Students must start practicing the questions from CBSE Sample Papers for Class 12 Business Studies with Solutions Set 9 are designed as per the revised syllabus.
CBSE Sample Papers for Class 12 Business Studies Set 9 with Solutions
Time : 3 Hr.
Max. Marks : 80
General Instructions:
- This question paper contains 34 questions.
- Marks are indicated against each question.
- Answers should be brief and to the point.
- Answers to the questions carrying 3 marks may be from 50 to 75 words.
- Answers to the questions carrying 4 marks may be about 150 words.
- Answers to the questions carrying 6 marks may be about 200 words.
- Attempt all parts of the questions together.
Question 1.
Rohit is production manager in a shoe manufacturing company. He authorises his assistant manager to plan the production schedules and take the responsibility of completing the task. Identify the concept of organising.
(a) Delegation
(b) Centralisation
(c) Formal communication
(d) Coordination (1)
Answer:
(a) Delegation
Explanation: Delegation is an accomplishment of work through others or the process of assigning various power of decision-making from superior to subordinate levels. Here, in the given case, Rohit is doing the delegation of authority.
- Related Theory
Centralisation imply concentration of all decision making functions at the apex of the management hierarchy. - Formal communication is the official interaction of information through official channels in the organisation.
- Coordination is the force that binds all the other functions of management i.e., planning, organising, staffing, directing and controlling.
Question 2.
Rajendra is working under the production incharge in a garments factory. His work involves timely and accurate completion of jobs. Which role of functional foremanship is Rajendra performing?
(a) Repair boss
(b) Speed boss
(c) Inspectors
(d) Gang boss (1)
Answer:
(b) Speed boss
Explanation: According to Taylor, functional foremanship is a management technique wherein the duties of a traditional foreman are distributed between several workers. This technique separates the planning function and executive function in an organisation. Speed boss has to ensure timely and accurate completion of jobs.
Related Theory
- Repair boss-ensuring power working conditions of machine and tools.
- Inspector- checking the quality of work.
- Gang boss-keeping machines and tools etc. ready for operation by workers
Question 3.
Shruti , manager at Sahiba, is always very busy in the office. She performs several tasks in a single day. Some days she may spend more time in planning a future exhibition and on another day she may spend time in sorting out an employee’s problems. Which management feature is highlighted here?
(a) Management is multi-dimensional
(b) Management is a dynamic function
(c) Management is all- pervasive
(d) Management is a continuous process (1)
Answer:
(d) Management is a continuous process
Explanation: Management is a continuous process as it is a series of inter-related functions. Management attempts to conduct distinguishable and specific activities, techniques and procedures which cannot be performed at the same time. These functions are performed as a continuous process which make management a never ending process.
Related Theory
Management is multi dimensional as it is a complex activity which has three main dimensions viz. management of work, management of people, management of operations. Management is a dynamic function and has to adapt itself to the changing environment. Management is all pervasive as the activities involved in managing an enterprise are common to all organisations whether economic, social or political.
Question 4.
Purohit started a footwear showroom in Chennai, India. He wants to sell shoes in France but he understands that conditions are different in different countries. Identify the feature of business environment highlighted here:
(a) Relativity
(b) Uncertainty
(c) Dynamic nature
(d) Complexity (1)
Answer:
(a) Relativity
Explanation: Here selling the same product in different country is a relativity feature of business environment.
Related Theory
- Uncerainity: it is very difficult predic po ssible changes, mainly when changes are taking place too frequently
- Dynamic: It is not static and cannot be monitored or predicted.
- Complexity: Interactions b etween d ifferent factors can create new sets of influences and conditions making it difficult to determine which factor led to a particular situation or set of situations.
Question 5.
A transformer manufacturing company in Noida plans to expand its business operations in south India. They plan to set up a manufacturing unit near Chennai. Identify the decision to be taken by the management of the company.
(a) Financing decision
(b) Working capital decision
(c) Investment decision
(d) Dividend decision (1)
Answer:
(c) Investment decision
Explanation: Investment decisions refer to selecting and acquiring the assets in which funds will be invested by the business.
Related Theory
The acquired assets can be classified under two broad groups-Long-term assets which are related to long¬term p rofitability involving high-returns and minimal- risks; and Short-term assets or current assets, which are assets that can be easily converted into cash during the normal course of a business.
