Std 12_Bus. St_Sample Papers & Marking Scheme (4 Sets)

CBSE
ADDITIONAL PRACTICE QUESTIONS

Business Studies (054)
Class XII | 2023–24
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.

7. Attempt all parts of the questions together.
Section A
Serial
No. Question Marks
1 Vedant Ltd. is a company with a decreasing EBIT. The company has a 1

significant amount of debt in the form of debentures, and further borrowing
through debentures could exacerbate the situation. Which factor determining
the Capital Structure is the CFO of Vedant Ltd. primarily concerned about?
(a) cost of debt
(b) return on investment

(c) interest coverage ratio
(d) debt service coverage ratio
2 What is the primary strategic focus of the company, considering its "The 1
Complete Man" tagline, top position in the menswear industry, and
longstanding collection that has enriched a modern gentleman's wardrobe
for decades?
(a) ensuring ethical sourcing
(b) reinforcing cultural heritage
(c) establishing a unique identity
(d) maximising production efficiency
3 Which scenario BEST illustrates the impact of rapidly changing technology 1

on businesses?
(a) A software company is disrupted by a new entrant that offers a more

user-friendly interface and a lower price point.
(b) A manufacturing company is forced to automate its production line in
order to compete with lower-cost overseas competitors.
(c) A traditional brick-and-mortar retailer is forced to close its doors after
online retailers offer lower prices and a wider selection of products.
(d) A financial services company is forced to invest in new technology in
order to meet the demands of its customers for online and mobile banking
services.
4 Daniel and Andrew are two friends engaged in their respective businesses. 1
Daniel concentrates on producing products that meet the needs of producers
and sells whatever is produced by any means necessary. Andrew believes in
achieving the firm's goals through understanding the needs of consumers
and delivering the right products to them and constantly monitoring
competitors.
Which Marketing Management Philosophies do Daniel and Andrew adhere
to in their businesses?
(a)Product and Selling

(b) Selling and Marketing
(c) Marketing and Product
(d) Production and Product
5 Zebronics Technology Solutions, a leading tech company, recently 1

announced its plan to raise additional funds to fuel its expansion and
research initiatives. The company's board of directors approved an offer to
the existing shareholders to purchase additional shares at a discounted price.
This offer will be available for a specific period.
How is Zebronics Technology Solutions planning to raise additional funds
in the primary market, while offering its existing shareholders the
opportunity to purchase more shares?
(a) conducting an e-IPO to reach a wider digital audience

(b) privately placing shares with select institutional investors
(c) launching an Initial Public Offering to enter the stock market
(d) issuing right shares for existing shareholders at a discounted price
6 1
Identify the feature of Coordination illustrated in the picture.

(a) pervasive function
(b) deliberate function
(c) continuous process
(d) integrates group efforts
7 Which of the following statements accurately represents one of the 1

protective functions of SEBI in real-life scenarios?
(a) It is responsible for managing government budgets and allocating funds
for various developmental projects.
(b) It ensures the safety and security of data transmitted during online
trading transactions.
(c) It promotes and regulates the insurance industry to safeguard
policyholders' interests.
(d) It monitors and regulates the securities market to protect investors and
maintain market integrity.
8 A company's sales have been declining for the past three quarters. The 1
manager has decided to implement a new control system to try to improve
sales. Which of the following control systems would be the most effective in
this situation?
(a) A budget system that sets targets for sales and profits.
(b) A performance appraisal system that evaluates the performance of sales
staff.
(c) A quality control system that ensures that products meet customer
expectations.
(d) A survey that measures customer satisfaction with the company's

products and services.
9 Ms. Arundhati, the CEO of Sunlife Ltd., is delivering a speech to a group of 1

investors. She is emphasising the significance of the company's success and
achievement, which relies on the support of customers, shareholders,
suppliers, and intermediaries. She also discusses how establishing a positive
association with these parties contributes to enhancing the company's public
image in the market.
What is the primary goal of Ms. Arundhati's speech?
(a) to increase sales

(b) to generate positive publicity
(c) to improve the company's image
(d) to build relationships with stakeholders
10 Read the following statements: Assertion (A) and Reason(R). Choose the 1
correct alternative from those given below:
(A): The Supervisory Level performs the activities according to the plans of
Top and Middle level management.
(R): The Supervisory Level motivates the employees and boosts their
morale.
(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 step of the Organising Process involves stating the job description, a 1
document that clearly defines the contents and responsibilities related to a
job?
(a) Departmentalization
(b) Assignment of duties
(c) Establishing reporting relationships
(d) Identification and division of work
12 Give below are two statements marked as Assertion (A) and Reason (R). 1
Read the statements and choose the correct option.
A: Planning and controlling are interdependent and interlinked.

R: Planning provides the goals and objectives that the controlling function
uses to measure performance.
(a) Both A and R are true, but R is not the correct explanation of A.
(b) Both A and R are true, and R is the correct explanation of A.
(c) A is true, but R is false.
(d) A is false, but R is true.
13 Statement I: Channel of distribution is important as goods are produced at 1

one place and customers are scattered all over in the nook and corner of the
country, so the producer needs to distribute the goods through middlemen.
Statement II: Physical movement of goods is transportation of goods from

place of production to place of ultimate consumption.
Choose the correct option from the following:

(a) Statement I is true and II is false
(b) Statement II is true and I is false
(c) Both the statements are true
(d) Both the statements are false
14 Startup 20 India Chair Chintan Vaishnav highlighted the G20 startup group's 1
goal of pushing for $1 trillion investment in the global startup ecosystem.
Which of the following dimensions of the Business Environment will this
goal most likely to influence?
(a) fiscal policy of the government
(b) foreign policy of the government

(c) foreign trade policy of the government
(d) foreign exchange policy of the government
15 What is the significance of delegation in the scenario where Sara, as a 1

superior, entrusts her authority to Tiara, her subordinate, to enable her
learning, skill development, and better chances of promotion?
(a) facilitation of growth
(b) effective management
(c) employees' development
(d) motivation of employees
16 Given below are two statements marked as I and II respectively. Read both 1
statements and choose the correct option.
I: Demutualisation refers to the legal structure of an exchange whereby the
ownership, the management and the trading rights at the exchange are
segregated from one another.
II: Demutualisation refers to the process by which a public share company

converts into a mutual company.

(a) I is true and II is false
(b) II is true and I is false
(c) Both I and II are true
(d) Both I and II are false
17 The GST Council, during its 50th meeting, resolved a prolonged debate on 1
the tax treatment of online gaming, casinos, and horse racing, deciding to
impose a 28% levy on bets and wagers for all three activities and amend
GST laws to include online gaming.
Which of the following is the most likely impact of the GST council's
decision on businesses in the industry?
(a) The cost of doing business will increase, leading to higher prices for
consumers.
(b) Businesses will move their operations to other countries with lower tax
rates.
(c) The government will receive more revenue from taxes.

(d) The industry will become more competitive.
18 Match the following P’s of Marketing Mix with their explanation and 1
choose the correct option:
A. Price: - it is the amount that a customer pays for to 1

enjoy it.
B. Promotion: - it helps to grab the attention of the 2

customers and influence them to buy the product.
C. Product: - it is a commodity, produced or built to 3

satisfy the need of an individual or a group. It can be
intangible or tangible.
D. Place: - which is easily accessible to potential 4

buyers/customers.
(a) A (3), B (1), C (4), D (2)

(b) A (1), B (3), C (4), D (2)
(c) A (4), B (3), C (2), D(1)
(d) A (2), B (4), C (1), D (3)
19 What aspect of the profession is exemplified in the scenario where Ayesha 1

needs to register herself as a member of ICAI to become a Chartered
Accountant?
(a) Service motive

(b) Restricted entry
(c) Professional association
(d) Ethical code of conduct
20 Which of the following is a result of globalisation that has contributed to the 1

rationalisation of tariff structures?
(a) the formation of trade blocs
(b) increased competition among businesses
(c) enhanced ease of international business transactions
(d) governments facing pressure to reduce barriers to attract foreign
investment
21 Elon Reeve Musk is a top-level executive with diverse leadership roles of: 3
a) Founding and leading companies such as SpaceX, Tesla, and The Boring
Company.
b) Assuming the roles of CEO and Product Architect to guide Tesla's

operations and innovations.
c) Engaging in engineering and technical aspects to drive the development

of SpaceX's projects.
What are the three essential functions he is likely performing in his

positions?
22 Paul, the Manager of a manufacturing unit in Noida, employed various 3

strategies to address the production shortfall of 850 balls out of the 1,000-
ball target. Furthermore, what crucial initial steps he might have overlooked
during the process of analysing deviations and implementing corrective
measures?
OR
How can a regional manager of a retail chain enhance operational efficiency

and maximise profits by analysing deviations in sales performance among
different stores? Some outlets consistently exceed sales targets, while others
struggle to meet their goals. To address these disparities, the regional
manager aims to implement two management techniques for analysing
deviations. Explore these two techniques in detail.
23 Examine the multifaceted advantages of external recruitment in the context 3

of an organisation's workforce. Elaborate on how this recruitment strategy
contributes to elevating overall performance and competitiveness.
24 Design a comprehensive investment plan for a person seeking advice on 3

