SAMPLE QUESTION PAPER

BUSINESS STUDIES (319) New Course

Time : 3 Hours Maximum Marks: 100

Note:
i. This question paper consists of 51 questions in all.
ii. All questions are compulsory.
iii. Marks are given against each question.
iv. Section A consists of

a. Q.No. 1 to 20 – Multiple Choice type questions (MCQs) carrying 1 mark each. Select and
write the most appropriate option out of the four options given in each of these questions.
v. Section B consists of
a. Q.No. 21 to 35 – Objective type questions. Q.No. 21 to 35 carry 02 marks each. Attempt
these questions as per the instructions given for each of the questions.
vi. Section C consists of
a. Q.No. 36 to 41 – Very Short questions carrying 02 marks each to be answered in the range
of 30 to 50 words.
b. Q.No. 42 to 47 – Short Answer type questions carrying 03 marks each to be answered in
the range of 50 to 80 words.
c. Q.No. 48 to 51 – Long Answer type questions carrying 05 marks each to be answered in
the range of 80 to 120 words.

S. Section – A Marks
No. Ques. 1 to 20 are MCQs of 1 Mark each.

1. Any kind of external devices, like compact discs (CD’s) for computer, have 1
become obsolete. Google, with its Google Drive service, Apple with its iCloud
offering, enables the users store documents, photos, music and movies on
web-based servers. Identify the feature of business environment being
described in the above lines.
a) Sum total of all factors
b) Inter-relatedness
c) Uncertainty
d) Complex
2. (i) Liberalisation refers to the 1
a) integrating' the economy of a country with the world economy
b) Reduction in the number of industries reserved for the public sector
c) reducing the role of public sector
d) process of eliminating unnecessary controls and restrictions
3. An examples of ethical business practice is 1
a) To charge Maximum prices from the customer.
b) To use less weights for commodities.
c) To pay taxes to government correctly and promptly
d) Indulge in unfair trade practices

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4. Which of the following does not explain the impact of government policy 1
changes on business & industry
a) Increasing competition
b) More demanding market customers
c) Market orientations
d) Change in agricultural prices

5. Which of the following is an importance of planning? 1

a) Leads to Specialization
b) Maximum Utilization of Resources at any cost
c) Reduce Creativity
d) Less expansion and growth

6. _____________ is deciding in advance what is to be done in future. 1

a) Organising
b) Planning
c) Controlling
d) Budget

7. Which of the following is not a limitation of planning? 1

a) Rigidity
b) Probabilistic
c) Expensive
d) Time Saving
8. The government of India introduced a radical change in economic policies in 1
the year
a) 1995
b) 1981
c) 1991
d) 2002

9. Responsibility of business towards the shareholders or owners includes 1

1. To ensure safety of investment.
2. To provide regular, correct and adequate information on the financial
aspects.
3. To provide fair and regular dividend.
4. To provide services such as housing, medical care, recreation etc.
Choose the correct option from the options given below:
a) Only 1 and 4
b) Only 1 and 3
c) 1,2,3 and 4
d) 1,2 and 3 only

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10. The capital structure of a firm refers as a choice of that combination of ; 1
a) fixed Asset and current Assets
b) debt and equity
c) dividend and wealth
d) capital and profit
11. There are two statements marked as Assertion (A) and Reason(R). Read 1
the statements and choose the appropriate option from the options given
below;
Assertion (A):- Equity Shareholders' return consists of two components
viz, dividends and capital gains.
Reason (R):- Dividend decision is concerned with taking decision with
regards to the net profit distribution which is related either to pay dividend
to shareholders or to retain in the business.
Alternative:
a) (A) is correct but (R) is wrong
b) Both (A) and (R) are correct, but (R) is not the correct explanation of (A)
c) Both (A) and (R) are incorrect.
d) Both (A) and (R) are correct, and (R) is the correct explanation of (A)
12. __________ is a contract whereby one can use the assets of the other with due 1
permission of the owner on payment of rent without purchasing them.
a) Rent Agreement
b) Lease
c) Conveyance deed
d) External Commercial Borrowings

