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Board Paper of Class 12-Commerce 2015 Business Studies All India(SET 3) - Solutions

General Instructions:
(i) Answer to questions carrying 1 mark may be from one word to one sentence.
(ii) Answer to questions carrying 3 marks may be from 50 to 75 words.
(iii) Answer to questions carrying 4-5 marks may be about 150 words.
(iv) Answer to questions carrying 6 marks may be about 200 words.
(v) Attempt all parts of a question together.

  • Question 1

    Himanshu purchased a new car from 'Galaxy Motors' for Rs 25 lakhs. He was offered free insurance for the first year and three free servicing to be availed after the car had covered 5,000 km, 10,000 km and 15,000 km respectively. When Himanshu took the car for the first free servicing, he was told that the car was not new and first service had already been availed on this car. He felt cheated and filed a complaint in the State Commission. Being not satisfied with the decision of the State Commission, after two months he decided to file an appeal against it.

    Can Himanshu appeal against the decision of the State Commission? Give reason in support of your answer.


  • Question 2
    How does 'cost of equity' affect the choice of capital structure of a company ? Explain. VIEW SOLUTION

  • Question 3
    'Bharat Express' specialises in Courier Services. Its 'wide range of express package and parcel services' help business firms to make sure that the goods are made available to the customers at the right place and at the right time.
    State with reason, whether the working capital requirements of 'Bharat Express' will be high or low. VIEW SOLUTION

  • Question 4
    'Maruti Vega Ltd.' entered into the market with coloured television and have now introduced products like audio systems, air-conditioners washing machines, etc. The company is not only offering the products but also handling complaints and offering after-sales services.

    Identify the element of marketing-mix discussed here. VIEW SOLUTION

  • Question 5
    Explain, how management helps in the development of society. VIEW SOLUTION

  • Question 6
    'Himalaya Ltd'. is engaged in manufacturing of washing machines. The target of the organisation is to manufacture 500 washing machines a day. There is an occupational specialisation in the organisation which promotes efficiency of employees. There is no duplication of efforts in such type of organisation structure.

    Identify the type of organisation structure described above.


  • Question 7
    Give the meaning of 'Programme' as a type of plan. VIEW SOLUTION

  • Question 9
    State any three features of 'Informal Organisation'. VIEW SOLUTION

  • Question 10

    Jaideep recently joined as the Managing Director of 'Tivori Ltd.', an apparel designing company. He observed that the company had a number of experienced fashion designers on its payroll. They regularly offered useful suggestions which were neither appreciated nor rewarded by the company. Instead the company outsourced its services to some renowned fashion designers and paid them a good compensation for their services. Because of this the employees felt disheartened and stopped giving useful suggestions.

    (a) Identify the communication barrier discussed above.

    (b) State the category of this communication barrier.

    (c) Explain any other communication barrier of the same category.


  • Question 11
    'The Stock Exchange performs many vital functions in today's commercial world.' Explain any three such functions. VIEW SOLUTION

  • Question 12
    'A.S. Ltd.' is a large company engaged in assembly of air-conditioners. Recently the company had conducted the 'Time' and 'Motion' study and concluded that on an average a worker can assemble ten air-conditioners in a day. The target volume of the company in a day is assembling of 1,000 units of air-conditioners. The company is providing attractive allowances to reduce labour turnover and absenteeism. All the workers are happy. Even then the assembly of air-conditioners per day is 800 units only. To find out the reason the company compared actual performance of each worker and observed through C.C.T.V. that some of the workers were busy in gossiping.

    (a) Identify the function of management discussed above.

    (b) State those steps in the process of the function identified which are discussed in the above paragraph. VIEW SOLUTION

  • Question 13
    How do the 'Company-related factors' affect the choice of channels of distribution? Explain. VIEW SOLUTION

  • Question 14
    State any four points which highlight the importance of principles of management. VIEW SOLUTION

  • Question 15
    Explain any two points of importance of 'consumer protection' from the point of view of business and any two points from the point of view of consumers. VIEW SOLUTION

  • Question 16

    'Mission Coach Ltd.' is a large and creditworthy company manufacturing coaches for Indian Railways. It now wants to export these coaches to other countries and decides to invest in new hi-tech machines. Since the investment is large, it requires long-term finance. It decides to raise funds by issuing equity shares. The issue of equity shares involves huge floatation cost. To meet the expenses of floatation cost, the company decides to tap the money market.

    (a) Name and explain the money-market instrument the company can use for the above purpose.

    (b) What is the duration for which the company can get funds through this instrument ?

    (c) State any other purpose for which this instrument can be used.