short-term investment options, outlining three specific instruments of the
money market that can be recommended for short-term investments. Provide
detailed explanations for each instrument, their benefits, and how they can
effectively aid this person achieve their financial goals.
OR
Demonstrate your understanding of SEBI's regulatory functions by
designing the steps SEBI should take to investigate and resolve a suspected
case of fraudulent activities by a listed company.
25 The manager of a team in a fast-paced IT company, notices a decline in 4

employee motivation and productivity. Outline how he can use Maslow's
theory to identify and address the various needs of his employees.
OR
The HR manager of Starflight Ltd., has to develop an employee motivation

and engagement strategy that focuses on non-financial incentives. Highlight
and explain the various types of non-financial incentives she can introduce
to foster a positive work environment.
26 The allocation of resources for employee training and development has 4

long-term value for the organization's growth and sustainability.
OR
Provide a detailed explanation of each of the following steps in the selection
process that can maximise the chances of potential candidates of being
selected for the management position.
a) Preliminary Screening
b) Selection Tests
c) Employment Interview
d) Final Interviews and Decision- making
27 What are the key responsibilities that consumers must fulfill to ensure they 4
are protected under Consumer Protection Act?
28 Sameer has been given a task of evaluating the financial performance of two 4
companies, Alfa Ltd. and Beltex Ltd., in the same industry. Both companies
have been trading on equity as part of their financial strategy. Given is the
information that Sameer received. Which company is using trading on
equity more effectively?
Alfa Ltd.:
Total Assets: Rs. 500,000
Equity Capital: Rs. 300,000
Debt Capital: Rs. 200,000
Net Income: Rs. 50,000

Beltex Ltd:
Total Assets: Rs. 800,000
Equity Capital: Rs. 400,000
Debt Capital: Rs. 400,000

Net Income: Rs. 60,000.
29 Analyse the following scenarios and identify the specific barriers to 4

effective communication in each case:
Scenario 1: During a team meeting, two team members from different status
have different interpretations of a project's deadline. As a result, they end up
working on different timelines, causing confusion and delays.
Scenario 2: In an email exchange between team members, one team member

uses technical jargon and industry-specific terms that others may not fully
understand. As a result, some team members misinterpret the message,
leading to misunderstandings and misaligned tasks.
Scenario 3: A team member consistently interrupts others during team

discussions, not allowing them to express their ideas fully. This behavior
leads to frustration among team members and limits open and constructive
communication.
Scenario 4: During a virtual team meeting, poor internet connectivity causes

frequent disruptions and audio glitches. As a result, some team members
miss crucial information, and the overall meeting efficiency is reduced.
30 Analyse the following scenarios and identify the specific factors that may 4
affect the financial decisions of the company.
Scenario 1: The company is considering expanding its production capacity
by investing in new machinery and technology. This expansion will require
a significant upfront investment, but it is expected to increase production
efficiency and potentially open new market opportunities.
Scenario 2: The company is contemplating taking on debt to fund its

expansion plans. By leveraging debt financing, the company can accelerate
its growth and take advantage of current market opportunities.
Scenario 3: The company's management is evaluating a cost-cutting

initiative to improve profitability and reduce operating expenses. They are
considering workforce restructuring and optimising the supply chain to
achieve higher cost efficiency.
Scenario 4: The company is exploring the option of entering new

international markets to diversify its revenue sources and reduce dependence
on the domestic market.
31 a) How can the principle of "Discipline" positively impact employee 6

behaviour and performance in the manufacturing company?
b) Explain how a performance-based remuneration system aligns with the
principle of "Remuneration," and how it can motivate employees to improve
their discipline and productivity.
OR
2. The manager of a retail store has a team of ten sales associates. To

improve efficiency, she decides to implement the principle of "Division of
Work" and delegate specific tasks to each team member. However, one sales
associate is unhappy with their assigned responsibilities and believes they
should have more authority in decision-making.
a) How can the principle of "Division of Work" help improve the store's
efficiency and productivity?
b) How can the manager balance the delegation of tasks while ensuring
appropriate authority is given to each team member? Explain in three points.
32 Explain any three of the the following Concepts by F.W.Taylor: 6

a) Differential Piece Wage Rate System
b) Mental Revolution
c) Harmony not Discord
d) Functional Foremanship
OR
A project manager working on a high-profile construction project which
involves constructing a state-of-the-art sports stadium with multiple
facilities. As he starts the planning phase, he realises that there are several
potential limitations associated with planning. Identify six limitations
commonly associated with the planning phase.
33 The CEO of a fast-growing tech company has asked the head of operations 6
to lead a workshop for department heads on effective planning. The
workshop will cover different types of plans, including strategies, policies,
programme, objectives, rules and procedures. The goal is to enhance their
understanding of these planning components and how they contribute to the
company's success. Write six points to include in this workshop.
34 Define the three primary levels of packaging in the context of product 6

distribution, and provide a real-life example for each level.
CBSE
ADDITIONAL PRACTICE QUESTIONS-Marking Scheme
Business Studies (054)
Class XII | 2023–24

Section A
Q No. Question Marks
1 (c) Interest Coverage Ratio 1
2 (c) establishing a unique identity 1
3 (c) A traditional brick-and-mortar retailer is forced to close its doors after 1

online retailers offer lower prices and a wider selection of products.
4 (b) Selling and Marketing 1
5 (d) issuing right shares for existing shareholders at a discounted price 1
6 (d) Integrates group efforts 1
7 (d) It monitors and regulates the securities market to protect investors and 1
maintain market integrity.
8 (a) A budget system that sets targets for sales and profits. 1
9 (d) to build relationships with stakeholders 1

10 (b) Both (A) and (R) are true but (R) is not the correct explanation of (A) 1
11 (b) Assignment of duties 1
12 (b) Both A and R are true, and R is the correct explanation of A. 1
13 (c) Both the statements are true 1
14 (b) Foreign policy of the government 1
15 (c) Employees' development 1
16 (a) Statement I is true and II is false 1
17 (a) The cost of doing business will increase, leading to higher prices for 1
consumers.
18 (c) A (4), B (3), C (2), D(1) 1
19 (c) Professional association 1
20 (d) Rationalisation of tariff structure 1
21 As a top-level executive with diverse leadership roles, Elon Reeve Musk is 3

likely performing the following three essential functions in his position
-Founding and leading companies such as SpaceX, Tesla, and The Boring
Company: Musk is involved in creating and establishing these companies
and takes charge of their overall direction, strategy, and vision.
-Assuming the roles of CEO and Product Architect to guide Tesla's

operations and innovations: In his role as CEO and Product Architect of
Tesla, Musk is responsible for overseeing the company's day-to-day
operations, making key decisions, and driving innovation in the
development of Tesla's products.
-Engaging in engineering and technical aspects to drive the development of
SpaceX's projects: As Chief Engineer of SpaceX, Musk actively
participates in the engineering and technical aspects of the company's
projects, leading the way in developing cutting-edge space exploration
technologies and initiatives.
Award 1 mark each for 3 functions
22 (i) Setting performance standards: The first step in the controlling process 3
is to set the performance standards. Standards are those criteria, on which
the actual performances are measured. These standards serve as a
benchmark towards which an organisation strives to work.
(ii) Measurement of actual performance: After the establishment of
standards, the next step is measuring the actual performance with the set
standards. This can be done by opting several methods like personal
observation, sample checking, performance reports, etc.
(iii) Comparison of actual performance with standards: In this step, the

actual performances are compared with the established standards. Such
comparisons reveal the deviation between planned and actual results.
Award 1 mark each to the corrective measures.
OR
1. Management by Exception:(MBE) is a managerial approach that focuses
on identifying and addressing significant deviations or exceptions from
standard performance. Instead of monitoring all stores equally, the regional
manager prioritizes attention on exceptional cases that deviate significantly
from established benchmarks.
2. Critical Point Control: It involves closely monitoring specific key

performance indicators (KPIs) or KRA's that have a significant impact on
overall sales performance. Managers use this technique to identify critical
points where immediate action is necessary to prevent potential crises or
losses.
Award 1.5 mark to each technique.
23 1. When organisations hire externally, they bring in new talent with fresh 3
perspectives and diverse skill sets. These individuals often possess different
experiences, backgrounds, and knowledge, which can inject creativity and
innovation into the company's operations.
2. Hiring talent from outside the organisation can provide valuable industry
insights and a competitive edge. External recruits may come from rival
companies or different sectors, bringing with them knowledge of market
trends, best practices, and emerging technologies.
3. External recruitment can lead to faster growth and skill development

within the organisation. When experienced professionals join a new
workplace, they often possess a wide range of expertise that can be quickly
shared and disseminated among the existing workforce.
Award 1 mark each for External recruitment advantages.
24 1. Treasury Bills (T-Bills): Treasury Bills are short-term debt instruments

issued by the government to raise funds for a short duration, usually
ranging from 91 days to 364 days. They are considered one of the safest
investments as they are backed by the government's creditworthiness.
2. Commercial Paper (CP): Commercial Paper is an unsecured, short-term

debt instrument issued by corporations to meet their short-term funding
needs, usually for up to 270 days. CPs are rated by credit rating agencies to
assess their creditworthiness. Compared to T-Bills, CPs generally offer
higher returns due to the credit risk associated with corporations.
3. Certificate of Deposit (CD): Certificate of Deposit is a time deposit

offered by banks with fixed maturity dates, ranging from a few weeks to
several months. CDs have higher interest rates than regular savings
accounts and are insured by the government up to a certain limit.
Award 1 mark each for three instruments of the money market.
OR
Step 1: Preliminary Investigation: SEBI should initiate a preliminary

investigation based on the information received about the suspected
fraudulent activities by the listed company. This involves gathering initial
evidence, identifying potential violations, and assessing the gravity of the
situation.
Step 2: Formal Investigation: Upon finding substantial evidence during the

preliminary investigation, SEBI should launch a formal investigation. This
involves a deeper examination of the company's activities, including
financial records, transactions, and management practices. The
investigation may involve summoning company officials, scrutinising
books, and seeking expert opinions.
Step 3: Inspection of Books and Records: As part of its regulatory function,

