Business Studies (215) - April' 2013 | NIOS SECONDARY Solved Papers

BUSINESS STUDIES (April’ 2013)
(215)
NIOS SECONDARY Solved Papers
Time: 3 Hours
Maximum Marks: 100


1. Which of the following is not an economic objective of business?      1
(A) Creation of customers (B) Best possible use of resources (C) Economic well being of the employees (D) Continuous innovations
Ans.:- (C) Economic well being of the employees
2. Minimum number of members required to form a Public Company are           1

(A) 2 (B) 7 (C) 10 (D) 20
Ans.:- (B) 7
3. In which of he following forms of organisation, liability of the members is unlimited?1
(A) Private company (B) Public company (C) Cooperative society (D) Partnership
Ans.:- (D) Partnership
4. The limited liability Partnership Act was enacted in the year 1
(A) 1932 (B) 1956 (C) 2008 (D) 2010
Ans.:- (C) 2008
5. Which is not an advantage of rail transport?  1
(A) It is relatively faster than road transport
(B) It is suitable for carrying heavy goods in large quantities over long distance
(C) It is a flexible mode of transport
(D) It is a convenient mode of transport for travelling long distances
Ans.:- (C) It is a flexible mode of transport
6. A trader of Indian has, imported goods from U.S.A. but he is not in a position to pay import duty immediately. In which type of ware house he can keep the goods?       1
(A) Public warehouse (B) Government warehouse (C) Bonded warehouse (D) Cooperative warehouse
Ans.:- (C) Bonded warehouse
7. News papers are suitable for advertising        1
(A) Consumer goods designed for general public
(B) Products required by target customers
(C) Agricultural products meant for farmers
(D) Products that require live demonstration to the consumers
Ans.:- (B) Products required by target customers
8. The consumers protection Act was enforced in the year          1
(A) 1972 (B) 1982 (C) 1986 (D) 2002
Ans.:- (C) 1986
9. Wage employment means     1
(A) Doing a business
(B) Engaging in some economic activity on his own
(C) Managing an economic activity on his own
(D) Serving another person for wages or salary
Ans.:- (D) Serving another person for wages or salary
10. Which is true about entrepreneurs?                               1
(A) They are gamblers
(B) They depend on others
(C) They are born not made
(D) They take risk in converting ideas into action
Ans.:- (D) They take risk in converting ideas into action

11. Explain the following in reference to E-commerce:  3

(a) B2B                  (b) B2C

Ans.:- (a) B2B (Business-to-Business):- Companies doing business with each other such as manufacturers selling to distributors and wholesalers selling to retailers. Pricing is based on quantity of order and is often negotiable.

(b) B2C (Business-to-Consumer):- Business selling to the general public typically through catalogs utilizing shopping cart software. By dollar volume, B2B takes the price, and the consumer to do the transactions.

12. Explain the term ‘Primary Industry:- Primary industry is concerned with production of goods with the help of nature. It is a nature-oriented industry, which requires very little human effort. e.g. Agriculture, farming etc.’ giving any two examples.           3

Ans.:- Primary Industry:- Primary industry is concerned with production of goods with the help of nature. It is a nature-oriented industry, which requires very little human effort. e.g. Agriculture, farming etc. is concerned with production of goods with the help of nature. It is a nature-oriented industry, which requires very little human effort. e.g. Agriculture, farming etc.

13. State the effect of non-registration of a partnership firm.                                       3

Ans.:- The effect of non-registration of a partnership firm are:-

a)      Your firm cannot take any action in a court of law against any other party for settlement of claims.

b)      In case there is any dispute among partners, it is not possible to settle the settlement of claims, through a court of law.

c)       Your firm cannot claim adjustments for amount payable ot or receivable from any other party through a court of law.

14. A ship carrying rose flowers to France for Valentine day was insured against losses arising from accident. The ship reached the port safely and on time but the consignment got spoiled due to delay in unloading. Is the insurance company liable to pay the claim of loss? Which principle of insurance is violated? Explain the principle.3

Ans.:- The principal of Causa-proxima (nearest cause) is violated. According to this principle the insured can claim compensation for a loss only if it is caused by the risk insured against. The risk insured should be nearest cause (not a remote cause) for the loss. Only then the insurance company is liable to pay the compensation. 

