Students can access the CBSE Sample Papers for Class 12 Business Studies with Solutions and marking scheme Term 2 Set 9 will help students in understanding the difficulty level of the exam.
CBSE Sample Papers for Class 12 Business Studies Term 2 Set 9 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.
It is a process of stimulating people to action to accomplish desired goals. Identify and state two features of the process as an element of Directing. (2)
Answer:
Motivation means is a incitement or inducement to act or move. It process of stimulating people to action to accomplish desired goals.
The features of motivation as element of directing are as follows: (any two)
(1) It is an internal feeling: An urge, drives or needs of human-being, which are internal but likely to influence human behaviour. These urges are internal to an individual
(2) It produces goal directed behaviour: Motivated employees is likely to act in a desired manner and contribute effectively.
(3) It can be either positive or negative: Positive motivation provides positive rewards. This can be provided through rewards like increase in pay, promotion, recognition etc. Negative motivation involves use of negative means or rewards like punishment, stopping increments, threatening etc. which also may prompt a person to act in the desired way.
(4) It is a complex process: Because any type of organisation may not have uniform effect on all the members. Individuals are heterogeneous in their expectations and perceptions.
Question 2.
“Supervision is the process of guiding the efforts of employees and other resources to ensure optimum utilisation of resources and achievement of work targets”. Explain any two role performed by supervisor in an organisation. (2)
Answer:
Supervision is the process of guiding the efforts of employees and other resources to accomplish the desired objectives. It means overseeing what is being done by subordinates and giving instructions to ensure optimum utilisation of resources and achievement of work targets.
The roles performed by a supervisor are as follows: (any two)
- Supervisor maintains day-to-day contacts and friendly relations with the workers. He acts as a guide, friend and philosopher to the workers.
Supervisor acts as a link between workers and management He conveys management ideas of the workers on one hand and workers problems to the management on the other.
Supervisor play a key role in maintaining group unity among workers placed under his control - Supervisor ensure performance of work according to the targets set
- Supervisor provides good on-the-job training to the workers and employees.
- Supervisory leadership plays a key role in influencing the workers in the organisation.
- A good supervisor analyses the work performed and gives feedback to the workers.
Question 3.
This function of management is considered as the post mortem of past activities’. Explain. (2)
Answer:
Controlling is looking back as it is like a post-mortem of past activities to find out deviations from the standards established. Controlling is done with an aim to check the factors responsible for poor performance or deviation in the actual performance, so that such mistakes are not repeated in future and the organisation can achieve its predetermined objectives.
Question 4.
“Unicon Securities Pvt. Ltd’ was established to deal in securities. It was registered as a stock broker with National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) to trade in securities listed at these exchanges. It is also a depository participant with CDSL and NSDL In the first three years, it developed its business successfully.
After that the composition of Board of Directors changed. Some customers complained to the customer care centre of the company that shares purchased by them and for which the payment has been duly made, were not transferred to their Demat Accounts by, Unicon securities Pvt. Ltd’ .
The executive of customer care centre promised the aggrieved customers that their shares will be transferred to their respective D’mat Accounts very soon. But the company delayed the matter and didn’t transfer the shares of the customers to their D’mat Accounts. This eroded investors” confidence and multiplied their grievances.
(A) Identify the step of trading procedure in a stock exchange which has not been followed by Unicon Securities Pvt. Ltd.
(B) Name the Apex statutory body of capital market to whom customer can complain to redress their grievances. (2)
Answer:
(A) Delivery of shares in Demat form directly to investors Demat Account by the broker.
(B) The Securities and Exchange Board of India (SEBI)
Question 5.
Which source of recruitment should be adopted to boost morale of the existing employees?
OR
Ruby International is a diamond jewellery manufacturing company based in Surat. There is international demand of company’s jewellery and as such the company is earning huge profits as well Apart from sharing profits with the shareholders, the company also take care of its employees. To boost the morale of its employees, the company decided to increase the fringe benefits like car allowance, foreign trips etc.
These are in addition to basic incentives, regular increments in salaries every year. For the elderly members of the organisation, the company decided to include gratuity in addition to the already given benefits like pension and provident fund. The company also decided to give company’s shares at price lower than the market price to the employees on achieving their set targets. Which financial incentives have been highlighted in this case? (3)
Answer:
Internal source of recruitment should adopted to boost morale of the existing employees. There are two important sources of internal recruitment namely, transfers and promotions, which are discussed below:
(1) Transfers: It involves shifting of an employee from one job to another, one department to another or from one shift to another, without a substantive change in the responsibilities and status of the employee. It may lead to changes in duties and responsibilities, working condition etc., but not necessarily salary. Transfer is a good source of filling the vacancies with employees from over-staffed departments. It is practically a horizontal movement of employees.
(2) Promotions: Business enterprises generally follow the practice of filling higher jobs by promoting employees from lower jobs. Promotion leads to shifting an employee to a higher position, carrying higher responsibilities, facilities, status and pay.
Promotion is a vertical shifting of employees. This practice helps to improve the motivation, loyalty and satisfaction level of employees. It has a great psychological impact over the employees because a promotion at the higher level may lead to a chain of promotions at lower levels in the organisation.