SEBI has the authority to inspect the books and records of listed companies
to ensure compliance with securities laws. This step involves a detailed
examination of the company's financial records and transactions.
Award 1 mark each for regulatory function of SEBI.
25 Step 1: Ensure that the basic physiological needs of employees are met, 3
such as providing a comfortable and safe working environment. Address
concerns related to workload, work-life balance, and job security.
Step 2: Encourage team-building activities and collaborative projects to
fulfill social needs. Organise team lunches, outings, or virtual events to
foster a sense of camaraderie among team members.
Step 3: Address esteem needs by recognising employees' achievements and
contributions. Implement an employee recognition program that
acknowledges outstanding performance and milestones.
Step 4: Promote self-actualisation by encouraging employees to pursue

their passions and interests within their roles.
Award 1 mark each of the points given or any other relevant point.
OR
1. Employee Recognition Program: Introduce an employee recognition

program to acknowledge and appreciate outstanding performance and
achievements. Employees can be recognized through a "Employee of the
Month" program or regular shout-outs in team meetings. Recognition helps
boost self-esteem and encourages a sense of belonging within the
organization.
2. Opportunities for Employee Involvement: Involve employees in
decision-making processes, such as project planning or policy
development. Providing opportunities for employee involvement fosters a
sense of ownership and commitment to the organization's success.
3. Autonomy: Empowering employees with a sense of autonomy and

involvement in decision- making increases their job satisfaction and
commitment to the organization.
4. Employee Development and Growth Opportunities: Providing

opportunities for skill enhancement and career growth demonstrates the
organization's commitment to employee development, encouraging a sense
of loyalty and dedication among employees.
Award 1 mark each for non-financial incentives
26 1. When we invest in training and development, we empower our 4

employees with the skills and knowledge they need to excel in their roles.
Well-trained employees are more confident, efficient, and productive.
2. Investing in training and development allows us to stay ahead of the

competition by adapting to emerging trends, technological advancements,
and changing customer needs.
3. Employees value organisations that prioritise their growth and

development. By investing in training, we show our commitment to their
professional advancement, fostering higher levels of employee engagement
and job satisfaction.
4. A learning culture encourages employees to think creatively, leading to
innovation and process improvements. By investing in employee
development, we nurture a culture that values continuous learning, enabling
us to adapt swiftly to changing market conditions and customer demands.
Award 1 mark each for points given or any other relevant point.
OR
1. Preliminary Screening: This is the initial stage of the selection process.

Its purpose is to filter out candidates who do not meet the minimum
qualifications and requirements for the management position. The
screening helps save time and resources by focusing only on eligible
candidates.
2. Selection Tests: These tests are assessments that evaluate candidates'
aptitude, skills, and abilities related to the managerial role. These tests help
assess a candidate's cognitive abilities, problem-solving skills, critical
thinking, and domain knowledge.
3. Employment Interview: It is a crucial step in the selection process. It
allows the organization to assess your communication skills, interpersonal
qualities, cultural fit, and enthusiasm for the position. It also provides an
opportunity to learn more about the company and the role.
4. Final Interviews and Decision-making: In the final interviews, the
organization aims to narrow down the candidate pool further and make a
well-informed decision about the best fit for the management position. This
stage often involves interactions with senior management and decision-
makers.
Award 1 mark each for the selection process steps.
27 1. As consumers, it is crucial to make informed decisions before purchasing 4

goods or services. Take the time to research and gather relevant
information about the product or service, its features, pricing, and the
reputation of the seller or service provider. Being well-informed empowers
you to make the right choices and avoid any potential pitfalls.
2. Before entering into any consumer transaction, carefully read and
understand the terms and conditions. This includes contracts, warranties,
and refund policies. By being aware of the terms, you can avoid surprises
and potential disputes later on.
3. Ensure that the information you provide during a transaction, such as

your name, contact details, and payment information, is accurate and
truthful. This helps facilitate smooth transactions and prevents any
complications that may arise from incorrect information.
4. If you come across a product that is defective, unsafe, or does not meet
the promised standards, it is essential to report the issue to the seller or
manufacturer promptly.
5. As a responsible consumer, exercise caution while sharing personal

information online, and only transact on secure and reputable websites. Be
wary of potential scams and phishing attempts.
6. If you encounter any issues or dissatisfaction with a product or service,

address the concern with the seller or service provider promptly. Delaying
the reporting of grievances may limit your options for redressal.
7. Keep a record of receipts, invoices, warranties, or any other documents
related to your purchases. These documents serve as evidence in case of
disputes or when seeking a refund or replacement.
8. Should a dispute arise, cooperate with consumer redressal forums or

agencies when seeking resolution. Provide necessary information and
attend hearings or proceedings as required.
Award 1/2 mark for each responsibility
28 To determine which company is using trading on equity more effectively, 4

compare their Return on Equity (ROE) ratios. ROE is a key financial ratio
that measures how efficiently a company is using its shareholders' equity to
generate profits.
ROE is calculated as follows:

ROE = (Net Income / Average Shareholders' Equity) * 100
Calculate the ROE for both companies:
For Alfa Ltd :
ROE = (50,000 / (300,000 + 0) / 2) * 100

ROE = (50,000 / 300,000) * 100
ROE = 0.1667 * 100
ROE = 16.67%
For Beltex Ltd :
ROE = (60,000 / (400,000 + 0) / 2) * 100
ROE = (60,000 / 400,000) * 100
ROE = 0.15 * 100

ROE = 15.00%
Now, let's compare the ROE ratios for both companies:
Alfa Ltd has an ROE of 16.67%, and Beltex Ltd has an ROE of 15.00%.
Answer: Based on the provided financial data, Alfa is using trading on

equity more effectively than Beltex. Alfa's higher ROE of 16.67% indicates
that it is generating a better return on its shareholders' equity compared to
Beltex, which has an ROE of 15.00%.
This suggests that Alfa is utilising its equity more efficiently to generate
profits, making its trading on equity strategy more effective.
Award 2 marks each for both the companies ROE.
29 Here are the identified barriers to effective communication in each 1

scenario:
Scenario 1
Barrier: Status Differences: In this scenario, the different interpretations of

the project's deadline stem from team members' diverse status backgrounds.
Each team member might have different attitudes towards time, varying
work norms, and approaches to meeting deadlines, leading to confusion and
delays in project execution.
Scenario 2
Language and Jargon: The use of technical jargon and industry-specific
terms in the email exchange creates a barrier to effective communication.
Some team members may not fully understand the specialised language,
leading to misinterpretation of the message and causing misunderstandings
and misaligned tasks.
Scenario 3
Lack of Active Listening: The team member's consistent habit of
interrupting others during discussions inhibits open and constructive
communication. This behavior reflects a lack of active listening, as the
individual fails to allow others to express their ideas fully, leading to
frustration among team members and hindering effective collaboration.
Scenario 4
Technological Issues: In this virtual team meeting scenario, poor internet
connectivity causing frequent disruptions and audio glitches is a
technological issue that acts as a barrier to effective communication. Some
team members may miss crucial information due to the technical problems,
and the overall efficiency of the meeting is reduced.
Award 1 mark each for barrier to communication.
30 As an evaluator of the financial decisions of a manufacturing company, the 4

following scenarios have been presented for analysis:
Scenario 1
Market Demand: Assessing current and projected market demand is

essential to ensure that the expanded production capacity aligns with
potential sales and revenue growth.
Scenario 2
Risk Assessment: The management should conduct a risk assessment to
understand the potential consequences of increased debt, such as interest
rate fluctuations and refinancing risks.
Scenario 3
Cost Analysis: A comprehensive cost analysis is necessary to identify areas

where cost-cutting measures can be implemented without compromising
product quality or customer satisfaction.
Scenario 4
Market Entry Costs: Assessing the expenses associated with market entry,
such as marketing, distribution, and infrastructure setup, is essential for
financial decision-making.
Award 1 mark for each factor or any other relevant point.
31 1. The principle of "Discipline" as proposed by Henry Fayol emphasizes

the importance of establishing clear rules, guidelines, and consequences for
employee conduct within the organization. When applied effectively, this
principle can have several positive impacts like accountability, reduced
absenteeism and consistent performance on employee behavior and
performance in the manufacturing company.
2. The principle of "Remuneration" in Henry Fayol's management
principles pertains to fairly compensating employees for their work and
contributions to the organization. A performance-based remuneration
system is one that ties employee compensation directly to their individual
or team performance. This creates a direct link between efforts and
rewards, motivating employees to be disciplined and put in their best effort
to achieve higher rewards.
OR
1. The principle of "Division of Work," as proposed by Henry Fayol,
advocates dividing the overall work into specialized tasks and assigning
them to individuals based on their skills and expertise. Implementing this
principle in the retail store can lead to several benefits that improve
efficiency and productivity.
2. As a manager, follow these steps to achieve a balanced approach:

