SAI INTERNATIONAL SCHOOL

PRE-BOARD EXAMINATION - 2022-23

CLASS – XII
BUSINESS STUDIES (054)

Time Allowed: 3 hours Maximum Marks: 80

General Instructions:
1. This question paper contains 34 questions.
2. Marks are indicated against each question.
3. Answers should be brief and to the point.
4. Answers to the questions carrying 3 marks may be from 50 to 75 words.
5. Answers to the questions carrying 4 marks may be about 150 words.
6. Answers to the questions carrying 6 marks may be about 200 words.
7. Attempt all parts of the questions together.
Sl. Questions Marks
No
1 The objective of the Marketing Department of ‘KOTEX Ltd.’ is to increase sales 1
by 10 per cent by offering discounts. But, the finance department may not approve
of such discounts as it means loss of revenue. These kinds of conflict arise in
organizations because each department performing activities in isolation from
others and barriers between departments are becoming more rigid. Identify the
point of importance of coordination to which this case is related:
(a) Growth in size
(b) Functional differentiation
(c) Specialization
(d) None of these
Harshit Ltd. has grown in size. It was a market leader but with changes in business
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environment and with the entry of MNCs, its market share is declining. To cope up
with the situation CEO starts delegating some of his authority to the General Manager,
who also felt himself overburdened and with the approval of CEO disperses some of
his authority to various levels throughout the organisation. Identify the concept of
management discussed above.

(a) Delegation

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 (b) Organising

(c) Decentralization

(d) Centralization

3 Assertion (A): The primary objective of financial management is to maximise the wealth 1
of equity shareholders.

Reason (R): Investment Decision is concerned with the investment of a firm’s funds in
different assets.

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.

4 Statement I: Registration of brokers and sub-brokers and other players in the market is a 1
regulatory function of SEBI.

Statement II: Spreading of Equity Cult is the function of stock exchange.

(a) Both the statements are true.

(b) Both the statements are false.

(c) Statement I is true, Statement II is false.

(d) Statement II is true, Statement I is false.

Which of these is the correct purpose of recruitment?
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(a) Make sure that there is a match between cost and benefits
(b) To attract potential employees with the necessary qualification
(c) Help the firm to create the more culturally diverse workforce
(d) Help the firm to recognize the caliber of every employee
According to the World Health Organization, 39% of adults are overweight. Over the last
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2
 40 years, the prevalence of obesity has tripled around the world. With over half of
consumers drinking at least one sugary drink on a given day, regulations towards the
beverage sector are likely to become increasingly onerous. In the U.K., for example, a
sugar tax was introduced in 2018 on beverages containing more than 5% sugar. Identify
the related dimensions of business environment.
(a) Legal dimension and Social dimension
(b) Social dimension and Technological dimension
(c) Technological dimension and Legal dimension
(d) Political dimension and Technological dimension

Which consumer right has been highlighted here?

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(a) Right to be heard
(b) Right to seek redressal
(c) Right to safety
(d) Right to choose.

Assertion (A): Controlling aims to ensure that resources are used effectively and efficiently
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to achieve predetermined goals.

Reason (R): Controlling is both a backward-looking as well as forward-looking function.

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

9 Identify the correct sequence of the steps involved in the selection process. 1

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 (a) Medical Examination, Contract of Employment, Reference and Background
Checking, Selection Decision, Job Offer

(b) Reference and Background Checking, Selection Decision, Contract of Employment,

Medical Examination, Job Offer

(c) Job Offer, Reference and Background Checking, Selection Decision, Medical
Examination, Contract of Employment

(d) Reference and Background Checking, Selection Decision, Medical Examination, Job
Offer, Contract of Employment
Which one of the following is a step of controlling?
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(a) Assessing personnel required
(b) Taking corrective action
(c) Assessing the environment
(d) Taking disciplinary action
Which of the following is not an objective of financial planning?
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(a) Ensuring enough funds are available at the right time
(b) Ensuring excess availability of funds at the right time
(c) Ensuring smooth business operations
(d) All of the above
12 ____________________________ is the right to file a complaint in case of dissatisfaction 1
with goods or services in the grievance cell.
(a) Right to seek redressal
(b) Right to be heard
(c) Right to be informed
(d) None of the above
Match the following
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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 (iii) Technoogical environment
business
(iv) Economic environment
D. General stability and peace in the
country

