Comprehensive CBSE Objective Type Question Bank Business Studies (Term -1)

Business Studies and Questions



Comprehensive CBSE Objective Type Question Bank Business Studies Term–I (For Class XII)



Comprehensive CBSE Objective Type Question Bank Business Studies Term–I (FOR CLASS XII) (According to the Latest CBSE Examination Pattern) By ATUL PANDEY   LAXMI PUBLICATIONS (P) LTD (An ISO 9001:2015 Company) BENGALURU • CHENNAI • GUWAHATI • HYDERABAD • JALANDHAR KOCHI • KOLKATA • LUCKNOW • MUMBAI • RANCHI NEW DELHI

Comprehensive CBSE OBJECTIVE TYPE QUESTION BANK BUSINESS STUDIES–XII (TERM–I) Copyright © by Laxmi Publications Pvt., Ltd. All rights reserved including those of translation into other languages. In accordance with the Copyright (Amendment) Act, 2012, no part of this publication may be reproduced, stored in a retrieval system, translated into any other language or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise. Any such act or scanning, uploading, and or electronic sharing of any part of this book without the permission of the publisher constitutes unlawful piracy and theft of the copyright holder’s intellectual property. If you would like to use material from the book (other than for review purposes), prior written permission must be obtained from the publishers. Printed and bound in India Typeset at : Goswami Associates New Edition ISBN : 978-93-5274-566-1 Limits of Liability/Disclaimer of Warranty: The publisher and the author make no representation or warranties with respect to the accuracy or completeness of the contents of this work and specifically disclaim all warranties. The advice, strategies, and activities contained herein may not be suitable for every situation. In performing activities adult supervision must be sought. Likewise, common sense and care are essential to the conduct of any and all activities, whether described in this book or otherwise. Neither the publisher nor the author shall be liable or assumes any responsibility for any injuries or damages arising here from. The fact that an organization or Website if referred to in this work as a citation and/or a potential source of further information does not mean that the author or the publisher endorses the information the organization or Website may provide or recommendations it may make. Further, readers must be aware that the Internet Websites listed in this work may have changed or disappeared between when this work was written and when it is read. All trademarks, logos or any other mark such as Vibgyor, USP, Amanda, Golden Bells, Firewall Media, Mercury, Trinity, Laxmi appearing in this work are trademarks and intellectual property owned by or licensed to Laxmi Publications, its subsidiaries or affiliates. Notwithstanding this disclaimer, all other names and marks mentioned in this work are the trade names, trademarks or service marks of their respective owners. & Bengaluru 080-26 75 69 30 & Chennai 044-24 34 47 26 Branches & Guwahati 0361-254 36 69 & Hyderabad 040-27 55 53 83 & Jalandhar 0181-222 12 72 & Kochi 0484-405 13 03 & Kolkata 033-40 04 77 79 & Lucknow 0522-430 36 13 Published in India by & Ranchi 0651-224 24 64 Laxmi Publications (P) Ltd. C—00000/021/08 Printed at : Ajit Printing Press, Delhi. (An ISO 9001:2015 Company) 113, GOLDEN HOUSE, GURUDWARA ROAD, DARYAGANJ, NEW DELHI - 110002, INDIA Telephone : 91-11-4353 2500, 4353 2501 www.laxmipublications.com [email protected]

Contents 1. Nature and Significance of Management ......................................... 1–9 2. Principles of Management ............................................................. 10–19 3. Business Environment ................................................................... 20–28 4. Planning .......................................................................................... 29–36 5. Organising ...................................................................................... 37–44 6. Marketing ....................................................................................... 45–54



Syllabus Business Studies (Code No. 054) Class–XII (2021–22) First Term Theory: 40 Marks Duration: 90 Minutes Units MCQ Based Question Paper Periods Marks Part A Principles and Functions of Management 12 16 11 1. Nature and Significance of Management 08 14 08 30 2. Principles of Management 10 49 10 3. Business Environment 10 24 40 4. Planning 24 10 73 5. Organising                     Total Part B Business Finance and Marketing 6. Marketing Management                     Total                     Total Project Work (Part 1) Students would prepare only ONE project in the entire academic session, which is divided into 2 terms i.e., Term I and Term II. Part A: Principles and Functions of Management Unit 1: Nature and Significance of Management Concept After going through this unit, the student/learner would be able to: Management–concept, objectives, and importance ● Understand the concept of management. ● Explain the meaning of ‘Effectiveness and Efficiency’. ● Discuss the objectives of management. ● Describe the importance of management.

Management as Science, Art and Profession ● Examine the nature of management as a science, art and profession. Levels of Management ● Understand the role of top, middle and lower levels of management Management functions–planning, organizing, ● Explain the functions of management staffing, directing and controlling Coordination–concept and importance ● Discuss the concept and characteristics of coordination. ● Explain the importance of coordination. Unit 2: Principles of Management Principles of Management–concept and ● Understand the concept of principles of significance management. ● Explain the significance of management principles. Fayol’s principles of management ● Discuss the principles of management developed by Fayol. Taylor’s Scientific management principles ● Explain the principles and techniques of and techniques ‘Scientific Management’. Unit 3: Business Environment Business Environment–concept and ● Understand the concept of ‘Business importance Environment’. ● Describe the importance of business environment. Dimensions of Business Environment– ● Describe the various dimensions of Economic, Social, Technological, Political ‘Business Environment’. and Legal Unit 4: Planning Planning: Concept, importance and limitation ● Understand the concept of planning. ● Describe the importance of planning. ● Understand the limitations of planning. Planning process ● Describe the steps in the process of planning. Unit 5: Organising Organising: Concept and importance ● Understand the concept of organizing as Organising Process a structure and as a process. ● Explain the importance of organising. ● Describe the steps in the process of organizing

Structure of organisation–functional and ● Describe functional and divisional divisional concept structures of organisation. Delegation: concept, elements and importance ● Understand the concept of delegation. ● Describe the elements of delegation. ● Appreciate the importance of delegation. Decentralization: concept and importance ● Understand the concept of decentra- lisation. ● Explain the importance of decentra- lisation. ● Differentiate between delegation and decentralisation. Part B: Business Finance and Marketing Unit 6: Marketing Marketing–Concept, functions and ● Understand the concept of marketing. philosophies ● Discuss the functions of marketing. ● Explain the marketing philosophies. Marketing Mix–Concept and elements ● Understand the concept of marketing mix. ● Describe the elements of the marketing mix. Product–branding, labelling and packaging– ● Understand the concept of product as an Concept element of marketing mix. ● Understand the concepts of branding, labelling and packaging. Price–Concept, Factors determining price ● Understand the concept of price as an element of marketing mix. ● Describe the factors determining price of a product. Physical Distribution–concept ● Understand the concept of physical distribution. Promotion–Concept and elements; ● Understand the concept of promotion as Advertising, Personal Selling, Sales an element of marketing mix. Promotion and Public Relations ● Describe the elements of the promotion mix. ● Understand the concept of advertising and personal selling. ● Understand the concept of sales promotion. ● Discuss the concept of public relations. Project Work in Business Studies (Only One Project): Guidelines as Given in Class XII Curriculum.



