Students can access the CBSE Sample Papers for Class 12 Business Studies with Solutions and marking scheme Term 2 Set 8 will help students in understanding the difficulty level of the exam.
CBSE Sample Papers for Class 12 Business Studies Term 2 Set 8 with Solutions
Time allowed: 2 Hours
Maximum Marks: 40
General Instructions:
- This is a Subjective Question Paper containing 12 questions.
- This paper contains 4 questions of 2 marks each, 4 questions of 3 marks each and 4 questions of 5 marks each.
- 2 marks questions are Short Answer Type Questions and are to be answered in 30-50 words.
- 3 marks questions are Short Answer Type Questions and are to be answered in 50-80 words.
- 5 marks questions are Long Answer Type Questions and are to be answered in 80-120 words.
- This question paper contains Case/Source Based Questions.
Question 1.
Lailah Trends Ltd adopted several ways of training to improve the quality and quantity of output and provide job satisfaction
(A) Mr. Sameuls was asked to work with an expert for a specific time period so that he can learn by observations.
(B) Ms. Banerjee was provided study material so that she goes through these units by answering the questions and fill in the blanks.
Identify which techniques of training were used and for whom by Lailah Trends Ltd. (2)
Answer:
(A) The technique of training used for Mr.sameuls is coaching.
(B) The technique of training used for Ms. Banerjee is Programmed instructions.
Question 2.
Name and explain the “on the job” method of training that is used to give training to plumber.(2)
Answer:
Apprenticeship training is given to plumber. Apprenticeship programmes put the trainee under the guidance of a master worker. These are designed to acquire a higher level of skill
Question 3.
Prakash Limited is a company manufacturing electrical goods. Mrs Renu is its managing director. By virtue of her wise direction, the company has achieved great heights. Management institute one day invited her for a lecture. There she got an opportunity to dialogue with the student of Management Studies. She narrated to them the story of her success. She told them two main things first employees should know that their work is being evaluated and progress reports prepared. Second, optimum use of human and physical resource should be made possible.
On the basis of the above case state any two points of importance of controlling function. (2)
Answer:
The two points that highlight the importance of the controlling function are as follows:
(1) Judging accuracy of standards: The controlling function helps the business managers to judge the objectivity and accuracy of the current standards. It also assists in reviewing and revising the standards keeping in view of the forthcoming changes in both the internal and external environment of the business.
(2) Improving employee motivation: The controlling function seeks to motivate the employees and helps them to give better performance. This is because it makes them aware well in advance about what they are expected to do and what the standards of performance are, on the basics of which they will be judged.
Question 4.
‘Mission Coach Ltd.’ is a large and creditworthy company manufacturing coaches far 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. Name and explain the money-market instrument the company can use far the above purpose.
Answer:
The company can us Commercial paper for the purpose. It is an instrument issued by large and credit worthy companies to raise short term funds at lower rates of interest than the market rates. It is an unsecured, negotiable promissory note with a fixed maturity period.
Question 5.
Gaspe Ltd. is a large manufacturing unit.
Recently, the company has conducted time and motion studies and concluded that on an average, a worker could produce 500 units per day. However it has been noticed that the average daily production of worker is in the range of 300-350 units. (3)
Answer:
The management function, in this case, is controlling which is a systematic process involving comparisons, measurement and evaluation of organisational goals. The step involved in the case is ‘Comparing actual performance with standards’ which means comparing the actual performance with the set standards.
The time and motion studies determined that the standards set were 500 units per day per worker but the average actual performance per worker is in the range of 300-350 units per day. Thus, the need for action = Desired performance – Actual performance = 500-300/350 units = 200/150 units. This means that the company produces 150-200 units less per day per worker.
Based on the step of comparing results with standards, the next step the company under take will be’ Analysing Deviations’. This step is a study of determining the reasons for the variations of 150-200 units per day per worker from the set standards of 500 units per day per worker. The company will identify certain critical points in the production process that are important for timely completion of work.
The issues within the critical points of production processes are determined and analysed for understanding the nature of causes for deviations. If required, the management can control the issues by exception if the deviations are of urgent nature.
Following these analyses, the company will take the final step to take necessary action to correct problems or make improvements. These corrective actions attempt to increase the output of the workers by motivation and other incentives.
Question 6.
Sudershan Agro Ltd. wants to modernise its plants and machinery. To fulfill its capital requirements, the company decides to make a public issue of shares. Explain two different methods which the company may adopt for the new public issue of shares. (3)
Answer:
The market for the new issues of shares is known as primary market It deals with new securities being issued for the first time. The essential function of a primary market is to facilitate the transfer of investible funds from savers to entrepreneurs seeking to establish new enterprises or to expand existing ones through the issue securities for the first time. The various methods of floating new issues in the primary market are: (any two)
(1) Offer through prospectus: Offer through prospectus is the most popular method of raising funds by public companies in the primary market A prospectus makes a direct appeal to investors to raise capital, through an advertisement in newspapers and magazines.
