Plus One Business Studies Previous Year Questions

Ch:1   Business, Trade and Commerce
  1. Industries which provide support services to other industries are known as :
    (a) Primary Industries (b) Secondary Industries  (c) Tertiary Industries (d) None of these
    Ans : Tertiary
  2. Write any two examples for extractive industries.
    Ans: Mining,Fishing,Hunting,Lumbering
  3. Adwaith, a teacher sold his old car at a profit of ` 10,000.
    • (a) Is it a business activity ?
    • (b) State any three features of business.
  4. Explain any four multiple objectives of business.
  5. Commerce includes trade and _______.
    • (a) Industry (b) Auxiliaries to trade
    • (c) Business (d) Outsourcing
  6. Commerce includes trade and _______.
    (a) Industry     (b) Auxiliaries to trade    (c) Business     (d) Outsourcing
  7. List out any four multiple objectives of business.
  8. Briefly explain the nature of business risk.
  9. Explain the types of Industries with the help of a chart.
  10. Mohan, a teacher in Ernakulam bought a car for ` 5 lakhs. After two months he sold it to Raju for ` 6 lakhs. Is it a business activity ? Why ?
  11. Classify the following industries in to extractive, genetic, manufacturing and construction.
    (a) Mining (b) Poultry farming    (c) Building a dam (d) Sugar production
    Ans : a) Mining – Extractive
              b) Poultry farming – Genetic
              c) Building a dam – Construction
              d) Sugar production – Manufacturing
  12. Match the following :
    •              A                          B
    • (a) Hindrance of place      – Insurance
    • (b) Hindrance of risk         – Transport
    • (c) Hindrance of finance       – Advertising
    • (d) Hindrance of knowledge     – Warehousing
    • (e) Hindrance of time           – Banking
  13. What is Commerce ? Briefly describe the various functions of Commerce.
  14. Which among the following is a personal cause of business risk ?
    • (a) Strike of employees
    • (b) Famine
    • (c) Change in technology
    • (d) Flood
    • Ans:(a) Strike of employees
  15. Classify the following industries into Primary,Secondary and tertiary
    a) Mining  b) Poultry farms  c)Oil refinery    d) Construction of dams  
    e)Baking   f)Advertising.
    Ans : a. Mining – Primary industry
    •         b. Poultry farm – Primary industry
    •         c. Oil refinery – Secondary industry
    •        d. Construction of dam – Secondary Industry
    •        e. Banking – Tertiary Industry
    •        f. Advertising – Tertiary industry
  16. ‘We want to consider a lot of factors before starting a business.’ Explain any 5 of it.
  17. Identify the economics cause of business risk from the following:
    A – Flood
    B – Market Competition
    C – Strike
    D – POwer failure
  18. Classify the following activities into economic and non economic
    (a) Dr.Prakash runs a clinic
    (b) Mrs. Athulya paints a picture to gift on her daughter’s birth day.
  19. Explain any five multiple objectives of business:
  20. Which among the following is a “human cause” of business risk?
    a)Earthquake    b) Mismanagement  c)Change in demand   d)Competition in market
    Ans :  Mismanagement
  21. What do you mean by business risk? What is the reward of businessman for taking this risk?
  22. Describe the importance of profit in business?
  23. Which of the following is not a characteristic of business ?
    • (a) Production
    • (b) Exchange or sale
    • (c) Wages or salaries to investors
    • (d) Risk element
    • Ans:Wages or salaries to investors
  24. Dr. Raju is working in City Hospital, Chennai as medical officer. Mention the category of economic activity in which Dr. Raju belongs. State any two features of this activity.
    Ans: Employment.
  25. Explain any five factors that are important to be considered while starting a business’
  26. The broad’ classification of business activities include …….and………..
    • a) Trade and Auxiliaries to trade
    • b) IndustrY and Commerce
    • c) Industry and Trade
      d) Internal Trade and External Trade
  27. Write any three difference between Profession and employment.
Ch:2    Forms of Business Organisation

Ch:2    Forms of Business Organisation 

  1. The liability of Karta in a Joint Hindu family business is:
    (a) Limited     (b) Unlimited     (c) No liability (    d) None of these
  2.  Complete the following as per hint given.
                  Hint: Partnership Firms : Partners
    • (a) Cooperative societies : ………….?……………..
    • (b) Company : …………?……………..
      Ans : Members,Share holders
  3. Match the following :

     A                                                       B

Equal voting rights       –     Joint Stock Company
Unlimited liability         –     Limited liability
Common seal                 –    Cooperative Societies
Coparceners                   –    Sole proprietorship

