Kerala Plus One Business Studies Model Question Paper 3
General Instructions
- There is a ‘cool off time’ of 15 minutes in addition to the writing time of 2 hrs.
- You are not allowed to write your answers nor to discuss anything with others during the ‘cool off time’.
- Use the ‘cool off time’ to get familiar with the questions and to plan your answers.
- Read questions carefully before you answering.
- All questions are compulsory and the only internal choice is allowed.
- When you select a question, all the sub-questions must be answered from the same question itself.
- Calculations, figures, and graphs should be shown in the answer sheet itself.
- Malayalam version of the questions is also provided.
- Give provided wherever necessary.
- Electronic devices except non-programmable calculators are not allowed in the Examination Hall.
Answer the following questions from 1 to 9. Each carries 1 score.
Question 1.
Business activities are undertaken primarily to …………..
a. Earn profit
b. Have recognition
c. Fulfill social obligation
Question 2.
Provision of residential accommodation to the member at a reasonable rate is the objective
a. Producers cooperative
b. Consumers cooperative
c. Housing cooperative
d. Credit cooperative
Question 3.
Which of the following cannot be classified as an auxiliary to trade’?
a. Mining
b. Insurance
c. Warehousing
d. Transport
Question 4.
Mortality is to be enforced in an establishment by the ………………
a. Top level management
b. Middle-level management
c. Low-level management
d. Employees at all levels
Question 5.
Preliminary contracts are signed
a. before the incorporation
b. after incorporation but before the capital subscription
c. after incorporation but before the commencement of business
d. after the commencement of business
Question 6.
……………….. is the last link in the channel of distribution of goods and services
a. Wholesale
b. Retailer
c. Producer
d. Customer
Question 7.
Public deposits are the deposits that are raised directly from
a. The public
b. The director
c. The auditors
d. The owner’s
Question 8.
An arrangement to acquire the right use an asset without owing is called
a. Factoring
b. Leasing
c. Financing
d. Warehousing
Question 9.
ADRs are issued in
a. Canada
കാനഡ
b.China again
c. India
d. USA
Answer any 6 questions from 10 to 16. Each carries 2 scores.
Question 10.
Write any two merits of lease financing.
Question 11.
Explain the concept of discretionary responsibility.
Question 12.
Name the following partners.
a. A partnership firm informs its customers that Mr. Ramesh is its partner. From the customers, Mr. Ramesh comes to know about it. But he does not deny it.
b. Vinod is a partner who hasn’t invested any money and does not take part in any activity.
Question 13.
Write a short note on NABARD.
Question 14.
Certain retailers do not have any fixed place of business to conduct the trade. State any two characteristics of them.
Question 15.
Find the business models from the following.
a. Customers making toll free calls through call centers to inquire about the product of a company
b. CIAL Tech Ltd. .uses a network of computers for monitoring delivery of components to the suppliers
Question 16.
A cooperative society is a voluntary association of persons who join together with the motive of the welfare of the members. State any two merits of a cooperative society.
Answer any 4 questions from 17 to 21. Each carries 3 scores.
Question 17.
How does a cooperative society exemplify democracy and secularism? Explain.
Question 18.
Compare the status of minor in joint Hindu family business with that in a partnership firm.
Question 19.
Write any two limitations of business.
Question 20.
The management of Thottam Plantation decided to set apart 10% of their profits for the education of students belonging to weaker sections. Identify the type of social responsibility referred here. Also, write three points of arguments for social responsibility.
Question 21.
For buying and selling of goods within the boundaries of a country mainly two intermediaries are involved. Write two services each provided by these intermediaries to the producers.
Answer the following questions which carry 4 scores.
Question 22.
Match the following:
Answer any 3 questions from 23 to 26. Each carries 4 scores.
Question 23.
Kochi Metro rail corporation Ltd. Engaged in the construction of Kochi metro by joining together with the government of Kerala What are the advantages of such venture?
Question 24.
Modern means of communication helps in making the exchange of ideas and information faster. Explain the modern means of communication.
Question 25.
