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CHENNAI SAHODAYA SCHOOLS COMPLEX

COMMON EXAMINATION
CLASS – 12
(BUSINESS STUDIES -054)
Roll No: Maximum Marks: 80
Date: Time Allowed: 3 hours
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 Vimla Agro Food Ltd. is a famous multinational company. Mr. Shiv is its finance 1
manager. He is trying to increase the market value of capital invested by the equity
shareholders. He already knew it could be possible only when the price of the shares
increases and the price of shares increases only if financing, investment, and dividend
decisions are taken optimally. He did the same and achieved success. Which objective
of financial management has been referred to here?
(a) Maximizing the wealth of equity shareholders
(b) Effective utilisation of funds
(c) Ensures the safety of funds
(d) Avoiding idle finance

2 Under which of the following conditions does a business need not maintain a high level 1
of inventory?
(a) When a higher level of customer services need to be provided
(b) When a high degree of accurate sales forecast can be made
(c) When the responsiveness of the distribution system is low
(d) All of the above

3 Introduction of mobile phones has negatively affected the business of cameras and 1
watches it is related to.
(a)Social Environment
(b)Economic Environment
(c)Technological Development
(d) Political Environment

4 ------------ is an essential legal document as it helps in settling disputes /claims 1

between the investors and the brokers.
(a)Credit note
(b) Contract note
(c) Both (a) and (b)
(d) None of the above

5 1

Which principle of Scientific Management has been shown here?

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(a) Harmony not Discard

(b) Cooperation not individualism
(c) Science not Rule of Thumb
(d) None of the above

6 Under Management by exception manager. 1

(a)Sets up a range and deviation within the range are ignored and
beyond range are taken seriously
(b)All deviations taken seriously
(c )Both (a) and (b)
(d)None of the above

7 The principles of division of labour may be used to a government office where a 1

diary/dispatch clerk receives and sends mail, and a data entry operator enters data into a
computer. Division of labour also applies to limited companies with different divisions
such as production, finance, research & development, and so on. Which aspect of
management principles is highlighted above?
(a)General Guidelines
(b) Universal applicability
(c )Flexible
(d)Contingent

8 Ram runs a logistic company. The Tour in charges of each trip in the company are 1
expected to submit a report to the Event Manager on the completion of every trip.
Identify the step in the controlling process being described in the above lines.

(a) Setting of standards

(b) Measurement of actual performance
(c) Taking corrective action
(d) Analysing the deviations

9 Chilico Ltd. Has appointed the former consulting executive of Shri Shankar Ltd. Rajan 1
as its Vice President. What will be his basic task?
(a)To integrate diverse element and coordinate activities of different departments.
(b)To carry out plans formulated by top level management.
(c) To oversee the efforts of the workforce.
(d) Help to maintain quality of output.

10 Aiming to revive Jammu and Kashmir's attraction as a top location for film shooting 1
the J&K film policy, 2021 offers a host of incentives to the filmmakers, such as
subsidies and low long term interest rates, for films with patriotic and certain other
themes shot in J&K. for giving work opportunities to local artistes, etc. This will have
an impact on business enterprises in the state. Which component of business
environment is highlighted above:
(a) Specific and general forces (b) Technological environment
(c) Economic environment (d) Totality of external forces

11 Read the following statements: Assertion (A) and Reason(R). Choose the correct 1
alternative from those given below:

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

organization
REASON (R): It enables a manager to use his time on high priority activities.
Choose the correct option:
(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 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 Match the following. 1

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Column I Column I
A. Stock Market indicates (i) Political environment
B. Customs and traditions (ii) Social environment
C. New techniques of operating business (iii) Technological
environment
D. General stability and peace in the country (iv) Economic environment

Find the correct option.

A B C D
a) iv iii i ii
b) ii iii iv i
c) iii iv ii i
d) iv ii iii i

13 Rs.4,500 crores would be raised by allotment of securities to a consortium of financial 1

institutions, instead of inviting subscription from the public by making a direct appeal
to investors to raise capital.’’ Identify the method of floatation of new issues in the
primary market being discussed above, which the company has decided to use.
(a) Offer for Sale
(b) Private Placement
(c) Right Issue
(d) Offer through Prospectus

14 According to the Economic Survey, insights from behavioural economics 1

can be strategically utilised to create an aspirational agenda for social change – from
BBBP (Beti Bachao Beti Padhao) to BADLAVL (Beti Aapki Dhan Lakshmi Aur Vijay
Lakshmi); from Swachh Bharat to Sundar Bharat; from “Give it Up” for the LPG
subsidy to ‘Think about the Subsidy’ and from tax evasion to tax compliance. Identify
the type of plan being described in the above lines.
(a) Programme (b) Method
(c) Strategy (d) Rule

15 Which of the following proves that management is not an exact science? 1

(A)Management has its own theory and principles that have developed over a period of
time, but it also draws on other disciplines such as economics, sociology, psychology
and mathematics. Like any other organized activity, management has its own
vocabulary of terms and concepts.

