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 Series ARSP/01 Set ~ 1
Roll No. Q.P Code 15/1/1
Candidates must write the Q.P Code
on the title page of the answer-book.

 Please check that this question paper contains 06 printed pages.

 Q.P. Code given on the right hand side of the question paper should be written
on the title page of the answer-book by the candidate.
 Please check that this question paper contains 34questions.
 Please write down the serial number of the question in the answer-book
before attempting it.
 15 Minute times has been allotted to read this question paper. The question
paper will be distributed at 10:15 a.m. From 10.15 a.m to 10.30 a.m, the students
will read the question paper only and will not write any answer on the answer –
book during this period.

Business Studies

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. Mr Abeer Dahiya is a production manager in Nidhi Automobiles Ltd. The Board of Directors of the company [1]
has fixed a target of producing 5,000 units in a month at a cost of ₹1,000 per unit. Abeer was able to achieve the
target of production but at a cost of ₹1,200 per unit. Abeer as a production manager is _________.

a) effective b) efficient but not effective

c) effective but not efficient d) efficient

2. Increase or decrease in the value of rupee is an example of ________. [1]

a) Political Environment b) Social Environment

c) legal environment d) Economic Environment

3. Advertisements of cigarettes carry the statutory warning. This is because of ________. [1]

a) economical environment b) Legal Environment

c) Political Environment d) Social Environment

4. What out of the following happens because of the optimum amount of working capital? [1]

a) Decrease in liquidity b) Decrease in profitability

c) Profitability increases d) Both profitability and liquidity will increase

5. Management by exception: [1]

a) all deviations b) Cooperation

c) significant deviation d) controlling

6. Highlight the feature of management depicted by the image given here. [1]
 a) Goal-oriented b) Pervasive

c) Group activity d) Dynamic

7. ________ is not a participant in money market. [1]

a) RBI b) SEBI

c) NBFCs d) Mutual Funds

8. Formal training plays an important part in equipping subordinates with skills that help them rise in the [1]
organisation but equally important is the experience gained by handling assignments independently.
Identify the concept of management highlighted in the phrase experience gained by handling assignments
independently?

a) Delegation b) Development

c) Decentralisation d) Training
9. Which of the following statement is false? [1]
a. Marketing is not merely a business phenomena or confined only to business organisations.
b. Marketing activities are equally relevant to non-profit organisations.
c. Physical distribution includes the decision regarding channels of distribution or the marketing intermediaries
(like whole salers, retailers) to be used only.
d. Grading is particularly necessary for products which are not produced according to predetermined
specifications.

a) Option (d) b) Option (a)

c) Option (c) d) Option (b)

10. Assertion (A): Efficiency involves cost-benefit analysis. [1]
Reason (R): Efficiency focuses on deriving more benefits by using more resources.

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.

11. Establishing reporting system leads to: [1]
i. Specialization
ii. Improved productivity
iii. The clarity in a working relationship
iv. Adaption to change

a) iv and i b) i and ii

c) ii and iii d) only iii

12. What is meant by Demat Account? [1]
 a) Demand Depository Account b) Depository Participant Account

c) Dematerialisation of of Securities d) Development Market Account

13. Statement I: In the process of marketing, the function of storage is performed by different agencies such as [1]
manufacturers, wholesalers and retailers.
Statement II: The marketing mix consists of various elements, popularly known as four Ps of marketing -
Product, Price, Packaging and Promotion.

