Board Paper of Class 12 2021 Business Studies Term 1 Set4 Solutions

General Instructions:

  1. This question paper contains 60 questions out of which 50 questions are to be attempted. All questions carry equal marks
  2. This question paper consists of three Sections – Section A, B and C.
  3. Section - A contains 24 questions. Attempt any 20 questions from Q. No. 1 to 24.
  4. Section - B contains 24 questions. Attempt any 20 questions from Q. No. 25 to 48.
  5. Section - C contains 12 questions. Attempt any 10 questions from Q. No. 49 to 60.
  6. The first 20 questions in Section A & Section B and first 10 questions in Section C attempted by a candidate will be evaluated.
  7. There is only one correct option for every Multiple Choice Question (MCQ). Marks will not be awarded for answering more than one option.
  8. There is no negative marking.

Question 1

At times, a business may concentrate on producing goods with fewer resources but cannot achieve the targeted production. In such a case, the business is said to be:

  1. Effective but not efficient
  2. Efficient but not effective
  3. Both effective and efficient
  4. Neither effective nor efficient

Ans. (b)

Question 2

The process that initiates implementation of plans by clarifying jobs, working relationships and effectively deploying resources for the attainment of identified and desired results is called:

  1. Coordination
  2. Management
  3. Organising
  4. Delegation

Ans. (c)

Question 3

Which Marketing management philosophy lays emphasis on continuous improvement in the quality of the product?

  1. Production concept
  2. Product concept
  3. Marketing concept
  4. Social marketing concept

Ans. (b)

Question 4

The objective of which of the following techniques of scientific management is to determine the number of workers to be employed in an organization?

  1. Method study
  2. Motion study
  3. Time study
  4. Differential piece wage system

Ans. (c)

Question 5

Which of the following is an element of political environment?

  1. Existing structure of the economy in terms of the relative role of private and public sectors.
  2. Rise in the disposable income of people due to an increase in the gross domestic product of a country.
  3. Legislations passed by the Government authorities.
  4. Attitude of the elected Government representatives towards business.

Ans. (c)

Question 6

The function of marketing that involves the physical movement of goods from one place to another is called:

  1. Promotion
  2. Transportation
  3. Storage and Warehousing
  4. Customer support services

Ans. (b)

Question 7

Identify the principle of management given by Fayol according to which “The intent of this principle is to produce more and better work with the same effort.

  1. Division of work
  2. Unity of direction
  3. Scalar chain
  4. Equity

Ans. (a)

Question 8

Which product-related decision is concerned with providing detailed information about the product on its package?

  1. Branding
  2. Packaging
  3. Labeling
  4. Both Branding and Packaging

Ans. (c)

Question 9

Which step in the process of ‘Planning’ function of management involves weighing pros and cons of each alternative?

  1. Developing Premises
  2. Identifying alternative courses of action
  3. Evaluating alternative courses
  4. Selecting an alternative

Ans. (c)

Question 10

The element of delegation which relates to the obligation of a subordinate to properly perform the assigned duty is known as:

  1. Authority
  2. Responsibility
  3. Accountability
  4. Centralisation

Ans. (b)

Question 11

The type of organizational structure in which jobs of similar nature are grouped together on the basis of functions to form departments is called:

  1. Functional structure
  2. Divisional structure
  3. Informal structure
  4. Grouped structure

Ans. (a)

Question 12

Which of the following statements correctly explains the limitation of planning ‘Planning does not guarantee success?

  1. Planning is required at all levels of management and in all the departments of the organization.
  2. Planning involves thorough examination and evaluation of available alternatives.
  3. Relying on a previously tried and tested successful plan just because it had worked before and will work again.
  4. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events.

Ans. (c)

Question 13

“Product Cost’ as a factor affecting price determination of a product includes:

  1. Cost of producing, distributing, and selling the product.
  2. Utility provided by the product.
  3. Nature and degree of competition.
  4. Maximising profit in the short run.

Ans. (a)

Question 14

The concept of ‘Mental Revolution’, as prescribed by Taylor, involves, a change in the mindset of:

  1. Workers towards the management.
  2. Management towards the workers.
  3. Workers, and management towards one another from competition to cooperation.
  4. Customers towards the management of the organization.