  1. Explain Partnership Deed and list out its contents.
  2. “It is a type of business owned and operated by one person.”
    • (a) What form of business is mentioned above ?
    • (b) Explain it and also list out its features.
  3. A _____ partner is one who allows the use of his/her name by a firm, but does not contribute to its capital.
    (a) Active      (b) Sleeping      (c) Nominal       (d) Secret
    Ans : (c) Nominal  
  4. Write any four merits of sole proprietorship.
  5. On the basis of nature of operation, co-operative societies are of different types. Describe any five types of co-operative society.
  6. Explain the features of Joint Stock Company.
  7. Write any ‘three’ features of a Co-op – society.
  8. Match the following :
                  A                                                         B
    (a) Partnership                        –      Member
    (b) Joint Stock Company        –    Partner
    (c) Sole Proprietorship           –  Shareholder
    (d) Co-op – society                 –    Sole Trader
  9. Briefly explain any five features of a Joint Stock Company.
  10. Differentiate between Public Company and Private Company.
  11. What is a Partnership Deed ? What are its contents ?
  12. Write a short note on the following in one or two sentences each
    • (a) Nominal partner
    • (b) H.u.F.
  13. “Profits need to be shared” This statement is not applicable to:
    A – Joint stock company
    B – Partnership
    C – Co operative society
    D – Sole proprietorship
    Ans: Sole proprietorship
  14. Match the following :
    •               A                                        (B)
    • (a) Partnership –                       (1) Co-parcener
    • (b) H.u.F.        –                            (2) Service motive
    • (c) Joint Stock Company        (3) Partner
    • (d) Co-Op-Society                    (4) Shareholder
  15. ‘A company can be described as an artificial person having a separate legal entity,perpetual succession and common seal. 
    1. (a) List any 2 merits and 2 demerits of it.
    2. (b) Differentiate between private company and public company.
  16. State any four privileges enjoyed by a private company.
    Ans: 1. The minimum number of members required to form a private company is only 2 whereas it is 7 in case of public company.
    2. A private company can start business immediately after its incorporation.
    3. A private company need not issue a prospectus or not required to file with the Register a statement in lieu of prospectus.
    4. It need not hold a statutory meeting or file a statutory report.
    5. There is no restriction with regard to the remuneration payable to directors
    6. Only two members can make the quorum for a meeting.
    7. It is not required to offer new shares to existing shareholders in proportion to their share holdings.
  17. Briefly explain any eight features of a joint stock company.
  18. ‘One man One vote’ is the principles of ……….form of business organisation.
    a) joint stock company  b)Partnership    c)co operative society    d)Hindu Joint family business
  19. Write short notes on the following
    a) HUF (Hindu Undivided family business)
    b) Partnership deed.
  20. Jisha and lekha jointly start a business on the basis of an agreement.they contributed capital and sharing risks,engaged in business jointly and severally.
    A – identify the form of business organisation mentioned above.
    B – Describe any four merits and emirates of it.
  21. Name a form of business organization found only in India
  22. Complete the series
    Partnership  –       Partner
    Company     – …?……
  23. Amal,Binu and Chandran decided to start a partnership business.They want to make a partnership  deed. As a commerce  student suggest them the possible aspects to be included in their proposed partnership deed’
  24. “It is a voluntary association of persons, who join together with the motive of welfare of the members.”
    • (a) Identify the form of organization referred above’
    • (b) Explain any three features and four merits of this form of business.
  25. Which among the following is the main characteristic of Hindu Undivided FamiiY Business?
    • a) Single ownershiP
    • b) Transfer of membershiP
    • c) Membership by birth
    • d) Registration is comPulsorY
      Ans: Membership by birth
Ch:3     Private, Public and Global Enterprises
  • Ch:3     Private, Public and Global Enterprises
  1. What is the minimum portion that the Government should hold in the paid up capital of a Government Company ?
    (a) 49%       (b) 51%      (c) 50%       (d) 25%
    Ans : 51%   
  2. Write any two features of Global enterprises.
  3. “These are created by a special act of Parliament or state legislature.”
    (a) Identify the form of public sector enterprise mentioned in the above statement.
    (b) Write two examples of them.
    Ans : Statutory corporations Ex : LIC,SBI,RBI,IFCI, central warehousing corporation
  4. Explain the Departmental undertakings and its features.
  5. Find the odd one out.
    (a) FCI (b) RBI    (c) Indian Railway (d) ONGC
    Ans:  (c) Indian Railway 
  6. State the meaning of Government Company. Write any two limitations of Government Company.
  7. State the features of Global enterprises.
  8. Fill in the blanks as per hint given.
    (a) State Bank of India – Public Sector Bank.
    (b) HDFC Bank – ______ ?
  9. List out any ‘three’ merits of a Statutory Corporation.
  10. Explain any four features of a departmental undertaking.
  11. What are global enterprises ? List out any three features of it.
  12. A government company is any  company in which its paid up capital held by  government is not less than
    1. (a) 49%
    2. (b) 50%
    3. (c) 51%
    4. (d) 26%
  13. List any two features of a statutory corporation.
  14. Briefly explain any three features of global enterprises
  15. What do you mean by a departmental undertaking ? Give two examples.
  16. The paid up capital of a government company should not be less than
    A – 49%
    B – 51%
    C – 50%
    D – 48%