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 Find the correct option.
A B C D A B C D
(a) (iv) (iii) (i) (ii) (b) (ii) (iii) (iv) (i)
(c) (iii) (iv) (ii) (i) (d) (iv) (ii) (iii) (i)

14 Which element of the marketing mix involves decisions about product design, features, 1
and packaging?
(a) Promotion
(b) Price
(c) Product
(d) Place
Kundan Lai joined a food processing unit as a factory worker. Since he was expected to
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work on sophisticated machinery, he was asked to undergo special training. Identify the
training method with reference to the above lines.
(a) Vestibule training
(b) Apprenticeship training
(c) Internship training
(d) Induction training

16 Who, of the following, cannot be considered a consumer? 1

(a) A person who buys things to further sell them consideration.

(b) A person who gets things without consideration.

(c) A person who uses things without the permission of the purchasers.

(d) All of the above

17 Debts financing is better than equity if 1

(a) Company has a strong cash flow

(b) Company has a weak cash flow

(c) Cash flow position does not matter

(d) None of the above

18 Bharti Ltd. is a leading mobile company. It is planning to acquire Queen Ltd. (its close 1
competitor) business worth `1,000 crores. Which financial decision is involved in it?
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 (a) Investment

(b) Financing

(c) Dividend

(d) None of these

19 Shubhangi purchased a car for Rs. 11 crores and found its engine defective. Despite many 1
complaints, the defect was not rectified. She filed a complaint to National Commission
but was not satisfied with its order. Suggest to her the appropriate authority where she can
appeal.

(a) National Commission

(b) District Commission

(C ) Supreme Court of India

(d) None of the above.

20 Read the following statements carefully: 1

Statement I: Cost of debt is lower than cost of equity for a company.

Statement II: The objective of financial management is to increase shareholder’s wealth.

In the light of given statements, choose the correct alternative from the following:

A. Both the statements are true.

B. Both the statements are false.

C. Statement I is true, Statement II is false.

D. Statement II is true, Statement I is false.

21 State any three limitations of the planning function of management. 3

OR

Explain the first three steps in the process of 'Planning'.

22 What is meant by 'Esteem needs' and 'Self-actualization needs' about the motivation of the 3
employees, with example?

OR
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 How directing helps in efficient and effective functioning of the organisation? Explain by
giving any three points.

23 ‘Smart Stationery Ltd.’ wants to raise funds of ₹ 40,00,000 for its new project. The 3
management is considering the following mix of debt and equity to raise this amount:

Alternative
Capital Structure
I (₹) II (₹) III (₹)

Equlity 40,00,000 30,00,000 10,00,000

Debt 0 10,00,000 30,00,000

Other details are as follows:

Interest Rate on Debt 9%

Face Value of Equity Shares ₹ 100 each

Tax Rate 30%

Earning Before Interest and Tax (EBIT) ₹ 8,00,000

(a) Under which of the three alternatives will the company be able to take advantage of
Trading on Equity?

(b) Does Earning Per Share always rise with increase in debt?

24 ‘The first masters’ is a leading advertising company in its industry. Recently they had a 3
meeting in which all the reasons which were outside the control of the organisation were
discussed. The organisation wanted to maintain its supremacy in the market. They
decided to break the meeting into two parts. In the first part customers, competitors,
suppliers, etc. were discussed where as in the second part the political, economic, social
conditions in the country were discussed. It was concluded that company was doing
extremely well in the domestic market and the client base was expanding. However
when the company’s performance in foreign markets was evaluated it was found that
conditions were different in different countries so the strategies adopted would have to
be different. After the meeting the company was looking forward to making new gains.
Which features of Business Environment have been highlighted in the above case? Also
identify the lines.

25 Kartik joins a garment factory as a plant supervisor in Lucknow. He observes that the 4
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 output of some workers is very low as compared to the standards set for their
performance. On analyzing the reasons for the same, he finds out that a lot of time of the
workers is wasted in getting the requisite materials issued from the store. Whereas on
asking, the store keeper complains that there is no harmony in the working of the
production department as a whole. Everyday the workers approach him at the last minute
to procure different kinds of threads, laces, mirrors, buttons etc. If it is not available in the
store then he has to place an order with the purchase officer. As a result, a lot of time of
the workers is wasted. So, in order to integrate the various production activities,
henceforth, Kartik ensures,that the store keeper is informed well three days in advance
about the requisite material. Consequently, the store keeper is able to keep the materials
ready for the workers every morning in accordance with their requirements.
In context of the above case:

(a) Identify and explain the quality of management that Kartik has introduced in the
working of the production department as a corrective measure to control the output
of the workers.