Miss Lindzy approaches you with the intention of subscribing to shares in a private limited company. She wants to know the privileges enjoyed by a private limited company. Can you help her?
Question 26.
“ High profit-making institutions are beneficial not only to the businessmen but also to the society”. Comment on the above statement both from the point of view of the businessman and the society.
Answer any 3 questions from 27 to 30. Each carries 5 scores.
Question 27.
Explain the term marine insurance and also explain the types of marine insurance.
Question 28.
A commerce teacher, while going through the topic, “ Internal Trade”. Cites the examples of ‘Bata Shoe Company’ having its headquarters in Mumbai where if it has its showrooms at different locations of the city as well as in various cities all over India. The products of the company carry the same price in all these showrooms. Identify the type of shop cited in the example. List any five features of such shops.
Question 29.
Do you welcome the opening of the Indian retail market to multinationals like Walmart, McDonald’s etc?
Question 30.
Suppose, a public enterprise is established in your district. As an e-commerce student, can you compare the various features of the three forms of public enterprises?
Answer any 2 questions from 31 to 33. Each carries 8 scores.
Question 31.
Mr. Manoj is running a ladies store. As he has no business partners in the shop, he appointed two more ladies to assist him in trading activities for a salary of Rs. 2,000 per month. Identify this business organization State any four advantages and three disadvantages of the organization.
Question 32.
The newly established Eastern valley Ltd., require a huge volume of finance for establishing their business. A wide variety of sources of funds are available for them. Advice the finance department about the factors to be considered before selecting the suitable sources.
Question 33.
Seetharam & sons Pvt.Ltd and Krishna Sagar Ltd. are two companies incorporated in India. Identify the types of companies. Differentiate between the two types of companies
Answers
Answer 1.
a. Earn profit
ലാഭം നേടുക
Answer 2.
c. Housing cooperative
Answer 3.
Mining
Answer 4.
Employees at all levels
Answer 5.
before the incorporation
Answer 6.
b.Retailer
Answer 7.
The public
Answer 8.
Leasing
Answer 9.
USA
Answer 10.
- It provides finance without diluting the ownership or control of a business
- It does not affect the debtor raising of an enterprise.
Answer 11.
Discretionary Responsibility
This refers to purely voluntary obligation that an enterprise assumes for instance providing charitable contribution to educational institutions or helping the affected people during floods or earthquakes.
Answer 12.
a. Partner by holding out
b. Nominal partner
Answer 13.
National Bank for Agriculture and Rural Development (NABARD)
NABARD was set up in 1982 to promote integrated rural development. It has been adopting a multipronged, multipurpose strategy for the promotion of rural business enterprises in the country.
Answer 14.
Characteristics of if itinerant retailers
a. Deals in daily use consumer products.
b. Supply of products of doorsteps etc.
Answer 15.
a. C2B
b. B2B.
Answer 16.
a. Large funds
b. Share of risk
Answer 17.
AH, a feature of the cooperative society lends it to a democratic character. Further, the membership of a cooperative society is open to all, irrespective of their religion, caste, and gender. The cooperative society through its purpose lays emphasis on the values of mutual help and welfare. These features prove the secular nature of cooperative societies.
Answer 18.
A person becomes a member of a joint Hindu family business when he takes birth in such a family. All minors the family are coparceners in the family business. A partnership is based on a legal contract between partners. Since the minor is incompetent for entering to a valid contract, minor cannot be a partner of a partnership firm, but minor can be appointed as a beneficiary of a partnership firm.
Answer 19.
- It lacks a personal touch with customers.
- Incongruence between order taking and order fulfillment speed.
Answer 20.
Discretionary Responsibility
This refers to purely voluntary obligation that an enterprise assumes, for instance, providing a charitable contribution to an educational institute or helping the affected people during floods or earthquakes,
Arguments for Social Responsibility.
1. The justification for existence and growth
Business exists for providing goods and services to satisfy human needs. Though profit motive is an important justification for undertaking a business activity,
2. The long-term interest of the firm
A firm and its image stand to gain maximum profits in the long run when it has its highest goal as service to society. When an increasing number of members of society, including workers, consumers, shareholders, government official feel that business enterprise is not serving its best interest, they will tend to withdraw their cooperation to the enterprise concerned.