OR
The financial incentives highlighted in this case are:
(1) Pay and allowances: The employees are happy as they get their salaries timely, their basic incentive, and they are also supported by regular increments in their salaries every year. Here the company is also giving dearness allowance which is a yearly increase in the salary overcoming the impact of inflationary forces.
(2) Perquisites: The company, however, has decided to increase the fringe be refitted like car allowance, foreign trips, etc. One more thing one needs to understand is the difference between perquisites and allowances, where allowances are paid directly in the form of money, perquisites are the benefits given which have their own monetary value, for example a trip to Malaysia funded by the company is a fringe benefit or a perquisite.
(3) Retirement benefits: For the elderly members of the organisation, the company has decided to include gratuity in the list of benefits along with already given benefits like pension and provident fund.
(4) Co-partnership/Stock option: It is about providing company’s shares at a price lower than the market price. All these steps will lift the morale of the employees.
Question 6.
How does recruitment take place through employment exchange and labour contractor? (3)
Answer:
Employment Exchange: Employment exchanges run by the Government are regarded as a good source of recruitment for unskilled and skilled operative jobs. In some cases, compulsory notification of vacancies to employment exchange is required by law.
Thus, employment exchanges help to match personnel demand and supply by serving as link between job-seekers and employers. Unfortunately, the records of employment exchange are often not up to date and many of the candidates referred by them may not be found suitable.
Labour Contractors: Labour contractors maintain close contacts with labourers and they can provide the required number of unskilled workers at short notice. Workers are recruited through labour contractors who are themselves employees of the organisation. The disadvantages of this system are that if the contractor himself decides to leave the organisation, all the workers employed through him will follow suit.
Question 7.
A company was manufacturing solar panels for charging of mobiles, which were in great demand. It was found that target of producing 500 solar panels a day was not met by the employees. On analysis, it was found that the workers were not at fault. Due to non availability of raw materials, the company was not able to achieve set targets and alternative arrangements were needed.
(A) Identify the function of management discussed above.
(B) State the steps in the process of the function identified which are discussed in the above paragraph.
Answer:
(A) The function of management discussed above is controlling.
(B)The steps in the process of controlling identified in the above paragraph are:
(1) Setting standards of performance: The first step in controlling process is.
setting up performance standards. The company has set a target of producing 500 solar panels.
(2) Measurement of actual performance: Once performance standards are set, -the next step is measuring actual performance. On analysis, it was found that targets were not met by the employees
(3) Comparing actual performance: After the actual performance is measured, it can be compared with the pre-defined standards. This helps in assessing whether there are any deviations / deficiencies in performance.
(4) Analysing deviations: With the comparison of the actual performance with set standards, deviations in performance are identified.
Question 8.
Kynaa, a beauty products e-commerce company, is diversifying into men’s grooming. It is also tapping the demand for beauty products in the fashion industry and amid professionals such as make-up artists. As it diversifies its online presence, Kynaa is also expanding it physical presence. They have 41 outlets across 18 cities presently and plan to expand to 180 outlets. Each store requires a capital expenditure of ₹60-80 lakh.
The company has decided to raise funds by issuing equity shares but not directly to the public, rather by offering them for sale through brokers. Identify and briefly explain the method of floatation followed by the company. Also name and explain the other methods of floatation that can be used by the company for raising funds from the public, in the primary market.
Answer:
Method of floatation used is offer for sale- In this method securities are not offered directly to the public but are offered for sale through intermediaries like stock brokers.
The other methods of floatation that can be used by the company for raising funds are:
- Offer through prospectus: This method involves inviting subscription from public through prospectus. The issue may be underwritten & has to be listed with one stock exchange.
- E-IPO: A company proposing to issue capital to the public through online system of stock exchange.
Question 9.
“Communication is transfer of information from the sender to the receiver with the information being understood by the receiver”. In the light of this statement explain various elements of communication.
OR
Sam India Ltd. is a company dealing in FMCG. Its products are in great demand. As a result, the employees in the marketing department are always racing against time. The employees have to work overtime and on holidays to cater to the demand. Managers in the marketing department are under stress as they have to handle more than two territories. The work stress has led to dissatisfaction among the employees and managers.
(A) Name the step of staffing process which has not been performed properly.
(B) State the next two stages immediately following the step identified in part ‘i’.(5)
Answer:
Communication has been defined as a process. This process involves elements like source, encoding, media/channel, receiver, decoding, noise and feedback.
The various elements of communication are:
(1) Sender: Sender means person who conveys his thoughts or ideas to the receiver. The sender represents source of communication.
(2) Message: It is the content of ideas, feelings, suggestions, order, etc., intended to be communicated.
(3) Encoding: It is the process of converting the message into communication symbols such as words, pictures, gestures etc.,
(4) Media: It is the path through which encoded message is transmitted to receiver. The channel may be in written form, face to face, phone call, Internet etc.,
(5) Decoding: It is the process of converting encoded symbols of the sender.
(6) Receiver: The person who receives communication of the sender.
(7) Feedback: It includes all those actions of receiver indicating that he has received and understood message of sender.
