cbse 2014 question paper for class 12 business studies - outside delhi

7/22/2019 CBSE 2014 Question Paper for Class 12 Business Studies - Outside Delhi

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66/1 1 P.T.O.

narjmWu H moS >H mo Cma-nwpVH m Ho _wI-n>na Ad` {bIo &Candidates must write the Code on the

title page of the answer-book.

Series OSR H moS> Z. 66/1Code No.

amob Z.Roll No.

`mdgm{`H A``ZBUSINESS STUDIES

{ZYm[aV g_` : 3KQ>o A{YH V_ AH : 90

Time allowed : 3 hours Maximum Marks : 90

H n`m OmM H a b| {H Bg Z-n _o _w{V n> 11h & Z-n _| Xm{hZo hmW H s Amoa {XE JE H moS >Z~a H moN>m Cma-nwpVH m Ho _wI-n> na

{bI|& H n`m OmM H a b| {H Bg Z-n _| >30Z h &

H n`m Z H m Cma {bIZm ew H aZo gonhbo, Z H m H _mH Ad` {bI| & Bg Z-n H monT>Zo Ho {bE 15{_ZQ >H m g_` {X`m J`m h & Z-n H m {dVaU nydm

_| 10.15~Oo {H m OmEJm & 10.15~Oo go 10.30 ~Oo VH N>m Hodb Z-nH mo nT>|Jo AmaBg Ad{Y Ho XmamZ doCma-nwpVH m na H moB Cma Zht {bI|Jo &

Please check that this question paper contains 11printed pages.

Code number given on the right hand side of the question paper should be

written on the title page of the answer-book by the candidate.

Please check that this question paper contains 30questions.

Please write down the Serial Number of the question beforeattempting it.

15 minutes time has been allotted to read this question paper. The question

paper will be distributed at 10.15 a.m. From 10.15 a.m. to 10.30 a.m., the

students will read the question paper only and will not write any answer on

theanswer-bookduring this period.

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66/1 2

gm_m` {ZX}e:

(i) 1AH dmboZm| Ho Cma EH eXgo EH dm`VH hm| &

(ii) 3AH m| dmbo Zm| Ho Cma 50 75eXm| Ho hm| &

(iii) 4 5AH m| dmbo Zm| Ho Cma bJ^J 150eXm| Ho hm| &

(iv) 6AH m| dmbo Zm| Ho Cma bJ^J200eXm| Ho hm| &

(v) EH Z Ho g^r ^mJ gmW-gmW hr hb H s{OE &

General Instructions :

(i) Answers to questions carrying 1 mark may be from one word to one

sentence.

(ii) Answers to questions carrying3marks may be from 50 75words.

(iii) Answers to questions carrying4 5 marks may be about 150words.

(iv) Answers to questions carrying 6marks may be about200words.

(v) Attempt all parts of a question together.

1. H m` H m ~YZgo `m A{^m` h ? 1What is meant by Management of Work ?

2. g_`-A``Zmam `m {ZYm[aV {H m OmVm h ? 1What is determined by Time-Study?

3. `dgm` Ho {d{YH n`mdaU_| `m gp_{bV hmoVm h ?CboI H s{OE & 1

What is included in Legal Environmentof Business ? State.

4. `moOZm Ho EH H ma Ho n _| {d{YH m AW Xr{OE & 1Give the meaning of Methodas a type of plan.

5. A{YH ma AVaU Ho EH Vd Ho n _| CmaXm{`dH m AW Xr{OE & 1Give the meaning of Responsibility as an element of delegation.

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66/1 3 P.T.O.

6. ~Y Ho EH H m Ho n _| gJR>ZH mo n[a^m{fV H s{OE & 1

Define organizingas a function of management.

7. O~ gJR>Z ^Vu Ho AmV[aH moVm| H m Cn`moJ H aVo h Vmo H _Mmar {H g H ma AnZo

{ZnmXZ _| gwYma Ho {bE A{^o[aV hmoVo h ?CboI H s{OE & 1How are employees motivated to improve their performance when the

organization uses internal sources of recruitment ? State.

8. H _Mm[a`m| H mo H `mU Ed gm_m{OH gwajm XmZ H aZm _mZd ggmYZ ~Y mam{Znm{XV H s OmZodmbr {d{e> {H mAm| _| go EH h & _mZd ggmYZ ~Y H s A` Xmo

{d{e> {H mE ~VmBE &>1

Providing for social security and welfare of employees is one of the

specialised activities performed by Human Resource Management.

Mention any two other specialised activities of Human Resource

Management.

9. gofU Ho EH Vd Ho n _| {dH moS>Z ({S>H moqS>J) H m `m AW h ? 1

What is meant by Decodingas an element of communication ?