Unit 1: Nature and Significance of Management  MULTIPLE CHOICE QUESTIONS  In each of the following questions only one option is correct. Select the correct option. 1. The activities involved in managing an enterprise are common to all organisations whether economic, social or political. Which characteristic of management is discussed in the given statement? (a) Management is a goal oriented process (b) Management is all pervasive (c) Management is dynamic (d) Management is an intangible force 2. ‘Management has to adapt itself to the changing environment.’ Which characteristic of management is mentioned in the given statement? (a) Management is multidimensional (b) Management is a group activity (c) Management is a dynamic function (d) Management is a continuous process 3. ‘An organisation is a collection of diverse individuals with different needs’. Which characteristic of management is discussed here? (a) Management is a group activity (b) Management is a continuous process (c) Management is an intangible force (d) Management is all pervasive 4. ‘Management is consumed with management of people, management of work and management of operations’. Which characteristic of management is discussed in the given statement? (a) Management is all pervasive (b) Management is a group activity (c) Management is a continuous process (d) Management is multi-dimensional 5. Which one of the following is not an organisational objective of management? (a) Survival (b) Growth (c) Profit (d) Employment generation 1

2 Business Studies—XII 6. ‘Management aims at reducing costs and increasing the productivity through better planning, organising, directing, staffing and controlling the activities of the organisation.’ Which importance of management is mentioned in the given statement? (a) Management helps in achieving group goals (b) Management increases efficiency (c) Management helps in achieving personal objectives (d) Management creates a dynamic organisation 7. Management is concerned as: (b) Science (a) Art (d) None of these (c) Both art and science 8. ‘Management helps people adapt to environmental changes so that the organisation is able to maintain its competitive edge’. Which feature of management is mentioned here? (a) Management creates a dynamic organisation (b) Management helps in achieving personal objectives (c) Management helps in the development of society (d) Management increases efficiency 9. Which one of the following is not the function of management? (a) Planning (b) Organising (c) Coordinating (d) Directing 10. Which one of the following is the primary function of management? (a) Planning (b) Organising (c) Directing (d) Controlling 11. Which one of the following is an evaluative function of management? (a) Planning (b) Controlling (c) Organising (d) Directing 12. Which of the following levels of management is responsible for welfare and survival of the organisation? (a) Top management (b) Middle management (c) Supervisory management (d) None of these 13. Deeraj is working as a supervisor in a factory. At which level of management is he working? (a) Top management (b) Middle management (c) Operations management (d) None of these 14. A good manager synchronises all the activities of different departments through: (a) Planning (b) Staffing (c) Coordination (d) Supervision 15. Under what function of management, policies and strategies are formulated: (a) Directing (b) Organising (c) Planning (d) Controlling 16. Efficiency is concerned with (b) Cooperation (a) Completion of task (d) Utilisation of minimum resources (c) Right man at right job

Nature and Significance of Management 3 17. Middle level management consists of: (b) Chairman (a) President (d) Finance manager (c) Supervisor 18. Who is responsible for the welfare and survival of an organization? (a) Middle level (b) Top level managers (c) Operational management (d) None of these 19. Which of the following is not included in top level management? (a) Managing director (b) Chief executive (c) Accountant (d) Board of directors 20. Which of the following managerial functions helps in finding right people for the right job? (a) Planning (b) Organising (c) Staffing (d) Directing 21. Name the process which ensures the orderly arrangement of individual and group efforts to ensure unity of action in the realisation of common objectives (a) Planning (b) Organising (c) Coordination (d) Cooperation 22. ‘Coordination is the responsibility of all managers’. Which characteristic of coordination is discussed here? (a) Coordination is a deliberates Function (b) Coordination is the responsibility of all managers (c) Coordination is a continuous process (d) Coordination integrates group efforts 23. ‘The purpose of coordination is to secure unity of action in the realisation of a common purpose’. Which characteristic of coordination is mentioned in the above statement? (a) Coordination integrates group efforts (b) Coordination ensures unity of action (c) Coordination is a continuous process (d) Coordination is an all pervasive function 24. ‘Coordination unifies unrelated or diverse interests into purposeful work activity’. Name the characteristic of coordination reflected by the above statement. (a) Coordination integrates group efforts (b) Coordination ensures unity of action (c) Coordination is a continuous process (d) Coordination is a deliberate function Answers 1. (b) 2. (c) 3. (a) 4. (d) 5. (d) 6. (b) 7. (c) 8. (a) 11. (b) 12. (a) 13. (c) 14. (c) 9. (c) 10. (a) 17. (d) 18. (b) 19. (c) 20. (c) 23. (b) 24. (a) 15. (c) 16. (d) 21. (c) 22. (b)

4 Business Studies—XII  ASSERTION AND REASON TYPE QUESTIONS  The following questions consist of two statements one labelled as Assertion A and the other Reason R. Examine both the statements carefully and mark the correct choice according to the instructions given below: (a) If A is correct but R is wrong. (b) If A is wrong but R is correct. (c) If both A and R are correct. (d) If both A and R are wrong. 1. Assertion (A): Management is multi-dimensional. Reason (R): Management is a complex activity that has three main dimensions, management of work, management of people and management of operations. 2. Assertion (A): Management is all pervasive. Reason (R): The activities involved in managing on enterprise are common to all organisations. 3. Assertion (A): Management is an intangible force. Reason (R): Management cannot be seen but its presence can be felt in the way the organisation functions. 4. Assertion (A): Co-ordination is a deliberate function. Reason (R): A manager has to co-ordinate the efforts of different people in a conscious and deliberate manner. 5. Assertion (A): Co-ordination is the responsibility of all managers. Reason (R): Co-ordination is the function of every manager in the organisation. 6. Assertion (A): Management is a group activity. Reason (R): An organisation is a collection of diverse individuals with different needs. Answers 1. (c) 2. (c) 3. (c) 4. (c) 5. (c) 6. (c)  MATCHING TYPE QUESTIONS  1. Match the function of management in Column I with their respective definition in Column II. Column I Column II (A) Planning (B) Organising (i) It is the function of determining in advance (C) Staffing what is to be done and who is to do it. (ii) It is the function of finding the right people for the right job. (iii) It is the function of assigning duties and grouping of tasks.