Question 6.
The total capital of Uranium Private Limited is ₹ 50 lakhs. The amount of debt is ₹ 20 lakhs. The company has earned a profit of ₹ 10 lakhs during the current financial year. Its return on investment (ROI) for the present year is:
(a) 20%
(b) 40%
(c) 10%
(d) 80% (1)
Answer:
(a) 20%
Explanation: Return on investment (ROI) is calculated by dividing net income (after interest and taxes) by total liabilities, which indicates the extent of earnings made from the capital employed in a business. 10 lakh/50 lakh x 100 = 20%
Related Theory
If the ROI of the company is higher, it can choose to use trading on equity to increase its EPS i.e., its ability to use debt is greater.
Question 7.
Mr. V.K. Rao, General Manager in a cooler manufacturing company, has set the target and made a approach for achieving the pre-determined objectives for the production team. He told the production incharge that all the workers have to work towards achieving organisation’s goals. These goals set target with need to be achieved and against which actual performance will be measured. Which of the following importance of planning is highlighted in this case?
(a) Planning establishes standards for controlling
(b) Planning promotes innovative ideas
(c) Planning reduces risks of uncertainty
(d) Planning provides directions (1)
Answer:
(a) Planning establishes standards for controlling.
Explanation: Planning involves setting up of organisational goals. The entire managerial process is concerned with accomplishing pre-determined goals. Planning provides the goals or standards against which actual performance is measured. By comparing actual performance with some standard, managers can know whether they have attained the goals. As such, planning is a prerequisite for controlling.
Related Theory
Planning promote innovative ideas as new ideas can take the shape of concrete plans. Planning reduces the risks of uncertainty as by deciding in advance the tasks to be performed, Planning shows the way to deal with changes and uncertain events.
Question 8.
………….. source of finance involves payment of interest and principal amount.
(a) Debt
(b) Equity
(c) Retained earnings
(d) None of the above (1)
Answer:
(a) Debt
Explanation: Sources of funds can be a certain proportion of debt, which is fixed-interest sources of financing and equity, which is a variable-divided securities’ source of funds.
Related Theory
Financial management involves a study on capital structure to determine a suitable proportion of debt and equity sources of funds and to ensure minimum cost of capital.
Question 9.
Match the concepts of organising in column I with their related definitions in column II:
| Column I | Column I |
| (A) Decentralisation | (i) Framework within which managerial and operating tasks are performed |
| (B) Organisational structure | (ii) Granting of authority to subordinates |
| (C) Divisional structure | (iii) Systematic granting of authority to lowest level |
| (D) Delegation of authority | (iv) Structure which is formed on the basis of product specialisation |
(a) A-(i), B-(ii), C-(iii), D-(iv)
(b) A-(ii), B-(iii), C-(i), D-(iv)
(c) A-(iii), B-(i), C-(iv), D-(ii)
(d) A-(iv), B-(ii), C-(i), D-(iii) (1)
Answer:
(c) A-(iii), B-(i), C-(iv), D-(ii).
Explanation: Decentralisation refers to the systematic effort to delegate to the Lowest level, all authority except which can be exercised at the central point. Organisational structure is a system that outlines how certain activities are directed in order to achieve the goals of an organisation.
Divisional Structure is the system in which an organisation is divided into different divisions on the basis of products. Delegation of authority is granting authority to subordinates to operate within prescribed limits.
Related Theory
Functional structure involves grouping of employee positions into departments as per the organisation’s functions.
Question 10.
Charley Ltd. is a multi national company. The company is making huge profits since last few years. The company has decided to increase the dividend share ratio to the shareholders. Identify the type of decision:
(a) Investment decision
(b) Rnancing decision
(c) Dividend decision
(d) None of the above (1)
Answer:
(c) Dividend decision
Explanation: Increasing the share in dividend of shareholders is a type of dividend decision.
Related Theory
Dividend is a portion of company’s earnings which can be in the form of cash, stock or property.
Question 11.
Soft Glow Ltd. is a natural and ethical beauty brand famous for offering organic beauty products for men and
women. The company uses plant-based materials for its products and is the No. 1 beauty brand in the country. It not only satisfies its customers but also believes in overall protection of the planet. Identify the marketing management philosophy being followed by Soft Glow Ltd.