Assess Individual Capabilities
Encourage Input and Involvement
Set Clear Expectations
Foster a Collaborative Culture
Provide Feedback and Recognition
Monitor Progress
Award 1 mark for a detailed explanation of each point.
32 a) Differential Piece Wage Rate System: F.W. Taylor it as a method to 1

incentivize workers and increase productivity. Under this system, workers
are paid different rates for each unit of output they produce. The idea
behind this approach is to reward higher productivity with higher wages.
Taylor believed that by offering financial incentives, workers would be
motivated to work more efficiently and increase their output, leading to
greater overall productivity for the organization. This concept laid the
foundation for modern performance-based pay systems and piece-rate
systems that are still in use today in some industries.
b) Mental Revolution: The term "Mental Revolution" coined by F.W.
Taylor refers to a fundamental change in the mindset and attitudes of both
workers and management towards work. Taylor observed that there was
often a significant divide between workers and management, with both
sides viewing each other with suspicion and distrust. He advocated for a
mental revolution that involved workers acknowledging that their interests
were aligned with those of management, and vice versa. Taylor believed
that through cooperation and understanding, both parties could work
together to achieve common goals, such as increased efficiency and
productivity. This mental revolution was seen as a prerequisite for
successfully implementing scientific management principles in an
organisation.
c) Harmony, not Discord: F.W. Taylor emphasized the importance of

achieving harmony rather than discord in the workplace. He believed that
conflicts and antagonism between workers and management were
detrimental to productivity and hindered organizational success. To achieve
harmony, Taylor proposed the application of scientific management
principles, which involved careful planning, standardization of work
processes, and clear communication between workers and management. By
removing unnecessary frictions and creating an environment of mutual trust
and cooperation, Taylor aimed to establish a harmonious relationship
between employees and management, ultimately leading to increased
productivity and efficiency.
d) Functional Foremanship: Functional Foremanship is a concept
developed by F.W. Taylor as part of his scientific management system.
Under this approach, the traditional role of a single foreman overseeing a
group of workers is divided into multiple specialized foremen, each
responsible for a specific aspect of the production process. Taylor identified
eight distinct functions that were crucial for efficient production, such as
route clerk, instruction card clerk, time and cost clerk, etc.
Award 1 mark for any three

OR
1. One of the primary limitations of planning is the uncertainty of the

future. No one can predict with absolute certainty how the external
environment or internal conditions will change over time. Changes in
market trends, technological advancements, economic conditions, or
political factors can disrupt even the most well-thought-out plans.
2. Planning can be a time-consuming process, especially for complex
organizations and projects. Gathering data, analyzing information, setting
goals, and formulating strategies require considerable time and effort,
which may delay the actual implementation of actions.
3. Strict adherence to plans may lead to rigidity in decision-making. If

managers are unwilling to adapt or deviate from the original plan when
unforeseen circumstances arise, it can hinder the organization's ability to
respond effectively to changing conditions.
4. Planning can be costly, particularly when it involves extensive research,

market surveys, or hiring specialized consultants. Smaller organizations or
those with limited resources might find it challenging to afford
comprehensive planning processes.
5. Planning often relies on forecasts and assumptions about the future.

Overreliance on predictions can lead to unrealistic expectations and
misalignments between actual outcomes and planned goals.
6. Some employees or stakeholders may resist the implementation of new

plans, especially if they perceive the changes as threatening or disruptive to
their current roles or ways of doing things. This resistance can undermine
the successful execution of the plan.
Award 1 mark each limitation of planning.
33 1. A strategic plan defines our company's long-term vision, mission, and 6

overarching objectives. It involves analyzing market trends, identifying
opportunities, and understanding our strengths and weaknesses.
2. Policies are broad guidelines and principles that guide decision-making

and behavior within the organization. They define acceptable conduct,
standards, and rules for various activities and processes.
3. Programmes are comprehensive plans that encompass multiple projects
or activities with a common goal.
4. Objectives are specific, measurable targets that support the achievement
of the overall strategic plan.
5. Rules are specific and explicit guidelines that govern specific actions or
conduct within the organization. They define the do's and don'ts, ensuring
clarity and uniformity in employee behavior.
6. Procedures are detailed step-by-step instructions on how to perform

specific tasks or processes. They provide consistency and standardization,
ensuring tasks are executed accurately and efficiently.
Award 1 mark for each type of plan.

34 Primary Packaging: it is the layer of packaging that directly encloses the 6
product. It is the first level of packaging that comes into direct contact with
the product and is often the most visible to the consumer.
Real-Life Example: For a consumer electronics company, the primary
packaging for a smartphone would be the box that holds the phone itself,
along with any accessories such as charging cables and earphones.
Secondary Packaging: it refers to the packaging used to group and protect

multiple units of the primary package during distribution. It is designed to
facilitate handling and transportation of the product.
Real-Life Example: Continuing with the smartphone example, the

secondary packaging would be the larger carton that holds multiple
individual phone boxes for shipment to retailers.
Tertiary Packaging: it is the outermost layer of packaging used for bulk

transportation and storage of products. It is designed to protect products
during long-distance transportation and warehousing.
Real-Life Example: In the context of the consumer electronics company,
the tertiary packaging would be the large pallets or crates used to hold and
transport numerous secondary packages filled with smartphones to
distribution centers or retail stores
Award 1 mark to each level of packaging and 1 mark for each example
given.
BANGALORE SAHODAYA QUESTION PAPER (2022-23)
BUSINESS STUDIES (Code – 054)
CLASS XII –SET 1
Maximum Marks: 80 Time allowed: 3 Hrs
Date :
General instructions :
1 This question paper contains 34 questions.
1. “Successful organisations do not achieve their goals by chance, but by following a deliberate 1
process.” Identify the process highlighted here.
2. Name the level of management. 1

(a) Overseeing the efforts of the workforce
(b) Formulating organizational goals
3. Management function which is known as “Management in action” is 1

(a) Planning
(b) Staffing
(c) Directing
(d) Organising
4. State True / False : 1

(a) With the efforts of the Middle level managers, the quality of the product is maintained.
(b) To acquire knowledge of a subject is an art, while using the acquired knowledge is science.
1
5. Assertion (A) : Co-ordination is the essence of management. 1
Reason (R) : Co-ordination is a process by which a manager synchronises the activities of different
departments. It is the force that binds all other functions and thus called the essence of
management.
Select the correct alternative.
(a) Both Assertion(A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion(A).
(b) Both Assertion (A) and Reason (R) are true but Reason (R) is not the correct explanation of
Assertion (A).
(c) Assertion (A) is true and Reason (R) is false.
(d) Assertion (A) is false and Reason (R) is true.
6. Match the example in Column I with the function in Column II. 1

Column I Column II
A. Planning (i) Matching out comes with targets
B. Organising (ii) Objectives
C. Directing (iii) Resources for implementation
D. Controlling (iv) Supervision and motivation Choose the correct alternatives.
(a) (i), (ii), (iii), (iv)
(b) (ii), (i), (ii), (iv)
(c) (iii), (ii), (i), (iv)
(d) (ii), (iii), (iv), (i)
7. Complete the following: 1

“The nature of the relationship of our country with foreign countries” is a major element of
________component of the Business environment.
8. Indian ethnic wear like sarees are in great demand in India, but Italy does not have such a high 1
demand for the same. State the feature of business environment reflected in this statement.
9. Which of the following is not an element of legal environment. 1

(a) Court judgments.
(b) The extent and nature of government interventions in business.
(c) Government regulations.
(d) Administrative orders issued by government authorities.
10. What is micro environment? 1

11. Distinguish between Authority and Responsibility on the basis of origin. 1
12. Registration of underwriters is the ________________function of SEBI. 1
2
13. ……………………refers to a situation when a company is not able to meet its fixed financial 1
obligation
(a) Financial leverage

(b) Financial risk
(c) Financial Planning
(d) None of these
14. State the purpose of a Depository participant. 1
15. How does nature of business affect the requirement of fixed capital? 1
16. According to which concept of marketing, availability and affordability of the product are considered 1
to be the key to the success of the firm?
17. Assertion (A) : Marketing activities are equally relevant to non-profit organisations. 1
Reason (R) : Marketing helps the organisations in achieving marketing their goals such as improving
literacy standards, etc.
Choose the correct alternative:
(a) Both (A) and (R) are true and (R) is the correct explanation of (A).
(b) Both (A) and (R) are true and (R) is not the correct explanation of (A).
(c) (A) is true, and (R) is false.