13. Followings are the components of 4'P's except 1

a) Product
b) Place
c) Price
d) Public
14. Which of the following is not a Feature of Departmental Store? 1
a) The entire building is divided into a number of departments or sections.
b) In each department specific type of goods like stationery items, books,
electronic goods, garments, jewellery etc. are made available.
c) These stores also provide the facility like free home delivery of goods,
execution of telephonic order for goods, credit facility, etc.
d) Large amount of capital investment is required to start and run a
departmental store
15. _______ retailing is a type of small-scale retail trade in which retailers move 1
around and sell a variety of items directly to the consumers.
a) Itinerant
b) Fixed shop
c) Departmental
d) Chain

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16. Services Provided by the Wholesalers to manufacturers includes 1
a) Regular Supply
b) Risk Protection
c) Bulk Buying
d) Financial Help
17. Resources required for successful e-business implementation NOT includes 1
a) A Website
b) Technically Qualified Workforce
c) Adequate Computers
d) Big Office Building
18. Arun decided to sell his old books to his friend’s brother, Rakesh. This is 1
a__________ transaction:
a) B2B
b) B2C
c) Intra-B
d) C2C
19. Withdrawal of money from ATM is an example of_______type of transaction: 1
a) B2B
b) B2C
c) intra-B
d) C2C
20. In a B2B transaction both the parties involved are: 1
a) Manufacturer and Supplier
b) Customer and Customer
c) Wholesaler and Customer
d) Retailer and Customer
Section – B
Ques 21 to 35 below. Internal choices have been given wherever necessary
21. Fill in the Blanks:- 1x2
a) ________ refers to negative and unfavourable external factors that are
likely to create hurdles for a firm
b) ________ are the impact of govt. policy changes on business & industry

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22. In relation to types of business environment, match the Column 1 with 1/2x4
Column 2.

Column 1 Column 2

I. Economic environment a. Approaches adopted for

production of goods and services

II. Political Environment b. Regulations

III. Legal Environment c. Government policies and attitude

towards the business community

IV. Technological d. Strength of capital market

Environment

23. Fill in the Balnks:- 1x2

a) Manufacturing department may be sub-divided into stores, repairs,
maintenance, production, etc. is an example of ___________
b) ______________ shifts the power of decision making to lower levels
under a well-considered plan

24. Give one word Answer – 1x2

a) What is known as the primary function of management ___________
b) A strategy is derived from ______________

25. Fill in the Blanks - 1x2

a) ________ refers to planning regarding financial needs of the enterprise
various sources of raising funds and their optimum utilization.
b) _______ refers to the structure of total capital funds raised by the company.

26. Give One word: 1x2

a) Name the process that enables the management to foresee the fund
requirements, both the quantum as well as the timing.
b) It is essentially the preparation of a financial blueprint of an organisation’s
future operations. Identify the related concept.

27. Which method of long-term financing, Public Deposit or Retention of Profits, 1x2
are being referred to, in each of the following statements:
a) Management is less careful about funds utilization by this method.
b) To raise funds through this method, an advertisement is generally given
through the newspapers.

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28. Identify the features that relate to equity shares, preference shares and 1x2
debentures
a) In case of winding up of the company, the capital is refunded after payment
of debentures but before payment to equity shareholders.
b) Their holders are creditors of the company for a fixed period.

29. Give one word/phrase for the following statements: 1x2

a) The component of marketing that relates to channels of distribution.
b) The components that are combined to achieve the marketing goal

30. Which method of price fixation is being referred to here 1x2

a) Rama fixes the price of shirts that he manufactures and sells at a price 10%
higher than its cost.
b) Shyama introduces a new brand of biscuits at a low introductory price.

31. Which element of the promotion mix is being referred to in the following 1x2
statements:-
a) It is a temporary incentive to induce trial or purchase of a new product
______
b) It is an effective promotion tool for machines, lubricant etc. ___________

32. Identify the following and write 'WT' for wholesale trade and 'RT' for retail 1x2
trade.
a) Dealing in limited variety of products.
b) Goods purchased from wholesalers for resale.

33. Correct the following sentences 1x2

a) Producer is a middleman in the chain of distribution.
b) Presence of too many middlemen increases the price of the product.

34. State the full form of the following – 1x2

a) WWW
b) B2B

35. Identify the following in e-banking transactions– 1x2

a) A machine using which we can withdraw money from our deposit accounts
at our convenience.
b) A system that allows the account holder to avail the banking facility over
telephone

Section – C
Ques 36 to 51 below. Internal choices have been given wherever necessary
36. State any two relaxations available under the company Act 2013 to a one 2
person company.