Nature and Significance of Management 5 Choose the correct alternative: (b) A–(i), B–(iii), C–(ii) (a) A–(iii), B–(ii), C–(i) (d) A–(i), B–(ii), C–(iii) (c) A–(ii), B–(i), C–(iii) 2. Match the characteristic of management mentioned in Column I with their respective explanation in Column II. Column I Column II (A) Pervasive (i) Management is concerned with management of work, management of people and management of (B) Multi-dimensional operations. (C) Group activity (ii) Managerial activities are common in all types of organisations. (iii) An organisation is a collection of diverse individuals with different needs. Choose the correct alternative: (b) A–(i), B–(ii), C–(iii) (a) A–(ii), B–(i), C–(iii) (d) A–(ii), B–(iii), C–(i) (c) A–(iii), B–(i), C–(ii) Answers 1. (b) 2. (a)  FILL IN THE BLANKS  Fill in the following blanks with appropriate items: 1. Mainly, planning is concerned with .......................... . 2. .......................... aims to help each other. 3. Marketing and personnel managers are part of .......................... . 4. The work performed by top level management is .......................... . 5. Coordination is .......................... . 6. Nirmal Garments Ltd is to produce 5000 shirts per month at a cost of ` 100 per shirt. The production manager could achieve this target at the cost of ` 110 per shirt. The production manager in the above case is .......................... . 7. .......................... is an art of getting the things done through others. Answers 1. Formulation of policies and strategies 2. Cooperation 3. middle level management 4. complex and stressful 5. the essence of management 6. Effective 7. Management

6 Business Studies—XII  TRUE OR FALSE STATEMENTS  State whether the following statements are True or False: 1. ‘Coordination is the function of management’ 2. ‘Coordination is the art of things getting done through others’ 3. ‘Top level management directly, interacts with the workforce’. 4. ‘Management is mutli-dimensional’. 5. ‘Planning is the function of determining in advance what is to be done and who is to do it. 6. ‘Management can be called an inexact science. 7. ‘Management is a tangible force’. 8. ‘Management is a one time process. Answers 1. False 2. False 3. False 4. True 5. True 6. True 7. True 8. False  CASE STUDY BASED QUESTIONS  PASSAGE I Read the passage given below and answer the following questions: Avinash is the managing director of a Garment Manufacturing Company. He has been on this post for last 10 years and under his guidance and leadership the company has been performing well. As a manager he aims at reducing costs and increase productivity through improved performance of various managerial functions. He always sets goals in advance and develops a way of achieving them efficiently and effectively. As an experienced manager he believes that in order to be successful, an organisation must change itself and its goals according to the needs of the environment. 1. At which level of management, Avinash is working? (a) Top level (b) Middle level (c) Lower level (d) Operational level 2. Which managerial function is discussed in the above para? (a) Planning (b) Organising (c) Directing (d) Controlling 3. Identify the importance of management discussed in the above para. (a) Management helps in achieving personal goals (b) Management increases efficiency (c) Management helps in achieving group goals (d) Management helps in the development of society 4. Identify the characteristic of management discussed in the above para. (a) Management is a group activity (b) Management is an intangible force (c) Management is a dynamic function (d) Management is a continuous process

Nature and Significance of Management 7 PASSAGE II Read the passage given below and answer the following questions: Sumit is the General Manager of a Pharmaceutical Company. As a manager his task is to give a common direction to the individual effort in achieving the overall goal of the organisation. He believes that an organisation has a set of basic goals which are the basic reason for its existence. As a manager he unites the efforts of different individuals in the organisation towards achieving these goals. He is of the view that coordination is very important in any organisation as it unifies unrelated or diverse interests into purposeful work activity. As organisations grow in size, the number of people employed by the organisation also increases. Hence it is important to harmonise individual goals and organisational goals through coordination. 1. Identify the importance of management mentioned in the above para. (a) Management helps in achieving personal objectives (b) Management helps in achieving group goals (c) Management helps in the development of society (d) Management increases efficiency 2. Identify the characteristic of management mentioned in the above para. (a) Management is multidimensional (b) Management is all pervasive (c) Management is a goal oriented process (d) Management is a continuous process 3. Identify the characteristic of coordination mentioned in the above para. (a) Coordination is the responsibility of all managers (b) Coordination is a continuous process (c) Coordination is a deliberate function (d) Coordination integrates group efforts 4. Identify the importance of coordination discussed in the above para. (a) Essence of management (b) Growth in size (c) Functional differentiation (d) Specialisation PASSAGE III Read the passage given below and answer the following questions: Rakesh is a managing director in a Mobile Manufacturing Company. He is of the view that management cannot be seen but its presence can be felt in the way the organisation functions. He believes that management has a systematised body of knowledge. It has its own theory and principles that have developed over a period of time. 1. At which level of management Rakesh is working? (a) Top level management (b) Middle level management (c) Lower level management (d) None of these

Con 8 Business Studies—XII 2. Which of the following functions will be performed by Rakesh as a Managing director? (a) Coordinating the activities of different departments (b) Assigning necessary duties and responsibilities to the personnel (c) Interacting with the workforce (d) Motivating the workforce to achieve the desired objectives 3. Which characteristic of management is discussed in the given para? (a) Management is a dynamic function (b) Management is a group activity (c) Management is an intangible force (d) Management is multi-dimensional 4. Identify the nature of management discussed in the above para. (a) Management as a profession (b) Management as a science (c) Management as a discipline (d) Management as an art Answers Passage I 2. (d) 3. (b) 4. (c) 1. (a) Passage II 2. (c) 3. (d) 4. (b) 1. (b) Passage III 2. (a) 3. (c) 4. (b) 1. (a)  VERY SHORT ANSWER QUESTIONS  1. State how coordination integrates group efforts? 2. State why management is considered as a dynamic function? 3. State why it is said that managemet is multi-dimensional? 4. ‘Coordination is a deliberate function’ comment. 5. Explain how management increases efficiency? 6. State how management helps in achieving personal objectives? 7. ‘Management is a continuous process’. Comment. 8. Name the process of designing and maintaining on environment in which individuals, working together in groups, efficiently accomplish selected aims. 9. State the nature of management when it is said that it is a systematised body of knowledge that explains certain general truths. 10. Management has a systematised body of knowledge. Comment. 11. Which managerial function is concerned with assigning duties, grouping tasks, establishing authority and allocating resources required to carry out a specific plan? 12. Coordination is a separate function of management. Comment. 13. Name the managerial function that aims at finding the right people for the right job. 14. Which level of management is responsible for the welfare and survival of the organisation? 15. Which organisational objective helps the business in adding to its prospects in the long run?