Answer 21.
Services of wholesalers
1. Services to manufacturers:
a. Facilitate large-scale production;
Bulk orders from wholesalers enable the producers to take the production on a large scale and take advantages of economies of scale.
b. Bearing risk
The wholesaler deals in goods in its own name and takes the risk of loss or damage in storage and transit.
c. Financial assistance
Wholesalers provide financial assistance to manufacturers means they make ready cash payment for purchases and even advance money to producers.
Services to retailers :
a. Availability of goods
The wholesalers make the products Real owner Fixed percentage of interest No voting rights International source of finance various manufacturers readily available to the retailers.
b. Marketing support
The wholesalers perform various marketing functions and provide support to retailers.
C. Grant of credit
Answer 22.
Answer 23.
Government company
A government company is established under the Indian Companies Act, 1956 and is registered and governed by the provisions of the Indian Companies Act. According to the Indian Companies Act 1956, a government company means any company in which not less than 51 percent of the paid up capital is held by the central government, or partly by central government and partly by one or more state governments.
Features
- It is an organization created by the Indian companies act,
- It can obtain funds from government shareholdings
- It can enter into a contract.
- It can acquire property in its own name.
- Its management is regulated by the provisions of the companies act.
Answer 24.
1. Fax
The printed, a message is converted into electronic signals as the paper rolls through the fax machine. This message is received in the same format the other end on the paper roll that is attached to the machine.
2. Internet & E-mail
The Internet is an international computer network that links computers from sectors such as government agencies business houses, educational institution, stores it and allows it to be read on satisfying certain conditions.
3. Video conferencing and Teleconferencing
This mode of communication begins in Teleconferencing. A number of telephones are simultaneously connected to one another. Teleconferencing is a facility enabling people in different parts of the world to have an audio meeting, saving on transit time and hotel stay.
4. Video conferencing
It is the closest it gets to seeing and hearing one another without being present together technologies used in a video conference area monitor, screen, microphone, camera etc.
5. Voicemail
Voicemail is a form of email only. Here, a message, instead of being communicated in a written is sent in the form of voice of the caller.
Answer 25.
Privileges of a private company
- A private company can be formed by only two members. Andiamo.
- There is no need to issue a prospectus.
- Allotment of shares can be done without receiving the minimum subscription,
- It can start a business as soon as it receives the certificate of incorporation.
- It needs to have only two directors
- It is not required to keep an index of members
- There is no restriction on the amount of loan to the directors of a private company.
Answer 26.
From the viewpoint of business:
- Profit is necessary for the survival of the business.
- Profit increases the efficiency of a business.
- Profit accelerates the pace of growth.
- Profit builds a good image of the business.
- Profit brings prosperity to the business.
- Profit is a reward for the risk borne by the businessman.
From the viewpoint of society:
- Society gets quality products at reasonable prices.
- Employees will get better remuneration, good working condition etc
- A profitable business enterprise generates more employment opportunities
- A profitable business concern can undertake various community development programs.
Answer 27.
Classification of marine insurance
- Ship or hull insurance
When a ship is insured against marine hazards it is known as hull insurance.
- Cargo insurance
Marine insurance that covers the risk of loss of cargo is known as cargo insurance.
- Freight insurance
Insurance of the risk of loss of freight is known as freight insurance,
Answer 28.
Chain stores or multiple shops:
It is a system of branch shop operating under centralized management and dealing in a similar line of products. The central office is called head office. Branches are located all over the world.
Features of multiple shops
- As there is centralized procurement they enjoy economies of scale
- By selling directly to the consumers they eliminate unnecessary middlemen on the sale of goods and services
- Since sales are made in cash basis no bad debts occurred
- It reduces the chance of dead stock by transferring the same to branch in another locality where it is in demand
Answer 29.