  17. Find the odd one
    A- Canara Bank
    B – Reserve bank of India
    C – Punjab National Bank
    D – Indian Overseas bank
  18. Classify the following public enterprises into departmental,statutory corporations and government company.
    BHEL,RBI,POstal Department,Indian Railway,SAIL,Air India
    Ans :Departmental : Postal department,Indian railway
          Statutory Corporation:RBI, Air India
          Government Company :SAIL,BHEL 
  19. How far global enterprises  benefitted a nation ?
  20. Which among the following is an example of departmental undertaking ?
    a) LIC    b)RBI    c)Doordarshan    d) KSRTC
    Ans : Doordarshan
  21. Distinguish between public warehouses and bonded warehouses.
  22. Explain the features of Global enterprises.
  23. Explain any three features of a statutory corporation?
  24. Huge capital resources and use of advanced technologies are the specialities of global enterprises. Explain any other three features of these enterprises’
  25. Name the form of public sector enterprises that is constituted as an autonomous unit by an Act of Parliament. Explain any four features of such an organisation.
  26. ‘A public sector undertaking formed by, passing an Act in the Parliament’. Identify it. Give an example.
    Ans: Statutory /Public corporation. Ex: SBI,LIC,RBI,KSRTC.
  27. Write any three differences between departmental undertaking and statutory corporations.
Ch: 4 Business Services

Ch: 4 Business Services

  1. Write any two differences between goods and services.
  2. Explain briefly the functions of a commercial Bank. (2 Points)
  3. explain any 4 principles of insurance.
  4. The warehouses which are licensed by the government to accept imported goods before the payment of tax and customs duty are called _______.
    • (a) Bonded warehouses (b) Private warehouses
    • (c) Government warehouses (d) Public warehouses
  5. The warehouses which are licensed by the government to accept imported goods before the payment of tax and customs duty are called _______.
    (a) Bonded warehouses (b) Private warehouses  (c) Government warehouses (d) Public warehouses
    Ans : Bonded warehouse
  6. List out any four basic features of Business service.
    Ans: Intangibility,Inconsistency,Inseparability,Inventory less,Involvement.
  7. Write a short note on different types of banks.
  8. Explain in detail any four principles of insurance with suitable examples.
  9. Warehousing provides ______ utility.
    (a) Time (b) Place   (c) Risk (d) Finance
    Ans: (a) Time
  10. Write a short note on the following :   (a) Bonded warehouses  (b) Government warehouses
  11. Explain any two principles of insurance applicable to life insurance.
  12. Illustrate the various functions performed by Commercial Banks in India.
  13. Which among the following is not a function of warehousine ?
    • (a) Break the bulk
    • (b) Price stabilization
    • (c) Consolidation
    • (d) Mail facilities
      Ans:(d) Mail facilities
  14. Describe the various functions performed by commercial banks in India.
    Functions of commercial banks
    • 1. Acceptance of deposits
      1. a. Savings account
      2. b. Current account
      3. c. Fixed deposit
      4. d. Recurring deposit
    • 2. Lending of funds/Loans and advances
      • a. Loans
      • b. Cash credits
      • c. Trade bills discounting
      • d. Overdrafts
    • 3. Cheque facilities
    • 4. Remittance of funds
    • 5. Allied services
  • a. Bill payments
  • b. Locker facilities
  • c. Buying and selling of shares and debentures
  • d. Payment of insurance premium etc.,
    [Any four functions with explanation 4 X 2 Score],[ Points only 1 score each,maximum 4 score]
  2. Explain any four functions of warehousing.
  3. Mrs.Preetha, a business man took a policy worth Rs. 20 Lakh on her life and insured her business property for Rs.50 lakh.
    Identify the two types of insurance mentioned in the above cases. Explain briefly four principles.
  4. Bring out any two features of business service.
  5. Explain the following principles of insurance
    A – Causa proxima
    B – utmost good faith
    C – mitigation of loss
    D – Contribution
  6. Name any two companies that provide DTH services in India’
  7. Justify the need for business process outsourcing by giving any two points’
  8. List out any three allied services provided by commercial banks’
  9.  Kalyani Associates, a leading umbrella manufacturer wants to store their products up to consumption in a safe place.
    • (a) Name the business service available to them.
    • (b) Explain any three types of this service.
    • (c) Discuss its four functions.
      Ans : warehousing,
  10. VSAT (Very SmaII APerture Terminal) is satellite based “””‘
    • a) rail transPort service
    • b) communication service
    • c) banking service
    • d) air transPort service
      Ans: communication service
Ch: 5 Emerging Modes of Business
  • Ch: 5 Emerging Modes of Business
  1. Which one of the following is not a form of e-banking services ?
    (a) Automated Teller Machine (ATM)
    (b) Point of Sale (PoS)
    (c) Cheque
    (d) Electronic Fund Transfer (EFT)
  2. Write any two examples of B2C transactions.
  3. Write the benefits of e-Business.
    Ans :Online purchase,Online room booking, Electronic payment, Cash withdrawal using ATM
  4. What is a joint venture ?
  5. Write any four payment mechanisms available in online shopping.
    Ans:Cash on delivery,cheque,net banking,credit/debit card,digital cash,e wallets ,google payphone pe,paytm
  6. Write any five differences between traditional business and e-business.
  7. List any ‘one’ method of payment mechanism in online transactions. Suggest any two products suitable for vending machines.
  8. What do you mean by e-banking ? Give two examples for e-banking services.
  9. Describe the following :
    1. (a) e-commerce
      (b) cash on delivery
      Ans : a) E-Commerce: Commercial transactions conducted electronically on the internet is called E-Commerce. It covers a firm’s interactions with its customers and suppliers over the internet.
    2. b) Cash on Delivery: It means that, the payment on e-commerce transaction is made at the time of delivery of goods to the buyer.
  10. cash withdrawal by a customer by using an ATM is an example of———–model of  e-business transaction.
    • (a) B2B
    • (b) B2C
    • (c) Intra B
    • (d) czc
      Ans : (b) B2C
  11. Name any two types of payment mechanisms used in online shopping.
  12. Name any two type of products which are suitable for vending machines.
  13. Difference between traditional business and e-business
  14. ‘E-business has several benefits’. Explain any four of it.
  15. What is the full form of “NEFT”
  16. Identify the E-Business models from the following
    (a) Sale of second hand goods
    (b) Payment made to distributors
    Ans : (a) C2C
    1.     (b) B2B
  17. Suggest any two type of products which are suitable for vending machines.
  18. Name any two types of payment mechanism used in e-business transactions.
  19. Match the following