Nature and Significance of Management 9 Answers 1. Coordination unifies unrelated or diverse interests into purposeful work activity. It provides a common focus to group effort to ensure that performance is as per the plans. 2. Management is considered as a dynamic function, as it has to adapt itself to the changing environment. 3. Management is a complex activity that has three main dimensions (i) Management of work (ii) Management of people (iii) Management of operations 4. Coordination is a deliberate function as a manager has to coordinate the efforts of different people in a conscious and deliberate manner. 5. The ultimate goal of a manager is to reduce costs and increase productivity through better planning, organising, directing/staffing and controlling the activities of the organisation. Thus, management increases efficiency. 6. A manager motivates and leads his team in such a way that individual members are able to achieve personal goals while contributing to the overall organisational objective. 7. The process of management is a series of continuous, composite but separate functions. These functions are simultaneously performed by all managers all the time. 8. Management 9. Management as a science. 10. Management has a systematised body of knowledge. It has its own theory and principles that have developed over a period of time. 11. Organising. 12. Coordination is not a separate function of management but its very essence. Coordination is a part of all management functions. 13. Staffing 14. Top level management 15. Growth

Unit 3: Business Environment  MULTIPLE CHOICE QUESTIONS  In each of the following questions only one option is correct. Select the correct option. 1. Which of the following is an example of specific force of business environment? (a) Competitors (b) Political conditions (c) Legal framework (d) Political scenario 2. ‘Business environment keeps on changing from time to time’ which feature of business environment is discussed here? (a) Complexity (b) Uncertainty (c) Dynamic nature (d) Relativity 3. ‘Business environment differs from country to country and even from region to region’. Which features of business environment is mentioned in the given statement? (a) Uncertainty (b) Complexity (c) Dynamic (d) Relativity 4. ‘Since environment is a source of both opportunities and threats for a business enterprises, its understanding and analysis can be the basis for deciding the future course of action’. Identify the importance of environment discussed in the given statement. (a) It helps in coping with rapid changes (b) It helps in assesting in planning and policy formulation (c) It helps in improving performance (d) It helps in tapping useful resources 5. Which of the following is a general force of business environment? (a) Suppliers (b) Political conditions (c) Investors (d) Customers 6. ‘It is very difficult to predict future happenings, especially when environmental changes are taking place too frequently’ which of the following features of business environment is discussed in the given statement? (a) Dynamic nature (b) Complexity (c) Uncertainty (d) Relativity 7. The trend of online shopping and electronic payment mechanism has increased in the recent past. Which dimension of business environment is responsible for such a scenario? (a) Political (b) Legal (c) Social (d) Technological 8. As per the directions issued by the Supreme Court, the government passed an order to ban the sale of tobacco products within the area of 200 meters of all educational institutions. Which dimension of business environment is mentioned here? (a) Social (b) Legal (c) Economic (d) Technological 20

Business Environment 21 9. Since customers can now afford to buy the products of foreign companies, hence the government has encouraged foreign companies to must in some sectors of retailing. Which two dimensions of business environment is discussed in the given statement? (a) Economic and political (b) Social and legal (c) Technological and political (d) Legal and social 10. Which of the following economic reforms aims at reducing the roll of public sector in the economy? (a) Liberalisation (b) Privatisation (c) Globalisation (d) None of these 11. Withdrawal of currency from its present circulation is called (a) Demonetisation (b) Privatisation (c) Depreciation of currency (d) Appreciation of currency 12. Which of the following economic reforms aim at integrating the domestic economy with the various other economics? (a) Privatisation (b) Liberalisation (c) Globalisation (d) Disinvestment 13. Entry of multinational firms in domestic economy is an example of: (a) General force (b) Specific force (c) Opportunity (d) Threat 14. Which one of the following does not characterise the business environment? (a) Uncertainty (b) Relativity (c) Members of the organisation (d) Complexity 15. Which of the following dimensions of business environment is concerned with disposable income of people? (a) Social (b) Economic (c) Legal (d) Political 16. Which of the following reforms is concerned with reduction of government controls and restriction? (a) Liberalisation (b) Privatisation (c) Globalisation (d) Disinvestment 17. Which of the following does not characterise the business environment? (a) Uncertainty (b) Employees (c) Relativity (d) Complexity 18. Which of the following best indicates the importance of business environment? (a) Identification (b) Improvement in performance (c) Coping with rapid changes (d) All of these 19. Which of the following is an example of social environment? (a) Money supply in the economy (b) Consumer protection act (c) The constitution of the country (d) Composition of family 20. Liberalisation means (a) Integration among economies (b) Reduced government controls and restrictions (c) Policy of planned disinvestments (d) None of these

22 Business Studies—XII 21. Which of the following does not explain the impact of government policy changes on business and industry? (a) More demanding customers (b) Increasing competition (c) Change in agricultural prices (d) Market orientation 22. What will be the effect of increase in tax by the government? (a) Increase in profit margin (b) Creates fear in the minds of investors (c) Increase in cost of production (d) None of these 23. Which of the following creates fear in the minds of investors? (a) Technological improvements (b) New innovations (c) Political uncertainty (d) None of these 24. The court passed an order that all schools must have water purifiers for the school children. Which dimensions of business environment is mentioned in the given statement? (a) Social (b) Legal (c) Political (d) Economic 25. Just after the declaration of the results of the Lok Sabha Elections, the Bombay Stock Exchange’s price index (Sensex) rose by 2100 points in a day. Identify the environmental factor which led to this rise (a) Political (b) Legal (c) Social (d) Economic 26. The government of India recently allowed public sector undertaking to fix their own prices for petrol and diesel. Which economic reform is the reason for this change in the governments policy? (a) Liberalisation (b) Privatisation (c) Globalisation (d) Outsourcing 27. Which dimension of business environment requires that advertisements of baby food must necessarily inform the potential buyers that mother’s milk is the best? (a) Economic (b) Legal (c) Social (d) Political 28. Falcon, a company manufacturing light bulbs incurred heavy expenditure on Scientific Research and Development and discovered a technology that made it possible to produce an energy efficient light bulb that lasts atleast 15 times as long as a standard bulb. It resulted in growth and profitability of the company. Which of the following dimensions of business environment is discussed in the given case? (a) Political (b) Social (c) Legal (d) Technological 29. ‘Due to the recent spread of COVID 19 pandemic, demand for sanitizers, hand washes and face masks has gone up drastically. Which feature of business environment is mentioned in the given statement? (a) Relativity (b) Complexity (c) Inter-relations (d) Uncertainty 30. ‘Due to government policy changes in the early 90s, large number of foreign firms entered the Domestic Indian Market. Identify the impact of government policy changes on business and industry, mentioned in the given statement. (a) More demanding customers (b) Increasing competition (c) Market orientation (d) Necessity for change