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.
14. Match the following: [1]

(i) Reduction in bank rate (a) Social environment

(ii) An increasing number of working women (b) Legal environment

(iii) Prohibition of alcohol advertisements (c) Economic environment

(iv) On-line flight booking (d) Technological environment

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

c) (i) - (b), (ii) - (c), (iii) - (d), (iv) - (a) d) (i) - (c), (ii) - (a), (iii) - (b), (iv) - (d)
15. Which of the following options explains the Standardisation and Grading function of marketing? [1]
a. It affects the success or failure of a product in the market.
b. It refers to designing and developing the package for the products.
c. It helps in achieving uniformity and consistency in the output and classifies products into different groups
based on their size.
d. It reduces the need for inspection of products.

a) Option (b) b) Option (c)

c) Option (d) d) Option (a)

16. ________ has been established with the specific objective of providing a ready market for money market [1]
instruments.

a) Reserve Bank of India b) State Bank of India

c) Discount Finance House of India d) Securities and Exchange Board of India

17. The Government of India has recently come up with an amendment to Companies Act 2013 regarding corporate [1]
social responsibility. It is a dimension of ________ environment.

a) social b) economic

c) political d) legal
18. Lexi Ltd launched Buddyline, an exercise book and comprehensive stationery brand name comprising of ball [1]
pens, gel pens and geometry boxes after identifying the target market and understanding the needs and wants of
the consumers of that market. All their products were of good quality and eco-friendly but expensive. They
wanted to distinguish their product from that of their competitors. They spent lot of effort, time and money in
creating the brand name, as they knew that without a brand name, they can only create awareness for the generic
 product and can never be sure of the sale of their products. The effort paid off and the demand for the products
started growing. The customers liked the brand and became habitual to it. They did not mind paying a higher
price. Over a period of time, it became a status symbol to buy Buddyline brand because of its quality. The
consumers felt pride in using them. Identify the marketing philosophy followed by Lexi Ltd.

a) The Selling Concept b) The Product Concept

c) The Marketing Concept d) The Societal Marketing Philosophy

19. Advertisement is: [1]
i. a tool of sales promotion
ii. an element of management
iii. an element of branding
iv. a technique of sales promotion