(a) Production concept
(b) Product concept
(c) Selling concept
(d) Societal marketing concept (1)
Answer:
(d) Societal marketing concept
Explanation: Societal marketing concept incorporates social responsibility of marketing by understanding concerns on ethical, environmental, legal and social context of marketing activities and programmes.
Related Theory
The product concept is based on the philosophy that customers will prefer products that offer quality, performance, or innovation-related features. The production concept is the philosophy that focuses on the internal capabilities of a business rather than the desires or needs of a marketplace. The selling concept is based on the philosphy that aggressive selling and promotional efforts should be made to make the customer buy the product
Question 12.
Squib Ltd. is a large creditworthy company operating in Kashmir valley. It is an export oriented unit, dealing in exclusive embroidered shawls. The floods in the valley have created many problems for the company. Many craftsmen and workers have been dislocated and raw material has been destroyed.
The firm is, therefore, unable to get an uninterrupted supply of raw materials and the duration of the production cycle has also increased. To add to the problems of the organisation, the suppliers of raw materials who were earlier selling on credit are asking the company for advance payment or cash payment on delivery.
The company is facing a liquidity crisis. The CEO of the company feels that taking a bank loan is the only option with the company to meet its short term shortage of cash. As a finance manager of the company, suggest the alternative to bank borrowings that the company can use to resolve the crisis.
(a) Call money
(b) Commercial paper
(c) Treasury bill
(d) Commercial bill (1)
Answer:
(b) Commercial paper
Explanation: Commercial paper is a short term unsecured promissory note, negotiable and transferable by endorsement and delivery with in a fixed maturity period. It is issued by large and creditworthy companies to raise short-term funds at lower rates of interest than market rates.
It usually has a maturity period of 15 days to one year. The issuance of commercial paper is an alternative to bank borrowing for large companies that are generally considered to be financially strong.
Related Theory
Call money is short-term finance repayable on demand, with a maturity period of one day to fifteen days, used for inter-bank transactions. Treasury bill is an instrument of short-term borrowings by the Government of India maturing in less than one year.
They are also known as zero coupon bonds. Commercial bill is a bill of exchange used to finance the working capital requirements. It is a short-term, negatiable, self liquidating instrument which is used to finance the credit sales of firms.
Question 13.
Which one of the following is states the significance of staffing?
(a) helps to ensure optimum utilisation of the human resources
(b) helps in discovering and obtaining competent personnel for various jobs
(c) makes for higher performance, by putting right person on the right job
(d) All of the above (1)
Answer:
(d) all of the above
Explanation: The staffing function of management fulfills the human resource requirement and finds the right people for the right job. Basically, staffing fills the positions as shown in the organisation structure.
Question 14.
Ira is talking about a process to her subordinates which gives instructions and guides people in doing work. Identify the process.
(a) Directing
(b) Controlling
(c) Staffing
(d) Organising (1)
Answer:
(a) directing
Explanation: Directing refers to the process of instructing, guiding, counselling, motivating and leading people in the organisation to achieve its objectives.
Question 15.
The Consumer Protection Act, 1986 seeks to protect and promote the interests of …………………
(a) Consumers
(b) Marketers
(c) Both
(d) None of the above (1)
Answer:
(a) consumers
Explanation: The Act provides safeguards to consumers against defective goods, deficient services, unfair trade practices, and other forms of their exploitation.
Question 16.
Mohammad is selected in Apex limited as a fresher. He was given the duty of identifying requirement of work force, followed by recruitment, selection, placement, promotion, appraisal and development of personnel, to fill the roles designed into the organisation structure.Which function of management is performed by Mohammad in the given case?
(a) Directing
(b) Controlling
(c) Staffing
(d) Organising (1)
Answer:
(a) Staffing
Explanation: Staffing has been described as the managerial function of filling and keeping filled the positions in the organisation structure.
Question 17.
A good leader can always identify the potential of his employees and motivate them to extract work up to their full potential. Which characteristic of directing is highlighted here?
(a) Directing initiates action
(b) Directing takes place at every level of management
(c) Directing guides employees
(d) Directing flows from top to bottom (1)
Answer:
(c) Directing guides employees Explanation: Directing guides employees to fully realise their potential and capabilities by motivating and providing effective Leadership.
Question 18.