(d) (A) is false and (R) is true.
18. Explain giving reason whether the following is true / false. 1

“Packaging serves as a Promotional tool.”
19. What is meant by Physical Distribution? 1

20. Why is marketing called a social process? 1
21. Explain “Management of People” as a dimension of Management. 3
3
22. Mr.Rajan is working as a Personnel Manager in a company as Delhi. Although he is not 3
welleducated, he is an experienced person. Before this, he has worked on this post in two large
companies. His intention is always in promoting an efficient employee to a higher post and demoting
inefficient one to a lower vacant post.
(i) State on what source of recruitment is Mr.Rajan concentrating?
(ii) What are the benefits of which company is depriving by using this source?
OR
Briefly explain the following Training methods:
3
(a) Internship Training
(b) Apprenticeship Training
23. Sadaf is the CEO of a reputed company. She introduced appropriate skill development programmes 3
and a sound promotion policy for the employees of her company. To motivate and retain the best
talent in the company, she designed the jobs of the managers to include greater variety of work
content. Identify and explain the two incentives introduced by Sadaf to motivate the employees of
the company.
24. Distinguish between Money Market and Capital Market on the following basis: 3
(a) Participants
(b) Safety
(c) Liquidity
OR
Distinguish between Primary market and Secondary market on the following basis;
(a) Nature
3
(b) Purpose
(c) Capital promotion
25. Outline the scope of Human Resource Department. 4

26. Define Communication. Briefly explain the types of formal communication. 4
OR
Explain the importance of Motivation. 4
4
27. After preparing the financial statements of the company, the finance manager informed the following 4
deviations:
(i) State which of the following are positive/negative deviations.
(ii) Mention which of the following are key result areas and require Critical Point Control and
which should be dealt under management by Exception.
(a) The total communication cost has increased by 22% as compared to budgeted cost.
(b) Time taken to produce one unit has decreased by 1%.
(c) The sales revenue has decreased by 3%.
(d) The salary expense decreased because two people left the organization.
OR
What are the problems faced by the organization in implementing an effective control system?
28. Explain any four factors which affect the working capital requirement of a company. 4
29. The total capital of a company is Rs.10 crore, 20% of its capital has been financed through 10% debt. 4
The gross earnings of a company is Rs.1.2 crore. Calculate interest coverage ratio, should the
company raise additional capital through debt. Why or why not? Give reasons.
30. A shopkeeper sold you some spices, claiming that those were pure. Later a laboratory test showed that 4
those were adulterated.
What precautions should you have taken before buying and what remedies are available to you for the
wrong act?
31. “ Principles of Management enable managers to fulfill their tasks and responsibilities most effectively 6
and efficiently”. Explain.
32. (a) Name the types of plans required for the following: 2
(i) Launch of a product

(ii) Diversification of business
(iii) Launch of new product mix
(iv) Defines Do’s and Dont’s for manager.
(b) “Planning is not a guarantee of success of business” Comment.
OR
Define Planning. Explain the features of planning. 4
33. “A good and effective organizer follows series of steps to achieve the desired goal.” Discuss the steps 6
involved in the process of organizing.
5
34. Ashima purchased a bottle of tomato – sauce from a local grocery shop. The information provided on 6
the bottle was not clear. She fell sick consuming it. She filed a case in the District Commission under
the consumer Protection Act and got relief.
(a) Identify the important aspect neglected by the marketer in the above case.
(b) Explain briefly the functions of the aspect identified in (a) above.
*** Good Luck***
6
CLASS XII –SET 2
Maximum Marks: 80 MARKING SCHEME Time allowed: 3 Hrs
Date :
1. Management is dynamic 1
2. (a) Middle level management (b) Operational or supervisory level of management. 1
3. (b) - Social objectives 1
4. (a) false (b) false 1
5. (c) Statement I is correct and Statement II is not correct. 1
6. (i) Dealing with employees as individuals with diverse needs and behavior. 1
(ii) dealing with employees as a group of people.
7. Government 1
8. (a) Declined (b) No effect 1
9. (a) Customers 1
10. Macro environment refers to all those external factors which have a distant relation with business 1
and influence all business units almost in the same way.
11. Basis Authority Responsibility 1

Origin Relationship between superior Originates because of delegation of authority.
And subordinate
12. Secondary 1
13. Investment Decision or Capital Budgeting Decision. 1
14. (a) National Securities Depository limited (NSDL) 1

(b) Central Depository Services limited (CDSL)
15. Cost incurred for raising funds in the securities market. 1

16. Selling concept 1
17. A – statement I is correct and statement II is wrong. 1
18. False – needs are basic to human beings wants are culturally defined objects, that are potential 1
satisfiers of needs.
19. Advertising is non-personal form of information as advertiser and consumer do not come into 1
personal contact.
1
20. It refers to sell the goods directly to the consumers by the manufacturer without involving any 1
intermediary.
21. In order to realise goals, the organization has to do different activities like purchase, sale, finance, 3
etc. A single person cannot do all these activities all by himself, so many people as a group have to
join to complete the activities.
The organizational goals can be fully realized (i) if all the people of the organization work in a
team.
(ii) With effective co-ordination more in one direction only.
Hence, we say that management is a group activities, not an activity to be performed by a single
person.
22. Trade Test: These tests seek to measure 1hr knowledge, skills and proficiently that a candidate possess 3
with regard to a particular job position.
Interest Test : Are tests used to define the interests of the candidate.
Aptitude Test : These tests seek to evaluate the potential of a candidate in acquiring new skills.
OR
Sources of Internal Recruitment : Transfer and promotions.
1
Merits : (a) Motivates employees
(b) Promotes training
(c) Economical
any 2 explain
(d) Simple process 2
23. (a) Organisational barriers – organisation policy / status , organization facilities / Rules & 3
Regulations.
(b) Psychological barriers - distrust
Lack of attention any one each
Premature extraction
2
24. The risks involved are: 3
(i) Interest on debt has to be paid even if the company is unable to generate sufficient
profit and
(ii) If debt is obtained at rate of interest higher than the rate of return, then it will reduce
EPS of equity shareholders, which will adversely affect the market price of equity shares.
In addition, the other factor to be considered is the various factors affecting the choice of “Capital
structure”.
OR
The working capital requirement would be more as he is engaged in “Manufacturing Industry”
Reasons : Raw material needs to be connected into finished goods before any sales become
possible. There is long time gap between purchase of raw material and connecting finished product 3
into sales factors fixed capital requirement :
Scale of operations
Growth prospects any 2
Diversification
25. Job analysis is the complete study of the job embodying every known and determinable factor, 4
including duties and responsibilities involved in its performance.
Job analysis involves two dimensions:

(a) Job description explain
(b) Job specification
Further, workload and workforce analysis also needs to be done. (explain)
26. Maslow’s Need Hierarchy Needs Assumptions. 4

(a) Behavior of people is based on their needs.
(b) People’s need are in hierarchical order.
(c) A satisfied need can no longer motive a person.
(d) A person moves to the next higher level of the hierarchy only when the lower need is
satisfied.
OR
Leadership is the ability of a person to influence the behavior of others.
4
Types of leadership styles:
(a) Autocratic
(b) Democratic explain
(c) Free-Rein
3
27. (a) Ensuring order and discipline [Importance] 4
(b) Little control over external factors [limitation]
(c) Making efficient use of resources and accomplishment of organizational goals (importance)
(d) Judging accuracy of standards (importance)
OR
Controlling Process :
1. Setting performance standards
2. Measurement of actual performance
3. Comparison of actual performance with standards
4. Analysing deviation
28. 4
Number of shares = 90,000 shares
Capital required for expansion = Rs.50 lacs.
Total Investment = 90,00,000 + 50,00,000 = 1,40,00,000
8% Debentures = Interest = 50,00,000 8% = 4,00,000
Given EPS = Rs.14/-
EAT EAT
EPS = = 14 =
No.of shares 90,000
EAT = Rs.12,60,000
Let EBT be X
EBT – Tax = EAT
X – 0.3X = 12,60,000
0.7X = 12,60,000
X= 18,00,000
EBIT = EBT + Interest
Rs. 18,00,000+Rs.4,00,000 = Rs.22,00,000
EBIT 22,00,000
ROI = 100 100 15.7%
Total investment 14,000,000
As ROI is 15.7% which is greater than rate of interest on debenture is 8%, company can choose to
use Trading on equity to increase EPS.
The finance manager, Mr.Rathi was also justified in making this decision.
4
29. Long term investment decision is also referred as capital Budgeting decision. It relates to 2
investment in long term assets. Eg: purchase of a new machine. The finance manager has to make a
comparative study of various alternatives available in the market on the basis of cost and
profitability. These decisions are very important as they affect (a) earnings of the business
(b) Irreversible decision
(c) Huge amount of investment Factors:
a) Cash flows of the project
b) Tax Rate any 2 explain.
c) Investment criteria
2
30. Redressal Agencies : 4

District Commission – Goods / services of value not exceeding Rs. 1 crore.
State commission – Good / services of value exceeding 1 Crore and less than Rs.10 crore, and in
case the aggrieved party is not satisfied with the order of District commission, he can appeal before
state commission within 45 days of passing of order.
National Commission – When goods / services of value is more than Rs.10 crore and when
aggrieved party is not satisfied with the order of State commission, can file an appeal before
National Commission within 30 days of passing of order.
Supreme court of India – Claims exceeds Rs.10 crore and if the aggrieved party is not satisfied with
the order of National Commission.
31. Differential piece rate system. 6

To differentiate efficient and inefficient workers. (with example to be explained)
5
32. Planning Process: 2
Setting objectives
Developing premises
Identifying alternative causes of action
Evaluating alternative causes of action
Selecting an alternative
Implement the plan 4
Follow up action
OR
(a) (i) Objective (ii) Policy (c) Strategy (iv) Budget
(b) Importance of Planning :
(i) Provides direction
(ii) Reduces the risk of uncertainty 2
(iii) Reduces overlapping and wasteful activities