a) iv and i b) only i

c) iii and iv d) ii and iii

20. When actual performance is better than the standard performance it is called ________. [1]

a) Poor Deviation b) Good Deviation

c) Positive Deviation d) Negative Deviation

21. Ketan, Managing Director of Darjeeling Tea Limited decided that his company will serve society through [3]
earning a reasonable profit. For achieving this goal, he started the business of tea. In order to attract the tea
consumers of the whole country, he gave his advertisement on the television. The company had just started
capturing the market when a survey report was presented on a news channel. This report stated that the people
had started liking coffee more than tea and that it was useful for health also. The company had to immediately
change its business from that of tea to coffee. Ketan saved the company from suffering the possible heavy loss
through his timely action.
Identify and state the characteristic of management highlighted in the above case.
22. Sahil, the director of a garments company, is planning to manufacture bags for the utilisation of waste materials [3]
from one of his garments units. He decided that his manufacturing unit will be set up in the rural area of Odisha
where people have very less job opportunities and labour is available at a very low rate. He also thought of
giving equal opportunities to men and women.
For this, he selected S. Chatterjee, Inderjeet Kaur, Aslam and Sarabjeet as heads of the Sales, Accounts,
Purchase and Production Departments.
Identify and state the next two steps that Sahil has to follow in the staffing process after selecting the above
heads.
OR
Aakansha, Nikita and Parishma are the owners of a handicraft unit in the urban area of Dibrugarh in Assam, which is
involved in the manufacturing and marketing of Sital Pati, traditional mats and Jappi (the traditional headgear). They
decided to shift this manufacturing unit to a rural area with an objective of reducing the cost and providing job
opportunities to the locals.
They followed the functional structure in this organisation with a view to increasing managerial and operational
efficiency.
They assessed and analysed the type and number of employees required, keeping in mind that they had to encourage
 the women and the people with special needs belonging to the rural area.
State the next three steps that they will have to undertake for obtaining a satisfied workforce for their handicraft unit.
23. PQR Ltd. is engaged in manufacturing machine components. The target production is 200 units per day. The [3]
company had been successfully attaining this target until two months ago. Over the last two months, it has been
observed that daily production varies between 150 - 170 units.
a. Identify the management function to rectify the above situation.
b. Briefly state the procedure to be followed so that the actual production may come up to the target production.
24. Incorporated in 1990, Raju Dairy Ltd., is one of the leading manufacturers and marketers of dairy-based branded [3]
foods in India. In the initial years, its operations were restricted only to the collection and distribution of milk.
But, over the years it has gained a reasonable market share by offering a diverse range of dairy-based products
including fresh milk, flavoured yogurt, ice creams, buttermilk, cheese, ghee, milk powders etc. In order to raise
capital to finance its expansion plans, Raju Dairy Ltd. has decided to approach capital market through a mix of
Offer for sale of Rs.4 crore shares and a public issue of Rs.2 crore shares.
In context of the above case:
a. Name and explain the segment of capital market being approached by the company.
b. Identify the two methods of floatation used by the company to raise the required capital. Give one difference
between them.
OR
Ketan won a cash prize of Rs. 20,000 in the National level Robotics Competition. On the advice of his father, he
visits a nearby bank to open a Fixed deposit account in his name with the prize money. His sister Suhasini
accompanied him to the bank. On reaching the bank, he notices big banners which are placed within the premises
containing information about the various arrangements through which corporates may raise their capital through the
bank. Being a finance graduate, Suhasini explains to Ketan that banks play the role of the financial intermediary by
helping in the process of channelizing the savings of the households into the most profitable business ventures.
In the context of the above case:
a. Name another financial intermediary that helps in the process of channelizing the savings of the households into
the most productive use.
b. Also, outline any two functions of another financial intermediary as identified in part (a).
25. It is a test used for selection of employees to measure individual’s potential for learning new skills. Give its [4]
name and define two other tests also.
OR
Nakul belongs to a small village in Varanasi. Being the only literate person in his immediate family, he decides to
settle in a city. So he opens a sweets shop in Chandni Chowk, Delhi as he possesses extraordinary culinary skills.
Very soon he starts getting requests from his cousins in the village to engage them in some kind of job in his
business. Considering it to be his moral obligation, he engages five of his cousins in his business without paying any
specific attention to their individual capabilities. This leads to wastage of materials, time, effort and energy, resulting
in lower productivity and poor quality of products. As a result, the profitability of his business starts falling. Soon, he
realised that for the success of the business it is essential that right kind of people must be available in the right
number at the right time.
In the context of the above case:
a. Identify and explain the function of management that has been overlooked by Nakul.
b. Describe briefly the importance of the function of management as identified in part (a).
26. Agrima, Arunima and Avika are pursuing MBA from a reputed institution. Now it is the time of their placement. [4]
Agrima wants to work in a company which would provide her more authority for fulfilling her duties and will
give recognition, rewards, perquisites and prestige of job.
Arunima wants to work in an organisation in which behaviour of individuals is influenced by its characteristics
like autonomy, reward orientation, consideration to employees, risk-taking etc.