Gagan is the director of Gagan cow ghee. He makes false claims about the product on the packaging that it is pure cow ghee and does not respond when a consumer complained about the same. Which right of the consumer was violated by Gagan?
(a) Right to be heard
(b) Right to be seek redressal
(c) Right of safety
(d) Right of information (1)
Answer:
(a) Right to be heard
Explanation: Consumer has “the right to be heard and to be assured that consumer’s interests will receive due consideration at appropriate forums”.
Question 19.
Statement I: The consumer has a right to get relief in case the product or service falls short of his expectations Statement II: The consumer does not have a right to seek redressal.
Choose the correct option from the options given below:
(a) Statement I is correct and II is wrong
(b) Statement II is correct and I is wrong
(c) Both the statements are correct
(d) Both the statements are incorrect (1)
Answer:
(a) Statement I is correct and II is wrong
Question 20.
Consumer should only purchase standardised products. On which type of product the above logo is printed?
(a) Jewellery
(b) Edibles
(c) Agriculture product
(d) Industrial product (1)
Answer:
(d) Industrial product
Explanation: The ISI mark is a standards- compliance mark for industrial products in India since 1955. The mark certifies that a product conforms to an Indian standard (IS) developed by the Bureau of Indian Standards (BIS), the national standards body of India.
Question 21.
In Sunshine Ltd., the production department procured raw material to produce 10,000 units of mobile phones. The HR manager appointed 20 personnel in the finance department as against requirement of 10. The sales department expressed their inability to sell 10,000 units and could sell only 7,000 units. As a result, 3,000 units remained unsold.
(a) Which aspect of management is lacking in this case?
(b) Explain two features of this aspect. (3)
Answer:
(a) The aspect of management lacking in this case is coordination.
(b) The features of coordination are as follows:
(i) Coordination improves relations in the organisation: An organisation has several departments or divisions. All these divisions or departments work differently, so, there is a great possibility that conflicts may arise between these departments. Coordination helps in focusing the efforts and activities of various departments on attainment of common organisational goals.
(ii) Optimum utilisation of resources: Coordination helps in bringing together human resources and material resources, so that all the resources of the organisation can be utilised properly. As mentioned in this case, if production department had coordinated with sales department then there would have been no extra production of mobile phones. Also if HR has coordinated with finance department human resources would not have been wasted.
Question 22.
“Principles help the managers to take decisions while performing the functions of management.” State the nature of principles of management.
OR
“The principles of management derive their significance from their utility.” Explain the significance of management.(3)
Answer:
The following points summarise the nature of principles of management:
(i) Universal applicability: The principles of management are intended to apply to all types of organisations. However, the extent of their applicability would vary with the nature of the organisations, business activity, scale of operations and the like.
(ii) General guidelines: The principles of management are guidelines to action but do not provide solutions to all managerial problems.
(iii) Flexible: The principles of management are not rigid prescription, which have to be followed absolutely. They are flexible and can be modified by the manager when the situation so demands.
OR
The principles of management provide useful insights to managerial behaviour and influence managerial practices. The significance of principles of management are:
(i) Providing managers with useful insights into reality: The principles of management provide the managers with useful insights into real world situation. Adherence to these principles will add to their knowledge, ability and understanding of managerial situation and circumstances.
(ii) Scientific decisions: The principles of management helps in thoughtful decision making. They emphasise logic rather than blind faith. Management decisions taken on the basis of principles are free from bias and prejudice.
(iii) Fulfilling social responsibility: The increased awareness of the public, forces business to fuLfiL their social responsibiLities. The interpretation of the principles also assumes newer and contemporary meanings with the change in time.
Question 23.
Due to increased health awareness among the people in the country, the demand for Diet coke and Diet Pepsi is on rise. The people are now more conscious in choosing the product that do not have adverse effects on their health and also on the environment. In such a scenario it has become a challenge for companies as they have to not only meet the needs of consumers but also ensure that their products are safe.
(a) Identify the relevant feature of business environment being discussed here.
(b) Describe briefly any two points which highlight the Importance of business environment and its understanding by managers.
OR
A recent cut in the interest on loans announced by the banks encoraged Amit, a science student of Progressive School, to take a loan from State Bank of India to experiment and develop cars to be powered by fuel produced from garbage.