Milka bakery ordered 100 packets of bread from Vimala bread company through online



The manager of Milka bakery bought a mobile phone through Flipkart



Milka bakery pays their employees salary through their bank accounts.



Milka bakery paid their taxes through online.


24 – Mail order houses provide a lot of convenience to the customers, yet they are not very popular.” Give any two reasons to support this statement’

25 – Commonly used payment mechanism for online transactions are debit and credit cards. Briefly explain the other methods of payment for online transactions.

26 – Suggest any two payment mechanism used in e-Business.

Ch: 6  Social Responsibilities of Business and Business Ethics
  1. Respecting the religious sentiments and dignity of people while advertising a product is :
    • (a) Economic responsibility
    • (b) Ethical responsibility
    • (c) Legal responsibility
    • (d) None of these
  2. State the responsibilities of business towards customers. (3 points)
  3. “Every business should act in a manner that benefits society.”
    • (a) Do you agree with this ?
    • (b) Write any two arguments to justify your answer.
  4. Carbon monoxide emitted by automobiles causes _____ pollution.
    (a) Water (b) Land (c) Noise (d) Air
    Ans: Air
  5. Explain social responsibility of business towards the following interest groups :
    (a) Consumers   (b) Employees  (c) Shareholders or owners
  6. Describe the various basic elements of business ethics.
    Ans:Top Management commitment,Publication of Code,Establishment of compliance mechanism,Involving employees at all levels, Measuring results.
  7. Respecting religious sentiments of society is an example of ______ kind of social responsibility of business.
    (a) Ethical (b) Legal  (c) Economic (d) Discriminating
  8. Briefly explain any four causes of environmental pollution.
  9. How does business import its responsibility to the following interest groups ?
  10. Describe how business impart its responsibility towards the following groups :
    • (a) Owner
    • (b) Worker
    • (c) Consumer
    • (d) Government
    • (e) Community
  11. Ans: Responsibility of business:
    • 1. Owners: a) Safety of investment, b) Adequate return on investment.
    • 2. Workers: a) Fair wages, b) Job security, c) Promotion opportunities
    • 3. Consumers: a) Regular supply of commodities, b) Better quality, c) Reasonable Price,
    • d) Avoidance of unfair trade practices.
    • 4. Government: a) Lawful business, b) Prompt payment of tax.
    • 5. Community: a) Optimum use of natural resources, b) Concentrate in safety and welfare of the people c) Control pollution as far as possible.
  12. Explain the concept of social responsibility of business ? Give two examples for discretionary responsibility of business.
  13. Ans: Social responsibility refers to the obligations of the businessmen which are desirable in terms of the objectives and values of our society (or any meaningful explanation in 2 or 3 sentences).
  14. Examples for discretionary responsibility: a) Giving charity to an educational institution, . b) helping people in natural calamities etc.
  15. Fill in the blanks as per hint given :
    (a) obeyance of law —————- legal responsibility of business.
    (b)Respecting religiousl  and sentiments of people ———?
  16. Selling adulterated goods is against ……….responsibility of business.
    Ans :Ethical
  17. LIst out any element of Business Ethics.
    Ans: Elements of Business Ethics (Any Two)
    • 1. Top management commitment
    • 2. Publication of a ‘code’
    • 3. Establishment of compliance mechanism
    • 4. Involving employees at all levels
    • 5. Measuring results
  18. Business is is essentially a social institution, not merely a profit making activity ,Describe
  19. Give one example for Discretionary responsibility of business.
    Ans :Giving charity to poor people, Helping affected people in natural calamity.
  20. Anu and Vargese are working in a business organisation doing same job.anu is paid rs.500 per day and while Vargese is at 750. Is the act of management is genuine ? why?
    Ans : No, it is against business ethics.
  21. Write how the business impart their responsibility to the following interest groups
    A – Customers
    B – Government
    C – Suppliers
    D – General public
    E – owners.
  22. Respecting the religious sentiments and dignity of people in advertising a product is an example of ……….responsibility
    • (a) Legal
    • (b) Ethical
    • (c) Economic
    • (d) Discretionary
      Ans: Ethical