(iv) Promotes innovative ideas 4
33. Divisional structure – Will be able to achieve (i) Product specialization 6

(ii) fix clear accountability
(iii) facilitate faster decision making explain
(iv) expansion and growth
(v) growth opportunities
34. (a) (i) Gathering and Analysing market information 3

(ii) Market planning explain
(iii) Product Designing and Development
(b) element of marketing mix which affects the revenue and profits of a firm is Price mix.
Factors:
(a) Product cost
(b) Utility and Demand
(c) Competition
(d) Government Rules and Regulations
any 2 explain 3
(e) Pricing objectives
(f) Marketing methods used
*** Good Luck***
6
BUSINESS STUDIES (Code – 054) CLASS XII –SET 2
Maximum Marks: 80 Time allowed: 3 Hrs
Date :
1. “In order to be successful an organization must change its goals according to the needs of the 1
environment.” Which characteristic of management is highlighted in the statement?
2. Name the level of management. 1

(a) To interpret the policies framed by top management.
(b) To ensure safety standards are maintained.
3. To meet the objectives of the firm, the Asian Paints contributed large amount of funds to enable 1
farmers to use local resources effectively. Identify the management objective it tried to achieve.
(a) organizational objective
(b) Social objective
(c) Personnel objective
(d) Survival, profit and growth
4. State True / False 1

(a) Co-ordination is not a continuous process.
(b) To give proper remuneration is the social purpose of management.
5. Statement I : Management is all pervasive. 1

Statement II : Management is a tangible force.
Choose the correct alternative.
(a) Both the statements I and II are correct.
(b) Both the statements I and II are not correct.
(c) Statement I is correct and statement II is not correct.
(d) Statement II is correct and statement II is not correct.
6. Managing people has two dimensions, list them. 1

7. Price control means that the companies will sell goods on the ______price. 1
8. What are the main impact of demonetisation on (a) Private wealth (b) Public sector wealth 1
9. Which of the following is not a part of internal environment? 1
(a) Customers (b) objectives (c) Policies (d) organization structure
10. What is Macro environment? 1

11. Distinguish between Responsibility and Accountability on the basis of origin. 1
12. In _______market, only the investors do the mutual sale and purchase of securities. 1
1
13. 1
‘A decision to acquire a new and modern plant to upgrade an old one’.
Identify the aspect of financial decision.
14. Mention the two depository institutions in India. 1

15. What do you mean by floatation cost? 1
16. Which concept of marketing emphasizes greater importance to attracting and persuading customers 1
to buy the products?
17. Statement I : If the demand of a product is in elastic, the firm is in a position to fix higher prices. 1
Statement II : In case the degree of competition is high, the firm is in a position to set high prices.
Choose the correct alternative:
(a) Statement I is correct and statement II is wrong.
(b) Statement II is correct and statement I is missing.
(c) Both the statements are correct.
(d) Both the statements are wrong.
18. Explain giving reason, whether the following is true / false. 1

“Needs and wants” are one and the same thing.
19. Why advertising is “Non – personal Presentation” of information? 1

20. What is meant by Zero level channel of distribution? 1
21. Explain in brief, “Management” as a group of people having managerial responsibility for an 3
enterprise.
22. Give the meaning of

(a) Trade Test
3
(b) Interest Test
(c) Aptitude Test
OR
Name the two widely used sources of internal recruitment. Also state any two advantages of internal
sources of recruitment. 3
2
23. Mr. Shubhendu Bose is the owner of “Bikmac Enterprises” carrying on the business of 3
manufacturing various kinds of biscuits. There was a lot of discontentment in the organization and
the targets were not being met. He asked his son, Naval, who had recently completed MBA, to find
out the reason. Naval found that all decision making of the enterprise were in the hands of his
father. His father did not believe in his employees. As a result both the employer and employees
were not able to understand each others messages in the same sense. Thus, the employees were not
happy and targets were not met.
(a) Identify any two communication barriers because of which Bikmac Enterprises was not able
to achieve its target.
(b) State one more barrier of each of the types identified in (a) above.
24. A company wants to raise Rs.20 lakhs through debt. Issue of debt will increase the debt equity ratio. 3
What are the risks involved in it? What other factors, a company should consider before taking the
decision.
OR
Manish is engaged in the business of garment manufacturing. Generally he used to sell his garments
in Delhi. Identify the working capital requirements of Manish giving reasons in support of your
answer, further, Manish wants to expand and diversify his garment business. Explain any two factors 3
that will affect his fixed capital requirement.
25. In order to ensure, that the person who is appointed for it is competent in all possible ways, “job 4
analysis” is done. Explain.
26. State the assumptions of Maslow’s Need Hierarchy Theory. 4

OR
What do you mean by leadership? State the types of leadership styles. 4
3
27. Identify and explain the importance / limitation of controlling in the following situations. 4
(a) Manager installed CCTV cameras in the store to keep track of loss of stock.
(b) The cost of producing an inverter increased due to increase in excise duty tax.
(c) The supervisor always checks workers when they are working on machines to ensure that
they use raw materials efficiently and achieve the desired productivity.
(d) The production manager requested the factory has to revise the standard production time
and differential piece rate wage system after the new machinery was installed.
OR
The last step in the process of controlling is “taking corrective actions”. Briefly explain the steps in
chronological order that are taken in the process of controlling before this step.
28. Bhushan limited is in the business of manufacturing and exporting ready-made garments. It has a 4
share capital of Rs.90 lacs at the face value of Rs.100 each company is considering a major
expansion of its production facilities and wants to raise Rs.50 lacs. The finance manager of the
company Mr.Rathi has recommended that the company can raise funds of the same amount by
issuing 8% debentures. Given that earning per share of the company after expansion is Rs.14/- and
tax rate is 30% did Mr.Rathi give a justified recommendation? Show your workings clearly.
29. Investment decision can be long-term or short-term. Explain long term investment decision and 4
explain any two factors affecting this decision.
30. Describe briefly the three tier redressal mechanism available to consumers under consumer 4
Protection Act, 2019.
Under what circumstances can a consumer appeal in supreme court of India?
31. “To achieve maximum productivity of workers, it was important to recognize efficiency in terms of 6
appreciation and rewards”. Identify and explain the technique proposed by F.W.Taylor.
4
32. Planning involves certain logical steps for every manager to follow. Describe these steps briefly. 6
OR
(a) Identify and explain the types of plans being described below:
(i) A plan to achieve 30% ROI.
(ii) Pankaj solutions ltd propagates on cash sales and no credit allowed.
(iii) A plan used in marketing to combat the plan of the rival firms.
(iv) It has been estimated that the annual production cost of casting limited is going to be
Rs.500 crores.
(b) Briefly explain the importance of planning. 2
33. Neha runs a factory where in she manufactures shoes. The business has been doing well and she 6
intends to expand by diversifying into leather bags as well as western formal wear thereby making
her company a complete provider of corporate wear. This will enable her to market her business unit
as the “one stop” for working women. Which type of structure would you recommend for her
expanded organization and why?
34. (a) State the three functions of marketing that are performed before goods are actually produced. 3
(b) Name the element of marketing mix which affects the profits and revenue of a firm.
3
Explain any two factors which help in determining this element.
*** Good Luck***
5
CLASS XII –SET 1
Maximum Marks: 80 MARKING SCHEME Time allowed: 3 Hrs
Date :
1. Management 1
2. (a) Supervisory management (b) Top level management 1
3. (a) Directing 1
4. (a) False (b) False 1
5. (a) Both Assertion (A) and Reason (R) are true and Reason ® is the correct explanation of 1
Assertion (A)
6. (d) - (ii), (iii), (iv), (i) 1

7. Political 1
8. Relativity 1
9. (b) - The extent and nature of government interventions in business. 1
10. It refers to all those external factors which are closely related with business and influence each 1
industrial unit differently.
11. Basis Authority Responsibility 1

Origin It originates because of formal It originates because of senior subordinate
positions in the organisation relationship.
12. Regulatory 1
1
13.
Financial Risk
14. Depository participant facilitates the process of dematerialization. 1

15. Manufacturing business requires more fixed capital 1
Trading business requires less fixed capital
16. Production concept. 1
17. (a) Both (A) and (R) are true and (R) is correct explanation of (A). 1
18. True - In self – service stores it plays important role and also good packaging attracts customers. 1
19. Physical distribution refers to the combination of all decisions relating to Transportation, Inventory, 1
warehousing and order processing of goods.
20. Marketing is called a social process as it involves interaction of people. 1
1
21. Management is regarded as a multifaceted concepts as it involves three dimensions 3
namely. (a) Management of work (b) Management of people.
(c) Management of operations.
Management of people : Even after technological development , getting work done through people
skill continues to be the main objective of management. There are 2 main issues concerning people.
(i) To deal with the people having different needs and different interest.
(ii) To deal with the people taking them as one group.
Facing these two issues, management has to ensure the participation of its people in the realisation of
the organizational goal.
22. (i) Internal source of recruitment. 1

(ii) Depriving the benefits of External source.
(a) Qualified personnel
(b) Wider choice explain 2
(c) Fresh Talent
OR
(a) Internship Training is a type of training program which works through a collaboration between
1½
an educational institute and business firms. This method of training is popularly used in case of
professionals like doctors, lawyers etc. It is a method of on the job training.
(b) Apprenticeship Training is a provided to people who plan to pursue skilled jobs like that of a
plumber. Trainee acquired knowledge and skill related to a particular line of specialization under the
guidance of a master worker. It is a on job Training method. 1½
23. Career Advancement opportunities and Job enrichment – Explain. 3
24. Basis Money market Capital Market 3