(8) Noise: Noise means some obstruction or hindrance to communication. This hindrance may be caused to sender, message or receiver.
OR
(A) In the above case “Estimation of manpower requirements” is not done properly.
(B) The next two stages immediately following the step Estimation of manpower requirement are as follows-
Recruitment: Recruitment may be defined as the process of searching for prospective employees and stimulating them to apply for jobs in the organisation. The information generated in the process of writing the job description and the candidate profile may be used for developing the ‘situations vacant’ advertisement.
Selection: Selection is the process of choosing from among the pool of the prospective job candidates developed at the stage of recruitment.
Even in case of highly specialised jobs where the choice space is very narrow, the rigour of the selection process serves two important purposes:
(i) it ensures that the organisation gets the best among the available, and
(ii) it enhances the self-esteem and prestige of those selected and conveys to them the seriousness with which the things are done in the organisation.
Question 10.
Swastik Fragrances Ltd. is a large credit worthy company that manufactures and exports incense stick and perfumes. The company is exporting its products to Middle East countries and plans to expand its exports to European countries. The company has recently received a huge export order. Since the order is huge, it needs some short term finance. To meet its requirements, 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. (5)
Answer:
(A) The money market instrument that a company can use for this purpose is commercial paper. Commercial paper is a short-term unsecured, negotiable, promissory note with a fixed maturity period which is issued by large and creditworthy companies to raise short term funds at lower rates of interest than the prevailing market rates.
(B) The duration for which the company can get funds through this instrument is 15 days to one year.
(C) It can also be used to meet the short-term seasonal and working capital requirements of a business enterprise. Funds raised through commercial paper can also be used to meet the floatation cost This is known as Bridge financing.
Question 11.
‘G. Motors’ is the manufacturer of sophisticated cranes. The Production manager of the company, reported to the Chief Executive Officer, Ashish Jain that one of the machines used in manufacturing sophisticated cranes had to be replaced to compete in the market, as other competitors were using automatic machines for manufacturing cranes.
After a detailed analysis, it was decided to purchase a new automatic machine having the latest technology. It was also decided to finance this machine through long term sources of finance. Ashish Jain compared various machines and decided to invest in the machine which would yield the maximum returns to its investors.
(A) Identify the financial decision taken by Ashish Jain.
(B) Explain factors affecting the decision identified in (A) above. (5)
Answer:
Investment decision/ Capital Budgeting/ Long term Investment decision.
The factors affecting Investment decision/ Capital Budgeting/ Long term Investment decision are:
(1) Cash flows of the project: When a company takes an investment decision involving huge amount it expects to generate some cash flows over a period. These cash flows are in the form of a series of cash receipts and payments over the life of an investment
(2) The rate of return: The most important criterion is the rate of return of the project. These calculations are based on the expected returns from each proposal and the assessment of the risk involved.
(3) The investment criteria involved: The decision to invest in a particular project involves a number of calculations regarding the amount of investment, interest rate, cash flows and rate of return. There are different techniques to evaluate investment proposals which are known as capital budgeting techniques. These techniques are applied to each proposal before selecting a particular project.
Question 12.
The Indian legal Framework consists of number of regulations which provide protection to consumers. Explain those regulations.
OR
Rahila purchased a bottle of tomato-sauce from the local grocery shop. The information provided on the bottle was not clear. She fell sick on consuming it. She filed a case in the District Forum under the Consumer Protection Act. The consumer court was satisfied with the genuineness of the complaint and issued necessary directions. State the directions that might have been issued by the consumer court. (5)
Answer:
The Indian legal framework consists of a number of regulations which provide protection to customers. Some of these regulations are:
(1) The Consumer Protection Act, 1986: The Consumer Protection, 1986 seeks to protect and promote the interests of consumers. The Act safeguards the consumers against defective goods, deficient services, unfair trade practices, and other forms of their exploitation.
(2) The Contract Act, 1982: The Act lays down the conditions in which the promises made by parties to a contract will be binding on each other. The Act also specifies the remedies available to parties in case of breach of contract
(3) The Sale of Goods Act, 1990: The Act provides some safeguards and reliefs to the buyers of the goods in case the goods purchased do not comply with expressed or implied conditions or warranties.
(4) The Essential Commodities Act, 1955: The Act aims at controlling production, supply and distribution of essential commodities, checking inflationary trend in their prices and ensuring equal distribution of essential commodities.
(5) The Bureau of Indian Standards Act, 1986: The Bureau of Indian Standards has been set up under the Act The Bureau has two major activities: formulation of quality standards for goods and their centification through the BIS certification scheme.
OR
Directions that might have been issued by the court: (Any six)
- To remove the deficiency in service.
- To refund the price paid for the service provided.
- To pay a reasonable amount of compensation for any loss suffered by the inmates of old age home.
- To pay punitive damages.
- To discontinue the unfair/ restrictive trade practice and not to repeat the same in future.
- To pay any amount (not less than 5% of the value of the service provided) to be credited to the Consumer Welfare Fund or any other organisation/person, to be utilised in the prescribed manner.
- To issue corrective advertisement to neutralize the effect of misleading pamphlet
- To pay adequate costs to RO Youth Club.