  23. Briefly explain any two arguments against social responsibility of business
  24. You are appointed as a CEO of a leading manufacturing company having many branches across the country. Explain the steps which you can take to ensure business ethics in your organisation. (Hint – Elements)
  25. Which among the following is against business ethics?
    1. a) Using fair weights and measures
      b) Fair treatment to workers
      c) Earning reasonable Profits
      d) Charging unfair Price
  26. Write any two social responsibilities of business towards consumers
Ch: 7     Formation of a Company

Ch: 7     Formation of a Company

  1. The first stage in the formation of a company is:
    1. (a) Promotion (b) Incorporation
    2. (c) Raising of capital (d) Commencement of business
  2. Two important documents of a company are mentioned in the following statements. Write their names :
    1. (a) It defines the objectives of the company.
    2. (b) It defines the rules regarding the internal management of the company.
  3. Write the difference between Memorandum of Association and Articles of Association.                                                  (4 points)
  4. Explain the various clauses of Memorandum of Association of a Company.
  5. Name any two documents to be submitted before Registrar of Companies for getting a company registered.
    Ans: MA,AA,Prospectus
  6. Narrate any two functions performed by a promoter.
  7. Match the following :
                            A                                                                     B
    (a) Memorandum of Association        –        Invitation to public by a company to
    subscribe its shares or debentures
    (b) Articles of Association         –      Birth certificate of a company
    (c) Prospectus                 –          Define objectives of a company
    (d) Certificate of Incorporation         –         Rules regarding internal management
  8. Memorandum of Association of a company contains different clauses. List out and  explain such clauses.
  9. List any two privileges of a Private Company.
    Ans :
    A – Easy formation – Only two members are required
    B – No need to issue prospectus
    C – Allotment of shares can be done without receiving the minimum subscription
    D – It can start the business as soon as it is incorporated
    E -Minimum two directors
    F – Not Required to keep an index of members.
  10. List out the stages in the formation of a Private Company.
    Ans : Promotion, Incorporation.
  11. Who is a promoter ? List out any two functions of him.
  12. Describe any four clauses of memorandum of association.
  13. Write any five differences between Memorandum of Association and Articles of Association.
  14. Write any four difference between MA and AA
  15. Which clause of the memorandum of association defines the purpose of the company being formed ?
    • (a) Object clause
    • (b) Capital clause
    • (c) Liability clause
    • (d) Name clause
  16. Who is a promoter of a company ? list out any two functions of him.
  17. Who is a promoter ?Describe any three functions of a promoter.
  18. A Memorandum of Association is the major document of a company. Briefly explain the different clauses of it.
  19. Who is a promoter? Describe any two of his functions in relation to the formation of a company.
  20. The document is called the charter or constitution of a joint stock company.
    A – identify the document
    B – Explain its contents.
  21. Match the following :
    • (a) ProsPectus      –      TransferabilitY of shares
    • (b) Public ComPanY      – Primary document
    • (e) Articles of Association  –   Invitation to Public
    • (d) Memorandum of Association – Internal document
  22. Briefly explain any five clauses of Memorandum of Association’
  23. There are persons who assemble resources and undertake the necessary steps to form a such persons.Explain their legal position in the company.
Ch: 8   Sources of Business Finance