Ans. (c)

Question 15

The element of marketing mix by which marketers make use of various tools of communication to encourage the exchange of goods and services in the market is called:

  1. Branding
  2. Promotion
  3. Physical Distribution
  4. Price

Ans. (b)

Question 16

‘Planning is an intellectual activity of thinking rather than doing’. Which feature of planning is highlighted in this statement?

  1. Planning focuses on achieving objectives.
  2. Planning is futuristic.
  3. Planning involves decision-making.
  4. Planning is a mental exercise.

Ans. (d)

Question 17

Which of the following activities is not considered to be part of customer support services?

  1. After-sales services.
  2. Handling customer complaints and adjustments.
  3. Procuring credit services.
  4. Identifying the needs of the customers and taking various marketing decisions

Ans. (d)

Question 18

‘This principle will give rise to a spirit of mutual trust and belongingness among team members.’ Which principle of management stated by Fayol is highlighted by this statement?

  1. Initiative
  2. Esprit de Corps
  3. Equity
  4. Remuneration of Employees

Ans. (b)

Question 19

Which level of management is responsible for coordinating the activities of different departments according to overall objectives of the organization?

  1. Top Level
  2. Middle Level
  3. Supervisory Level
  4. Both middle and supervisory level

Ans. (a)

Question 20

The purpose of ‘Departmentalisation’ in the process of ‘organising’ is:

  1. To adapt changes in the business environment
  2. To facilitate specialization
  3. To facilitate expansion and growth of the organization without interrupting the existing operations
  4. To help in increasing the managerial efficiency.

Ans. (b)

Question 21

Which of the following options explains the Standardisation and Grading function of marketing?

  1. It affects the success or failure of a product in the market.
  2. It refers to designing and developing the package for the products.
  3. It helps in achieving uniformity and consistency in the output and classifies products into different groups based on their size.
  4. It reduces the need for inspection of products.

Ans. (c)

Question 22

Business environment is said to be uncertain as:

  1. Different element or parts of business environment are closely interrelated.
  2. It differs from country to country.
  3. It is difficult to predict future happenings especially when environment changes are taking place too frequently.
  4. It consists of numerous interrelated forces which arise from different sources.

Ans. (c)

Question 23

Name the concept which explains the manner in which decision making responsibilities are divided among hierarchical levels:
The average power consumed in the circuit is :

  1. Organisational structure
  2. Span of management
  3. Delegation
  4. Decentralisation

Ans. (d)

Question 24

Organisations should have a chain of authority and communication that runs from top to bottom and should be followed by manners and the subordinates.
Which principle of management given by Fayol in highlighted in the above statement?

  1. Authority and responsibility
  2. Discipline
  3. Scalar Chain
  4. Centralisation and decentralisation

Ans. (c)

Question 25

"Flavours of South" is a famous chain of South Indian restaurants. It believes in complete co-operation between the labour and management. Its management encourages the employees for their constructive suggestions. They take their employees into confidence for all important decisions.
Which principle of scientific management has been followed by ‘Flavours of South’?

  1. Science, not rule of thumb
  2. Harmony, not Discord
  3. Co-operation, not Individualism
  4. Development of each and every person to his or her greatest efficiency and prosperity

Ans. (c)

Question 26

Which of the following statements is correct with reference to “organizing” function of management?

  1. Leads to systematic allocation of jobs and facilitates specialization
  2. Reduces the risk of uncertainty
  3. Helps in obtaining competent personnel
  4. Judges accuracy of standards

Ans. (a)

Question 27

Which of the following functions of the marketing can improve performance of the product and also give it a competitive advantage in the market by attracting the target customers?

