CBSE Sample Papers for Class 12 Business Studies Paper 2 are part of CBSE Sample Papers for Class 12 Business Studies Here we have given CBSE Sample Papers for Class 12 Business Studies Paper 2.
CBSE Sample Papers for Class 12 Business Studies Paper 2
| Board | CBSE |
| Class | XII |
| Subject | Business Studies |
| Sample Paper Set | Paper 2 |
| Category | CBSE Sample Papers |
Students who are going to appear for CBSE Class 12 Examinations are advised to practice the CBSE sample papers given here which is designed as per the latest Syllabus and marking scheme as prescribed by the CBSE is given here. Paper 2 of Solved CBSE Sample Papers for Class 12 Business Studies is given below with free PDF download solutions.
Time: 3 Hours
Maximum Marks: 80
General Instructions
(i) Answer to questions carrying 1 mark may be from one word to one sentence.
(ii) Answer to questions carrying 3 marks may have about 50 to 75 words.
(iii) Answer to questions carrying 4 – 5 marks may have about 150 words.
(iv) Answer to questions carrying 6 marks may have about 200 words.
(v) Attempt all the parts of a question together.
Questions
Question 1:
Name the grapevine network in which an individual communicates with only those people whom he trusts?
Question 2:
There are three major decisions which an organisation has to take in respect of financial management. State these decisions.
Question 3:
Which consumer right gives the business firms freedom to set up their own consumer service and grievance cell?
Question 4:
ABC Ltd is engaged in manufacturing electric bulbs. The organisation is incurring losses. The production department is blaming sales department for poor sales and sales department is blaming production department for delayed production. Identify the force that is missing in the organisation.
Question 5:
Why is actual performance compared with standards in the process of controlling?
Question 6:
State the element of directing which helps in implementing the principle of scalar chain.
Question 7:
The CEO of Vivate’s Ltd, an insurance business enterprise dreams for his company becoming the best player in future, for which he sets the objectives, forecasts the future and develops various courses of action. Identify the management function highlighted in the case.
Question 8:
Name and state the ‘on-the-job method of training’ that is used to give training to the electricians.
Question 9:
“Our assets walk out of the door every evening, we have to make sure that they come back the next morning.” This statement relates to which function of management. Why is it important?
Question 10:
Maxwell Ltd is manufacturing auto spare parts on large scale. The company policy is that 5% of the daily production could be defective from last two months, it is observed that about 10 – 12% of production is defective. Which function of management is reinsured to correct the above case? State the procedure to be followed to correct the things.
Question 11:
Decentralisation is extending delegation to the lowest level. It explains the manner in which decision-making responsibilities are divided among hierarchical levels. It refers to delegation of authority throughout all the levels of the organisation. Then, what is the difference between the two on the basis of the following:
- Purpose
- Scope
- Status
Question 12:
Mother of Mr Jain acts as Vice President in Leo Ltd. Name the level of management, she is working. Explain any two functions performed by her.
Question 13:
In Atlans Ltd, no importance had been attached to the suggestions given by the subordinates. In 2016, the company appointed Mr Franco as its Chief Executive Officer. He was an MBA degree holder with an experience of a decade. After assuming the charge of his office, he started a campaign, in which he collected more than 10,000 suggestions from employees out of which 1,500 were selected and implemented in different fields. This campaign fetched the company an additional profit of ₹150 crore.
- Quoting lines from the para, identify which principle of management was opted by Mr Franco.
- State two positive effects of this principle.
Question 14:
Write short note on:
- District Forum
- National Commission
Question 15:
‘It is the process by which government’s control over the industry is being loosened.’ Identify the process and state the reforms (any four) introduced under this process.
Question 16:
Mr A, the director of garment company, is planning to manufacture bags for the utilisation of waste material of one of his garment unit. He decided that his manufacturing unit will be set up in a rural area of Uttar Pradesh, where people have very less job opportunities and labour is available at very low rate. He also thought of giving equal opportunities to men and women by employing them equally in this unit.
- Identify the first two steps of process of staffing for this unit.
- Identify the values witch Mr A wants to communicate to the society by setting up this unit.
