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SAMPLE QUESTION PAPER 2023-24

BUSINESS STUDIES (054)

CLASS XII

Max Marks – 80 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.

The Board of directors of Medex Pharma Ltd. decided to issue debentures

1. worth ₹40 lakhs in order to finance a major Research and Development 1
project. This would increase the Debt Equity ratio from 1:1 to 2:1.However, at
the same time it would increase the Earnings per share.

The reason that will justify the above situation is:

a) Unfavourable financial leverage, as the financial risk will be higher.

b) Unfavourable financial leverage, as return on investment is lower than the

cost of debt.

c) Favourable financial leverage as debt is easily available

d) Favourable financial leverage, as return on investment is higher than cost

of debt
2. A bottle of Anti- dandruff shampoo mentions ' Clean your hair and get rid of 1
dandruff in one squeeze'. The product related decision involved is-

a) Branding b) Product quality

c) Packaging d) Labelling

3. With the presence of women in the workforce, there has been a shift towards 1
formal wear, increased demand of electronic gadgets and increase in demand
of cosmetics.

The related dimension of business environment referred in the above lines is:

a) Technological environment. b) Social environment

c) Political environment. d) Economic environment

Name the function of marketing which is effective in bringing repeat sales

4. from the customers and developing brand loyalty for a product. 1

a) Standardization and grading

b) Promotion
c) Customer support services
d) Packaging and labelling

5. SEBI calls for information and issues a show cause notice to stock exchange 1
and its officials seeking explanation and conducting audit and enquiry. Which
function is SEBI performing?

a) Regulatory function b) Development function

c) Protective function d) Both a) and c)

6. 1

Identify the point of significance of management illustrated in the picture.

a) Management helps in achieving group goals

b) Management helps in achieving personal objectives
c) Management helps in development of society
d) Management increases efficiency

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. IND Dyechem Ltd. is a chemical manufacturing company producing dyes and 1

pigments both for domestic 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. Kamble, 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
b) Controlling d) Planning

9. Choose the incorrect statement about pricing objectives as a factor affecting 1

the price of a product.

a) If a firm's objective is to maximize profits in the short run, it should charge

maximum price for its products.

b) If a firm's objective is to capture market share, it should keep low price of its
product.

c) If a firm wants to attain product quality leadership, it should charge lower

prices.

d) If a firm is facing problems in survival due to stiff competition, it may offer

discount on its products.

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

ASSERTION (A): Management is concerned with efficient use of resources.

REASONING (R): For management both efficiency and effectiveness need to

be balanced.

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

11. Concentration of decision making functions at the apex of management 1
hierarchy is called __________

a) Decentralisation. b) Delegation

c) Organisational structure. d) Centralisation

12. Some employees have been assigned the job of measuring the output in an 1
objective and reliable way. They are applying different techniques for
achieving this aim. Some of these are personal-observation, sample-checking
etc. They are also keeping the units of measurement same as that of the units
in the standards.

Name the step of ‘Controlling process applicable in the above paragraph.

a) Analysing deviations

b) Comparing actual performance with standards.

c) Establishing standards.

d) Measurement of actual performance

13. Statement I: For products requiring long term storage like agricultural 1
products, the warehouses are located near to the market.

Statement II: Higher the level of inventory, higher will be the level of service to
customers but the cost of carrying the inventory will also be high.

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. Mr. Vivek is working as the General Manager of Oshin Hotels Ltd. Mr. Vivek 1
observed that Government was taking a special interest in the Tourism
industry as this sector is an important source of foreign exchange and
employment promotion. On the basis of this news, the company decided to
set up hotels at several tourist places. Oshin Hotels Ltd. established 50 hotels
before other companies considered this issue. Very soon, this brand Oshin
Hotels Ltd. became well known in the market. Identify the importance of
business environment described here.

a) It enables the firm to identify opportunities and getting the first mover
advantage.

b) It helps the firm to identify threats and early warning signals.

c) It helps in tapping useful resources.

d) It helps in improving performance.

15. Name the function of management that acts as a means for translating plans 1
into action.

a) Planning b) Directing

c) Organising d) Controlling

STATEMENT I: Electronic holdings can be converted into physical certificates

16. 1
with the process of dematerialisation.
STATEMENT II: There is no danger of theft, loss or forgery of share
certificates in dematerialisation.
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
17. ‘Pace.’ is a reputed Chartered Accountant firm which renders services to big 1
MNC’s. The Chartered Accountants of the firm are required to travel to Delhi
and NCR for which they use company’s cars. The firm decided to convert its
Petrol cars to Electric cars in order to improve the quality of life of people.
Identify the dimensions of business environment.

a) Political and Legal environment

b) Legal and Social environment

c) Technological and Political environment

d) Social and Technological Environment

Match the following tools of promotion with their explanation and

18. choose the correct option 1

A. It is undertaken by some identified 1 Personal selling

person /company who makes efforts
and bears the cost of it.
B. It plays an important role at the 2 Sales Promotion
awareness stage and develops
product preferences with the aim of
making sale.
C. It helps in managing public opinion 3 Advertising
and company’s relation with the public
on regular basis.
D. It uses tools specifically designed to 4 Public Relations
promote to customers, middlemen and
to salespersons.