Avika wants to join the organisation which has appropriate skill development programmes and sound promotion
policy that encourages employees to exhibit improved performance.
Identify and state the incentives about which Agrima, Arunima and Avika are talking about.
OR
Mukesh is working under his superior Neeraj. He always communicates useful and suggestions to his superior
regarding reduction of cost improvement in the product, etc. Neeraj implements his suggestion and has always found
favourable results, but he never appreciates Rakash for his suggestions. Now Rakesh decides not to communicate any
suggestion or idea to Neeraj. Identify the factor which acts as a communication barrier. Explain three other factors of
the same group of communication-barriers.
27. A Public transport corporation has hired 1000 buses for the different routes for the passengers of metropolitan [4]
city. Most of the 3000 crewmen (drivers, conductors, helpers etc.) of these buses have been found to be
unsatisfactorily dealing with public and daily commuters. They seem to be little interested in the job and the job
seem to have lost all meaning to them.
As manager of the public transport company what financial and non-financial incentives will you use to improve
the working of crewman in question? State any two of each type of incentives.
28. Pranav is engaged in transport business. Identify the working capital requirements of Pranav stating the reason in [4]
support of your answer. Pranav wants to expand and diversify his transport business. Explain any two factors
that will affect his fixed capital requirements.
29. Harish is working as a finance manager in Kozee Softwares Ltd. He has been awarded Best employee of the [4]
year Award because of his foresightedness. He always aims at smooth operations of all the financial activities
by focusing on fund requirements and their availability in the light of financial decisions. He takes into
consideration the growth, performance, investments and requirement of funds for a given period so that financial
resources are not left idle and don't unnecessarily add to the cost.
By doing all this Harish strives to achieve the two main objectives of an important concept of financial
management. Identify the concept and explain its two objectives.
30. Explain the following rights of a consumer provided under The Consumer Protection Act, 2019: [4]
i. Right to Safety
ii. Right to Seek Redressal
31. Taylor's principles of scientific management and Fayol's principles of management are mutually [6]
complementary." Do you agree with this view? Give any four reasons in support of your answer.
OR
Vini is a manager in Alpha Ltd, a company manufacturing plastic glasses and bowls. The government banned plastic
items. As a result, Alpha Ltd. incurred a huge loss as it had to stop production of plastic glasses and bowls, and had
to purchase new machinery for producing paper glasses and bowls.
The management of the company entered into an agreement with labour union whereby workers agreed to put in
extra hours without additional payment to revive the company out of loss. In return the management promised to
increase wages of the workers when this mission was accomplished.
 Vini found that workers' efficiency declined due to long working hours. She conducted an experiment to see the
effect of improvement of physical conditions of work to reduce stress. It worked and workers efficiency and
productivity increased manifold.
Within two months, the company revived out of loss. The management in returned increased their wages by 30
percent.
i. Identify and explain the principles/technique of management highlighted above.
ii. State the characteristic of principles of management highlighted above.
32. Suhasini, a home science graduate from a reputed college, has recently done a cookery course. She wished to [6]
start her own venture with a goal to provide 'health food' at reasonable prices. She discussed her idea with her
teacher (mentor) who encouraged her. After analyzing various options for starting her business venture, they
shortlisted the option to sell ready-made and 'ready to make' vegetable shakes and sattu milk shakes. Then, they
weighed the pros and cons of both the shortlisted options.
a. Name the function of management is discussed above and give any one of its characteristics.
b. Also briefly discuss any three limitations of the functionality discussed in the case.
OR
State the importance of planning.
33. A company X Limited manufacturing cosmetics, which has enjoyed a preeminent position in business, has [6]
grown in size. Its business was very good till 1991. But after that, the new liberalized environment has seen
entry of many MNC's in the sector. With the result the market share of X Limited has declined. The company
had followed a very centralized business model with Directors and divisional heads making even minor
decisions. Before 1991, this business model had served the company very well as consumers had no choice. But
now the company is under pressure to reform.
i. What organisation structure changes should the company bring about in order to retain its market share?
ii. How will the changes suggested by you help the firm? Keep in mind that the sector in which the company is
FMCG.
34. Mediquip Ltd. is a company dealing in distribution of medical equipments. The company recently imported [6]
15000 units of sugar testing machines to test the sugar levels without taking blood samples. For deciding the
marketing strategy, the Chief Executive Officer of the company called a meeting of the marketing heads of
different zones.
In the meeting, Sandeep, the North Zone Marketing Head, suggested that since the machines were sophisticated
they need to visit hospitals personally, to explain its working to the hospital staff who would be using the
machines. He also suggested that additional trained people may be recruited for the same.
Himanshu, another Zonal Head, added that since lot of money had been spent on the import of the machines, the
company was short of funds to pay to the additional staff as suggested by Sandeep.
Rahul, a newly appointed Zonal Head of South Zone suggested that since the size of the order is not large, a
detailed study of the factors determining the choice of channels of distribution is required before making the
right choice.
a. Identify the factors influencing the choice of channels of distribution which were discussed in the meeting.
b. Also, explain briefly the other consideration to be taken care of in each factor identified in part (a).