Question 17:
Vansh was appointed as the marketing head of Automobiles Ltd, manufacturers of cars and bikes. His sales target for a newly introduced bike was 20,000 units a month. For this, he involved new channels of distribution. But, he found that the target could not be achieved. Therefore, finally, Automobiles Ltd offered to sell their new bike, at about ₹4,000 less than the usual price’. It is an example of one of the techniques of sales promotion. Name the technique and explain any two other techniques with examples.
Question 18:
Which process prepares a blue print of an organisation’s future preparations relating to finance? Give two objectives, why this process is needed?
Question 19:
Define planning and discuss any three limitations of planning.
Question 20:
OTCEI is an exchange established on the lines of NASDAQ to provide quicker liquidity to securities at fixed and fair prices.
- What are the advantages of OTCEI?
- What values are looked upon by OTCEI to serve the various stakeholders?
Question 21:
Define scientific management. How it can be beneficial for the employees?
Question 22:
Sana is a young professional employed in a multinational company. Her annual package is of ₹ lakh. Since she lives with her parents, therefore she is able to save a major part of her earnings. Her friends are constantly advising her to invest in shares. But, she is not aware about the nitty-gritties regarding the functioning of the stock-exchange. So, she decided to invest in equity through the primary market, assuming that this will help her to earn stable dividends. But her father, who was a retired bank officer told her that even dividends are not stable as they are affected by several factors.
(i) Is Sana’s father right in his assertion?
(ii) Explain the following as factors affecting ‘dividend decision’ :
(a) Stability of dividend
(b) Legal constraints
(c) Access to capital market
(d) Growth opportunities
Question 23:
Stichwell is a leading garment manufacturing company of the country. The company believes in constantly updating their technology, so that latest and modern designs could be incorporated in their products. To keep in line with their mission, the company has just imported certain high-tech machines from Germany. But the workers of the factory are unable to work on new machines and are always demanding help from the supervisor.
The supervisor is overburdened with their frequent calls and ignores the problems of the workers.
- ‘‘The post of supervisor should be abolished in the hierarchy of managers.” Do you agree?
- Explain the role of the supervisor in the organisation.
- Suggest some remedies in this case to the supervisor.
Question 24:
As a project work in marketing management, the MBA students c . TIM thought of preparing apple jam from the apples grown in their school premises and sell it in the school annual fete. They approached the principal who not only appreciated them but also gave his consent for the same. The school decided to donate 50% of the revenue generated from the sale to a nearby orphanage. After the school fete, the school also decided to extend this project by providing employment to visually challenged and disadvantaged sections of society on regular basis.
- Explain any two product-related decisions which the students had to take.
- Suggest any two functions that the ‘label’ of the jam bottle must perform.
Question 25:
Neha and Rekha entered into a partnership business for manufacturing leather bags. Their products have been enjoying good market reputation. Separate departments have been created for production, marketing, finance, human resource and research. The brand name was well established in the market and the product market grew enormously. As the business flourished, they decided to produce leather jackets and leather shoes.
- Suggest an organisational structure to them.
- Also discuss the advantages and limitations of such an organisational structure.
Answers
Answer 1:
In cluster grapevine network, an individual communicates with only those people whom he trusts.
Answer 2:
Three major decisions to be taken in financial management are:
- Investment decision
- Financing decision
- Dividend decision
Answer 3:
‘Right to be Heard’ gives the business firms freedom to setup their own consumer services and grievance cell.
Answer 4:
Coordination is missing in the organisation due to lack of coordination among departments, the organisation is incurring losses.
Answer 5:
Actual performance is compared with the standards in the controlling process to find out the deviations between the actual result and the desired result.
Answer 6:
Communication helps in implementing the principle of scalar chain.
Answer 7:
Planning is the management function which is highlighted in the given case.
Answer 8:
Apprenticeship Programme It is on-the-job training method. Under this, a master worker is appointed as a trainer, who guides the workers regarding the skills of the job.
Answer 9:
This statement refers to ‘staffing’. It is important because:
- It ensures the availability of the most suitable and capable persons for various jobs.
- By placing right person on the right job, it ensures better performance.
- It helps to avoid overmanning, underutilisation of manpower and high labour cost.
Answer 10:
The management function reinsured to correct the above case is controlling.