Global enterprises or Multi-National Corporations (MNCs)
Global enterprises are huge industrial organizations which extend their industrial and marketing operations through a net VDC of their branches in several countries. They are characterized by their huge size, a large number of products, advanced technology etc.
Features:
1. Huge capital resources
These enterprises are characterized by ‘ possessing huge financial resources and the ability to raise funds from different sources.
2. Foreign collaboration
Global enterprises can collaborate with companies in the public and private sector
3. Advanced technology
These enterprises possess technological superiorities in their methods of production.
4. Product innovation
They are continuously engaged in developing new products, better quality an superior design of an existing product.
5. Marketing strategies
The marketing strategies of global companies are far more effective than other companies.
6. Expansion of market territory
Their operations and activities extend beyond the physical boundaries of their own country.
7. Centralized control
They have their headquarters in their home country and exercise control over all branches and subsidiaries,
Answer 30.
Public sector enterprises can be organized in the following three forms
- Departmental undertaking
- Statutory corporations
- Government company
1. Departmental undertaking
This is the oldest form of organizing public sector enterprises. It may be run either by the central government or by the state government. They are managed by the government employees and works under the center of a minister.
Eg: Railway, Post and Telegraph etc.
Features:
- They are financed from the government Treasury.
- They are subject to accounting and audit controls applicable other government activities.
- The employees of the enterprise are government servants.
2. Statutory corporations
Statutory corporations are public enterprises brought into existence by a special act of the government. The act defines its powers and functions, rules and regulations governing its employees and its relationship with the government departments.
Eg. LIC, RBI, SBI etc.
Features:
- Statutory corporations are set up under an act of parliament.
- This type of organization is wholly owned by the state.
- It is a body corporate and can sue and be sued.
3 ……. Government company
A government company is established under the Indian Companies Act, 1956 and is registered and governed by the provisions of the Indian Companies Act. According to the Indian Companies Act 1956, a government company means any company in which not less than 51 percent of the paid up capital is held by the central government, or partly by central government and partly by one or more state governments.
Features:
- It is an organization created by the In. Indian companies act, 1956.
- The company can sue and be sued.
- It can enter into a contract.
Answer 31.
Sole Proprietorship
Sole proprietorship refers to a form of business organization which is owned, managed and controlled by an individual who is the recipient of all profits and bearer of all risk. A sole proprietor is the one who is the only owner of a business.
Merits:
- Quick decision
A sole trader has full control over affairs of business, so he enjoys a considerable degree of freedom in decision making.
- Confidentiality of information
A sole trader can keep all information related to business operations confidential and maintain secrecy.
- Direct incentive
A sole trader is the only recipient of all the profit. The need to share profits does not arise as he is the single owner.
- It instills Sense of accomplishment and confidence in one’s abilities.
- There is ease information as well as the closure of the business
Demerits:
- Limited resources
Resources of a sole trader limited to his personal savings and borrowings from others
- Limited life of a business concern
The death, insanity, of a sole proprietor, causes discontinuity of business
- The owner has unlimited liability
- Limited managerial ability
A sole trader may not be an expert in every aspect of management.
Answer 32.
Sources of finance
A company would choose from among various sources of finance depending on the amount . of capital required and the term for which it is needed.
Factors affecting the choice of source of funds
- Cost of procurement and utilization of funds.
- Financial strength and stability of operation.
- A form of organization and legal status.
- Purpose and time period for which funds are required.
- The risk profile of source of finance.
- Control
- Effect on creditworthiness
- Flexibility and ease of obtaining funds.
- Tax benefit.
Answer 33.
Types of companies
1. Private company A private company means a company which
- Restrict the right of members to transfer its share.
- Has a minimum of 2 and a maximum of 50 members.
- Does not invite the public to subscribe to its share capital
- Must have minimum up paid capital of Rs.llakh
Public company
A public company means a company which is not a private company. As per Indian companies act a public company is one which
- Has a minimum paid-up capital of Rs. 5 lakhs
- Has a minimum of 7members and no limit on maximum member
- Has no restriction on transfer of share
- Is not prohibited from inviting the public to subscribe to its share capital or public deposits.