Ch: 8   Sources of Business Finance

  1. The internal source of finance include:
    1. (a) Factoring (b) Debentures
    2. (c) Retained earnings (d) Bank loan
  2. Write the name of any three external sources of business finance.
  3. What are the merits of equity shares ?
  4. _____ is an unsecured promissory note issued by a firm to raise funds for a short period varying from 90 days to 364 days.
    1. (a) Equity share (b) Trade credit   (c) Debentures (d) Commercial paper
      Ans : Commercial paper
  5. Briefly explain trade credit as a short-term source of finance.
  6. Even Though lease financing is one of the important sources of finance, it suffers from some limitations. List out any three such limitations.
  7. State any two merits and demerits of debentures.
  8. Identify the document which acknowledges debt of a company.
    (a) Share (b) Debenture    (c) Stock     (d) All of these
  9. What do you mean by working capital ?
  10. Describe the term ‘retained earnings’.
  11. Write four differences between share and debenture.
  12. What do you mean by Retained Earnings ?
  13. Write any three differences between a share and debenture.
  14. ‘Business requires capital for long term and short term purposes.,
    Ans :      Issue of Shares
    1.  Equity shares
    2.  Preference shares
    3.  Issue of debentures
    4.  Loan from financial institutions
    5. Retained earnings
  15. The maturity period of commercial paper is …………………
    (a)- 20-40 Days,(b)60-90 Days,(c)90-364 days,(d)120-365 Days
  16. What is minimum subscription?
    Ans :Minimum Subscription: It is the minimum amount of capital which in the opinion of directors must be raised by a company through issue of shares before making allotment of shares. A public company can’t commence business without raising minimum subscription. Normally the limit of minimum subscription is 90% of the size of the issue.

  17. Match the following




Primary Market

Equity shares

Borrowed fund

Financial leverage

Existing share holders


Owned fund

Right issue

Debt to total capital

Ans : Debenture – Borrowed fund
        Equity shares – Owned fund
          Financial leverage – Debt to capital
        IPO – Primary market
        Right issue –  existing share holders.

19 – Complete the series as per hint given.

A )  equity shares   – Owned fund
B ) Debentures-  ……..?………
20 – Find the odd one out:
a) Trade credit
b) Certificate of deposit
c) bank overdraft
d)Ploughing back of profit
Ans:Ploughing back of profit

20 – What do you mean by plaughing back of profit?

21 – Write any four differences between  a share and a debenture.

22 – A company wants to purchase a plant and machinery as a part of its modemization programme. Identify the type of fund required’

    1. Short term capital
    2.  Working caPital
    3.  Fixed capital
    4.  None of these
      Ans : Fixed capital

23 – Which of the following is not an external source of finance ?

(a) Preference share

(b) Public deposits

(c) Commercial Paper

(d) Equity share
Ans:  Equity share

24 – As a source of finance retained earnings is a better option than other sources.” Justify the statement.

25 – Alpha Ltd. decided to raise fund for its expansion programme’ As a finance manager what are the factors you should consider while choosing a suitable source of finance for the comPanY ? (anY four factors)

26 – Identify the document issued by public companies to invite public to subscribe its shares.

    1. a) Prospectus
    2. b)Memorandum of Association
    3. c) Table A
    4. d) Articles of Association

27 – FilI in the series given :

    1. a) Equity Shares – owned capital
    2. b) Debentures -…..?……
      Ans: borrowed /debt / creditorship

28 – Write any  two merits of retained earnings as a source of finance.

29 – Briefly explain the objectives of International Monetary Fund.

30 –  Briefly describe any two sources of long term capital.

31 –  Write any three merits of ‘factoring’ as a financial service.
            1 .Provides protection to the firms against bad debts