The procedure is as follows:
- Find out the causes of deviation of defective percentage from 5 to 12.
- Take corrective measures to control things.
Answer 11:
Difference between delegation and decentralisation on the given basis are:
| Basis | Delegation | Decentralisation |
| Purpose | To lessen the burden of the manager. | To increase the role of the subordinates in an organisation by giving them more autonomy. |
| Scope | It has narrow scope as it is limited to superior and his immediate subordinate. | It has wide scope as it implies extension of delegation to the lowest level of management. |
| Status | It is a process followed to share tasks. | It is the result of the policy decision of top management. |
Answer 12:
Mother of Mr Jain is working at top level of management.
The functions performed by her are as follows:
- Determining the objectives of the organisation.
- Assembling all the resources such as finance, capital, material, man, etc.
Answer 13:
(i) Mr Franco has opted to follow ‘Principle of Initiative’. Lines from the para indicative of this principle are, “he collected more than fields.”
(ii) Two positive effects of this principle are:
- Increases the thinking process, creativity and bringing of innovative ideas by the employees.
- Increases the sense of attachment to the organisation.
Answer 14:
- District Forum This is established by the State Government in each district. Only those complaints can be filed in the district forum, where the value of goods or service and the compensation claimed is upto ₹20 lakhs. An order passed by the district forum in a matter of original jurisdiction is appealable before the State Commission.
- National Commission This is established by the Central Government. Only those complaints can be filed in the commission, where the value of goods or services and the compensation sought is more than ₹1 crore.. An order passed by the National Commission in a matter of original jurisdiction is appealable before the Supreme Court.
Answer 15:
The process referred in the stated line is liberalisation. It refers to the process through which government controls and restrictions over the industry are being loosened. Economic liberalisation involves deregulation of the economy and greater autonomy of operations to the private sector and foreign companies.
The purpose of liberalisation is to unlock the economic potential of the country by encouraging the private sector and multinational corporations to operate and expand freely.
The reforms introduced under liberalisation were:
- Abolishing licensing in most of the industries.
- Freedom in deciding the scale of business.
- Freedom in deciding prices of goods and services.
- Reduction in tax rates and unnecessary government controls.
Answer 16:
(i) The first two steps of staffing process for this unit are:
- Estimating Manpower Requirements It means to estimate the number of persons required in the unit.
- Recruitment It is the process of searching for prospective employees and stimulating them to apply for jobs.
(ii) Values which Mr A wants to communicate to society are:
- Equality
- Development of backward areas.
Answer 17:
The name of this technique is ‘rebate’. Under it, in order to clear the excess stock, products are offered at reduced prices.
Two other techniques are explained below:
- Finance @ 0% Under this method, the product is sold and money is received in instalments at 0% rate of interest. The seller determines the number of instalments in which the price of the product will be recovered from the customer. No interest is received on these instalments, e.g. Bajaj offers a bike of ₹40,000 in 10 easy instalments of ₹4,000 each.
- Samples Under this method, the producer distributes free samples of his product among the consumers. Sales representatives distribute these samples from door-to-door. This method is mostly used for products of daily use e.g. washing powder, tea, toothpaste, etc.
Answer 18:
Financial planning is a process which prepares a blue print relating to finance needs. It means estimating the finance requirements of a business and determining the sources of funds. Financial planning includes both short-term and long-term planning.
Following are the two objectives of financial planning:
- To Ensure Availability of Funds, Whenever Required If adequate funds are not available, the business unit will not be able to honour its commitments and plans.
- To See that the Firm does not Raise Funds Unnecessarily If excess of funds are available with the business unit, it will unnecessarily add to the cost and may encourage excess expenditure.
Answer 19:
Planning is a process of deciding in advance what to do and how to do. It is a basic function of a manager which involves setting up of objectives and developing the best possible course of action to achieve these objectives.
Three limitations of planning are discussed below:
- Planning is a Time Consuming Process Sometimes, plans to be drawn up take so much of time that there is not much time left for their implementation. This leads to failure of planning.
- Planning does not Guarantee Success Success of planning rests on its implementation. Lack of proper implementation may lead to failure of planning. Even if a plan has worked earlier, it may not work again due to changes in the external environment.