15. Explain in brief the following modes of purchase    3

(a) Purchase by sample (b) Purchase by inspection

Ans.:- Modes of purchase:-

(a) Purchase by sample:- When we want to buy goods in bulk, it is not possible to inspect the whole lot to be purchased. What we do is look at the sample or pattern and then decide which one to buy. A sample is a specimen of goods, particularly of raw materials, foodstuffs, etc.

(b)Purchase by inspection:- Suppose we want to buy a shirt or a pen or some vegetables. Now what do we do? We will possibly go to the nearest shop and check by our self the shirt or pen or vegetables before buying them. This is the most common method of buying known as purchasing by inspection. It is mostly used in case of retail buying.

16. Explain the following characteristics of partnership form of organisation         4

(a) Unlimited liability (b) Principal Agent Relationship

Ans.:- Characteristics of partnership form of organisation:-

(a)    Unlimited liability:- Just like the sole proprietor the liability of partners is also unlimited. That means, if the assets of the firm are insufficient to meet thee liabilities, the personal properties of the partners, if any, can also be utilised to meet the firm’s liabilities.

(b)   Principal Agent Relationship:- All the partners of a firm are the joint owners of the business. They all have an equal right to actively participate in its management. Every partner has a right to act on behalf of the firm. When a partner deals with other parties in business transactions, he/she acts as an agent of the others and at the same time the others becomes  the principal.

17. Explain the following types of warehouses.                                                                   4

(a) Bonded warehouse (b) Public warehouse

Ans.:- (a) Bonded warehouse:- These warehouses are owned, managed and controlled by government as well as private agencies. Private bonded warehouses have to obtain license from the government. Bonded warehouses are used to store imported goods for which import duty is yet to be paid.

(b) Public warehouse:- The warehouses which are run to store goods of the general public are known as public warehouses. Anyone can store his goods in these warehouses on payment basis. An individual, a partnership firm or a company may own these warehouses. To start such warehouses a license from the government is required.

18. Give four differences between banks and money lenders.                                     4

Ans.:- The following table shows the distinction between a bank and money lender.

Basis

Banks

Moneylenders

Entity

Banks are organised institutions.

Moneylenders are individuals.

Activity

Banking activities include acceptance of deposits as lending of money.

Activities of moneylenders may not include acceptance of deposits.

Clients

Banks meet the needs of people in general and the business community in particular.

Moneylenders meet the needs of agriculturists and poor people.

Security

 Banks accept tangible and personal security against loans.

Moneylenders generally accept gold, jewellery or land as security for giving loan.

19. A buyer can seek compensation from the manufacturer if the product supplied to him is defective provided he/she takes care of few things after buying. State them.   4

Ans.:- A buyer can seek compensation from the manufacturer if the product supplied to him is defective provided he/she takes care of few things after buying are:-

a)      Proof of Transactions:- The responsibility of every consumer is that the proff of purchase and documents relating to purchase of durable goods should be invariably obtained and preserved.

b)      Proper use of Product/Services:- Some consumers, especially during the guarantee period, make rough use of the product, thinking that it will be replaced during the guarantee period. This is not fair on their part. They should always use the products properly.

20. Explain wage employment and self employment as career avenues.                 4

Ans.:- Wage employment:- Wage employment means serving another person for wages or salary. If someone is appointed as office assistant, he is expected to do what the office supervisor wants him to do, and he gets a monthly salary for his job. This type of employment is based on a contract between the employers and employee.

Self employment:- If an individual engages in any economic activity and manages it on his own, it is known as self-employment. In every locality, you may come across small stores, repair shops or service units. These establishments are owned and managed by a single person, sometimes they engage one or two assistants for help.

21. State in brief national objectives of business. 4

Ans.:- The following are the national objectives of business:

(i)     Creation of employment:- One of the important national objectives of business is to create opportunities for gainful employment of people. This can be achieved by establishing new business units, expanding markets, widening distribution channels, etc.