10. gJR>Zm_H dmVmdaUH s Eogr H moB Xmo {deofVmE ~VmBE Omo `{ `m| Ho `dhma H mo^m{dV H aVr h VWm EH A{dmr` mogmhZ Ho n _| H m H aVr h & 1

Give any two characteristics of Organizational Climate that influence

the behaviour of individuals and act as a non-financial incentive.

11. {dmr` Omo{I_go `m A{^m` h ? 1

What is meant by Financial Risk?

12. {dmr` ~YHo Co` H m CboI H s{OE & 1

State the objective of Financial Management.

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13. h_m EH H nZr _| Wm`r AmYma na H m aV h & H m g_PmVo Ho AZwgma Cgo {XZ _|

8KQ>o H m H aZm nS>Vmh VWm dh AnZr BN>mZwgma AmodaQ>mB_ H a gH Vr Wr & h_m Zo

AmodaQ>mB_ H m {H m, {OgHo H maU dh ~r_ma hmo JB Ama Cgo AnZoH m go Nw>Q>Q>r boZr

nS>r & {H gr Zo^r CgHo ~mao _| {MVm Zht H s Ama Z hr CgH s gohV Ho ~mao _| nyN>VmN>

H s & CgH mo `h _hgyg hAm {H dh AnZr Hw N> Amd`H VmAm| H mo hr nyam H a nm ahr WrO~{H CgH s Hw N> A` Amd`H VmE A^r ^r AnyU ah JB Wt &

(i) Cn w AZwN>oX go n{ m| H mo CV H aVo hE h_m H s CZ Amd`H VmAm| H mo

nhMm{ZE {Oh|dh nyam H a gH s h &

(ii) Cn w Amd`H VmAm|Ho ~mX AmZo dmbr h_m H s CZ Xmo Amd`H VmAm| H mo^r

g_PmBE Omo Cgo A^r ^r gVw> H aZr eof h & 3

Huma is working in a company on a permanent basis. As per the job

agreement she had to work for 8 hours a day and was free to work

overtime. Huma worked overtime, due to which she fell ill and had to

take leave from her work. No one showed concern and enquired about her

health. She realised that she was fulfilling only some of her needs while

some other needs still remained to be fulfilled.

(i) By quoting the lines from the above para, identify the needs ofHuma which she is able to fulfil.

(ii) Also explain two other needs of Huma followed by the above needs,

which still remained to be satisfied.

14. EH n dojH mam gn {H E OmZo dmbo Eogo {H ht VrZ H m`m] H mo g_PmBE Omo {H grgJR>Z Ho {bE A{V-Amd`H h& 3

Explain any three functions performed by a supervisor that are vital toany organization.

15. Q>mH EgM|O Ho db Am{WH d{ _| hr AnZm `moJXmZ Zht XoVm, A{nVwA` ~hV goH m gnZ H aVm h& Eogo {H ht VrZ H m`m] H mo g_PmBE & 3

Stock Exchange not only contributes to the economic growth, but

performs many other functions. Explain any three such functions.

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66/1 5 P.T.O.

16. nQ>mIo ~ZmZo dmbr EH H nZr E~rgr Ho H g {b{_Q>oS> Zo {Xdmbr Ho nyd Hw N> ZE CnmX

~mOma _| VwV {H E, {Oggo ~hV go JmhH AmH {fV hE & ~T>r hB _mJ H mo nyam H aZo Ho

{bE H nZr ZoAmg-nmg Ho CZ Jmdm|go bmoJm| H mo H m_ na {Z w {H m Ohm~hV A{YH

~oamoOJmar Wr & ~Y mam H _Mm[a`m|Ho gmW AN>o `dhma Ho H maU `mXm go `mXm

bmoJ H nZr _| H m_ H aZm MmhVo Wo & My{H CnmXm| H s ~mOma _| ~hV A{YH _mJ Wr,EH {V`moJr Zo CnmXm| H s ZH b H a br & {V`moJr Ho CnmXm| H mo Cn^mo mAm| Zo drH ma

Zht {H m `m|{H JwUdmm Ho H maU Egr~r Ho H g {b{_Q>oS> Ho CnmXm| H mo IarXZm g_mZ

H m VrH _mZm OmVm Wm &

(A) CnmX-g~Yr Cg _hdnyU {ZU` H mo nhMm{ZE Ed g_PmBE {OgHo H maU

Cn^mo mAm|Zo E~rgr Ho H g {b{_Q>oS> Ho CnmX H mo dar`Vm Xr &

(~) Eogo {H ht Xmo _y`m| H mo ^r nhMm{ZE {Oh| E~rgr Ho H g {b{_Q>oS> g_mO H mogo{fV H aZm MmhVr h & 3

ABC Crackers Ltd., a fire-cracker manufacturing company launched

some new products on the eve of Diwali in the market, which attracted

many buyers. To meet the increased demand the company employed

people from nearby villages where there is a lot of unemployment.