He developed such a car and exhibited it in the science fair organised by the Directorate of Education. He was awarded the first prize for his invention. Identify and explain the dimensions of business environment discussed in the above case. (3)
Answer:
(a) Inter-related ness is the relevant feature of business environment which is being discussed here.
(b) The two points which highlight the importance of business environment and its understanding by managers are described below:
(i) It enables the firm to identify opportunities and getting the first mover advantage: Opportunities refer to the positive external trends or changes that will help a firm to improve its performance. Early identification of opportunities helps an enterprise to be the first to expLoit them instead of losing them to competitors.
(ii) It helps in tapping useful resources: Environment is a source of various resources for running a business. The enterprise design polices that allows it to get the resources which are in need so that it can convert those resources into outputs that the environment desires.
OR
The various dimensions of business environment discussed in the above case are as follows:
(i) Economic environment: “A recent cut in interest on Loans.” Economic environment comprises economic factors that can affect management practices in a business enterprise. These include interest rates, inflation rates, changes in disposable income of people, stock market indices, and the value of rupee. Short-term and Longterm interest rates significantly affect the demand for products and services.
(ii) Technological environment: “Experiment and deveLop cars to be powered by fuel garbage.” Technological environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.
Question 24.
“Unforeseen events and changes, rise in costs and prices, environmental changes, governmental interventions, legal regulations, all affect business plan.” In the light of the statement, state any three limitations of planning function of management. (3)
Answer:
The Limitations of planning are as follows:
(i) Planning leads to rigidity: In an organisation, a well defined plan is drawn up with specific goals to be achieved within a specific time frame. These plans then decide the future course of action and managers may not be in a position to change it. This Level of rigidity may create diffculty.
(ii) Planning reduces creativity: Planning is an activity which is done by the top management. Usually, the rest of the members just implement these plans. The middle management and other decision makes are neither allowed to deviate from plans nor they are permitted to act on their own. Thus, much of the initiative or creativity inherent in them also gets Lost or reduced.
(iii) Planning involves huge costs: When plans are drawn up, huge costs are invoLved in their formulation. Detailed plans require scientific calculations to ascertain facts and figures. The costs sometimes incurred may not justify the benefits derived.
Question 25.
“Controlling is a systematic process involving series of steps.” Explain. (4)
Answer:
The steps involved in the controlling process are as following:
(i) Step 1:
Setting performance standards: The first step in the controlling process is setting up performance standards. Standards serve as benchmark towards which an organisation strives to work.
(ii) Step 2:
Measurement of actual performance: Once performance standards are set, the next step is measurement of actual performance. Performance should be measured in an objective and reliable manner.
(iii) Step 3:
Comparing actual performance with standards: This step involves comparison of actual performance with the standards. Such comparison will reveal the deviation between actual and desired results.
(iv) Step 4:
Analysing deviations: Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations.
(v) Step 5: Taking corrective action: The final step in controlling process is taking corrective action . No corrective action is required when the deviation are within acceptable Limits.
Question 26.
“All businesses follows a set pattern of planning”. Explain the salient features of planning.
OR
Explain the limitations of planning. (4)
Answer:
Some of the salient features of planning are:
(i) Planning focuses on achieving objectives: Specific goals are set out in the plans. Planning contributes to the achievement of pre-determined goals.
(ii) Planning is a primary function of management: Planning Lays down the base for other functions of management. Planning precedes other functions.
(iii) Planning is pervasive: Planning is required at all the Levels of management as well as in all departments of organisation.
(iv) Planning is continuous: Plans are prepared for specific period of time. At the end of that period there is a need for a new plan to be drawn on the basis of new requirements and future conditions. Hence, planning is a continuous process.
(v) Planning is futuristic: Planning essentially involves Looking ahead and preparing for the future. Planning is regarded as forward Looking function based on forecasting.
OR
The major Limitations of planning are as follows:
(i) Planning leads to rigidity: Plans decide the future course of action to achieve specific goals and managers may not be in a position to change it. This type of rigidity in plans may create diffculty.
(ii) Planning reduces creativity: Planning is an activity which is done by the top management. Middle management and other decisions maker are neither allowed to deviate from the plans nor they are permitted to act on their own. Thus, planning reduces creativity.
(iii) Planning involves huge costs: When plans are drawn up huge costs are involved in their formulation. The costs incurred sometimes may not justify the benefits derived from the plans.
