.
Insurance
Insurance is an agreement between two parties whereby one party undertakes, in exchange for a consideration, to pay the other party an agreed sum of money to compensate the loss, damage or injury caused as a result of some unforeseen events.

1. Utmost good faith

Both the insurer and the insured should display good faith towards each other in regard to the contract

2. Insurable interest

The insured should have an insurable interest in the subject matter of insurance.

3. Indemnity
All the insurance contract except life insurance are a contract of indemnity.

4. Proximate causes
When the loss is the result of two or more causes, the proximate cause for the loss alone will be considered by the insurance company for admitting the claim.

5. Subrogation
After the insured is compensated for the loss or damage to the property insured, the right of ownership of such property passes on to the insurer.

6. Contribution

If the same property is insured with one or more insurer, in case, there is a loss, the insured have no right to recover more than the full amount of his actual loss. The insurers together have to share the losses.

Answer 33.
1. Services to manufacturers;
a. Facilitate large-scale production;

Bulk orders from wholesalers enable the producers to undertake production on a large scale and take advantages of economies of scale,

b. Bearing risk

The wholesaler deals in goods in their own name and takes the risk of loss or damage in storage and transit.

C. Financial assistance
Wholesalers provide financial assistance to manufactures b means they make ready cash payment for purchases and even advance money to producers.

d. Expert advice

As wholesalers are in direct contact with retailers they provide useful information regarding customer taste and preference and market condition to manufacturers.

Services to retailers:

a. Availability of goods:

The wholesalers make the products of various manufacturers readily available to the retailers.

b. Marketing support:
The wholesalers perform various marketing functions and provide support to retailers.

C. Grant of credit

Wholesalers provide credit facilities to retailers.

d. Specialized knowledge:

The wholesalers specialize in one line of products and know the pulse of the market. So they offer expert advice to retailers.