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37. (i) Explain any two internal Sources of Recruitment. 2
OR
(ii) Explain any two sources of external recruitment
38. The highly reputed companies (Blue Chip companies) are the major players of 2
this type of money market instruments.
a) Identify the money market instrument highlighted in the above line.
b) What is the main purpose of instrument identified in (a)?
39. (i) Define Entrepot Trade with an example. 2
OR
(ii) Define Export with examples
40. Arunodya Airlines company offered 'Travel today pay fare later' plan for its 2
prospective customers.
a) Name the promotional tool used by the Arunodya Airlines.
b) State any one other product for which above identified plan is quite
common now-a-days.
41. (i) State any two avenues of self-employment. 2
OR
(ii) State any two avenues of Wage Employment
42. Nipun was working in an enterprise on a daily wages basis. It was difficult for 3
him to fulfill the basic needs of his family. His daughter fell ill. He had no
money for his daughter’s treatment. To meet the expenses of her treatment, he
participated in a cycle race and won the prize money. The cycle company
offered him a permanent pensionable job which he happily accepted.
By quoting lines from the above paragraph, identify the needs of Rahim that
are satisfied by the offer of the cycle company.
Also, explain two other needs of Rahim followed by above that are still to be
satisfied.

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43. (i) Roshan is the chief chef of ‘Khidmat restaurant located in the city of 3
Bangaluru.
The place is known for its exquisite Mughlai cuisine especially mutton
biryani and kababs. All the food is prepared under Roshan’s purview. The
various activities in the kitchen are initiated in accordance to his
instructions. He is very clear and specific in issuing instructions to his
subordinates in order to ensure smooth working of the department. He
personally oversees the method followed by the chefs for preparation of
each dish. He misses no opportunity to praise his subordinates for their
good work. All his team members feel very happy and satisfied under his
direction. He provides constant guidance to them in order to improve upon
its taste and presentation and also encourages them to innovate and be
more creative in their work.
In the above context:
Identify the various elements of directing mentioned in the above
paragraph by quoting lines from the paragraph.
OR
(ii) After completing his bachelor’s in computer science, Abhijeet joined an IT
consultancy firm. He observed there that the senior management more
often communicated failures than successes. They rarely shared any good
news related to the growth of the firm or give any recognition to its
employees for their extraordinary contributions towards the firm. As a
result, Abhijeet never felt encouraged enough to work up to his full
potential and started exploring other avenues for employment.
In the context of the above case:
1. Identify and explain the element of directing in the absence of which
the employees don’t feel encouraged to work.
2. State the importance of this element as identified in part (1) by giving
any two suitable points
44. State any three limitations of advertising. 3
45. (i) The space outside buses, company trucks (used to carry company's own 3
products) can be used to attract and inform the customers about the
product, availability, price etc.
a) Which media of advertisement is highlighted in above line?
b) Generally for which products media of advertisement identified in (a)
is suitable?
OR
(ii) A manufacturer of detergent powder wants to introduce detergent cake in
the market under a new brand name. Which sales promotion tools should
he use to attract the customers? Give reasons in support of your answer.

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46. What is the difference between Letter of Credit and Letter of Hypothecation in 3
relation to external trade?
47. (i) State ant three differences between GATT and WTO. 3
OR
(ii) What are (i) Bill of Lading, (ii) Shipping order and (iii) Mate's receipt.
48. Differentiate between Departmental undertaking and Public corporation on the 5
basis of the followings:
(i) Establishment (ii) Legal Status (iii) Capital (iv) Management (v) Control
and Accountability.
49. (i) What are the recent trends in recruitment? Explain briefly. 5
OR
(ii) The Manager must be aware of the sources of recruitment from where the
suitable candidates can be hired. Mention and Explain the sources of
recruitment.
50. Companies have to get their securities listed in the stock exchange for the 5
purpose of trading through stock exchange. Describe the steps involved in
Trading procedure.
51. (i) Small business plays a major role in the socio-economic development of 5
any country. Do you agree with the above statement? Enumerate any four
importance of small business.
OR
(ii) After passing Class 12, Sunita wants to start her own boutique. Her
Mother has promised her to meet her initial financial requirement. She has
been advised by her teacher that there are a number of government
agencies providing help in various fields and she can approach them. Name
such agencies and state the nature of assistance these can provide in
starting small businesses.