Because of the good behaviour of the management with the employees,

more and more people wanted to join the company. As the products were

in great demand in the market, a competitor imitated the products.The

products of the competitor were not accepted by the consumers as itwas

a status symbol to buy the products of ABC Crackers Ltd. because of

their quality.

(a) Identify and explain the product-related decision because of which

consumers preferred the products of ABC Crackers Ltd.

(b) Also identify any two values which ABC Crackers Ltd. wanted to

communicate to the society.

17. Cn^mo m gajU A{Y{Z`_, 1986Ho AVJV Cn^mo m H mo CnbY {H ht N> amhVm| H mCboI H s{OE & 3

State any six reliefs available to a consumer under the Consumer

Protection Act, 1986.

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18. Cn^mo mAm| Ho {ZZ{b{IV A{YH mam| H m dUZ H s{OE : 3

(i) Cn^mo m {ejm H m A{YH ma

(ii) M`Z H m A{YH ma

Explain the following Rights of Consumers :

(i) Right to Consumer Education

(ii) Right to Choose

19. _oJm {b{_Q>oS> dmQ>a-hrQ>g H m {Z_mU H a ahr Wr & H nZr mam BgHo gMmbZ Ho W_ df_| A{OV Am` Hodb BgH s bmJVm| H mo hr nyam H aZo Ho {bE n`m Wr & Am` H mo ~T>mZoHo {bE H nZr Zo H _ Am` Ho H maUm|H m {dbofU {H m & {dbofU Ho nMmV H nZr Zo{ZU` {b`m

(i) l_ bmJV H mo H _ H aZo Ho {bE Bg {Z_mUr BH mB H mo Eogo {nN>S>o jo _|WmZmV[aV H a {X`m OmE Ohm _OXar ~hV H _ Xa na CnbY hmo &

(ii) gmoba dmQ>a-hrQ>g H m {Z_mU ew {H m OmE Ama Yrao-Yrao {~Obr dmbo dmQ>a-hrQ>g H m CnmXZ H _ {H m OmE &

Bggo Z Ho db Omo{I_m| gogwajm {_boJr, A{nVw A` Co`m| H s ny{V _| ^r _XXhmoJr &

(A) Cn w d{UV ~Y Ho Co`m| H monhMm{ZE Ed g_PmBE &(~) Eogo Xmo _y`m| H m CboI H s{OE Omo H nZr g_mO H mo go{fV H aZm MmhVrh & 4Mega Ltd. was manufacturing water-heaters. In the first year of its

operations, the revenue earned by the company was just sufficient to

meet its costs. To increase the revenue, the company analysed the

reasons of less revenues. After analysis the company decided

(i) to reduce the labour cost by shifting the manufacturing unit to a

backward area where labour was available at a very low rate.

(ii) to start manufacturing solar water-heaters and reduce the

production of electric water-heaters slowly.

This will not only help in covering the risks, but also help in

meeting other objectives too.

(a) Identify and explain the objectives of management discussed

above.

(b) State any two values which the company wanted to communicate

to the society.

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66/1 7 P.T.O.

20. `mdgm{`H n`mdaUH s AdYmaUm VWm BgH s {H ht VrZ {deofVmAm| H mo g_PmBE & 4Explain the concept of Business Environmentand any three features of

it.

21.

^Vu Ho ~m moVm| Ho {H ht Mma bm^m| H m CboI H s{OE &4

State any four advantages of external sources of recruitment.

22. {dmr` ~Y Ho {ZdoeEd {dmr`Z{ZU`m| H m AW Xr{OE & 4Give the meaning of Investment and Financing decisions of financial

management.

23. {Z`moOZ H s {H ht nmM {deofVmAm| H m CboI H s{OE & 5State any five features of planning.

24. nyOr~mOmaAma _wm ~mOma_| {ZZ{b{IV AmYmam| na AV }X H s{OE : 5

(i) AW

(ii) VabVm(iii) gwajm

(iv) Ano{jV {V\ b

(v) Ad{Y

Differentiate between Capital Marketand Money Marketon the basis

of the following :

(i) Meaning

(ii) Liquidity

(iii) Safety

(iv) Expected Return

(v) Duration

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66/1 8

25. d`{ H {dH H m `m AW h ?EH AN>o {dHo Vm Ho {H ht VrZ JwUm| H mo g_PmBE & 5

What is meant by Personal Selling ? Explain any three qualities of a

good salesman.