(ii)   Promotion of social justice:- As a responsible citizen, a businessman is expected to provide equal opportunities to all persons with whom he/she deals. She/he is also expected to provide equal opportunities to all the employees to work and progress.

(iii) Production according to national priority:- Business units should produce and supply goods in accordance with the priorities laid down in the plans and policies of the Government. One of the national objectives of business in our country should be to increase the production and supply of essential goods at reasonable prices.

(iv)  Contribute to the revenue of the country:- The business owners should pay their taxes and dues honestly and regularly. This will increase the revenue of the government, which can be used for the development of the nation.

(v)    Self-sufficiency and Export Promotion:- To help the country to become self-reliant, business units have the added responsibility of restricting import of goods. Besides, every business unit should aim at increasing exports and adding to the foreign exchange reserves of the country.  

22. State any five advantages of Multinational Company.           5

Ans.:- Advantages of Multinational companies

(i)     Investment of Foreign Capital:- Direct investment of capital by Multinational Companies helps under-developed counties to speed up their economic development.

(ii)   Generation of Employment:- Expansion of industrial and trading activities by Multinational Companies leads to creation of employment opportunities and raising the standard of living in host countries.

(iii) Increase in Exports and Inflow of Foreign Exchange:- Goods produced in the host countries are sometimes exported by Multinational Companies. Foreign exchange thus earned contributes to the foreign exchange reserves of host countries.

(iv)  Healthy Competition:- Efficient production of quality goods by Multinational Companies prompt the domestic producers to improve their performance in order to survive in the market.

(v)    Use of Advanced Technology:- With substantial resources Multinational Companies undertake Research and Development activities which contribute to improved methods and processes of production and thus, increase the quality of products. gradually, other countries also acquire these technologies.

23. State in brief any five functions of a wholesaler.           5

Ans.:- Following are the functions, which a wholesaler usually performs.

(a)    Collection of goods:-  A wholesaler collects goods from manufacturers or producers in large quantity.

(b)   Storage of goods:-  A wholesaler collects the goods and stores them safely in warehouses, till they are sold out. Perishable goods like fruits, vegetables, etc. are stored in cold storage.

(c)    Distribution: A wholesaler sells goods to different retailers. In this way, he also performs the function of distribution.

(d)   Financing:- The wholesaler provides financial support to producers and manufacturers by providing money in advance to them. He also sells goods to the retailer on credit. Thus, at both ends the wholesaler acts as a financier.

(e)   Risk taking:- The wholesaler buys finished goods from the producer and keeps them in the warehouses till they are sold. Therefore, he assumes the risks arising out of changes in demand, rise in price spoilage or destruction of goods.

24. Why departmental stores are becoming more and more popular in Indian cities?    5

Ans.:- Departmental stores are becoming more and more popular in India cities because of its facilities it is very much help full for the customers to buy their goods without wasting their valuable time and the facilities are as under:- The entire building is divided into a number to departments or counters. In each department specific type of goods like stationery items, books, electronic goods, garments, jewellery etc. are available. All these departments are centrally controlled under one management. Once you enter such a store you can do all your shopping by moving from one department to another. To encourage people to do all their shopping in one store, these stores also provide facilities like restaurant, telephone, toilets, ATM etc.

25. “NGOs have undertaken various activities as a part of consumer movement. They perform several functions.” Explain in brief any such five functions.  5

Ans.:- NGOs have undertaken various activities as part of the consumer movement. They perform several functions, like:-

(i)      Create awareness about consumer rights and educate the general public about consumer problems and remedies through seminars, workshops and training programmes.

(ii)    Provide legal aid to consumers by way, of assistance in seeking legal remedy.

(iii)   Undertake advocacy of consumers’ point of view as representative members of consumer protection councils and others official boards.

(iv)  Publish periodicals and journals to disseminate information among readers about consumer problems, legal reporting and other emerging matters of interest. Most of these periodicals do not accept advertisements from business firms.

26. Warehousing is a very important auxiliary to trade. Justify it by explaining its need by giving any four points. 6

Ans.:- Warehousing is one of the important auxiliaries to trade. It creates time utility by bridging the time gap between production and consumption of goods.