(B) Since management deals with human beings and human behavior, the outcomes of
these experiments are not capable of being accurately predicted or replicated.

(C)The application and use of principles of management is not universal. They have to
be modified according to a given situation.

(D)Both b & c

16 ABC limited issue prospectus for subscription of its share for Rs. 500 crore in 2018. 1
The issue was oversubscribed by 20 times. The company issued share to all the
applicants on pro rata basis. Later SEBI inspected the prospectus and found some
misleading statement about the management of the company in it. SEBI imposed a
penalty of Rs. 5 crore and banned its 3 executive directors for dealing in security
market for three years. which function is performed by SEBI in above case?
A) Development function B) Regulatory function
C) Controlling function D) Protective function

Read the following text and answer question number 17to 20

Soloni intends to start an enterprise that produces chocolates. Initially in order to
access the taste in preferences of the people about chocolates, she used social media
and online surveys. Thereafter, she prepared a detailed SWOT analysis of her
enterprise to device a strategy that will give her an edge over competitor. Based on her
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analysis of the market, she planned another segment of chocolate called “Desi delight”.
She planned to fix up the price of chocolate relatively lower in beginning and
increasing later on when demand pricks.

17 Identify the elements of marketing mix being discussed in above para. 1

(a)Product and price (b) Price and place
(c)Place and promotion (d) Production and promotion

18 By fixing the lower price Soloni is following which marketing 1

philosophy
(a) Product concept b) Production concept
(c)Selling concept d) Marketing concept

19 “Desi delight” is 1
(a) Brand name b) Brand mark
(c)Brand d)None of the above

20 By preparing SWOT analysis, she is performing which function 1

of marketing.
(a)Market research b) Standardization / grading
(c)Market planning d) branding

21 Ashutosh Gupta was working in 'Axe Ltd', a company manufacturing air purifiers. He 3
found that the profits had started declining from the last six months. Profit has an
implication for the survival of the firm, so he analyzed the business environment to
find out the reasons for this decline.
(a) Identify the level of management at which Ashutosh Gupta was working
(b) State two other functions being performed by Ashutosh Gupta.

22 'If anything goes wrong with the performance of key activities, the entire organization 3
suffers. Therefore, the organization should focus on them.' Explain the statement with a
suitable example.

23 Atul-The Assistant Manager, Vikas-The Marketing Head and Leena-The Human 3

Resource Manager of 'Montac Enterprises Ltd.' decided to leave the company. The
Chief Executing officer of the company called the Human Resource Manager, Leena
and requested her to fill up the vacancies before leaving the organisation. Leena
suggested that her subordinate Miss Rama Wadhwa is very competent and trustworthy,
if she could be moved up in the hierarchy, she would do the needful. The Chief
Executive Officer agreed for the same. Miss Rama Wadhwa contacted 'Smith
Recruiters' who advertised for the post of marketing head for 'Montac Enterprises Ltd'.
They were able to recruit a suitable candidate for the company. Atul's vacancy was
filled up by screening the database of unsolicited applications lying in the office.
(a) Name the internal/external sources of recruitment used by 'Montac Enterprises Ltd'.
to fill up the above stated vacancies.
(b) Also state any one merit of each of the above identified source of recruitment.

24 Financial market plays an important role in the allocation of scarce resources is an 3

economy by performing many important functions.' Explain any three such functions.
(OR)
Distinguish between 'Capital Market' and 'Money Market' on the basis of:
(a) Participants (b) Instruments.
25 Every action in the organisation is initiated through directing’. Explain any four points 4
of importance of directing in the light of this statement.
(OR)
Explain the ways to overcome the barriers of communication.
26 State the steps in the selection procedure, after the employment interview and before 4
the job offer.
(OR)
Explain the Vestuble Training and Apprenticeship Programme as methods of training
27 Suman bought a box of cheese of a reputed brand from a local shopkeeper. On opening 4
the box she found a piece of stone in the cheese. She reported the matter to the
shopkeeper who forwarded her complaint to the concerned company. Within a week
the representative of the company visited Suman's residence with an apology and as a
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replacement offered her a new cheese pack with four other varieties of cheese as
compensation for the inconvenience to her.
Identify and Explain the consumer right which Suman exercised.