(b) State briefly any two points highlighting the importance of quality of management
identified in part (a).

26 "Staffing makes for higher performance by putting the right person on the right job". Is 4
this statement true or false, justify your answer.

OR

It's a test employed in employee selection to gauge someone's ability to learn new skills.
Identify & explain and describe two other tests.

27 Ramesh who has recently received award of the most talented manager is very able. He 4
has helped the starting of various halted projects by guiding his subordinates and
removing their doubts through proper directing. This has helped the workers achieve their
targets on time. He knows that every member of the team is important for the completion
of a project. So he guides his team in such a manner that every single effort of every
single employee matters and is directed towards the achievement of objectives. There is a
lighter side to his personality also. He is very jovial. He cares about his team. This has
helped him bring cooperation and commitment among his team members thus bringing a
unique balance between activities and the group. However this has not prevented him
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 from having a keen vision of a leader. Whenever the subordinates resist any change he
tries to bring their cooperation by proper explanations and consistent efforts. The top level
management also sees a big role for him in the future.
Identify the importance of directing highlighted in the above case.

28 Explain any four points that highlight the importance of controlling. 4

OR

Explain the following techniques.

(a) Critical Point Control

(b) Management by exception

29 In an annual general meeting a company sets its targets for the year. The manufacturing 4
department has decided to manufacture 2.5 million units of the product and has decided to
monitor the performance so as to control it accordingly. The survey done by the company
has shown a number of cities in the north which are showing increased demand for the
product. The company in its research during the last three months generated various
options and decided to follow the best one. The HR team is also concerned about its
output. The HR head revealed that there can be shortage of MBA pass outs which can
reduce the quality of manpower in the near future so it has decided to arrange HR
workshops in different colleges to get the best candidates. The board meeting ends on a
positive note. In the above case identify the importance of planning and the concerned
lines.
Distinguish between selling concept and marketing concept of marketing
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management philosophies.

31 Ramesh buys a financial asset from the RBI. This financial asset is an instrument of short 6
term borrowing. He has bought it because he doesn’t want to take risk and wants an
assured return. This instrument is a promissory note. It is highly liquid. This instrument is
also known as Zero Coupon Bond. On this instrument is written T-91.

(a) Which financial asset is indicated in the above case?

(b) On whose behalf does the RBI issue this instrument?

(c) Why is this instrument called as the Zero-Coupon Bond?

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 (d) What does T-91 denote here?

(e) What is the minimum amount for which this instrument is available?

32 ‘Organisation is the harmonious adjustment of specialised parts for the accomplishment 6

of some common purpose or purposes.’ In the light of this statement, explain the
importance of organising.

OR

Give the meaning of ‘organising’ as a function of management. Explain the steps in the
process of organising.

33 Dipika opens a jewellery showroom in Jaipur after completing a course in jewellery 6

designing. She has employed eleven persons in her showroom. For greater productivity,
she divides the work into small tasks and each employee is trained to perform his/her
specialized job. The sales persons are allowed to close a deal with a buyer by giving a
maximum of 10% discount, whereas the decision to give any further discount rests with
Radhika as the final authority. In the earlier days of starting of the business, five of her
employees were asked to put in extra hours of work. In return she had promised to give
them a special incentive within a year. Therefore, after six months when the business was
doing well, she awarded a cash bonus to each of these employees to honour her
commitment. However, when it comes to settling the conflicts among her employees, she
tends to be more biased towards her female employees.
In context of the above case:

(a) Identify and explain the various principles of management that are being applied by
Dipika by quoting lines from the paragraph.

(b) Identify and explain the principle of management which is being violated by Dipika
by quoting lines from the paragraph.

(c) State any one effect of the violation of the principle of management by Dipika as
identified in part(b) of the question.

34 Explain the following functions of marketing 6

(a) Gathering and analysing market information

(b) Product designing and development

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 (c) Market planning

OR
State three important & describe three types of packaging.

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