Business Environment 23 31. After introduction of LPG policy in India, Domestic firms started to study and analyse the market first and produce goods accordingly. Which impact of government policy changes on business and industry is mentioned in the given statement? (a) More demanding customers (b) Market orientation (c) Necessity for change (d) Need for developing human resource Answers 1. (a) 2. (c) 3. (d) 4. (b) 5. (b) 6. (c) 7. (d) 8. (b) 11. (a) 12. (c) 13. (d) 14. (c) 9. (a) 10. (b) 17. (b) 18. (d) 19. (d) 20. (b) 23. (c) 24. (b) 25. (a) 26. (b) 15. (b) 16. (a) 29. (c) 30. (b) 31. (b) 21. (c) 22. (c) 27. (b) 28. (d)  ASSERTION AND REASON TYPE QUESTIONS  The following questions consist of two statements one labelled as Assertion A and the other Reason R. Examine both the statements carefully and mark the correct choice according to the instructions given below: (a) If A is correct but R is wrong. (b) If A is wrong but R is correct. (c) If both A and R are correct. (d) If both A and R are wrong. 1. Assertion (A): Totality of external forces is one of the important feature of business environment. Reason (R): Business environment is the sum total of all things external to business firms and as such is aggregative in nature. 2. Assertion (A): Business environment is uncertain. Reason (R): It is very difficult to predict future happenings especially when frequent changes are occuring in environment. 3. Assertion (A): Analysing business environment helps in coping with rapid changes. Reason (R): In order to effectively cope with changes in the environment managers must understand and examine the environment and develop suitable courses of action. 4. Assertion (A): As a result of the impact of government policy on business and industry, competition within the domestic market declined. Reason (R): Demand within the domestic market witnessed a significant decline. 5. Assertion (A): Government policy changes in India resulted in rapidly changing technological environment. Reason (R): Increased competition forced firms to develope new ways to survive and grow in the market. Answers 1. (c) 2. (c) 3. (c) 4. (d) 5. (c)

24 Business Studies—XII  MATCHING TYPE QUESTIONS  1. Match the features of business environment mentioned in Column I with their respective explanation mentioned in Column II. Column I Column II (A) Totality of external forces (i) Business environment is the sum total of (B) Dynamic nature all things external to business firms. (C) Relativity (ii) Business environment differs from country to country and even region to region. (iii) Business environment keeps on changing from time to time. Choose the correct alternative: (b) A–(ii), B–(i), C–(iii) (a) A–(i), B–(iii), C–(ii) (d) A–(iii), B–(i), C–(ii) (c) A–(i), B–(ii), C–(iii) 2. Match the economic reforms mentioned in Column I with their respective explanation mentioned in Column II. Column I Column II (A) Liberalisation (i) Reducing the role of public sector in the (B) Privatisaiton economy. (C) Globalisation (ii) Removing unnecessary central and restrictions on business. Choose the correct alternative: (a) A–(iii), B–(ii), C–(i) (iii) Integrating the domestic economy with the (c) A–(i), B–(ii), C–(iii) rest of the world. (b) A–(ii), B–(iii), C–(i) (d) A–(ii), B–(i), C–(iii) Answers 1. (a) 2. (d)  FILL IN THE BLANKS  Fill in the following blanks with appropriate items: 1. Increased competition in the market will ........................... . 2. Changes in fashions and tastes of consumers will ........................... . 3. Technological improvements and innovations result in ........................... . 4. Increase or decrease in the value of Rupee is an example of ........................... . 5. Advertisements of cigarettes carry the statutory warning. This is because of ........................... . 6. Facebook, Twitter and Whatsapp are the result of ........................... .

Business Environment 25 7. For the protection of a consumers right, there is ........................... . 8. Rise in GDP leads to rise in ........................... . 9. The complete awareness and understanding of business environment is called ........................... . 10. Through environemtal scanning a business firm can enjoy the ........................... . 11. External environment trends and changes will provide ........................... . 12. Advance understanding of business environment will help in ........................... . Answers 1. Reduce the profit margin 2. Shift the market demand from existing product to new ones 3. Rendering existing products obsolete 4. Economic environment 5. Legal environment 6. Technological environment 7. Consumer Protection Act, 1986 8. disposable income of people 9. environmental scanning 10. first mover advantage 11. threats 12. planning and policy formulation  TRUE OR FALSE STATEMENTS  State whether the following statements are True or False: 1. The social environment of business include interest rates, inflation rates, changes in disposable income of people, stock market indices and the value of rupee. 2. Technological environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services. 3. ‘Liberalisation means the integration of the various economics of the world’. 4. Political environment includes various legislations passed by the government, administrative orders issued by government authorities, court judgements etc. 5. Simplifying procedures for imports and exports is a part of privatisation economic reform. Answers 1. False 2. True 3. False 4. False 5. False  CASE STUDY BASED QUESTIONS  PASSAGE I Read the passage given below and answer the following questions: Business environments is the sum total of all things external to business firms and, as such is aggregative in nature. It consists of numerous inter-related and dynamic conditions or forces which arise from different sources. Understanding and analysing business environment can be the basis for deciding the future course of action or training guidelines for decision making.

26 Business Studies—XII 1. Identify the features of business environment discussed in the first line of the paragraph. (a) Specific and general forces (b) Totality of general forces (c) Inter-relatedness (d) Complexity 2. ‘It consists of numerous inter-related and dynamic conditions or forces which arise from different sources’. Which feature of Management is discussed in this statement? (a) Relativity (b) Inter-relatedness (c) Complexity (d) Dynamic nature 3. Which importance of business environment is mentioned in the above case? (a) It helps in tapping useful resources (b) It helps in improving performance (c) It helps in coping with rapid changes (d) It helps in asserting in planning and policy formulation 4. Which of the following is not a feature of business environment? (a) Relativity (b) Complexity (c) Contingent (d) Inter-relatedness PASSAGE II Read the passage given below and answer the following questions: Mr. Vivek is a managing director in a company. He is of the view that it is very important to analyse the business environment before taking any major business decision. According to him business environment includes both specific and general forces. Business environment never remains static and keeps on changing from time to time. According to him today’s business environment is getting increasingly dynamic, hence managers have to cope with these changes by understanding and examining the environment. It helps managers in developing suitable courses of action. 1. Which of the following is a specific force of business environment? (a) Investors (b) Technological conditions (c) Political conditions (d) Economic conditions 2. Which of the following is a general force of business environment? (a) Customers (b) Competitors (c) Suppliers (d) Economic conditions 3. Which features of business environment is discussed in the above para? (a) Dynamic nature (b) Inter-relatedness (c) Uncertainty (d) Complexity 4. Which importance of business environment is discussed in the above para? (a) It helps in improving performance (b) It helps in coping with rapid changes (c) It helps in asserting in planning and policy formulation (d) It helps in tapping useful resources