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 MARKING SCHEME
BUSINESS STUDIES (Revised 319)

Time : 3 Hours Maximum Marks: 100

S. Section – A Marks
No.
Ques. 1 to 20 are MCQs of 1 Mark each.

1. (c) Uncertainty 1

2. (d) process of eliminating unnecessary controls and restrictions 1

3. (d) Indulge in unfair trade practices 1

4. (d) Change in agricultural prices 1

5. c) Reduce Creativity 1

6. (b) Planning 1

7. (b) Probabilistic 1

8. (c) 1991 1

9. d) 1,2 and 3 only 1

10. (b) debt and equity 1

11. b) Both (A) and (R) are correct, but (R) is not the correct explanation 1
of (A)

12. b) Lease 1

13. d) Public 1

14. d) Large amount of capital investment is required to start and run a 1

departmental store

15. a) Itinerant 1

16. c) Bulk Buying 1

17. d) Big Office Building 1

18. c) C2C 1

19. b) B2C 1

20. a) Manufacturer and Supplier 1

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 Section – B
Ques.. 21 to 35.

21. (a)Threats 1x2=2

(b) More Demanding Customers

22. a) i-d, ii-c, iii-b, iv-a 1x2=2

23. (a) Functional Structure 1x2=2

(b) Decentralisation

24. (a) Planning 1x2=2

(b) Methods

25. (a) Financial planning 1x2=2

(b) Capital structure

26. (a) Financial planning 1x2=2

(b) Financial planning

27. (a) Retained Earnings 1x2=2

(b) Public Deposit

28. (a) Preference shares 1x2=2

(b) Debentures

29. (a) Place 1x2=2

(b) Marketing mix

30. (a) Cost based pricing 1x2=2

(b) Objective based pricing

31. (a) Sales promotion 1x2=2

(b) Personal Selling

32. (a) Cost based pricing 1x2=2

(b) Objective based pricing

33. (a) Wholesaler/Retailer is a middleman in the chain of distribution. 1x2=2

(b) No change

34. (a) World Wide Web 1x2=2

(b) business-to-business

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35. (a) ATM, or automated teller machine 1x2=2
(b) net-banking

Section – C
Qu. 36 to 51.

36. a) There is no need to prepare a cash flow statement. 2

b) There is no necessity for Annual General Meeting to be held.
c) The annual return can be signed by the Director and not necessarily
a Company Secretary.
d) An OPC need to hold only one meeting of the Board of Directors in
each half of a calendar year and the gap between two meetings
should not be less than 90 days.
(any two)

37. (i) Transfer: It means shifting of an employee from one job to another 2
without changing the responsibilities and salary and;
(ii) Promotion: It involves shifting or transferring employees to a
higher job.
OR
Some of the major types of external sources are as follows:
1. Advertisement in Newspapers
2. Employment Exchanges

38. (a) Commercial paper 2

(b) It is a popular instrument for financing working capital
requirements of business units

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39. When the firm of a country imports goods for the purpose of exporting 2
the same to the firms of some other country with or without making
any change, it is Known as entrepot trade or re-export trade for that
country. For example, if an Indian company imports rubber from
Thailand and exports it to Japan then it is called Entrepot trade for
India.
OR
Exports can be cars, clothes, pencils, heavy machinery, software, or
banking services. The limits to exports usually come in the form of
government regulation. For example, if the good is needed
domestically, the government may restrict exports of the good to
regulate domestic supply and prices.

40. (a) Deferred Payment Plan 2

(b) This plan is quite common now-a-days in case of TVs and air-
conditioners.

41. 1. Trading; 3
2. Manufacturing;
3. Professionals;
4. Individualised services.
(any two)
OR
(1) Small factory/shops
(2) Business firms
(3) Service organisations
(4) Government and Semi-Government organisations

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42. 1. The physiological needs and safety needs of Nipun are being 3
satisfied by the offer of the company.
2. The other needs of Nipun followed by the physiological needs and
safety needs that still need to be satisfied are as follows:

1+2=3

● Affiliation/Belonging Needs: These needs refer to affection, sense

of belongingness, acceptance and friendship. The organisation, by
encouraging cooperative teamwork and by having accessible and
kind superiors, can fulfill these needs of its employees.
● Esteem Needs: These include factors such as self-respect,
autonomy status, recognition and attention. The organisation, by
giving praise and recognition when the employees do well, and
offering promotions, can fulfill these needs of its employees.