28 A company's earnings before interest and tax is Rs.7 lakh. It pays 10% interest on its 4
debt. Total investment of company is Rs.50 lakh.
(a) Advise company whenever it should include debt or equity to raise its capital.
(b) Name the concept related to this.
(c) Will the company's decision to raise funds from debt or equity will change if
company's EBIT becomes 3 lakh.

29 Kunal joined as a shop level manager in the Production department of a textile 4

company in the year 2005. Because of his good work, he became the Deputy
Production Manager of the company in the year 2010. He had status and prestige and
was well-respected by all in the company. On 1 st March, 2019, he was promoted as
the General Manager of the company. Kunal was very happy on his promotion as now
he had become what he was capable of becoming. As a good manager, Kunal decided
to motivate his subordinates, after understanding the Need Hierarchy theory which is
based on various assumptions. He realised that people’s behaviour is based on their
needs and the manager can influence the behaviour of his employees by satisfying their
needs.
(a) One of the assumptions of Need Hierarchy theory is stated in the above paragraph.
State the other assumptions of this theory.
(b) State the needs of Kunal which are being satisfied through promotion.

30 What is meant by dividend policy decision? Explain the following factors which affect 4
the dividend decision of a company.
(i) Legal constraints
(ii) Stability of earnings
(iii) Access to capital markets

31 (A)Explain the following techniques of scientific management theory. 6

(i)Time Study
(ii)Fatigue Study
(iii)Standardisation and simplification.

(B) Differentiate between contributions made by F.W.Taylor and

Henry Fayol on any three basis.
(OR)
(A) Explain the following Principle of Management by Fayol
with examples
(i) Order
(ii) Centralisation and decentralisation
(iii) Initiative.

(B) ) Differentiate between Unity of Command and Unity of Direction

on any three basis.

32 Failing to plan is planning to fail". In this context explain the importance of planning. 6
(OR)
Planning is not a guarantee of success'. In this context, explain the
limitations of Planning.

33 Anoop Gaur started 'Cat's Eye', a company for providing cyber security solutions to 6
businesses. Its objective is to prevent, detect, respond to cyber attacks and protect
critical data. He was a hardworking software engineer and an expert in cyber security.
His reputation grew by leaps and bounds as he was not only a person of integrity but
also did his work with utmost honesty and sincerity. The business started growing day
by day.
He was delighted when he was offered a big project by the Ministry of Science and
Technology. While working on the project he found that the volume of work made it
impractical for him to handle all the work by himself. Therefore, he decided to expand
the team. The company maintained a close liaison with an engineering college in the
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State. During a campus placement, Aarav and Pranshi were appointed to work for the
new project.
He found the new employees capable, enthusiastic and trustworthy. Anoop Gaur was
thus, able to focus on the objectives and with the help of Aarav and Pranshi, the project
was completed on time. Not only this, Anoop Gaur was also able to extend his area of
operations. On the other hand, Aarav and Pranshi also got opportunities to develop and
exercise initiative.

(a)Identify and explain briefly the concept used by Anoop Gaur in the above case
which helped him in focussing on the objectives.
(b)Also, explain any four points of importance of the concept identified in in part (a).

34 Hemant, Guddu and Toshita were friends from college days and presently they were 6
doing different kinds of business. They regularly meet and discuss their business ideas,
and exchange notes on customer satisfaction, marketing efforts, product designing,
selling techniques, social concerns etc.
In one of such meetings, Hemant drew the attention of Guddu and Toshita towards the
exploitation of consumers. He told that most of the sellers were exploiting the
consumers in various ways and were not paying attention towards the social, ethical
and ecological aspects of marketing, whereas he was not doing so. Guddu told that they
were under pressure to satisfy the consumers but stated that the consumers would not
buy or not buy enough unless they were adequately convinced and motivated for the
same.
Toshita stressed that a company cannot achieve its objectives without satisfying the
needs of the customers. It was the duty of the businessmen to keep consumer
satisfaction in mind, because business is run by the resources made available by the
society. She further stated that she herself was taking into consideration the needs of
the customers.

(a)Identify the various types of thinking that guided Hemant, Guddu and Toshita in the
marketing efforts of their business.
(b)Also, state one more feature each of the various types of thinking identified that is
not given in the above para.

End of Paper