(2) Offer for sale: Under this method, securities are not issued directly to the public but are offered for sale through intermediaries like issuing houses or stock brokers.
(3) Private placement: Private placement is the allotment of shares by a company to institutional investors or some selected individuals. It helps to raise capital more quickly than a public issue.
(4) Rights issue: This is a privilege given to existing shareholders to subscribe to a new issue of shares according to the terms and conditions of the company.
(5) E-IPOs: A company proposing to issue capital to the public through the online system of the stock exchange has to enter into an agreement with the stock exchange. This is called an Initial Public Offer (IPO).
Question 7.
Name and explain the function of management which initiates actions. State any two points of importance of this function of management.(3)
Answer:
The process of acquiring human resources and physical assets and placing them under suitable roles and responsibilities should be directed towards achieving organisational goals. Directing or direction is the essence of all operations in an organisation that involves leading human and physical resources together through motivation, collaboration, coordination and delegation.
The points of importance of directing are: (any two)
(1) Initiates action: Direction initiates action based on the preconditions set under planning, organising and staffing. This implies that managers stimulate actions by supervising, motivating and leading their subordinates in the right way. Direction activates employees to work for achieving organisational goals.
(2) Integrates employees’ efforts: The work and activities of employees across all levels are interrelated and direction attempts to integrate all individual efforts. Individual efforts are integrated through coordination between plans, resources and human efforts and through guidance, supervision and counselling.
(3) Means of motivation: Organisational goals can be achieved by motivated employees who work willingly and perform to their best of their abilities. Directing helps in motivating employees to contribute their maximum efforts towards achieving organisational goals.
(4) Facilitates changes: Direction enables an organisation to adapt to changing conditions through better leadership and communication.
Question 8.
Identity and explain the elements of directing mentioned below.
(A) Astha, a manager, has the ability to influence others to bring about a change in their behaviour.
(B) Neeraj, a managing director, declares share in the profits to the manager for their contribution to increase profits of the company.
OR
State the steps in selection procedure, after the employment interview but before the job offer. (3)
Answer:
(A) Leadership: Leadership is the process of influencing the behaviour of people by making them strive voluntarily towards achievement of organisational goals. Leadership indicates the ability of an individual to maintain good interpersonal relations with followers and motivate them to contribute for achieving organisational objectives.
(B) Motivation: Motivation means incitement or inducement to act or move. In the context of an organisation. It means the process of making subordinates to act in a desired manner to achieve certain organisational goals.
OR
The steps in selection procedure, after the employment interview but before the job offer are as follows:
Reference and Background Checks: Many employers request names, addresses, and telephone numbers of references for the purpose of verifying information and, gaining additional information on an applicant. Previous employers, known persons, teachers and university professors can act as references.
Selection Decision: The final decision has to be made from among the candidates who pass the tests, interviews and reference checks. The views of the concerned manager will be generally considered in the final selection because it is he/she who is responsible for the performance of the new employee.
Medical Examination: After the selection decision and before the job offer is made, the candidate is required to undergo a medical fitness test The job offer is given to the candidate being declared fit after the medical examination.
Question 9.
Which function of management helps in obtaining right people and putting them on the right jobs. Explain four points of importance of this function.
OR
Veronica Ltd. is a large manufacturing unit. Recently, the company has conducted time and motion studies and concluded that on an average, a worker could produce 500 units per day. However it has been noticed that the average daily production of worker is in the range of 300-350 units.
(a) Name the function of management and identify the step in the process of this function which helped in finding out that the actual production of a worker is less than the set target.
(b) To complete the process of the function identified in question (a) and to ensure the performance as per time and motion studies, explain what further steps a manager has to take? (5)
Answer:
The function of management which helps in obtaining right people and putting them on the right jobs is staffing. Staffing is “putting people to jobs’. It begins with workforce planning and includes different other function like recruitment, selection, training, development, promotion, compensation and performance appraisal of workforce.
In other words, staffing is that part of the process of management which is concerned with obtaining, utilising and maintaining a satisfactory and satisfied work force.
Proper staffing ensures the following benefits to the organisation: (any four)
- It helps in discovering and obtaining competent personnel for various jobs;
- It Makes for higher performance, by putting right person on the right job;
- It ensures the continuous survival and growth of the enterprise through the succession planning for managers;
- It helps to ensure optimum utilisation of the human resources. By avoiding overmanning, it prevents under -utilisation of personnel and high labour costs. At the same time it avoids disruption of work by indicating in advance the shortages of personnel; and
- It improves job satisfaction and morale of employees through objective assessment and fair reward for their contribution.