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43. 1. The various elements of directing mentioned in the above paragraph 3
are as follows:
● Communication: “He is very clear and specific in issuing
instructions to his subordinates in order to ensure smooth
working of the department.”Supervision-. “He personally
oversees the method followed by the chefs for preparation of
each dish.”
● Leadership: “He provides constant guidance to them in order to
improve upon its taste and presentation and also encourages
them to innovate and be more creative in their work.”
● Motivation: “He misses no opportunity to praise his
subordinates for their good work.”
OR

1. The element of directing being referred to is motivation.

2. The importance of motivation is described below:

● Improves performance: Motivation helps to improve the

performance of both the employees as well as the organisation. This
is because motivated employees contribute their maximum efforts
for organisational goals.
● Reduces employee turnover: Motivation helps to reduce employee
turnover and thereby saves the cost of new recruitment and training.
This is due to the fact that the managers identify the motivational
needs of employees and provide suitable incentives. Consequently
the employees feel satisfied and may not think of leaving the
organisation.
44. 1. Advertising Multiplies Wants 3
2. Advertising adds to the Cost and Price of Product
3. Creation of Monopoly
4. Advertising may Affect the Value-system of Society
5. Motivation for Wrong or Dangerous deeds
(any three)

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45. (a) Outdoor Advertising 3
(b) Generally used for advertising products like shoes, lotions, creams,
fans, cycles etc.
OR
Sales promotion tools he should use to attract the customers are :
1. Distribution of Free Samples: As mentioned above, distribution of
free samples is a commonly used sales promotion tool.
2. Bonus Offer: At times marketeers offer extra quantity with standard
products without any additional charge to the customer.
3. Price-off: To increase sales, or to reduce competition, many business
firms cut down prices.
4. Free Offer: Many companies give 'free' offers to boost the sales of
their products.

46. There are two alternative methods by which payment canbe received 3
by the exporter.
(a) Letter of Credit: The exporter can get immediate payment on the
strength of the letter of credit which is issued by the importer's
bank in favour of the exporter. The exporter has to draw the bill in
order to get the payment from the local branch of the bank (in home
country), which has issued the letter of credit on behalf of the importer.
(b) Letter of Hypothecation: If the exporter wants to receive payment
immediately, he can get the bill (accepted by the importer) discounted
with his bank. But for this purpose, he has to give a letter of
hypothecation to his bank. Letter of hypothecation is a letter addressed
to a bank attached with the bill of exchange which is accepted by the
importer. Through his letter of hypothecation, the exporter authorises
the bank to sell the goods in case 3 of dishonour of the bill by the
importer so that the bank can realise the amount advanced by it to the
exporter.

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47. 1. Conceptual Framework: GATT was basically a set of rules and 3
regulations for multilateral trade agreements with the objective of
promoting international trade while WTO is an institutional
mechanism which attempts to regulate, monitor and liberalize
international trade.
2. Institutional Existence: GATT does not have any institutional
existence while WTO bears permanent institutional character with
functioning secretariat.
3. Nature of Participation: In case of GATT participating nations were
contracting parties while WTO has membership for nations.
4. Scope of Application of Rules and Regulations: The rules and
regulations pertaining to GATT were applicable for goods only
while in case of WTO it extends to both goods and services.
(any three)
OR
(i) Bill of Lading - It is a document issued by the shipping company
after the cargo is loaded on the ship. It is an acknowledgment of
goods by the shipping company. It is a document that shows the
title to the goods and is freely transferable by endorsement and
delivery.
(ii) Shipping order - The shipping bill is the main document on the
basis of which customs office grants permission for the export. It
contains full details regarding the goods being exported name of
the vessel, exporter s name & address, country of final destination,
etc.
(iii) Mate's receipt -A mate receipt is a receipt issued by the
commanding officer of the ship when the cargo is loaded on board
and contains the information about the name of the vessel, berth,
date of shipment, description of packages, and condition of the
cargo at the time of receipt on board the ship, etc.