Warehousing is necessary because of the following reasons.

(i)     Seasonal Production:- We know that agricultural commodities are harvested during certain seasons, but their consumption or use takes place throughout the year. Therefore, there is a need for proper storage or warehousing for these commodities, from where they can be supplied as and when required.

(ii)   Seasonal Demand:- There are certain goods which are demanded seasonally, like woollen garments in winters or umbrellas in the rainy season. However, the production of these goods takes place throughout the year to meet the seasonal demand. So there is a need to store these goods in a warehouse to make them available at the time of need.  

(iii) Large-scale Production:-  In case of manufactured goods, now-a-days production takes place to meet the existing as well as future demand of the products. Manufacturers also produce goods in huge quantity to enjoy the benefits of large-scale production, which is more economical.

(iv)  Quick Supply:- Both industrial as well as agricultural goods are produced at some specific places but are consumed throughout the country. Therefore, it is essential to stock these goods near the place of consumption so that without making any delay these goods are made available to the consumers at the time of their need.

27. Explain ‘granting of loans’ and ‘granting of advances’ as a function of commercial banks.6

Ans.:- Granting of loans and advances:-

(i)     Loans:- A loan is granted for a specific time period. Generally commercial banks provide short-term loans. But term loans, i.e. loans for more than a year may also be granted. The borrower may be given the entire amount in lump sum or in instalments. Loans are generally granted against the security of certain assets. A loan is normally repaid in instalments. However, it may also be repaid in lump sum.

(ii)   Advances:- An advance is a credit facility provided by the bank to its customers. It differs from loan in the sense that loans may be granted for longer period, but advances are normally granted for a short period of time. Further the purpose of granting advances is to meet the day-to-day requirements of business. The rate of interest charged on advances varies from bank to bank. Interest is charged only on the amount withdrawn and not on the sanctioned amount.

28. One of your friends wants to employ sales persons to sell his products. Explain how the qualities (any four) that a sales person should possess.                           6

Ans.:- The qualities that a sales person should possess are:-

(i)     Physical qualities:- A salesperson should  have a good appearance and an impressive personality. He should also have sound health.

(ii)   Mental qualities:- A good salesperson should posses certain mental qualities like imagination, initiative, self-confidence, sharp memory, alertness etc. he should be able to understand the needs and preferences of customers.

(iii) Integrity of character:- A good  salesperson should posses the qualities of honesty and integrity. He is to gain the confidence of the customers. He should be able to understand their needs and guide them how to satisfy those needs.

(iv)  Knowledge of the product and the company:- A salesperson should have full knowledge of the product and the company he is representing. He should be able to explain each and every aspect of the product i.e. its qualities, how to use it, what precautions to be taken etc.

29. Explain in brief the following right of consumers                              6

(a) Right to safety

(b) Right to be informed

(c) Right to choose

Ans.:- Rights of consumers:-

(a)    Right to safety:- Consumers have a right to be protected against marketing of goods which are injurious to health and like. As a consumer if you are conscious of this right, you can take precautions to prevent the injury or if injury is caused in spite of precaution, you have a right to complain against the dealer and even claim compensation.

(b)   Right to be informed:- Consumers also have the right to be informed about the quantity, quality, purity, standard or grade and price of the goods available so that they can make proper choice before buying any product or service.

(c)    Right to choose:- Every consumer has the right to choose the goods needed from a wide variety of similar goods. Very often dealers and traders try to use pressure tactics to sell goods of inferior quality.

30. State any four qualities required for success in self employment.                       6

Ans.:- Qualities required for success in self employment are:-

(i)     Mental abilities:- To be self-employed you need to have the ability to identify the most suitable area where there is opportunity of self-employment.

(ii)   Alertness and foresight:- A self employed person should be aware and alert about changes taking place in the market so as to adjust his operations.

(iii) Self-confidence:- In self-employment, the owner has to take all decisions, he must also have confidence in himself to overcome problems and also while dealing with suppliers/creditors, and government officials.

(iv)  Knowledge about business:- Any one who is self-employed in business must have full knowledge about the business, including technical knowledge and skill for running the business.

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