26. Q>oba Ed \o mob Ho {gmV nana nyaH h & EH H m _V h {H ~Y H mo H _Mm[a`m| Ho

gmWbm^m| H m ~Q>dmam H aZm Mm{hE, O~{H Xgao H m gwPmd h {H H _Mm[a`m| H mo {Vny{V

H nZr H s CnmOZ j_Vm na {Z a hmoZr Mm{hE VWm dh Ch|n`m OrdZ Va XmZH aZo

dmbr hmoZr Mm{hE &

Cn w AZwN>oX _| Cpb{IV \o mob Ed Q>oba Ho {gmVm| H mo nhMm{ZE Ed g_PmBE & 5

Principles of Taylor and Fayol are mutually complementary. Onebelieved that the management should share the gains with the workers,

while the other suggested that employees compensation should depend on

the earning capacity of the company and should give them a reasonable

standard of living.

Identify and explain the principles of Fayol and Taylor referred to in the

above para.

27. AmnMm[aH EdAZmnMm[aH gJR>Z _| {ZZ{b{IV AmYmam|na AV }X H s{OE : 6

(i) AW

(ii) CXJ_

(iii) A{YH ma

(iv) `dhma

(v) gofU H m dmh

(vi) H {V

AWdm

EH gJR>Z _| {dHorH aUHo _hd H mo {H ht Mma {~XAm| H s ghm`Vm go g_PmBE &

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10/24

66/1 9 P.T.O.

Differentiate between formal and informal organization on the basis of

the following :

(i) Meaning

(ii) Origin

(iii) Authority

(iv) Behaviour(v) Flow of communication

(vi) Nature

OR

With the help of any four points, explain the importance of

Decentralizationin an organization.

28. {Z`moOZ Ed {ZÙ Ho _` Amngr g~Y H mo g_PmBE & 6AWdm

{ZÙ H s {H m Ho {d{^Z MaUm| H mo g_PmBE &

Explain the relationship between planning and controlling.

OR

Explain the various steps in the process of controlling.

29. H m erb nyOr H s Amd`H VmAm| H mo ^m{dV H aZodmbo Vdm| Ho n _| {ZZ{b{IV H r`m`m H s{OE : 6

(i) `dgm` H s H{V

(ii) gMmbZ Va

(iii) _mg_r KQ>H

(iv) CnmXZ MH

AWdmnyOr gaMZm Ho M`Z H mo^m{dV H aZo dmbo Vdm| Ho n _| {ZZ{b{IV H s `m`mH s{OE :(i) amoH S> dmh pW{V(ii) g_Vm H s bmJV(iii) dVZ bmJV(iv) eoà ~mOma H s XemE

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11/24

66/1 10

Explain the following as factors affecting the requirements of working

capital :

(i) Nature of business

(ii) Scale of operations

(iii) Seasonal factors

(iv) Production cycle

OR

Explain the following as factors affecting the choice of capital structure :

(i) Cash flow position

(ii) Cost of equity

(iii) Floatation costs

(iv) Stock-market conditions

30. {dnUZ Ho {ZZ{b{IV H m`m] H s `m`m H s{OE : 6

(i) CnmX H m nmH Z ({S>OmBZ) Ed {dH mg

(ii) _mnrH aU Ed loUrH aU H aZm

(iii) JmhH ghm`Vm godmE

(iv)

CnmXm| H m _y`-

{ZYmaU

AWdm

`{n {dkmnZ dVwAm| Ed godmAm| Ho dVZ Ho {bE m` A`{YH Cn`moJ _| bmE OmZo

dmbo _m`_m|_| go EH h, VWm{n `h ~hV-gr AmbmoMZmAm|H mo Am_{V H aVm h & Eogr

{H ht Mma AmbmoMZmAm|H mo g_PmBE &

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12/24

66/1 11 P.T.O.

Explain the following functions of marketing :

(i) Product designing and development

(ii) Standardization and Grading

(iii) Customer Support Services

(iv) Pricing of products

OR

Though advertising is one of the most frequently used media of

promotion of goods and services, yet it attracts lot of objections. Explain

anyfour such objections.

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1

66/1 66/2 66/3

MARKING SCHEME2013-14

BUSINESS STUDIES

OUTSIDE DELHI66/1

EXPECTED ANSWERS / VALUE POINTS

DISTRIBUTION

OF MARKS

1 12 7 Q. What is meant by Management of Work?Ans. Management of work refers to translating work in

terms of goals to be achieved and assigning the means to

achieve them.

1 mark

2 11 12 Q. What is determined by Time Study?Ans. Time study determines the standard time taken to

perform a well defined job.

1 mark

3 10 8 Q. What is included in Legal Environment of

Business? State.

Ans. Legal environment includes various legislations

passed by the government, administrative orders issued by

government authorities, court judgments and decisions

rendered by various commissions and agencies.

1 mark

4 7 11 Q. Give the meaning of Method as a type of plan.

Ans. Method is the prescribed way or manner in which a

task has to be performed considering the objective.

1 mark

5 8 10 Q. Give the meaning of Responsibility as an element

of delegation.

Ans. Responsibility is the obligation of the subordinate to

properly perform the assigned duty.

1 mark

6 9 9 Q. Define organizing as a function of management.