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48. 5

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49. RECENT TRENDS IN RECRUITMENT 5
(i) E-Recruitment: Websites are the modern sources of recruitment
where the job vacancies are advertised through worldwide
web(www). This has an advantage of reducing the cost per
candidate, saves time, is convenient and a faster way, for
example naukri.com, job search.com, monster.com etc.
(ii) Outsourcing: Recruitment Process Outsourcing is "a form
of business process outsourcing (BPO)" where an employer
transfers all or part of its recruitment processes to an external
service provider.
(iii) Internships: These provide employment to fresh graduates
especially in technical areas to work as summer interns and later
on they may be offered regular jobs on completion of their
internship training.
(iv) Walk-in-interview: Under this method the employer can insert a
'Walk in' or 'Talk in' advertisement in a
leading newspaper or online . Those who walk in ( i.e come
personally) or talk in ( i.e contact over phone) are further asked
to give their details for the job vacancy. This serves as a good
source of recruitment when the vacancies arise all of a sudden
and need to be filled up immediately.
OR
The sources of recruitment from where the suitable candidates can be
hired. These sources can be internal and external.
(A) Internal Sources : In any business, existing employees expect that
they will have chances of promotion and will be considered for higher
positions before outsiders are considered. The internal sources of
recruitment include transfers and promotions.
(i) Transfer means shifting of an employee from one job to another
without changing the responsibilities and salary and;
(ii) Promotion involves shifting or transferring employees to a higher
job.
External Sources : All vacancies cannot be filled up from within the
organisation. Existing employees may lack the required skill, initiative
and qualifications needed for the jobs involved. Hence, managers have
to recruit some persons from outside the organisation.
i) Media Advertisements: You must have seen advertisements in
newspapers about vacancies in organisations

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 ii)Employment Exchanges : In India, employment exchanges have
been set up by the government for bringing together job-seekers and
employers who are looking for employees.

50. Trading procedure involves the following steps : 5

1. Selection of Broker : Firstly, investor chooses the broker through
whom he will buy or sell the securities.
2. Placement of Order : After fixing the broker, the investor places the
order stating the name of the company, number of shares to be
bought or sold the price at which the transaction has to be made.
3. Trade by the Broker : Broker makes the deal if the desired price is
quoted by any buyer/seller in his computer. Transactions on a stock
exchange can be on cash basis or carry over basis (badla).
4. Information to Investor : The broker informs the investor about the
deal. The buyer makes arrangement for payment.
5. Settlement : All transactions are settled through the clearing house
through electronic book entry.

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51 Yes, I agree with the above statement.
The importance of small-scale business is increasing day by day due to
the following factors.
1. The small business enterprises are capable of generating immediate
and large scale employment opportunities in our country.
2. They require less capital investment as compared to large scale
business enterprise.
3. The cost of production is less due to use of local resources and fewer
Establishments and less running cost.

4. The small industries help in effective mobilisation of the untapped

resources of the country. With the help of local resources and
indigenous technology, world class products can be produced by
village and cottage industries.

5. Small industries promote balanced regional development of the

country. These can be easily set up near the source of resources that
leads to overall economic development of that place.
(any four)
OR

To start and run a business enterprise one requires various resources

and facilities. These may be in the form of technical, financial,
marketing or training support. Such support is provided by the
Government by establishing different institutions or organisations from
time to time. some of such institutions and their role in providing
support.
1. National Small Industries Corporation Ltd.: The National Small
Industries Corporation Ltd. (NSIC) was set up in the year 1955 to
promote, aid and foster the growth of small industries in India. It
provides wide range of promotional services to small-scale
industries.
2. State Small Industries Development Corporations: The State Small
Industries Development Corporations (SSIDCs) are set up in
various states of our country to cater to the developmental needs of
small, tiny and village industries.

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3. National Bank for Agriculture and Rural Development: The
National Bank for Agriculture and Rural Development
(NABARD) was set up in 1982 as an apex institution for financing
agricultural and rural sectors.
Small Industries Development Bank of India: The Small Industries
Development Bank of India (SIDBI) was set up in 1990 as a principal
financial institution for promotion, financing and development of
small-scale industrial enterprises.

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