Business Environment 27 Answers Passage I 2. (c) 3. (d) 4. (c) 1. (b) 2. (d) 3. (a) 4. (b) Passage II 1. (a)  VERY SHORT ANSWER QUESTIONS  1. State why it is said that business environment is a relative concept? 2. State why business environment is said to have dynamic nature. 3. ‘Business Environment is largely uncertain’. Comment. 4. ‘Analysis of business environment helps the firm to identify threats’. Define threats in the given statement. 5. What are opportunities in the context of business environment? 6. State how studying business environment helps in asserting in planning and policy formulation? 7. Business environment includes both specific and general forces. List any four specific forces. 8. Name the economic reform which aims at eliminating unnecessary and unwanted restrictions imposed on Indian business and industry. 9. Disinvestment is a part of which economic reform? 10. Name the dimensions of business environment that includes forces relating to scientific improvements and innovations. 11. Customs, traditions and values are part of which dimension of business environment? 12. Name the economic reform that involves an increased level of interaction among the various nations of the world. 13. What is meant by ‘Totality of external forces’ as a feature of business environment? 14. Name the economic reform which is characterised by reduction in taxes and lefting of unnecessary controls over the economy. 15. State how government policy changes resulted in increased competition within the domestic Indian economy? Answers 1. Business environment is a relative concept, since it differs from country to country and even region to region. 2. Business environment is dynamic in the senses that it keeps on changing from time to time. It never remains static. 3. Business environment is largely uncertain as it is very difficult to predict future happenings, especially when environment changes are taking place too frequently. 4. Threats refer to the external environment trends and changes that can hinder a firm’s performance. 5. Opportunities refer to the positive external trends or changes that may help a firm to improve its performance.

28 Business Studies—XII 6. Since environment acts as a source of both threats and opportunities for a business enterprise, its understanding and analysis can be the basis for deciding the future course of action (planning) or training guidelines for decision making (policy). 7. (a) Investors (b) Competitors (c) Customers (d) Suppliers 8. Liberalisation 9. Privatisation 10. Technological 11. Social 12. Globalisation 13. Business envrionment is the sum total of all things external to business firms and as such, is aggregative in nature. 14. Liberalisation 15. Due to the changes in the rules of industrial licensing and entry of foreign firms, competition for domestic Indian firms increased especially in service industries like insurance, banking, telecommunications etc.

Unit 6: Marketing  MULTIPLE CHOICE QUESTIONS  In each of the following questions only one option is correct. Select the correct option. 1. Marketing is: (a) Purely a post production activity (b) Described as performance of business activities that direct the flow of goods and services from producers to consumers. (c) Concerned with only selling (d) Same as Advertising 2. The concepts of marketing management pertains to: (a) Selling concept (b) Marketing concept (c) Product concept (d) All of these 3. Which of the following functions of marketing is concerned with providing identity to the product? (a) Packaging (b) Labelling (c) Branding (d) Transportation 4. Generic names indicate: (a) A particular name (b) Whole class of the product (c) Particular quality (d) Only a brand 5. Which marketing management philosophy aims at maximising profits by producing at a large scale? (a) Product concept (b) Production concept (c) Selling concept (d) Societal concept 6. Which marketing management philosophy suggests that firms must undertake aggressive selling and promotional efforts to make customers buy their products? (a) Marketing concept (b) Selling concept (c) Societal concept (d) Product concept 7. Which function of marketing is concerned with informing, the customers about the firm’s product? (a) Branding (b) Pricing (c) Promotion (d) Packaging 8. Which of the following is not an element of marketing of goods? (a) Product (b) Price (c) Place (d) People 9. A part of a brand that is given legal protection is called: (a) Brand mark (b) Brand name (c) Trade mark (d) None of these 45

46 Business Studies—XII 10. Which of the following is not a component of physical distribution? (a) Order processing (b) Inventory control (c) Packaging (d) Warehousing 11. Which of the following is not an element of promotion? (a) Advertising (b) Personal selling (c) Stock clearing (d) Sales promotion 12. A consumer products manufacturing company is offering a number of consumer products like toileteries, detergent powder, food products etc. Identify the element of marketing mix referred here. (a) Product (b) Price (c) Place (d) Promotion 13. A multinational company operates in many countries of the world. The company is in the business of Insurance, Health care, Business Process Outsourcing, Computer education, Security etc. What is being marketed by the company? (a) Information (b) Product (c) Service (d) Idea 14. Name the tool of promotion that is adopted by the companies to create its favourable image among the people. (a) Advertising (b) Public relations (c) Sales promotion (d) Personal selling 15. Identify the promotional tool that aims at attracting customers by providing them certain short term incentives. (a) Sales promotion (b) Advertising (c) Personal selling (d) Public relations 16. Which of the following tools of promotion is in a paid form and has a mass reach? (a) Personal selling (b) Sales promotion (c) Advertising (d) Public relations 17. Anjali, a shoe manufacturer for school students, decided to maximise her profit by producing and distributing at a large scale and thereby reducing the average cost of production. Identify the marketing management philosophy adopted by Anjali. (a) Product concept (b) Production concept (c) Selling concept (d) Marketing concept 18. Reshma, a school bag manufacturer, decided to improve the product for profit maximisation and thus added a water bottle holder to the existing design. Identify the marketing management philosophy adopted by Reshma. (a) Product concept (b) Societal concept (c) Selling concept (d) Marketing concept 19. Which of the following components of physical distribution is concerned with stor- ing and assorting products in order to create time utility in them? (a) Transportation (b) Warehousing (c) Order processing (d) Inventory control

Marketing 47 20. Offering products at special prices, to clear off excess inventory is known as: (a) Rebate (b) Discount (c) Product combinations (d) Quantity gift 21. Which of the following is not a function of marketing? (a) Bending the customers according to product (b) Marketing planning (c) Gathering and analysing market information (d) Product designing and development 22. Which of the following is concerned with the quality performance of a product? (a) Marketing (b) Production (c) Product concept (d) Selling concept 23. Which of the following is a part of marketing mix? (a) Place and promotion (b) Price (c) Product (d) All of these 24. Under marketing mix, which of the following is not a part of product? (a) Quality (b) Design (c) List price (d) Brand name 25. Which of the following is not concerned with price? (a) Margins (b) List price (c) Advertising (d) Discounts 26. Which of the following is not a part of place and promotion? (a) Personal selling (b) Advertising (c) Sales promotion (d) Warranties 27. Providing information to the customers about product, its featursand quality, etc., is a part of: (a) Production (b) Promotion (c) Pricing (d) None of these 28. Which of the following is a brand name? (a) Woodland (b) Nike (c) Asian Paints (d) All of these 29. Nisha a School bag Manufacturer, decided to improve the product for profit maximisation and thus added a water bottle holder to the existing design. Identify the Marketing Management Philosophy adopted by Nisha in the given case (a) Production (b) Product (c) Selling (d) Societal 30. Beauty Products Ltd. is a natural and ethical beauty brand famous for ofering or- ganic beauty products for Men and Women. The Company uses plant based mate- rials for its products and is the No.1 beauty brand in the country. It not only satis- fies its customers but also believes in overall production of the plant. Identify the Marketing Management Philosophy being followed by Beauty Products Ltd. (a) Product (b) Production (c) Societal (d) Marketing