  1. Marketing Planning
  2. Product Designing and Development
  3. Promotion
  4. Branding

Ans. (b)

Question 28

Ram Murty, a Professor of Management conducted a class on Management principles and explained to his students the significance of Management principles. In the next class, the Professor asked his students to play roles of different managers. He gave them various situations and asked them to think like managers and provide solutions to the problems given in these situations. Each student applied the principles of management to the given situation in his own personalized manner, depending upon his creativity.
The nature of management highlighted in the above case is:

  1. Management as a Science
  2. Management as an Art
  3. Management both as an Art as a Science
  4. Management as a Profession

Ans. (b)

Question 29

Pioneer Ltd. is dealing in fruit juices in hair oils. To ensure unity of action and coordination, it has made to separate divisions for each product. Each division has its own incharge plans and execution resources. Thus, both the division are moving towards the same objectives through focused efforts.
Identify the Principle of management followed by Pioneer Ltd. in the above case

  1. Esprit de Corps
  2. Equity
  3. Unity of Diversion
  4. Authority and Responsibility

Ans. (c)

Question 30

The tool of promotion which involves making use of short term incentives designed to encourage the buyers to make immediate purchase of a product or a service is called:

  1. Advertising
  2. Personal Selling
  3. Sales Promotion
  4. Public Relations

Ans. (c)

Question 31

‘The management gives a common direction to the individual effort in achieving the overall goal of the organization.’
Which point of importance of management is highlighted in this statement?

  1. Helps in achieving personal objectives.
  2. Helps in achieving group goals
  3. Helps to increase efficiency
  4. Helps to create a dynamic organization

Ans. (b)

Question 32

‘Uttam Ayurvedic Ltd’. is an established Indian company manufacturing organic consumer goods like toothpaste and shampoos. It has planned to increase its market share from 30% to 40% in the current financial year.
With the expanding market of organic products, other companies in the consumer goods industry have also launched these products with organic components. The competition in the market has increased and it was found that the sales of Uttam Ayurvedic Ltd. came down and its market share was reduced to 23%.
Identify the limitation of planning highlighted in the above case:

  1. Planning may not work in dynamic environment.
  2. Planning is time-consuming.
  3. Planning involves huge costs.
  4. Planning reduces overlapping and wasteful activities.

Ans. (a)

Question 33

Several initiatives have been undertaken the Government of India to encourage domestic manufacturing and export of defence equipments. ‘Make in India’ in Defence, was one such scheme launched by the Government to encourage companies across the world to manufacture defence products in India.
To which dimension of business environment does the above case relates to?

  1. Economic Environment
  2. Legal Environment
  3. Political Environment
  4. Social Environment

Ans. (c)

Question 34

Which of the following statements is true?

  1. Accountability can be entirely delegated.
  2. Accountability flows downward.
  3. Accountability refers to answerability for final outcome of the assigned task.
  4. Accountability means the right of an individual to command his subordinates.

Ans. (c)

Question 35

Which of the following features of a profession is fully satisfied by Management?

  1. Service motive
  2. Well defined body of knowledge
  3. Restricted entry
  4. Ethical code of conduct

Ans.(b)

Question 36

‘Agile Pvt Ltd.’ manufactures athletic footwear. Owing to its popularity among sports teams across the country, it recently decided to enter into manufacturing of sports clothing and accessories.
The type of organizational structure which is suitable for the company is:

  1. Functional structure
  2. Divisional structure
  3. Horizontal structure
  4. Informal structure

Ans. (b)

Question 37

The Fayol’s principle of _______, emphasises in kindliness and justice in the behaviour of managers towards workers.

  1. Equity
  2. Discipline
  3. Espirt de Corps
  4. Scalar Chain

Ans. (a)

Question 38

Harshita Verma has set up a factory to manufacture herbal hand sanitizers in Meerut. The size and shape of the bottles in which the products are packed are specially designed so that it should be convenient to handle and use by the consumers.
The bottles in which the sanitizers are packed is part of:

  1. Primary packaging
  2. Secondary Packaging
  3. Tertiary packaging
  4. Both Secondary and Tertiary packaging

Ans. (a)

Question 39

Management principles help in thoughtful decision making. They emphasise logic rather than blind faith. This statement describes the following point of significance of Principles of Management:

  1. Fulfulling social responsibility
  2. Scientific decisions
  3. Meeting changing environment requirements
  4. Optimum utilization of resources and effective administration.

Ans. (b)

Question 40

‘SORT-IT Ltd’. is a leading software development company. The company is satisfying the diverse needs of its employees. Its employees are given competitive salaries and perks. They have been given chance for their personal growth and development. For harmony in organization management has to reconcile personal goals with organizational objective.
Identify the objective of management being met by ‘SORT-IT Ltd.’