- Planning Involves Huge Cost It usually involves a lot of time, effort and cost of the managers. Collection of data, boardroom meetings, investigations and discussions with experts involve a lot of expenditure of the organisation. Sometimes, the cost incurred may not justify the benefit derived from the plans.
Answer 20:
(i) Advantages of OTCEI market are given below:
- It provides a platform for trading to smaller and less liquid companies as they are not eligible for listing on a regular exchange.
- Family concerns and closely held companies can go public through OTCEI.
- Dealers can operate both in new issues and in secondary market at their option.
- There is no problem of bad and short deliveries.
- Uniform transparent system of trading with free flow of information between market makers to customers, since there is close contact between them.
(ii) Values looked upon by OTCEI are:
- Safety and fairness in transactions for investors.
- Equality and opportunity in funds raising for smaller companies.
Answer 21:
According to Taylor, “Scientific management means knowing exactly what you want from men to do and seeing that they do it in the best and cheapest way. ”
Scientific management can be beneficial for the employees in the following ways:
- It helps to improve the efficiency of business through standardisation, simplification, specialisation and work study.
- It helps in proper selection and training of the workers.
- It enables employers to minimise the cost of production by eliminating all types of costs.
- Through fatigue study, efficiency and productivity can be improved due to better working conditions and proper rest intervals.
Answer 22:
(i) Yes, Sana’s father is correct in his assertion.
(ii) Factors affecting dividend decision are:
(a) Stability of Dividend Every company adopts the policy of maintaining the stability of dividend per share. From this point of view, a little change in profit should not be allowed to increase or decrease the dividend.
(b) Legal Constraints Certain provisions of the Companies Act put restrictions on payouts as dividend. Such provisions must be adhered to while declaring the dividend.
(c) Access to Capital Market Large and reputed companies generally have easy access to the capital market and therefore may be depended less on retained earnings to finance their growth. These companies tend to pay higher dividends than the smaller companies.
(d) Growth Opportunities If the company has more opportunities for growth, it will require more finance. In such a situation, a major part of the income should be retained and a small part of it should be paid as dividend.
Answer 23:
(i) No, I do not agree with this statement.
(ii) Role of a supervisor can be enumerated as :
- The supervisor maintains day-to-day contact with the workers. He guides them like a friend, philosopher and guide.
- Supervisor in an organisation acts as a link between workers and management. Supervisor handles the problems of the workers and helps to avoid misunderstanding and conflict between management and workers.
(iii) Following are the suggestions to relieve the supervisor:
- Working of machinery should be explained to subordinates clearly.
- Training should be given to the workers to operate the new machines clearly.
- Select most efficient employee to operate the new machinery.
Answer 24:
(i) The two product related decisions which the students had to take are:
- Branding A brand is a name, term, sign, symbol, design or some combination of them used to identify the products and differentiate it from that of its competitors. Thus, branding is the process of assigning a distinctive name or symbol to a product, by which it can be remembered.
- Packaging It refers to the act of designing and producing the container or wrapper of a product. Various kinds of goods are placed into appropriate containers for protection and convenient handling. Thus, packaging implies placing products in suitable packages for delivery of the product to customer or for the purpose of storage and transport.
(ii) The two important functions that the label of the jam bottle must perform, are as follows:
- To describe the product and specify its contents.
- To help in identification of the product or brand.
Answer 25:
(i) Divisional structure will be suitable for them. It is an organisation structure in which various departments are created on the basis of products, territory or region.
(ii) Divisional structure has the following advantages:
- All the activities related to one type of product are grouped under one division, which brings integration and coordination in the activities.
- With more initiative and flexibility, decisions are taken much faster in divisional structure.
- It facilitates expansion and growth as new divisions can be added without interrupting the existing operations.
- Fixation of responsibility and accountability is easy, as divisional heads are responsible for the profits and losses of their divisions.
Divisional structure suffers from the following limitations:
- There is a duplication of physical facilities and functions, which leads to increase in cost.
- Greater autonomy to divisional heads may lead to misuse of authority.
- Managers in each division focus on their own objectives, without thinking of the organisational goals.
- Conflict may arise between different divisions on allocation of funds and other resources.
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