Ans. Organising is the process of identifying and groupingthe work to be performed, defining and delegating

responsibility and authority and establishing relationships

for the purpose of enabling people to work most

effectively together in accomplishing objectives.

(or any other correct definition)

1 mark

7 6 4 Q. How are employees motivated to improve their

performance when the organization uses internal

sources of recruitment? State.

Ans. Employees are motivated to improve their

performance when the organization uses internal sources

of recruitment as promotion at a higher level leads to achain of promotions at the lower levels in the organisation.

1 mark

8 4 3 Q. Providing for social security and welfare of

employees is one of the specialized activities

performed by Human Resource Management. Mention

any two other specialized activities of Human Resource

Management.Ans. Other specialized activities of human resource

management are: (Any two)

(i) Analysing jobs.

(ii) Recruitment.

(iii) Selection.(iv) Placement and orientation.

x 2

=

1 mark

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2

(v) Training and development of employees.

(vi) Performance Appraisal.

(vii) Developing compensation and incentive plans.

(viii) Maintaining labour relations and union management

relations.

(ix) Handling grievances and complaints.(x) Defending the company in law suits and avoiding legal

complications.

9 3 2 Q. What is meant by Decoding as an element of

communication?

Ans. Decoding means converting encoded symbols of the

sender.

1 mark

10 5 1 Q. Give any two characteristics of Organizational

Climate that influence the behaviour of individuals

and act as a non-financial incentive.

Ans. Characteristics of Organizational Climate thatinfluence the behaviour of individuals are : (Any two)

(i) Individual autonomy.

(ii) Reward orientation.

(iii) Consideration to employees.

(iv) Risk taking.

x 2=

1 mark

11 2 5 Q. What is meant by Financial Risk?Ans. Financial risk is the risk of the firm failing to meet its

payment obligations.

1 mark

12 1 6 Q. State the objective of Financial Management.

Ans. The objective of Financial Management ismaximizing shareholders wealth.

1 mark

13 15 16 Q. Huma is working in a company on a permanent

basis. As per the job agreement she had to work for 8

hours a day and was free to work overtime. Huma

worked overtime, due to which she fell ill and had to

take leave from her work. No one showed concern and

enquired about her health. She realized that she was

fulfilling only some of her needs while some other needs

still remained to be fulfilled.

(i) By quoting the lines from the above para, identifythe needs of Huma which she is able to fulfill.

(ii) Also explain two other needs of Huma followed by

the above needs, which still remained to be satisfied.

Ans. (i) Needs of Huma followed by the above needs,

which she is able to fulfill:

Physiological needs and safety/ security needs

Huma is working in a company on a permanent basis.

(ii) Needs of Huma which still remained to be satisfied are:

-Affiliation/ belongingness needs

These needs refer to the need for affection, sense ofbelonging, acceptance and friendship.

mark for

identify

cation

+

mark for

quoting the

line

= +

= 1 mark+

mark for

naming

the need

+

mark for

its explan

ation

= 1 x 2

=2marks

= 1+23marks

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15/24

3

-Esteem needs

These needs refer to the need for self respect, autonomy

status, recognition and attention.

14 16 13 Q. Explain any three functions performed by a

supervisor that are vital to any organization.

Ans. Functions performed by a supervisor are: (Anythree)

(i) Day to day contact with the workers.

(ii) Link between workers and management.

(iii) Maintains group unity.

(iv) Ensures performance of work according to targets.

(v) Provides on the job training to the workers.

(vi) Builds up high morale among the workers.

(vii) Gives feedback to the workers about their

performance.

(If an examinee has not given the headings as above but

has given the correct explanation, no marks should bededucted)

markfor the

heading

+ mark

for its

explanation

= 1 x 3

=

3 marks

15 14 15 Q. Stock Exchange not only contributes to the

economic growth, but performs many other functions.

Explain any three such functions.

Ans. Functions of a stock exchange: (Any three)

(i) Providing liquidity and marketability to existing

securities.

(ii) Pricing of securities.

(iii) Safety of transactions.

(iv) Spreading of equity cult.

(v) Providing scope for speculation.


has given the correct explanation, no marks should be

deducted)

mark

for the

heading

+ mark

for its

explanation

= 1 x 3

=

3 marks

16 13 14 Q. ABC Crackers Ltd., a fire-cracker manufacturing

company launched some new products on the eve of

Diwali in the market, which attracted many buyers. To

meet the increased demand the company employed

people from nearby villages where there is a lot ofunemployment. Because of the good behaviour of the

management with the employees, more and more

people wanted to join the company. As the products

were in great demand in the market, a competitor

imitated the products. The products of the competitor

were not accepted by the consumers as it was a status

symbol to buy the products of ABC Crackers Ltd.

because of their quality.