  1. Social
  2. Personnel
  3. Organisational
  4. Both Social and Personnel

Ans. (b)

Question 41

The step in the process of ‘Planning’ which is concerned with putting the plan into action i.e. doing what is required is called?

  1. Implementing the plan
  2. Follow up action
  3. Developing premises
  4. Selecting an alternative

Ans. (a)

Question 42

“The application of principles of management is dependent upon the prevailing situation at a particular point of time.’
The above statement highlights that principles of management are:

  1. Flexible
  2. Contingent
  3. Behavioural
  4. Universal

Ans. (b)

Question 43

For the following two statements, choose the correct option:
Statement I: If the demand of a product is inelastic, the firm is in a position to fix higher price.
Statement II: In case the degree of competition is high, the firm is in a position to set high prices.
Choose the correct option from options given below:

  1. Statement I is correct and Statement II is wrong.
  2. Statement II is correct and Statement I is wrong.
  3. Both the statements are correct.
  4. Both the statements are wrong.

Ans. (a)

Question 44

It acts as the binding force between departments and ensures that all action are aimed at achieving the goal of the organization. The statement highlights the following characteristics of co-ordination:

  1. Co-ordination is an all pervasive function.
  2. Co-ordination is the responsibility of all managers.
  3. Co-ordination is a continuous process.
  4. Co-ordination ensures unity of action.

Ans. (d)

Question 45

‘While performing the organizing function, jobs are allocated to the members of each department in accordance with their skills and competencies.’
Identify the step in the organizing function being discussed above:

  1. Identification and division of work
  2. Departmentalisation
  3. Assignment of duties
  4. Establishment of reporting relationships

Ans. (c)

Question 46

The function of marketing which involves taking decision regarding channels of distribution or marketing intermediaries is called:

  1. Physical Distribution
  2. Promotion
  3. Warehousing
  4. Marketing Planning

Ans. (a)

Question 47

The _______ techniques proposed by Taylor aims at eliminating unnecessary diversity of products.

  1. Motion study
  2. Standardisation and simplification of work
  3. Differential piece wage system
  4. Functional Foremanship

Ans. (b)

Question 48

Assertion(A): Delegation is a pre-requisite to the efficient functioning of an organization.

Reasoning (R): It enables a manager to use his time on high priority activities.

Choose the correct option:

  1. Both (A) and (R) are incorrect.
  2. (A) is correct, but (R) is incorrect.
  3. Both (A) and (R) are correct and (R) is the correct explanation of (A).
  4. Both (A) and (R) are correct, but (R) is not the correct explanation of (A).

Ans. (c)

Read the following text and answer Question No. 49-54 on the basis of the same.

JS Printing Solution Ltd. is a company manufacturing printers and scanners. The management of this company is known for speedy and prompt delivery of orders. As a result, the market share of this company is growing. The company grabbed a new project to supply 1,500 printers to Uprise Bank Ltd. for its various branches, within two weeks. The Production Manager, Ashok, made one of his efficient subordinates, Deepak the incharge of the project and also gave him the right to command workers in order to meet the target. Now Ashok could use his time on high-priority areas. He felt that this will also give an opportunity to Deepak to gain experience and develop himself for higher positions.

On getting the charge, Deepak was very happy, his confidence level increased and he was encouraged to do his best to fulfill the responsibility. Considering his responsibility, Ashok kept a track of the completion of work with Deepak and he is providing him the needed guidance to reach the target on time.

Question 49

Identify the concept of management used by Ashok to ensure accomplishment of the new project.

  1. Functional structure
  2. Divisional structure
  3. Delegation
  4. Decentralisation

Ans. (c)

Question 50

The application of the concept used above allows Ashok to use his time on high prority areas. This will lead to the organization towards:

  1. Adaptation to change
  2. Effective Management
  3. Economies of Scale
  4. Reduction in conflicts among different divisions

Ans. (b)

Question 51

On getting the charge, Deepak was very happy his confidence level increased and he was encouraged to do his best to fulfil the responsibility given to him.
The concept discussed above helps in:

  1. Departmentalisation
  2. Reduction in conflicts among different divisions
  3. Motivating the employees
  4. Promoting control and co-ordination within a department

Ans. (c)

Question 52

The concept discussed above provides benefits to:

  1. Superior only
  2. Subordinate only
  3. Both Superior and subordinate
  4. Neither superior nor subordinate

Ans. (c)

Question 53

The concept discussed above helps in facilitation of growth of an organisation as:

  1. The subordinate gets freedom from routine work.
  2. Duplication of effort is avoided.
  3. The subordinate gains experience and he is in a position to take up leading positions in new ventures.
  4. It makes training of employees easier.