         2. Ensure timely payment of account receivables

        3. Helps the clients to meet liabilities at the earliest

       4. Can focus attention on core activities and debt recovery will be taken care by factors

Ch:  9    Small Business
  1. Examples for traditional industries include:
    (a) Hand looms     (b) Coir industries      (c) Handicrafts    (d) All of these
    Ans:All of these
  2. Briefly explain the problems faced by small businesses.
  3. Expand NABARD.
    Ans: National Bank for Agricultural and Rural Development
  4. Name any one institution constituted for supporting small business in India.
  5. Write a short note on ‘District Industries Centre’.
    Ans : District Industries Centres (DICs): Established in 1978 – To support small entrepreneurs at district level – Provides all facilities and support to set up small and village industries – Identification of suitable schemes for entrepreneurs by Central and State Govts.
  6. The apex bank to provide financial assistance to small businesses is…………….
  7. (a) NCEUS     (b) RWED   (c) WASME    (d) SIDBI
  8. Ans: (d) SIDBI
  9. Explain any ‘four’ problems faced by small businesses in India.
  10. List any two incentives provided by the government for small industries in backward and hilly areas,
    Ans : Incentives provided by the government for small industries:
    1. 1. Land: Every state offers developed plots for setting up of industries.
    2. 2. Power: Power is supplied at a concessional rate of 50%.
    3. 3. Water: Water is supplied on a no profit, no loss basis or with a 50% concession.
    4. 4. Tax holiday: Exemption from paying taxes for 5 or 10 years is given to industries established in backward and tribal areas.
    5. 5. Raw Materials: Get preferential treatment in the matter of allotment of scarce raw materials.
    6. 6. Finance: Subsidy of 10-15 percent is given for building capital assets.
  11. Briefly describe any three Institutions constituted to provide financial assistance to small scale industries in india
    Ans:1. Small Industries Development Bank of India (SIDBI) It is an apex bank set up to meet the credit requirements of small scale sector. It was established in 1990 and its head quarters located at Lucknow. SIDBI provide financial assistance to small scale sector in the following way:
    (1)Refinancing term loans
    (2)Discounting and rediscounting bills of exchange
    (3) Extension of equity type assistance
  12. 2. National Bank for Agriculture and Rural Development(NABARD):NABARD was set up in 1982 to promote integrated rural development.Apart from agriculture, it supports small industries, cottage industries,and rural artisans using credit and non-credit approach.
  13. 3. National small Industries Corporation (NSIC) It was set up in 1955 to promote small business units in the country. It helps small business in the following ways.! (1)Supply indigenous and imported machinery on easy hire purchase terms (2)It distributes indigenous and imported raw materials.
  14. The only international non governmental organisation of micro,small and medium entreprises in india is …….
    a)   NABARD
    b)  SIDBI
    c)  WASME
    d)  UTI
    Ans : WASME
  15. Write a short note on “District industrial centers (DICs)
  16. Write any four major problems faced by small businesses in india.
  17. Name the Small scare unit in which investment in plant and machinery does not exceed rupees 25 lakh’
  18. .Entrepreneurs find it very difficult to run a small scale industries in lndia.Explain any four such important problems faced by small business’
  19. An apex bank set up in India to provide financial assistance to small business organizations is………
    1. a) SIDBI
    2. b) RSBDC
    3. c) IDBI
    4. d) IBRD
    5. Ans : SIDBI
  20. List out any three features of cottage industries.
Ch:  10 Internal Trade

Ch:  10 Internal Trade

  1. Which type of retailers provide door to door services to their customers ?
  2. (a) Street traders (b) Peddlers and hawkers
  3. (c) Cheap jacks (d) Market traders
  4. Write the name of retailers mentioned in the following statements :
    1. (a) Traders having no fixed place of business
    2. (b) Traders having a fixed place of business
  5. Match the following :
                             A                                                           B
    1. Mail order business ———-Network of retail shops
    2. Multiple shops —————–Self service shops
    3. Super markets ——————Shopping by post
  6. What are the services provided by Wholesalers to Manufacturers ? (3 points)
  7. This type of retail shop operates on the principle of self service. Identify the type of retail shop referred here.
    Ans : Super market /Super bazar
  8. Name any four types of itinerant retailers.
  9. Bata Shoe Store is an example of this type of fixed shop large retailers. Identify and explain this type of retailer.
  10. Write any three advantages of departmental store.
  11. What are the major problems faced by small scale industries in India ?
  12. Briefly explain any two problems faced by small business in India.
  13. What are Departmental Stores ? Briefly explain any three features of it.
  14. Identify the large scale retailing business unit selling wide variety of consumer products on the basis of self service ? List out any six features of it.
  15. Identify the type of retail outlets that sell their goods through mail from the following :  Mail order houses (b) Departmental stores  (c) Super markets (d) Multiple shops
  16. ‘Wholesaler is the connecting link between producer and retailer’.
    • (a) Explain any four services provided by them to producers.
    • (b) Describe any two types of fixed shop small retailers.
  17. Identify the type of retailer in the following cases:
    (a) Mr.Sunil sells vegetables on his cycle
    (b) Arun runs a used car showroom
    ( c) deepa runs a medical shop
    Ans:a – hawkers
          B – Second hand goods shop
          C – Single line stores
  18. A producer cannot survive without retailers. Do you agree ? write any five services provided by the retailers to producers?
  19. Who are cheap jacks?
  20. Super market is a large retailing business unit dealing consumer goods.
    A – Describe its features
    B – List any four of its merits and demerits
  21. Find the odd one.
    • (a) General stores
    • (b) SpecialitY shoPs
    • (c) Street stall holders
    • (d) Cheap jacks
  22. Ans :Cheap jacks
  23. Differentiate between Departmental Store and Multiple Shops.
  24. Find the odd one from the follawing :
    • a) Super markets
    • b) Multiple shr:ps
    • c) Market traders
    • d) Mail order houses
      Ans: c) Market traders
  25. List out any two services rendered by  retailers to consumers.
  26. A large retailing unit, selling a wide variety of consumer goods on ,low price and with self- service concept. Identify it and mention any two advantages.
    Ans: Supermarket.
  27. I am a retailer selling goods at different places on fixed days.identify me .
    Ans: market Trader
Ch: 11 International Business
  1.  Which of the following is a mode of entry into international business?
    1. (a) Export (b) Import (c) Contract manufacturing (d) All of these
  2. Explain the following :
    1. (a) Mate’s receipt
    2. (b) Bill of lading
  3. What are the benefits of International business to nation ?
  4. Name the document which serves as an evidence that the shipping company has accepted the goods for carrying to designated destination.
    Ans: Bill of lading
  5. Briefly explain any three important foreign trade promotion measures and schemes.
  6. Write any four differences between Domestic and International business.
  7. Trade between two persons belong to the same country is called ______.
    (a) External trade (b) Internal trade  (c) Foreign trade (d) International trade
  8. Which among the following is a mode of entry in to international business ?
    (a) Contract manufacturing (b) Joint ventures   (c) Wholly owned subsidiaries (d) All of these
  9. Differentiate between licensing and franchising.
  10. What is outsourcing of services ? List out any two benefits of it.
  11. List out any four differences between domestic business and international business.
  12. The scheme to refund excise duties and customs duties to exporters on production of proof of export of goods to authorities is called
    1. (a) manufacturing under bond scheme
    2. (b) duty drawback scheme
    3. (c) advance license scheme
    4. (d) export promotion capital goods scheme
  13. Ans: duty drawback scheme
  14. Write any two reasons for international business.
  15. Write any three reasons for international business.
    Ans: Earning foreign exchange
    1. b. Optimum utilization of resources
    2. c. Price stabilization
    3. d. Improves the quality of goods
    4. e. Establish cooperation among nations [Any two points]
  16. Briefly explain ‘joint ventures’ as a mode of entry into international business.
  17. Write short note on the following :
    1. (a) Special economic zones
    2. (b) Contract manufacturing
  18. Contract manufacturing is also known as ………….
  19. Fill in the blanks as per Hint