(a) Identify and explain the product-related decision

because of which consumers preferred the products of

ABC Crackers Ltd.(b) Also identify any two values which ABC Crackers

1/2 mark for

identification

+

1/2 mark for

its

explanation

= 1

= 1 marks

+

1 mark foreach value

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4

Ltd. wanted to communicate to the society.

Ans. (a) The product-related decision because of which

consumers preferred the products of ABC Crackers Ltd. is

Branding.

It refers to the process of giving a name, sign or a symbol

to a product to differentiate it from those of competitors.

(b) Values which ABC Crackers Ltd. wanted to

communicate to the society:

- Providing employment opportunities.

- Good behaviour in human interaction.

-Development of rural areas.

-Fulfilling social responsibility by providing quality goods.

(or any other correct value)

= 1 x 2

=2 mark

=1+2

=

3 marks

17 - - Q. State any six reliefs available to a consumer under

the Consumer Protection Act, 1986.

Ans. Reliefs available to a consumer under the ConsumerProtection Act, 1986: (Any six)

(i) To remove the defect in goods or deficiency in service.

(ii)To replace the defective product with a product free

from any defect.

(iii) To refund the price paid for the product.

(iv)To pay a reasonable amount of compensation for any

loss or injury suffered by the consumer due to negligence

of the manufacturer.

(v) To pay punitive damages in appropriate circumstances.

(vi) To discontinue this unfair/ restrictive trade practice

and not to repeat it in future.

(vii) Not to offer hazardous goods for sale.

(viii) To withdraw the hazardous goods from sale.

(ix) To cease manufacture of hazardous products.

(x) To pay any amount (not less than 5% of the value of

the defective products to be credited to the Consumer

Welfare Fund or any other organisation/person, to be

utilised in the prescribed manner.

(xi) To issue corrective advertisement to neutralize the

effect of a misleading advertisement.

(xii) To pay adequate costs to the appropriate party.(If an examinee has given only the headings, mark

for each heading should be awarded)

1/2 x 3

=

3marks

18 - - Q. Explain the following Rights of Consumers:

(i)Right to Consumer Education

(ii)Right to Choose

Ans.

(i)Right to Consumer Education

The consumer has the right to acquire knowledge about his

rights and the reliefs available to him to be well informed.

(ii)Right to Choose

The consumer has the freedom to choose from a variety ofproducts offered by the marketers at competitive prices.

1

+

1

=

3marks

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17/24

5

19 22 21 Q. Mega Ltd. was manufacturing water-heaters. In

the first year of its operations, the revenue earned by

the company was just sufficient to meet its costs. To

increase the revenue, the company analysed the reasons

of less revenues. After analysis the company decided(i) to reduce labour cost by shifting the manufacturing

unit to a backward area where labour was available at

a very low rate.

(ii) to start manufacturing solar water-heaters and

reduce the production of electric water-heaters slowly.

This will not only help in covering the risks, but also

help in meeting other objectives too.

(a) Identify and explain the objectives of management

discussed above.

(b) State any two values which the company wanted to

communicate to the society.Ans. (a) The objectives of management referred to are:

Organisational objectives

These refer to the utilisation of human and material

resources considering the interest of all stakeholders.

(b) Social objectives

These refer to the creation of benefit for various

constituents of the society.

(If an examinee has explained survival and growth as

objectives of management instead of organisational

objectives, full credit is to be given)

(ii) Values which the company wanted to communicate to

the society are:

(a) Providing employment opportunities.

(b) Development of backward regions.

(c) Concern for the environment.

(or any other correct value)

mark for

identification+

mark for

its

explanation

= 1+1

= 2 marks

+

1 mark for

each value

= 1 x 2

=2 mark=2+2

=

4 marks

20 21 22 Q. Explain the concept of Business Environment and

any three features of it.

Ans. Business Environment refers to the sum total of all

individuals, institutions and other forces that are outsidethe control of the business enterprise but that may affect its

performance.

Features of business environment: (Any three)

(i) Totality of external forces.

(ii) Includes specific and general forces.

(iii) Inter-relatedness.

(iv) Dynamic.

(v) Uncertain.

(vi) Complex.

(If an examinee has not given the headings as above buthas given the correct explanation, no marks should be

1 mark for

the concept

+

markfor

each heading

+

mark for

its

explanation

= 1 x 3

3 marks

=1+3

=

4 marks

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18/24

6

deducted)

21 19 20 Q. State any four advantages of external sources of

recruitment.

Ans. Advantages of external sources of recruitment: (Any

four)(i) The management can attract qualified and trained

people to apply for vacant jobs in the organisation.

(ii) The management has a wider choice while selecting

the right candidate.

(iii) External sources bring fresh talent in the organisation.

(iv) External sources encourage competitive spirit among

the existing staff.