1. Participants RBI, financial Institutions, banks Financial
institutions,
Banks, foreign
investors, retail
investors.
2. Safety Money market instruments are comparatively safer. Capital
market
securities are
rishis than
money market
instruments
3. Liquidity More liquid Less liquid
OR
Basis
Primary market Secondary market
2
1. Nature Market for new issues Market for 3
existing issues
2. Purpose To Raise capital To provide
liquidity
3. Capital Forms capital directly by moving money from savers to Forms capital
formation investors indirectly through
financial
intermediation
25. HRM – Scope : (i) Carrying out recruitment, preparing job descriptions, formulating compensation 4
and incentive plans. explain (ii) Providing Training and development. Dealing with
grievances and complaints.
26. Communication is defined as a process of exchange of ideas, news, views, facts, feelings etc 4
between or among people to create common understanding.
Types of formal communication :
(a) Vertical communication – Upward and Downward – Explain
(b) Horizontal / lateral communication
OR
Importance of Motivation :
(a) Helps to increase the performance
(b) Helps mould the attitudes 4
(c) Helps to reduce labour turnover
(d) Helps manages to introduce changes.
27. (a) Negative deviation Management by Exception 4
(b) Positive deviation Key area of performance, though positive deviation yet must be
checked to ensure that workers are not compromising with the quality of the product.
(c) Negative deviation Critical point control
(d) Not a deviation as change in cost is due to vacant positions.
OR
(a) Difficult to set accurate qualitative
standards.
(b) Little control on external factors.
(c) Resistance from employees
explain (d) Costly affair.
3
28. Working capital – factors. 4
(a) Scale of operations (g) Growth prospects

(b) Production cycle (h) Inflation
(c) Business cycle (i) Credit availed
(d) Credit allowed (j) Nature of business
any 4 explain
(e) Seasonal factors (k) level of competition
(f) Availability of Raw material (l) operating efficiency
29. EBIT = Rs.1,20,00,000 4
2,00,00,000
Debt = 1,00,00,000
20,00,000
Interest = 2,00,00,000
Interest coverage Ratio = EBIT 1,20,00,000

=6 times
Interest 20,00,000
Yes, the company can raise funds through Debt, as the company’s interest coverage ratio is 6 times
which is high which shows that the company’s earnings can meet interest expense.
30. Conscious about the quality of the product by checking AGmark and should have obtained cash 4
memo.
Remedies : (a) Removing the defects of the product.
(b) Replacing the defective product with right product.
(c) Returning the price of produce.
(d) Compensation
31. Importance of Principles of management 6
(a) Provides manages with useful insights into reality.

(b) Optimum utilization of resources and effective
administration (c) facilitates scientific decisions.
(d) Meeting changing environment requirements. explain
(e) fulfilling social responsibility
(f) management training, education and research.
4
32. (a) (i) Programme (ii) Objective (iii) Strategy (iv) Rules 2
(b) As planning has so many limitations, it cannot be said that it is a guarantee of the success of
business.
Limitations :
Planning creates rigidity
Does not work in a dynamic environment
Reduces creativity 4
explain any 4
Involves Huge costs
Time consuming process
OR
Planning : is deciding in advance what to do, how to do it, when to do it and who is to do it. 1
Features : Planning focuses on achieving objectives.
Planning primary function of management.
Planning is pervasive.
Planning is continuous. 5
Planning is futuristic.
33. Steps in organizing process : 6
(i) Identification and Division of work

(ii) Departmentalisation
(iii) Assignment of duties
explain
(iv) Establishing Reporting relationship
34. (a) labeling 1
(b) functions :
(i) Describe the products and specify its contents
(ii) Identify the product or brand
(iii) to help is grading of the product
explain
(iv) helps in promotion of the products
(v) provide information required by law. 5
*** Good Luck***
5
PRE BOARD - 1, SAMPLE QUESTION PAPER 2023-24
BUSINESS STUDIES (054)
CLASS XII
Max Marks: 80 Time allowed: 3 Hours

General instructions:
1. ABC Ltd. has Debt Equity ratio of 3:1 whereas XYZ Ltd. has Debt Equity ratio of 1:1. Name the 1
advantage ABC Ltd. will have over XYZ Ltd., when the rate of interest is lower than the rate of
return on investment of the company.
(a) Trading on equity (b) Low risk
(c) Low cost of equity (d) Greater flexibility.
2. Packing has acquired great significance in the marketing of goods and services, because of: 1
(a) Rising standards of health and sanitation. (b) Self-service outlets
(c) Innovational opportunity (d) All of these.
3. Aroma Ltd. is a chemical manufacturing company producing dyes and pigments both for domestic 1
and international market. It has enjoyed a considerable market share but lately, it has been facing
problems in terms of target sales and customer satisfaction. This is due to the reason that new
entrants have emerged with better technology and competitive pricing. The Chairman of the
company addressed this issue in the departmental meeting. The production head, Mr. Kapil, advised
the Chairman to revamp the system and take immediate necessary actions to rectify the problem
so that sales are achieved as per the plans.
Identify the relevant function of management being discussed here.
(a) Organising (b) Staffing (c) Controlling (d) Planning.
4. Tomato Ltd. a food delivery service app has recently faced criticism for the tampering of their 1
product by their delivery boys. Tomato Ltd. decided to put a hologram seal on the food packets in
order to protect the contents from spoilage, leakage, pilferage, damage, along with a tag with a safety
warning for the consumers to heck the seal. Which concept of marketing discussed above is
performing the important function of communicating with the potential buyers and promoting the
sale.
(a) Branding (b) Labelling
(c) Product designing and development (d) Packaging.
5. There is no fixed geographical location of: 1
(a) Capital market (b) Money Market (c) Primary market (d) both (b) & (c)
6. Which of the following is not a function of management? 1
(a) Planning (b) Staffing (c) Coordination (d) Controlling.
7. The allocative function of Financial market helps in . 1
(a) Bringing transparency in trading procedure
(b) Earning higher rate of return to household sector
(c) Better functioning of depository
(d) Determining the prices of securities.
8. Which of the following is an example of social environment? 1
(a) Composition of family (b) Consumer Protection Act
(c) Money supply in the economy (d) The constitution of the country.
9. Instrument with a maturity period of less than one year are traded in the __________. 1
(a) Capital Market (b) Money Market
(c) Bombay Stock Exchange (BSE) (d) National Stock Exchange (NSE)
10. According to which concept of marketing availability and affordability of the product are considered 1
to be the key to the success of the firm?
(a) Production concept (b) Product concept (c) Selling concept (d) Marketing concept.
11. Read the following statements: Assertion (A) and Reason(R). Choose the correct alternative from those given 1
below:
ASSERTION (A): Management is an intangible force.
REASONING (R): Management has to adapt itself to its changing external environment, which consist of
social, economic and political factors.
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
(c) Assertion (A) is true but Reason (R) is False
(d) Assertion (A) is False but Reason (R) is True
12. The aim of demonetisation was not to . 1
(a) Curb corruption.

(b) Withhold the accumulation of black money generated by undeclared income.
(c) Reduce the prices of real estate.
(d) Counterfeit the use of high denomination notes for illegal activities.
13. While scrutinizing the production records, it is found that in a particular bath the rejection rate as 5% 1
against the set standard of 2%. The management found out that this was due to negligence of quality
control staff. This action is part of which step in the controlling process?
(a) Measuring the actual process (b) Comparing actual performance with standards.
(c) Taking corrective actions. (d) Analysing deviations
14. Statement I: For products requiring long term storage like agricultural products, the warehouses are
located near to the market. 1
Statement II: Higher the level of inventory, higher will be the level of service tocustomers but the cost of
carrying the inventory will also be high.
(b) Statement II is true and I is false
(d) Both the statements are false
15. Match the following:

(i) Bank reducing interest rate on housing loans. (A) Economic Environment. 1
(ii) An increasing number of working women. (B) Political Environment.
(iii)Alcoholic beverages are prohibited to be advertised on (C) Legal Environment.
„Doordarshan‟.
(iv) A Stable government has built up confidence among the (D) Social Environment.
firms to invest in big projects.
(a) (i) - (A); (ii) - (D); (iii) - (C); (iv) - (B).