(iv) Planning is time consuming process: Sometimes plans to be drawn up take so much of time that there is not much of time left for their implentation.
(v) Planning does not guarantee success: The success of an enterprise is possible only when plans are properly drawn up and implemented. Any plan needs to be translated into action or it becomes meaningless.
Question 27.
Technofab is a fast growing computer manufacturing company. Mr. Kaushik is the owner of the company and the company has a capital base of ₹ 25 crores. Within a short span of time the company could generate cash flow which not only covered fixed cash payment obligations but also create sufficient buffer.
The company plans to expand its business and setup a new unit which requires an investment of ₹ 40 crores. To seek advice Mr. Kaushik called his finance manager Mr. Dixit who advised him a mix of equity 40% and debt 60%.
(a) Identify the decision of financial management discussed here.
(b) Discuss four factors affecting the decisions discussed above. (4)
Answer:
(a) The concept of financial management discussed here is the capital structure, which is an investment decision of financial management.
(b) The factors affecting the choice of capital structure are:
(i) Cash flow position: Size of cash flows must be considered before issuing debt. Cash flows must not only cover fixed cash payment obligations but there must be sufficient buffer also.
(ii) Interest coverage ratio (ICR): The interest coverage ratio refers to the number of times earnings before interest and taxes of a company covers the interest obligation. The higher the ratio, lower is the risk of the company failing to meet its interest payment obligations.
(iii) Return on investment (ROI): If the return on investment of the company is higher, it can choose to use trading on equity to increase its EPS.
(iv) Cost of debt: A firm’s ability to borrow at a lower rate increases its capacity to employ higher debt.
Question 28.
Sushant started a power tools manufacturing company which provides power tools to industrial units all over India. His unique ideas and technique makes his company different from others. All the operations and activities were properly noticed and the standard time taken to perform them was noted.
This took a few months and now the company could find out the number of workers required and the number of days to be involved in the various manufacturing processes. A year later they moved to another level by considering the stress involved in the lives of the workers. The amount and frequency of rest intervals in finishing a particular task were noted.
This helped the company in optimising the rest intervals for the workers so that their outputs could be increased. After six more months, the company decided to reward the efficient workers. A different rate of wage payment was decided for those workers who performed above the standard.
The standard was decided. This led to a revolutionary change in the perspective of the workers who now started giving their full efforts in order to increase their wages.
(a) Which concept of management has been discussed in the above case?
(b) Name the three types of this management concept highlighted above. Also identify the lines where these types have been indicated. (4)
Answer:
(a) The concept of management discussed here is Taylor’s Scientific Management.
(b) The various types of techniques used are:
(i) Time study: This technique determines the standard time needed to perform a well- defined job.
Line: “All the operations and activities were properly noticed and the standard time taken to perform them was noted.”
(ii) Fatigue study: Fatigue study is aimed at determining the amount and frequency of rest intervals in order to maximise productivity.
Line: “The amount and frequency of rest intervals in finishing a particular task were noted.”
(iii) Differential piece wage system: The main objective of this technique of wage payment was to differentiate between efficient and inefficient workers. The efficient workers are paid more in comparison to inefficient workers. The idea is to promote efficiency. Taylor recommended that efficient workers should be paid at a higher rate than the inefficient ones. Line: “A different rate of wage payment was decided for those workers who performed above the standards.”
Question 29.
“Organising helps in the survival and growth of an enterprise and equips it to meet various challenges.” Discuss the crucial role that organising plays in any business enterprise.
OR
Explain the disadvantages of functional structure. (4)
Answer:
The following points highlight the crucial role that organising plays in any business enterprise:
(i) Benefits of specialisation: Organising leads to specialisation, as the assigned work is performed regularly by the concerned person.
(ii) Clarity in working relationships: The reporting relationships get clarified after proper organising.
(iii) Optimum utilisation of resources: There is reduction in duplication of efforts and overlapping of activities after proper organising.
(iv) Adaptation to change: A well organised business firm can adapt to external changes.
(v) Effective administration: On the administration front an organisation becomes better as all the job positions and working relationships are clearly defined.
(vi) Development of personnel: When jobs are assigned through organising, the employees learn and develop in actual work environment.
OR
Grouping of jobs of singular nature under functions and organising these functions as separate departments creates a functional structure. Thus, a functional structure is an organisational design that groups similar or related jobs together.