Ans. (c)

Question 54

Which of the following statements is not true about the concept discussed above?

  1. It is a process followed to share tasks.
  2. It is necessary in all organisations.
  3. It helps to lessen the burden of a manager.
  4. It is a philosophy that implies selective disposal of authority.

Ans. (d)

Question 55

In ‘Delight Ice Creams Ltd.’ decision making authority is concentrated at the top level and no authority has been delegated among the subordinates. On the other hand in “Tasty Ice Creams Ltd.”, a big organization as compared to ‘Delight Ice Creams Ltd.’, decision making authority is always delegated among more than one person.
Identify the principle of management discussed above.

  1. Stability of personnel
  2. Centralisation and Decentralisation
  3. Authority and Responsibility
  4. Scalar Chain

Ans. (b)

Question 56

Priya Seth, a fashion designer has launched a new range of dresses by the name, Sukriti. To give her dresses a distinct image and to distinguish them from the competitor’s products, she has designed a unique symbol with a distinct colour scheme. This symbol is available on all the labels, packaging and advertising campaigns of this new range of dresses. She has also registered this symbol to give it a legal protection against its use by other firm.
From the following name the term used to denote the symbol designed by Priya Seth in the above case:

  1. Brand mark
  2. Trade mark
  3. Brand name
  4. Brand icon

Ans. (b)

Question 57

‘Safe Life Technologies Private Limited’ is a renowned pharmaceutical company in India. It has launched a new medicine to treat high blood pressure. To create awareness about the new medicine and to build a positive image about it, the company organized a seminar, which was attended by doctors from various hospitals and dealers in medicines. During the seminar, the representatives of the company discussed about the chemical composition and the functioning of the medicine.
Identify the tool of promotion used by ‘Safe Life Technologies Private Ltd.’ in the above case.

  1. Advertising
  2. Sales Promotion
  3. Personal Selling
  4. Public Relations

Ans. (c)

Question 58

Ritu Kapoor has set up a bakery, “ Bakes and Cakes” in Pune. She receives online orders for cakes from within the city and supplies them on the same day. She set a target that she would earn a revenue of ₹5,00,000 in the first year. She informed her employees about the target and asked them to contribute ideas to achieve the same:
Ritu Kapoor has performed the first step in the process of one of the functions of management. The next step to be performed is:

  1. Identifying alternatives courses of action
  2. Setting objective
  3. Developing premises
  4. Follow-up action

Ans. (c)

Question 59

Somesh works as a foreman in ‘Lakshmi Automotives Ltd’, a company manufacturing cars. He is subordinate to Ramesh, who is the Production Incharge in the factory. Somesh is incharge of timely and accurate completion of job by workers working in the Production Department. There are three other foremen who work under the Production Incharge, while four other foremen work under Naresh, the Planning Incharge in the factory. Each of the eight foremen is a specialist in his area and gives orders to the workers relating to it.
The technique of scientific management highlighted in the above case is:

  1. Method study
  2. Differential Piece Wage System
  3. Functional Foremanship
  4. Standardisation and simplification of work

Ans. (c)

Question 60

Vidhya Public School is a renowned school in Nagpur. The management recently appointed a new Business Studies teacher, Shweta to teach class 11th and 12th and gave her a monthly salary of ₹50,000. Shweta is not satisfied with it and said “The salary is not just and equitable as per the amount of work required to be done by a Business Studies teacher. Other schools in the city are paying ₹70,000 to their teachers teaching classes 11th and 12th.
Name the principle of the management that has been violated by Vidhya Public School in the above case.

  1. Discipline
  2. Remuneration of Employees
  3. Equity
  4. Esprit de corps

Ans. (b)

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