(If an examinee has given only the headings, mark


1 x 4

=

4 marks

22 20 19 Q. Give the meaning of Investment and Financing

decisions of financial management.Ans. The investment decision refers to how the firms

funds are invested in different assets to earn the highest

possible return for the investors.

It can be long term or short term.

Financing decision is about the quantum of finance to be

raised from various long-term sources and the proportion

in which they may be raised.

The sources are debt and/or equity.

2 + 2

=

4 marks

23 - - Q. State any five features of planning.

Ans. Features of planning are: (Any five)

1. Planning focuses on achieving organisational objectives.

2. Planning is the primary function of management as it

lays down the basis for all other functions of management.

3. Planning is pervasive as it is required in all

organisations, at all levels and in all departments.

4. Planning is continuous because a plan is framed,

implemented and is followed by another plan.

5. Planning is futuristic as it involves looking ahead andpreparing for the future.

6. Planning involves decision making as it involves a

choice from among the various alternative courses of

action.

7. Planning is a mental exercise as it is intellectual activity

of thinking rather than doing.

8. Planning provides the basis for controlling by providing

standards.

(If an examinee has given only the headings, mark


1 x 5=

5 marks

24 - - Q. Differentiate between Capital Market and Money

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Market on the basis of the following:

(i) Meaning

(ii) Liquidity

(iii) Safety

(iv) Expected Return

(v) DurationAns. DISTINCTION BETWEEN CAPITAL MARKET

AND MONEY MARKET

Basis CAPITAL

MARKET

MONEY

MARKET

(i) Meaning It refers to the

facilities and

institutional

arrangements

through which

funds, both debtand equity are

invested and

raised.

It is the market

where low risk,

unsecured, highly

liquid short term

debt instruments

are issued andtraded.

(ii) Liquidity Capital market

securities are

comparatively

less liquid.

Money market

securities are

comparatively

more liquid.

(iii) Safety Capital market

instruments are

riskier both with

respect to returns

and principalrepayment.

Money market

instruments are

generally much

safer with a

minimum risk ofdefault.

(iv) Expected

return

The investment in

capital markets

generally yields a

higher return.

The expected rate

of return of the

money market is

less.

(v) Duration The capital

market deals in

medium and long

term securities.

Money market

deals in short term

securities having a

maximum tenure

of one year.

1 x 5

=

5marks

25 23 24 Q. What is meant by Personal Selling? Explain any

three qualities of a good salesman.

Ans. Personal Selling means oral presentation of message

in the form of conversation with prospective customers for

the purpose of making a sale.

Qualities of a good salesman: (Any three)(i) Physical qualities.

2 marks for

the meaning

+

( mark foreach heading

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(ii) Psychological qualities.

(iii) Good behavior.

(iv) Technical quality.

(v) Good communication skills.

(vi) Honesty.

(vii) Courtesy.(viii) Persistence.

(ix) Capacity to inspire trust.

(x) Good mentally health.


has given the correct explanation, no marks should be

deducted)

+ mark

for each

explanation

=1 x 3

= 3 marks)

=2+3=5 marks

26 24 23 Q. Principles of Taylor and Fayol are mutually

complementary. One believed that the management

should share the gains with the workers, while other

suggested that employees compensation should dependon the earning capacity of the company and should give

them a reasonable standard of living.

Identify and explain the principles of Fayol and Taylor

referred to in the above para.Ans. The principle of Fayol referred to in the above para is

Remuneration:

It states that the overall pay and compensation should be

fair to both the employees and the organisation. The

employees should be paid fair wages which should give

them a reasonable standard of living.

The principle of Taylor referred to in the above para is

Harmony not discord.

It advocates that there should be complete harmony

between management and the workers. There should be

complete mental revolution on the part of both

management and workers.

1 mark foridentification

+

1 marks

for its

explanation

=

2 + 2

=

5marks

27 - - Q. Differentiate between formal and informal

organization on the basis of the following:

(i) Meaning

(ii) Origin(iii) Authority

(iv) Behaviour

(v) Flow of communication

(vi) Nature

Ans.

DIFFERENCE BETWEEN FORMAL AND INFORMAL

ORGANIZATION

Basis Formal

Organisation

Informal

Organisation

(i) Meaning Formalorganisation

Informalorganisation is a

1 x 6=

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refers to the

organisation

structure which is

designed by the

management to

accomplish aparticular task.

network of

personal and

social relations

arising

spontaneously as

people associatewith one another.

(ii) Origin It arises as a

result of

companys rules

and policies.

It arises as a

result of social

interaction.

(iii) Authority It arises by virtue

of position in

management.

It arises out of

personal qualities.

(iv) Behaviour It is directed by

rules.

There is no set

behaviour pattern.

(v) Flow of

communication

Communication

takes place

through the scalar

chain.

Communication

can take place in

any direction.

(vi) Nature Its structure is

rigid in nature.