The disadvantages of functional structure are :
(i) The departmental goals in the functional structure take importance over the organisational goals.
(ii) The functional heads have experience and knowledge only about their departments leading to their inflexible attitude towards each other.
(iii) The basic nature of departments varies from each other so there is a lack of flow of information on a regular basis. This decreases coordination.
(iv) The departments try to have their own quota of interests fulfilled Leading to conflict of interests.
(v) As employees get training of one function only, therefore, problem of inflexibility rises.
Question 30.
Enjoyourtrip.com is a reputed company which book hotels, flights, buses online. The company offers new types of schemes to the potential customers. Mohan was offered a scheme of staying in a hotel for 6 days and 5 nights for free. However, when he reached the destination, he was told that every room of the hotel was booked.
He told them that he was informed earlier that his room was booked. He even showed them the confirmation he received on his mail.
(a) Can Mohan file a complaint against the tourist agency?
(b) Will he get a relief in this case?
(c) Name the relief he will get.
(d) Which consumer right has been violated in this case? (4)
Answer:
(a) Yes, Mohan can file a complaint against Enjoyourtrip.com as he has got the confirmation as the proof. He even showed the confirmation he received on his mail at the destination.
(b) Yes, Mohan will get a relief as he has proof of confirmation of his booking. He will get relief as his time and money (fare charges for travelling purpose) are wasted.
(c) The relief Mohan will get is ‘he will be compensated for the loss of time and money and also for filing the complaint’. The second relief will be directed towards the company which will have to stop this wrong trade practices for future.
(d) The consumer right which has been violated here is ‘Right to be Informed’. This was the responsibility of the company to inform him beforehand if the rooms were not available. They did the worse by giving him confirmation and denying him the hotel room at the last moment.
Question 31.
Mr. Bajaj is the General Manager in a pharmaceutical company. He is a very hard working person but sometimes he lacks in conveying his messages to the departments properly. The words and expressions conveyed by him are not properly understood by others. Sometimes, he also uses wrong words because of which intended meaning is not conveyed. All these create confusion and misunderstanding among him and the subordinates.
(a) Identify the quality of management lacking in this case.
(b) State the category of this quality of management that is lacking.
(c) Explain any four other categories of the same category. (6)
Answer:
(a) The quality of management lacking in Mr. Bajaj is communication. All the professional knowledge and intelligence that a manager possesses becomes immaterial if he is not able of communicate effectively with his subordinates and create understanding in them.
(b) Semantic barrier – Such barriers are concerned with problems and obstructions in the process of coding and decoding of a message into words and expression. Normally, such barriers result on account of use of wrong words, faulty translations, different interpretations etc.
(c) The categories of semantic barriers are:
(i) Technical jargon: These are words used by experts and specialists and difficult belonging to some other field. Use of such words can act as a barrier to effective communication.
(ii) Symbols with different meanings: A single word may have more than one meaning. For example, word ‘plane’ has different meanings.
(iii) Faulty translation: When a message is translated into some other language then due to lack of equal command on both the languages the meanings might change.
(iv) Unclarified assumptions: Sometimes a message conveyed may carry assumptions. These assumptions may be differently understood and explained by the receiver leading to barriers in communication.
Question 32.
Explain the benefits of staffing to an organisation.
OR
“Internal sources of recruitment are more economical for an organisation but it has some drawbacks too”. Discuss.(6)
Answer:
Staffing is putting people to jobs. Staffing is that part of the process of management which is concerned with obtaining, utilising and maintaining a satisfactory and satisfied workforce. Proper staffing ensures the following benefits to the organisation:
(i) It helps in discovering and obtaining competent personnel for various jobs.
(ii) It makes for higher performance, by putting right person on the right job.
(iii) It ensures the continuous survival and growth of the enterprise through the succession planning for managers.
(iv) It improves job satisfaction and morale of employers through objective assessment and fair rewarding for their contribution.
OR
Recruitment of personnels from internal sources in an organisation is economical and beneficial. The merits of fulling up vacancies form internal sources are as follows:
(i) Employees are motivated to improve their performance. A promotion at a higher level may lead to a chain of promotion at lower levels in the organisation.
(ii) Internal recruitment simplifies the process of selection and placement. The candidates that are already working in the enterprise can be evaluated more accurately and economically.