OR
(a) The management function, in this case, is controlling which is a systematic process involving comparisons, measurement and evaluation of organisational goals. The step involved in the case is ‘Comparing actual performance with standards’ which means comparing the actual performance with the set standards.
The time and motion studies determined that the standards set were 500 units per day per worker but the average actual performance per worker is in the range of 300-350 units per day.
Thus, the need for action = Desired performance – Actual performance = 500-300/350 units = 200/150 units. This means that the company produces 150-200 units less per day per worker.
(b) Based on the step of comparing results with standards, the next step the company undertake will be ‘ Analysing Deviations’. This step is a study of determining the reasons for the variations of 150-200 units per day per worker from the set standards of 500 units per day per worker. The company will identify certain critical points in the production process that are important for timely completion of work. The issues within the critical points of production processes are determined and analysed for understanding the nature of causes for deviations. If required, the management can control the issues by exception if the deviations are of urgent nature. Following these analyses, the company will take the final step to take necessary action to correct problems or make improvements. These corrective actions attempt to increase the output of the workers by motivation and other incentives.
Question 10.
State the steps which are involved in the screen-based trading for buying and selling of securities in the secondary market. (5)
Answer:
The following are the first four steps in the screen based trading for buying and selling of securities in the secondary market:
(1) The investor has to approach a registered broker or sub-broker and sign a broker client agreement and a client registration form before placing an order to buy or sell securities
(2) The investor has to open a “demat” account or “beneficial owner” account with a depository participant for holding and transferring securities in the demat form.
(3) The investor then places an order with the broker to buy or sell shares, the broker will go ahead with the deal and issue the order confirmation slip to the investor.
(4) The broker then will go on-line and connect to the main stock exchange and match the share and best price available.
Question 11.
Raghav Agro Ltd. has started manufacturing biocompost useful for organic farming and has set up a unit at Nasik. Due to increasing demand of organic forming in the country, the company is unable to meet the demands of the market. It is planning to set up a second unit at Kolhapur. The finance manager estimates that it will require rs.150 crores for the set-up and rs. 25 crores for working capital to start the second unit. As a highly capital intensive industry, what factors will affect the fixed and working capital? (5)
Answer:
The factors that affect requirements of fixed and working capital in a company include:
(1) Growth prospects: As Raghav Agro Ltd.’s products made by biocompost will have high demand, Raghav Agro Ltd. will have higher growth prospects and will require working capital in the short-run and fixed capital in the long-run.
(2) Scale of operation: Biocompost production is highly capital intensive and will require huge amount of fixed capital.
(3) Availability of raw material: Raw materials required are yard wastes which are not expensive but are not easily available. Accordingly, working capital will be high as Raghav Agro Ltd. will have large inventories for a specific time period to cater to the demand.
(4) Nature of business: Raghav Agro Ltd.’s biocompost production unit is highly capital intensive and will take more time to convert inventory of raw materials into finished goods. Thus, the fixed and working capital requirements of Raghav Agro Ltd. will be high.
Question 12.
“Any person who buys any goods for a consideration is called a consumer.” What are the different ways in which a ‘consumer’ is defined as per the provisions of Consumer Protection Act, 1986?
OR
Mr Rohan purchased a new motorbike for rupees 2 lakh and his friends Mr Hamir purchased a new car for rupees 25 lakh. After a few days it was found that motorbike and car both were defective. They are thinking to whom they should complain about it. Suggest them the solution to their problem.
Answer:
Under the Consumer Protection Act,1986 a consumer is defined as:
(1) Any person who buys any goods for a consideration, which has been paid or promised, or partly paid and partly promised, or under any scheme of deferred payment It includes any user of such goods, when such use is made with the approval of the buyer, but does not include a person who obtains goods for re-sale or any commercial purpose.
(2) Any person who hires or avails of any service, for a consideration which has been paid or promised, or partly paid and partly promised, or under any system of deferred payment. It includes any beneficiary of services when such services are availed of with the approval of the person concerned, but does not include a person who avails of such services for any commercial purpose.
Rohan should file his complaint with district forum. A complaint can to be made to the appropriate District Forum when the value of the goods or services in question, along with the compensation claimed, does not exceed ₹20 lakhs.
In case the aggrieved party is not satisfied with the order of the District Forum, he can appeal before the State Commission within 30 days of the passing of the order. Hamir should file his complaint with state forum. A complaint can to be made to the appropriate State Commission when the value of the goods or services in question, along with the compensation claimed, exceeds ₹20 lakhs but does not exceed ₹1 crore. The appeals against the orders of a District Forum can also be filed before the State Commission.