48 Business Studies—XII 31. A TV Manufacturing Company is spending substantial amount of money to persuade the target customers to buy its TV sets through advertisements, personal selling and sales promotion techniques. Identify the element of marketing mix regards here: (a) Product (b) Price (c) Place (d) Promotion 32. Saraswati Ltd. entered into the market with coloured televisions and have now introduced products like audio systems, air conditioners, washing machines etc. The company is not only offering the products but also handling complaints and offering after sales services. Identify the element of marketing mix discuseed here (a) Product (b) Price (c) Place (d) Promotion 33. Crackers Ltd. a fire Cracker Manufacturing Company launched some new products on Eve of Diwali which attracted many buyers. To must the increased demand, the company employed children from nearyby villages. Although the product was in great demand, appropriate safety warnings for use were not mentioned on the packets that led to many accidents. Identify the product related decision that was not shown into consideration by the company (a) Branding (b) Packaging (c) Labelling (d) Product designing and development 34. Sunita took her niece, Aishwarya for shopping to ‘Benetton’ to buy her a dress on the occassion of her birthday. She was delighted when on payment of the dress she got a discount voucher to get 20% off for a meal of ` 500 or above at a famous eating joint. Identify the technique of sales promotion used by the company in the above situation: (a) Usable benefits (b) Product combination (c) Rebate (d) Discount 35. GATA Ltd. is a large multinational company and operates in many countries of the world. The company is in the business of insurance, healthcare, business process outsourcing, computer education, security etc. What is being marketed by the company in the above case? (a) Products (b) Services (c) Information (d) Experience 36. Beena has been using ‘Clean’ a famous detergent available in the market. On watch- ing numerous advertisements in the television, she decided to try a new brand of detergent. When she went to the near-by store to purchase the same, she saw deter- gents of other producers making similar claims of whiteness and stain removing abilities. Hence she could not make up her mind as which detergent to purchase. Identify the objection of advertising discussed in this case. (a) Confuses the buyers (b) Adds to cost (c) Undermines social values (d) Encourage sale of inferior and dublous goods

Marketing 49 37. Ashima purchased a bottle of tomato sauce from the local grocery shop. The infor- mation provided on the bottle was not clear. She fell sick on consuming it. She filed a case in the district forum under consumer protection act and got the relief. Identify the important aspect neglected by the marketer in the above case: (a) Packaging (b) Branding (c) Lableeing (d) Advertising 38. Jasdeep a dealer in School uniforms, decided to maximise his profit by using different aggressive promotional efforts. Identify the Marketing Management Philosophy adopted by Jasdeep. (a) Marketing (b) Selling (c) Product (d) Production Answers 1. (b) 2. (d) 3. (c) 4. (b) 5. (b) 6. (b) 7. (c) 8. (d) 11. (c) 12. (a) 13. (c) 14. (b) 9. (c) 10. (c) 17. (b) 18. (a) 19. (b) 20. (a) 23. (d) 24. (c) 25. (c) 26. (d) 15. (a) 16. (c) 29. (b) 30. (c) 31. (d) 32. (a) 35. (b) 36. (a) 37. (c) 38. (b) 21. (a) 22. (c) 27. (b) 28. (d) 33. (c) 34. (a)  ASSERTION AND REASON TYPE QUESTIONS  The following questions consist of two statements one labelled as Assertion A and the other Reason R. Examine both the statements carefully and mark the correct choice according to the instructions given below: (a) If A is correct but R is wrong. (b) If A is wrong but R is correct. (c) If both A and R are correct. (d) If both A and R are wrong. 1. Assertion (A): The product concept’s main focus is on quality, performance and features of product. Reason (R): This concept believes in maximising profit through product quality. 2. Assertion (A): Advertising is a less forceful form of communication. Reason (R): There is no compulsion on the prospects to pay attention to the message. 3. Assertion (A): In personal selling a direct face to face dialogue takes place between the seller and the customer. Reason (R): Personal selling is a medium through which a large number of people can be reached over a vast geographical area. 4. Assertion (A): The price of a product is affected by the elasticity of demand. Reason (R): Incase of enlastic demand, the total revenue increases when the price is increased and goes down when the price is reduced. 5. Assertion (A): Extent of competition influence the price of a commodity. Reason (R): The price tend to reach the lower limit incase there is lesser degree of competition while under conditions of free competition, the price tend to set at the highest level.

50 Business Studies—XII 6. Assertion (A): Public relations as a tool of promotion involve a variety of programmes designed to promote or protect a company’s image and its individual products in the eyes of the public. Reason (R): The main objective of public relations is to disseminate information and build goodwill about the business. 7. Assertion (A): A brand is a name, term, sign, symbol, design or some combination of them used to identify the products, goods or services of one seller or group of sellers and to differentiate them from those of the competitors. Reason (R): Branding is important function of marketing as one of its care functions is to provide information required by law to the customers. 8. Assertion (A): The main focus of selling philosophy of marketing is an customer needs. Reason (R): The main objective of selling philosophy is achieved through integrated marketing. Answers 1. (c) 2. (c) 3. (a) 4. (c) 5. (a) 6. (c) 7. (a) 8. (d)  MATCHING TYPE QUESTIONS  1. Match the marketing management philosophy mentioned in Column I with their respective focus mentioned in Column II Column I Column II (A) Product Concept (i) Selling and Promoting (B) Selling Concept (ii) Existing Product (C) Production Concept (iii) Quantity Product Choose the correct alternative: (b) A–(ii), B–(iii), C–(i) (a) A–(i), B–(ii), C–(iii) (d) A–(iii), B–(ii), C–(i) (c) A–(ii), B–(i), C–(iii) 2. Match the functions of marketing mentioned in Column I with their respective explanation in Column II Column I Column II (A) Customer Support Service (i) Offering Good After Sales Services (B) Standardisation (ii) Process of Classification of Products into (C) Grading Different groups. (iii) Producing Goods of Predetermined Choose the correct alternative: (a) A–(i), B–(ii), C–(iii) Specificational. (c) A–(iii), B–(ii), C–(i) (b) A–(i), B–(iii), C–(ii) (d) A–(ii), B–(iii), C–(i)