(iii) Transfer is a tool of training the employees to prepare them for higher jobs. Also people recruited from within the organisation do not need induction training which saves the cost to the organisation.
(iv) Transfers has the benefit of shifting workforce from the surplus departments to those where there is shortage of staff which is economically viable for the organisation.
(v) Filling of jobs internally is cheaper as compared to getting candidates from external sources. Though the internal sources of recruitment are economical for the organisation but they suffer from some drawbacks too. Some of the drawbacks of internal sources of recruitment are:
- When vacancies are filled through internal sources, the scope of induction of fresh talent is reduced.
- The employees may become lethargic if they are sure of time bound promotions.
- A new enterprise cannot use internal sources of recruitment.
- The spirit of competition among the employees may be hampered.
- Frequent transfers of employees may often reduce the productivity of the organisation.
Question 33.
Explain the functions of SEBI.
OR
What are the functions of a stock exchange? (6)
Answer:
The functions of SEBI are as follows:
(i) Development functions:
Developing the capital markets by considering the improvement of all possible aspects connected with it. Doing timely research and undertaking publishing of the outcomes of research, as and when required. Training the intermediaries (who act as a vital link between investors and issuers). Investors education. Promotion of fair practices and code of conduct.
(ii) Regulatory functions:
- Registration of brokers and sub-brokers.
- Registration and regulation of mutual funds.
- Regulation of take-over bids.
- Conducting inspections, enquiries and audits of Stock exchanges.
- Levying fee, as and when required.
- Regulation of underwriters, stock brokers, etc.
- Regulation of stock bankers, portfolio exchanges, and merchant bankers.
- Prohibition of fraudulent and unfair trade practices.
OR
The functions of stock exchange are as follows:
(i) Ensures liquidity and marketability of existing securities by providing a ready and continuous market for the sale and purchase of securities.
(ii) Helps in determining the prices of the securities through the forces of demand and supply.
(iii) It promotes the habit of saving and investment among the general public.
(iv) It provides a legal framework for fair and safe dealings.
(v) It helps the companies in raising finance thus facilitating capital formation and economic growth.
(vi) It provides scope for healthy speculation in a controlled and restricted way.
Question 34.
Sushma is the founder of a new FMCG company. She wants her products to speak to the potential customers. For this purpose, she is working a lot on the packaging of her products. She has decided to cut down the personal selling efforts of her company by reducing the number of salesmen as she wants that the packaging should speak for itself, thus, gaining the attention of the potential customers. She has made other efforts also.
She has brought an R & D department in her organisation and has asked them to invent new types of packaging in order to increase the scope of marketing as new packaging would ensure safety, environment friendliness and attractiveness.
She knows she will face a lot of competition in the market as already there are many players in the market who are ready to give challenge to her products. She wants her packaging to be such that her product should stand apart, be recognised easily and not be lost in the pool of different products in the market.
Their packaging should convey their quality. The nature of the potential customers has changed over the years. They have become more demanding and informed. They have more choices now.
One thing that the customers always look for in an FMCG product is the hygiene and purity; these two traits can only be conveyed to the potential customers by proper packaging. Sushma perception about packaging is really noteworthy.
(a) Which concept of marketing has been highlighted in the above case?
(b) Identify the different functions of this concept highlighted in the lines above. (6)
Answer:
(a) The concept of marketing highlighted in the above case is ‘Importance of Packaging’. Packaging is the process of wrapping of products to make them safe from external damages at the time of their physical distribution and storage as well.
(b) The different benefits of packaging highlighted above are:
(i) It helps in self service outlets: Sushma has decided to cut down the personal selling efforts of her company by reducing the number of salesmen as she wants that the packaging should speak for itself, thus, gaining the attention of the potential customers.
(ii) It provides an innovational opportunity: She has brought an R & D department in her organisation and has asked them to invent new types of packaging in order to increase the scope of marketing as new packaging would ensure safety, environment friendliness and attractiveness.
(iii) It helps in product differentiation: She wants her packaging to be such that her product should stand distinct, be recognised easily and not be lost in the pool of different products in the market.
(iv) It helps in meeting the expectations of customers as standards of health and sanitation are rising: One thing that the customers always look for in an FMCG product is the hygiene and purity; these two traits can only be conveyed to the potential customers by proper packaging.