Its structure is

flexible in nature.

Or

Q. With the help of any four points, explain the

importance of Decentralization in an organization.Ans. Importance of Decentralisation:( Any four)

(i) Develops initiative amongst subordinates.(ii) Develops managerial talent for the future.

(iii) Leads to quick decision making.

(iv) Gives relief to top management.

(v) Facilitates growth.

(vi) Facilitates better control.


has given the correct explanation, full credit should be

given)

6 marks

OR

mark for

heading

+ 1 mark

for

explanation

= 1 x 4

=

6marks

28 28 27 Q. Explain the relationship between planning and

controlling.Ans. Relationship between planning and controlling:

There is a close and reciprocal relationship between

planning and controlling because:

1. Controlling is blind in the absence of standards which

are provided by planning;

2. Planning without controlling is meaningless as

controlling ensures that the events conform to the plans.

3. Planning prescribes an appropriate course of action for

achieving objectives whereas controlling evaluates

whether decisions have been translated into desired

actions.4. Planning and controlling are both forward-looking and

1 x 4

=

6 marks

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looking back.

(Note: If the answer covers the above points in any

other form, full credit should be given)

OR

Q. Explain the various steps in the process ofcontrolling.

Ans. Steps in the process of controlling:

(i) Setting performance standards.

(ii) Measurement of actual performance.

(iii) Comparison of actual performance with the standards

and analysing deviations.

(iv) Taking corrective action.

(If an examinee has combined or written separately any

of the above stated points but covered all points in

order, full credit to be given.)

(If an examinee has not given the headings as above buthas given the correct explanation, no marks should be

deducted)

OR

mark for

each heading

+

1 mark for

each

explanation

=

1 x 4

=

6 marks

29 - - Q. Explain the following as factors affecting the

requirements of working capital:




(iv) Production cycle

Ans. Factors affecting the requirements of working capital:


Trading organisations require lesser working capital than

manufacturing organisations as there is no processing

involved; service industries require the least working

capital as they do not have to maintain inventory.


Organisations which operate on a higher scale require

more working capital as the quantum of inventory and

debtors required is high.


During peak season, larger amounts of working capital is

required because of higher level of activity.(iv) Production cycle

Businesses with a longer production cycle require more

working capital as there is more time gap between the

receipt of raw materials and their conversion into finished

goods.

OR

Q. Explain the following as factors affecting the choice

of capital structure:

(i) Cash flow position(ii) Cost of equity

1 x 4

=

6 marks

OR

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(iv) Stock-market conditionsAns. Factors affecting the choice of capital structure:

(i) Cash flow position

A stronger cash flow position makes debt funding more

viable.(ii) Cost of equity

A company can use debt only upto a certain limit as higher

debt increase the cost of equity which may lead to a

decrease in share price inspite of increased earning per

share.


Raising funds through equity requires a higher floatation

cost than raising debt.

(iv) Stock-market conditions

Raising funds through equity is preferred if the stock

markets are bullish while during a bearish phase, thecompany may opt for debt.

1 x 4

=

6 marks

30 27 28 Q. Explain the following functions of marketing:

(i) Product designing and development



(iv) Pricing of products

Ans. (i) Product designing and development

Product designing and development helps to make the

product attractive to the target customers. A good design

can improve performance of a product and also give it a

competitive advantage in the market.


Standardisation ensures uniformity and consistency in

output reducing the need for inspection and testing of the

products. Grading ensures that the goods belong to a

particular quality and helps in realising higher prices for

better quality products.


This includes services like after sales services, handling

customer complaints and grievances, maintenance

services, technical services etc.(iv) Pricing of products

Pricing involves crucial decisions like setting the pricing

objectives, determining the pricing strategies, fixing the

price etc.

OR

Q. Though advertising is one of the most frequently

used media of promotion of goods and services, yet it

attracts lot of objections. Explain any four such

objections.

Ans. Though advertising is one of the most frequently usedmedium of promotion of goods and services, yet it attracts

1 x 4

=

6marks

OR

mark foreach heading

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lot of objections which are: (Any four)

(i) Adds to Cost:

Advertising unnecessarily adds to the cost of the product,

which is ultimately passed on to the buyers in the form of

high prices.

(ii) Undermines Social Values:Advertising undermines social values and promotes

materialism and discontent among people.

(iii) Confuses the Buyers:

There are so many products being advertised that the buyer

gets confused as to which one should he buy.

(iv) Encourages Sale of Inferior Products:

Advertising does not distinguish between superior and

inferior products and persuade people to purchase even the

inferior products.

(v) Some Advertisements are in Bad Taste:

Another criticism against advertising is that someadvertisements are in bad taste. They may not be approved

by the society in general.

+

1 mark for

each

explanation

= 1 x 4

=

6marks.

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cbse 2014 question paper for class 12 business studies - outside delhi

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