  1. Ans L falta,Noida,Cochin,Chennai

20 – Name the following documents
(a) Document issued by custom house for giving permission to export
(b)The document issued as an evidence that the goods have been accepted by the shipping company  for delivery.
Ans: (a) Shipping bill
        (b) Bill of lading

21 – What do you mean by Licensing ? How it is different from from Franchising?

22 – “Outsourcing is essential in todays competitive market”.Explain the need for outsourcing based on the above statement.
Ans :Need/Advantages of Out Sourcing (Any 4)

    1.  Concentrate on core competency :BPO provides an opportunity to the business to concentrate on core areas. It will enable better performance.
    2. Cost reduction:Outsourcing agencies are specialists in their activities. They can perform the same job at a lower cost.
    3.  Convenience and less investment To the extent you can avail of the services of others, your investment requirements are reduced and others have invested in those activities for you.
    4.  Specialization Through outsourcing specialization in business operation can be achieved.
    5.  Avoidance of labour problems Outsourcing help a business to reduce its labour force .So labour problems can be reduced to an extent.
    6.  Economic growth and development It generates employment opportunities. In India IT companies utilizing the full advantages of out sourcing business from foreign countries.

23 – Write short notes on
(a) Joint ventures
(b)Foreign Direct Investment.

24 – Which among the following is a document relating to the payment in international business?
a)  Shipping bill
b) Certificate of origin
c) Letter of credit
d) Export Invoice
Ans :Letter of credit

25 – What is Franchising ?

26 – A receipt issued by the commanding officer of the ship when the cargo is loaded on the ship is known as

    1. (a) shipping bill
    2. (b) mate’s receipt
    3. (c) cargo receipt
    4. (d) shipping order
      Ans:  mate’s receipt

27 – Differentiate between licensing and franchising’

28 – Mr. Hari decided to import some machinery for his proposed garment making unit’ As a commerce student prepare a brief report about the steps involved in import procedure for information to Hari.

29 – Write a report on contract manufacturing in international business’

30 – Which one of the following is NOT an export document?

    1. a) Letter of credit
    2. b) Bill of Lading
    3. c) BiIi of entry
    4. d) Certificate of origin
      Ans:  Letter of credit

31 – Differentiate the terms Licensing and franchising in connection with international business.

32 – From the items given in brackets, choose the suitable

  1. mode of entry into international business for the following cases. (Joint venture,  Contract manufacturing,  Licensing)
    a) Agreement with a manufacturer of foreign country to get the products produced.
    b) A contractual arrangement to access tire patent or technology of a firm for producing goods in foreign countries.
    c) Establishing a firm jointly with a foreign partner.
    Ans : a) Contract manufacturing
            b) Licensing
            c) Joint venture.