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

b) A (1), B (3), C (4), D (2)
c) A (2), B (3), C (4), D(1)
d) A (2), B (4), C (1), D (3)

From the following which is not a relevant feature of management as science:

19. 1
a) Principles are based on the basis of experimentation

b) Systematized body of knowledge

c) Based on practice and creativity

d) Universal Validity
 The aim of demonetisation was not to____________
20. 1
a) Curb corruption
b) Reduce the prices of real estate
c) Withhold the accumulation of black money generated by undeclared
income
d) Counterfeit the use of high denomination notes for illegal activities

21. Captcha Ltd. is a construction company in which all the employees learn 3
various ways of dealing with diverse situations from their seniors. Company
provides financial as well as non-financial incentives. This helps the
employees to grow and develop their abilities. The organisation behaves as a
responsible constituent of society and always creates good quality products. It
has a positive image in the market. The training modules are excellent and
the employees always try to find unique ways of providing solutions in the
context of rapidly changing business environment. This has helped the
organisation to adjust smoothly.

Identify and state three points of importance of management being highlighted

here.

22. State any three reasons as to why controlling is regarded as an indispensable 3

function of management.

OR

Enumerate any three advantages of Management by Exception which is used

by manager in analysing deviations. 3

23. Resolutions Pvt. Ltd. is a publishing company. Its book on Business Studies 3
for class XII is in great demand. As a result, the employees in the marketing
department are always racing against time as they have to work overtime and
on holidays as well to cater to the demand. The work stress has led to
dissatisfaction among the employees of the marketing department.

1. Name and explain the step of staffing process which has not been
performed properly.

2. Also, explain the immediate next step in the process of staffing.

24. State any three functions of Stock Exchange. 3

OR

State the first three steps involved in the screen-based trading for buying and 3
selling of securities.

25. Explain the following features of Directing 4

a) Directing initiates action

b) Directing is a continuous process

OR

Explain the following leadership styles:

4
a) Autocratic leadership
b) Laissez Faire leadership

State any four limitations of using internal sources of recruitment.

26. 4
OR

State any four commonly used sources of recruiting employees from outside
the organisation. 4

27 Mr. Akshay, a 20 year old college student purchased a book online from XYZ 4
Pvt Ltd and when it was delivered, he noticed that there was no MRP
mentioned on it. He browsed the internet and found that the book was sold at
different prices in different places. He filed a case in District forum against the
publisher. The court held in favour of Akshay and awarded a compensation of
₹10,000.

a)Identify and state the consumer right violated in the above case.

b) Name and explain the right exercised by Mr. Akshay.

28. Explain the following factors affecting the dividend decision of the company: 4

a) Taxation Policy
b) Cash Flow Position
29. Identify and state the various elements of communication highlighted in the 4
following cases:

(i) Department 'A' has sent an encoded message to department 'B' through
internet. What is the role of internet here?

(ii) Madhur is making gestures so that he can send a message to Ranbhir.

What is Madhur doing here?

(iii) Ranbhir is trying to understand the message sent by Madhur by reading

his gestures. What is Ranbhir doing here?

(iv) Kamesh picks up his phone and finds a message on it. He reads the
message carefully. What is the role of Kamesh here?

30. Dhaval Acharya, after acquiring a bachelor’s degree in Hotel Management 4

joined his father’s chain of vegetarian restaurants in Ahmednagar. Being
young and enterprising, he suggested his father to add a new section of
vegetarian bakery items which required an investment of ₹ 5 crores. His father
Mr. Aariketh Acharya suggested him to take the decision with caution and
understood everything comprehensively as bad decision may damage the
financial fortune of business.

Identify the decision suggested by Mr. Aariketh Acharya. State by giving any
three reasons as to why he must have advised his son to take decision with
caution.

1) Explain any two techniques of Scientific Management from the following:

31. a) Method study 3+3=6
b) Motion study
c) Time study

2) Differentiate between Unity of Command and Unity of Direction on any

three basis.
OR
1) Explain any two principles of Fayol from the following: 3+3=6
a) Discipline
b) Order
c) Initiative

2) Differentiate between contributions made by F.W.Taylor and Henry Fayol

on any three basis.
32. Explain the steps that are required to be performed by a manager before 6
evaluating all possible courses of action in planning process.

OR

Explain how planning: 6

a) Reduces overlapping and wasteful activities

b) Establishes standards for controlling
c) Facilitates decision making

33. Read the statements given in point 1 and 2, answer the questions that follow: 3+3=6
1) Tea is produced in Assam but is carried to customers not only in this
state but also in other parts of the country.

a) Identify and explain the function of marketing that enables the marketer to
achieve its goals.

b) Enumerate any two factors that marketer should take into consideration in
order to analyse the identified needs.

2) Paddy is grown during summer season but its demand and sale takes
place throughout the year.
a) Name and state the function of marketing which should be undertaken to
reduce the gap between production and consumption of Paddy.
b) State by giving two reasons as to why proper discharge of this function is
important.

6
34. Diligent developers, a website design company in Bangalore is a startup
initiative of Mr. Maniraj which aims at achieving a profit margin of 10% in its
first year. Mr. Maniraj appointed Mr. Advait as the Digital marketing Head, Mr.
Kiyansh as the head of Backend department and Mr. Nirved headed the
Graphics Designing Department. Since each head was specialised in specific
skills, it resulted in increased efficiency and better coordination.

However, problems arose when Mr. Advait started considering group

objectives superior to organisational objectives and stopped exchanging
information with Mr. Kiyansh and Mr. Nirved. The company had to bear the
brunt of lack of coordination and was unable to achieve its objectives.
a) Identify and state the organisational structure adopted by the company.
b) State two benefits and two limitations of the identified structure highlighted
in the above case.