Marketing 51 3. Match the tool of promotion mentioned in Column I with their respective explanation discussed in Column II Column I Column II (A) Perosnal Selling (i) It involves oral presentation of message in (B) Sales Promotion the form of conversation with the (C) Public Relations prospective customers. Choose the correct alternative: (ii) It aims at attracting customers by offering (a) A–(i), B–(ii), C–(iii) them short term incentives. (c) A–(iii), B–(ii), C–(i) (iii) It aims at creating a favourable image of the firm and its products among customers. (b) A–(ii), B–(iii), C–(i) (d) A–(i), B–(iii), C–(ii) 1. (c) 2. (b) Answers 3. (a)  FILL IN THE BLANKS  Fill in the following blanks with appropriate items: 1. The word ‘market’ has come from the Latin word ......................... . 2. The basic role of a marketer is to ......................... . 3. Scope of .......................... is limited but scope of .......................... is wider. 4. .......................... activities start after the product has been developed. 5. SWOT analysis is a strong part of ......................... . 6. Marketing mix is a set of ......................... . 7. .......................... refers to the act of designing and producing the container or wraper of a product. 8. .......................... refers to the products immediate container. 1. Marketio Answers 3. Selling, marketing 4. Selling 2. Identify a need and fill it 6. Marketing tools 7. Packaging 5. Marketing 8. Primary package  TRUE OR FALSE STATEMENTS  State whether the following statements are True or False: 1. Warehousing refers to the act of storing and assorting products in order to create time utility in them. 2. Order procesing is an important component of price mix.

52 Business Studies—XII 3. Promotion is concerned with making the goods and services available at the right place, so that people can purchase the same. 4. The price of a product tend to reach the upper limit in case there is level competi- tion in the market. 5. The demand for a product is said to be inelastic if a relatively small change in price results in large change in quantity demand. 6. Industrial products are usually technical, made to order and expensive products purchased by few buyers. Such products require short channels. 7. Advertising involves oral presentation of message in the form of conversation with one or more prospective customers. 8. Labelling involves putting identification marks on the package. 9. The main focus of sociatal concept is an customer needs. 10. Standardisation refers to producing goods of predetermined specifications which helps in achieving uniformly and consistency in output. 11. A brand or part of a brand that is given legal protection is called brand mark. Answers 1. True 2. False 3. False 4. True 5. False 6. True 7. False 8. True 11. False 9. False 10. True  CASE STUDY BASED QUESTIONS  PASSAGE I Read the passage given below and answer the following questions: After acquiring the necessary knowledge and skills on startig and Alovera Farm, Ashok wanted to be the leading manufacturer of Aloevera products worldwide. He observed that the products were expensive as the demans of the products was more than the supply. He was also keen to promote methods and practices that were economically viable, environ- mentally sound and at the same time protecting public health. Ashok’s main consideration was about the amount of money paid by the consumers in consideratio of the purchase of Aloevera products. He also thought that competitors prices and their anticipated reactions must also be considered for this. After gathering and analysing information and doing correct marketing planning, he came to know that the consumers compare the value of a product to the value of money which they are required to pay. The consumers will be ready to buy a product when they perceived that the value of the product is at least equal to the value of money which they would pay. Since he was entering into a new market, he felt that he may not be able to cover all costs. He knew that in the long run the business will not be able to survive unless all costs are covered in addition to a minimum profit. He examined the quality and features of the products of the competitors and the anticipated reactions of the consumers. Considering the same he decided to add some unique features to the packaging and also decided to provide free home delivery of the products.

Marketing 53 The above case relates to a concept which is considered to be an effective competitive marketing weapon. In conditions of perfect competition most of the firms complete with each other on this concept in the marketing of goods and services. 1. Identify the concept (a) Product (b) Price (c) Place (d) Promotion 2. Lerner degree of competition to the market results in ................... (a) Higher prices (b) Lower prices (c) No change in prices (d) Deflation 3. Demand for a product is said to be inelastic, when elasticity of demand is (a) more than 1 (b) equal to 1 (c) less than 1 (d) equal to zero 4. Inelastic demand can results in ................... (a) Higher revenues (b) Lower revenues (c) Zero revenues (d) Moderate revenues PASSAGE II Read the passage given below and answer the following questions: ABC Crackers Ltd. a fire-cracker manufacturing company launched some new products on the eve of Diwali in the market, which attracted many buyers. To meet the increased demand the company employed people from nearby villages where there is a lot of unemployment. Because of the good behaviour of the management with the employees, more and more people wanted to join the company. As the products were in great demands in the market, a competitor imitated the products. The products of the comeptitor were not accepted by the consumers as it was a status symbol to buy the products of ABC Crackers Ltd. because of their quality. 1. Identify the product related division because of which consumers preferred the products of ABC Crackers Ltd. (a) Labelling (b) Branding (c) Packaging (d) Order processig 2. Which product related decision provides identity to the product? (a) Branding (b) Labelling (c) Packaging (b) Advertising 3. Which of the following is not a function performed by labelling? (a) Describe the product and specify its contents (b) Identification of the product or brand (c) Grading of products (d) Product protection 4. Statutory warming on the package of cigarette or pan masala signifies which function of labelling (a) Grading of products (b) Helps in promotion of products (c) Identification of the product or brand (d) Providing information required by law

54 Business Studies—XII Passage I Answers 1. (b) 2. (a) 3. (c) 4. (a) Passage II 2. (a) 1. (b) 3. (d) 4. (d)  VERY SHORT ANSWER QUESTIONS  1. Name that element of marketing mix which affects revenue and profits of a firm. 2. Name the element of marketing mix in which a set of firms and individuals creates, possession, place and time utility and helps in market offering. 3. Name the promotional tool in which short term incentives are provided by the marketer to attract customers. 4. Why is marketing called a social process? 5. Name the sales promotion technique in which scratch cards are used. 6. Quantity of products is the main focus of which marketing management philosophy. 7. Why personal selling is considered as a flexible tool of promotion? 8. Name the act of storing and assorting products in order to create time utility. 9. Name the element of marketing mix, which include activities that make firm’s products available to the target customers. 10. Name the function of marketing which involves physical movement of goods from one place to the other. 11. Identify the tool of promotion that aims at creating a passive image of a firm and its product among people. 12. State how advertising encourages sale of inferior products. 13. Name any two environmental factors that may affect the choice of channel of distribution. 14. Name the part of a brand that is given legal protection. 15. Name the components of physical distribution. Answers 1. Price 2. Place 3. Sales Promotion 4. Marketing is called a social process because it involves the firm’s interaction with people. 5. Instant draw and assigned gifts. 6. Production Concept 7. Personal selling is considered as a flexible tool of promotion as the sales presentation can be adjusted to fit the specific needs of the individual customers. 8. Warehousing 9. Place/Physical distribution 10. Transportation 11. Public relations 12. Advertising does not distinguish between superior and inferior products and persuade people to purchase even the inferior products. 13. (a) Economic conditions (b) Legal constraints 14. Trade mark 15. (a) Order processing (b) Transportation (c) Warehousing (d) Inventory control



(An ISO 9001:2015 Company) ISBN:978-93-5274-566-1 9 789352 745661 T12-6726-099-COMP.CBSE OBJ BUSI T-I XII