(b) (i) - (A); (ii) - (B); (iii) - (C); (iv) - (D).
(c) (i) - (D); (ii) - (A); (iii) - (C); (iv) - (B).
(d) (i) - (D); (ii) - (A); (iii) - (B); (iv) - (C).
16. STATEMENT I: Electronic holdings can be converted into physical certificateswith the process of
dematerialisation. 1
STATEMENT II: There is no danger of theft, loss or forgery of sharecertificates in
dematerialisation.
(b) Both the statements are false
(d) Statement II is true and I is false.
17. Which of the following is not a component of economic environment if business? 1
(a) Interest rates (b) Inflation rates
(c) Literacy rates (d) Rates of saving and Investment.
18. Match the following: 1
(i) A name, term, sign, symbol, design or some combination of them, used (A) Trade Mark.
to identify the products of one seller & to differentiate them from those of
the competitors
(ii) The verbal component of a brand. (B) Brand mark.
(iii) That part of a brand which can be recognised but which is not utterable. (C) Brand.
(iv) A brand or part of a brand that is given legal protection. (D) Brand name.
(a) (i) - (A); (ii) - (B); (iii) - (C); (iv) - (D).
(b) (i) - (A); (ii) - (C); (iii) - (B); (iv) - (D).
(c) (i) - (A); (ii) - (D); (iii) - (C); (iv) - (B) .
(d) (i) - (A); (ii) - (D); (iii) - (B); (iv) - (C).
19. Which of the following is not a characteristic of a profession? 1
(a) Service motive (b) Restricted entry
(c) Well-defined body of knowledge (d) Based on practice and creativity.
20. Complete Centralisation would imply concentration of all decision making functions at the _______. 1
(a) lower level of the management hierarchy (b) apex of the management hierarchy
(c) middle level management (d) None of these.
21. Top management plans for the entire organization. According to these plans the organizational 3
structure is developed and staffed. In order to ensure that these plans are executed according to
plans, directing is required. Any discrepancies between actual and realized activities are then taken
care of at the stage of controlling. Name and explain the process highlighted above which started at
the planning stage itself and is implicit and inherent in all the functions of management in an
organization.
22. Polycons Ltd. is a firm manufacturing paper bags in Odisha. It has employed female workers in the 3
company and manufactures paper bags from recycle paper and thereafter sells them to various firms
at economic rates.
Since last 1 month, its customers (firms) are reporting of complaints received from the users that
these paper bags are unable to manage heavy weight and get torn easily.
(a) Identify function of management has been ignored above?
(b) Discuss the step to be undertaken in respect of the ignored function to pacify the situation.
OR
Explain “Critical point control” with respect to Analyzing deviations, a step in the process of controlling.
Give a suitable example.
23. An organisation provides security services. It requires such candidates who are reliable and don‟t 3
leak out the secret of their clients. What steps should be incorporated in selection process? State net
two steps of selection process.
24 State any three Protective functions of SEBI. 3
OR
Distinguish between Capital market and Money market on the basis of:
(a) Participants (b) Duration & (c) Safety
25. Ruma is working in a company on a permanent basis. As per the job agreement she had to work for 4
8 hours a day and was free to work overtime. Ruma worked overtime, due to which she fell ill and
had to take leave from her work. No one showed concern and enquired about her health. She
realised that she was fulfilling only some of her needs while some other needs still remained to he
fulfilled.
(i) By quoting the lines from the above para, identify the needs of Ruma which she is able to
fulfill.
(ii) Also explain two other needs of Ruma followed by the above needs, which still retained to be
satisfied.
OR
Explain the following leadership styles:
(a) Authoritive leadership
(b) Participative leadership
26. State Merits of using External sources of recruitment. 4
OR
Veera Ltd. received 25,555 applications for the post of 56 Supervisors. Preliminary, screening was
done and 4,450 were filtered. Varied steps of selection process were taken and finally 56 candidates
as supervisors were selected. They were directly posted to their respective posts. After one month
performance appraisal of these candidates conducted. It was found that out of 56, ten were not able
to perform as per standards as they were facing practical problems while handling machines.
(a) In your opinion, what should be done to improve the performance of these ten supervisors?
(b) How can an organisation are benefited by improving the skill level of employees.
27. Manishankar purchased a pack of chocolates of a renowned brand for his daughter from a shop in
the nearby market. After consuming the chocolates, his daughter fell sick. He filed a case with the 4
District forum against the renowned brand. He lost the case because of a mistake that he could not
provide proof of purchase.
What should be kept in mind by a consumer while purchasing, using and consuming goods and
services apart from avoiding the mistake committed by Manishankar, in order to enable him/ her
to achieve the objective of consumer protection? Enumerate any four points.
28. Explain the following factors affecting the Investing decision of the company:
2+2
(a) Cash flow of the project
=4
(b) Investment criteria
29. Identify and state the various elements of communication highlighted in the following cases:
4
(i) Department 'X' has sent an encoded message to department 'Y' throughinternet. What is the
role of internet here?
(ii) Manoj is making gestures so that he can send a message to Ranjan.What is Manoj doing
here?
(iii) Ranjan is trying to understand the message sent by Manoj by readinghis gestures. What is
Ranjan doing here?
(iv) Kartik picks up his phone and finds a message on it. He reads the message carefully. What
is the role of Kartik here?
30. Lifeline Ltd. is a company engaged in production of organic food. Presently it sells its products 4
through indirect channels of distribution. The company is planning to start its own show rooms and
online portals. The financial manager suggested to use debt to invest in own showrooms and online
portals.
Company plans to raise debt capital of ₹ 40 Lakhs through a loan from HDFC bank at 10% interest.
The present capital base of the company is ₹ 9 Lakhs equity of ₹ 10 each. The rate of tax is 30%.
In the context of above case-
Assuming expected rate of return same as current year, i.e., 15% do you think the decision to use
debt is justified.
Show your working clearly.
31. (i) Explain the following techniques of Scientific Principles:
6
(a) Science, not rule of thumb.
(b) Harmony not discord
(c) Cooperation not individualism
OR
(i) Explain the following principles of Fayol:
(a) Authority and Responsibility
(b) Unity of Command
(c) Esprit De Corps.
32. Briefly explain the next three steps in the process of planning which the manager will have to have to 6
follow after using conjecture about what might happen in the future.
OR
„The pros and cons of each alternative need to be weighed.‟ Name and briefly explain the logical steps
in the process of planning which are followed by a manager before performing the step highlighted in
the above statement.
33. Choco Ltd. offers a wide variety of chocolate products. It has an action program of not selling its 6
products by their generic name but under different names like Choco-silk bar, Choco-Munchy and
Choco-crunchy etc. for different customer segments. All these names have great popularity and
acceptability in the markets.
As the company policy the products were offered at reasonable and affordable prices for targeting a
mass customer base.
During the festive season the company launched a massive promotional campaign to increase its
revenue and achieve its communication objectives. The company introduced free gifts for the
customers.
Their on-ground sales team delivers the product not only to the departmental stores but also to small
shops, so that all segments of customers can easily get the products. They also provide information
and support services to customers to ensure repeat sales.
From the viewpoint of the management function, briefly explain any four activities of marketing
which the firm will be involved in, apart from the above-mentioned ones it's already performing.
34. The function of organising is to arrange, direct, coordinate & control the activities of an enterprise.‟
In the light of this statement, explain the meaning of organising and various steps in the process of 6
organising.

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CBSE

ADDITIONAL PRACTICE QUESTIONS

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.

7. Attempt all parts of the questions together.

1 Vedant Ltd. is a company with a decreasing EBIT. The company has a 1

(a) cost of debt

(b) return on investment

(d) debt service coverage ratio

3 Which scenario BEST illustrates the impact of rapidly changing technology 1

(a) A software company is disrupted by a new entrant that offers a more

(a)Product and Selling

5 Zebronics Technology Solutions, a leading tech company, recently 1

(a) conducting an e-IPO to reach a wider digital audience

Identify the feature of Coordination illustrated in the picture.

7 Which of the following statements accurately represents one of the 1

(d) A survey that measures customer satisfaction with the company's

9 Ms. Arundhati, the CEO of Sunlife Ltd., is delivering a speech to a group of 1

What is the primary goal of Ms. Arundhati's speech?

(a) to increase sales

(c) to improve the company's image

(d) to build relationships with stakeholders

A: Planning and controlling are interdependent and interlinked.

13 Statement I: Channel of distribution is important as goods are produced at 1

Statement II: Physical movement of goods is transportation of goods from

Choose the correct option from the following:

(a) fiscal policy of the government

(b) foreign policy of the government

(d) foreign exchange policy of the government

15 What is the significance of delegation in the scenario where Sara, as a 1

II: Demutualisation refers to the process by which a public share company

Choose the correct option from the following:

(c) The government will receive more revenue from taxes.

A. Price: - it is the amount that a customer pays for to 1

B. Promotion: - it helps to grab the attention of the 2

C. Product: - it is a commodity, produced or built to 3

D. Place: - which is easily accessible to potential 4

(a) A (3), B (1), C (4), D (2)

19 What aspect of the profession is exemplified in the scenario where Ayesha 1

(a) Service motive

20 Which of the following is a result of globalisation that has contributed to the 1

b) Assuming the roles of CEO and Product Architect to guide Tesla's

c) Engaging in engineering and technical aspects to drive the development

What are the three essential functions he is likely performing in his

22 Paul, the Manager of a manufacturing unit in Noida, employed various 3

How can a regional manager of a retail chain enhance operational efficiency

23 Examine the multifaceted advantages of external recruitment in the context 3

24 Design a comprehensive investment plan for a person seeking advice on 3

25 The manager of a team in a fast-paced IT company, notices a decline in 4

The HR manager of Starflight Ltd., has to develop an employee motivation

26 The allocation of resources for employee training and development has 4

d) Final Interviews and Decision- making

Equity Capital: Rs. 300,000

Debt Capital: Rs. 200,000

Net Income: Rs. 50,000

Total Assets: Rs. 800,000

Equity Capital: Rs. 400,000

Debt Capital: Rs. 400,000

29 Analyse the following scenarios and identify the specific barriers to 4