  • Question 17

    Beni, after completing her MBA, took up a job with a multinational company named 'Fortio'. The company was paying good salary and perks to its employees. The wages were within the paying capacity of the company the provided the employees a reasonable standard of living. The company also had a good work-culture and the behaviour of superiors was very good towards their subordinates. Beni was very happy in this organisation, but due to long working hours she did not have time to cook her meal. She had to depend upon outside food, which was deteriorating her health.
    She observed that this problem was faced by many of her colleagues, not only in her company but also in many other companies. This was because of increase in the number of working women and non-availability of hygienic home-cooked food. She identified this as a great opportunity and decided to give up her job to supply packaged home-cooked food to office goers at a reasonable price. At the end of the day she was also distributing the left-over food in the nearby night-shelters.

    (a) State the dimension of business environment being discussed above.

    (b) State the principle of management being followed by 'Fortio'.

    (c) Identify any two values being communicated by the company to the society in the above case.


  • Question 18

    The workers of 'Gargya Ltd.' are unable to work on new computerised machines imported by the company to fulfil the increased demand. Therefore, the workers are seeking extra guidance from the supervisor and the supervisor is overburdened with the frequent calls of workers.

    Suggest how the supervisor, by increasing the skills and knowledge of workers, can make them handle their work independently.

    Also state any three benefits that the workers will derive by the decision of the supervisor.


  • Question 19
    Neeraj Gupta started a company 'YoYo Ltd'. with ten employees, to assemble economical computers for the Indian rural market. The company did very well in its initial years. As the product was good and marketed well, the demand went up. To increase production the company decided to recruit additional employees. Neeraj Gupta, who was earlier taking all decisions for the company, had to selectively disperse the authority. He believed that people are competent, capable and resourceful and can assume responsibility for effective implementation of their decisions. This paid off and the company was not only able to increase its production but also expanded its product range with different features.

    (a) Identify the concept used by Neeraj Gupta through which he was able to steer his company to greater heights.

    (b) Also explain any three points of importance of this concept. VIEW SOLUTION

  • Question 20
    Give the meaning of 'divisional structure' of organising. State its any four advantages. VIEW SOLUTION

  • Question 21

    Anjali had been working with 'Tata Enterprises' for the last ten years. She was famous for her dedication towards the work. When the Manager senior to her retired, all her colleagues thought that now Anjali would be promoted. But to everyone's surprise the vacant post was filled by an outsider 'Miss Monika'. Anjali felt demoralised and her performance started declining. She would absent herself often and could not meet her targets.

    Miss Monika was a good leader who would not only instruct her subordinates, but also guide and inspire them. She noticed Anjali's behaviour and felt hat her performance could be improved. She started involving Anjali in decision-making issues related to the organisation and made her a part of a high-level joint management committee. Anjali was now punctual to office and her performance started improving.

    (a) Identify the function of management being performed by Monika.

    (b) Name the element of the above function of management which helped Monika to improve Anjali's behaviour.

    (c) State any three features of the element identified in (b) above.


  • Question 22

    Mohit Gupta is working with 'Yellow Security Services Ltd.' He is also recruiting security guards for the company. The company provide security services in Delhi and Noida at short notice to various companies. The guards are recruited on temporary basis. The guards provided by this company are known for their honesty and punctuality. Mohit Gupta is well known in his village for providing employment to unskilled people.

    (a) Name the source of recruitment used by 'Yellow Security Services Ltd.'

    (b) State any one disadvantage of this source of recruitment.

    (c) Identify the need of 'Security Guards' which is being fulfilled by the company as per Maslow's need hierarchy.

    (d) Identify any two values communicated to the society in the above stated case.


  • Question 23

    Explain the following principles of management :

    (a) Subordination of Individual Interest to General Interest.

    (b) Development of Each and Every Person to His or Her Greatest Efficiency.


  • Question 24

    Radhika was a student of Business Studies of Class XII. Her father was a farmer who grew different varities of rice and was well-versed about various aspects of rice cultivation. He was also selected by the government for a pilot-project on rice cultivation. As a project-work in Business Studies she decided to study the feasibility of marketing good quality rice at a reasonable price. Her father suggested her to use internet to gather customers' views and opinions. She found that there was a huge demand for packaged organic rice. She knew that there were no pre-determined specifications in case of rice because of which it would be difficult to achieve uniformity in the output. To differentiate the product from its competitors, she gave it the name of 'Malabari Organic Rice' and classified it into three different varieties namely − Popular, Classic and Supreme, based on the quality. She felt that these names would help her in product differentiation.

    Explain the three functions of marketing, with reference to the above paragraph. VIEW SOLUTION

  • Question 25

    'Abhishek Ltd'. is manufacturing cotton clothes. It has been consistently earning good profits for many years. This year too, it has been able to generate enough profits. There is availability of enough cash in the company and good prospects for growth in future. It is a well managed oranisation and believes in quality, equal employment opportunities and good remuneration practices. It has many shareholders who prefer to receive a regular income from their investments.
    It has taken a loan of Rs 50 lakhs from I.C.I.C.I. Bank and is bound by certain restrictions on the payment of dividend according to the terms of the loan agreement.

    The above discussion about the company leads to various factors which decide how much of the profits should retained and how much has to be distributed by the company.

    Quoting the lines from the above discussion, identify and explain any four such factors.

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