Business StudiesCBSE Class 12 · Sample paper, session 2025-26

CBSE Class 12 Business Studies: sample paper 2025-26

The sample question paper CBSE published for the 2025-26 session, as printed: 34 questions for 80 marks, in sections, with each OR choice shown as an alternative. Try each question first, then open our solution.

Every question here has our step-by-step solution, split into the steps that earn marks. Each one was checked by an independent re-solve from the question paper.

Source: official sample question paper from cbseacademic.nic.in: https://cbseacademic.nic.in/web_material/SQP/ClassXII_2025_26/BusinessStudies-SQP.pdf. Questions are transcribed from that PDF; figures are described in words, so check the official paper for them.

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How the paper is set

Section	Questions	What it has
A	1-20	section letters not printed on the paper; labelled by the CBSE Business Studies pattern
B	21-24	section letters not printed on the paper; labelled by the CBSE Business Studies pattern
C	25-30	section letters not printed on the paper; labelled by the CBSE Business Studies pattern
D	31-34	section letters not printed on the paper; labelled by the CBSE Business Studies pattern

Instructions in brief: 34 questions; marks indicated against each; 3-mark answers 50-75 words, 4-mark about 150 words, 6-mark about 200 words; attempt all parts of a question together.

Section A

section letters not printed on the paper; labelled by the CBSE Business Studies pattern

Q1 · 1 mark · MCQCompetency-basedNature and Significance of Management
The project managers in an organisation set targets for the upcoming months and outline strategies to achieve them. At the same time, they assign specific roles and responsibilities to their team members. They motivate them to meet the deadline, by celebrating their achievements and taking their feedback. Thus, various functions are simultaneously performed by all managers all the time. Name the characteristic of Management discussed above.
1. (A)Management is a dynamic function
2. (B)Management is a continuous process
3. (C)Management is an intangible force
4. (D)Management is goal oriented
Try it first, then show our solutionSolution
1. The managers plan (set targets and strategies), organise (assign roles), direct (motivate) and take feedback, all at the same time and again and again.
2. A series of functions performed simultaneously and all the time by all managers is what makes management a continuous process. Option (B).
  1 mark
Answer: (B) Management is a continuous process
Where the marks are
- Functions performed simultaneously and all the time (1 mark)
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Q2 · 1 mark · MCQCompetency-basedPrinciples of Management
Henri Fayol's principle of discipline which emphasizes obedience to organisational rules and employment agreement, is evolved out of the experience and collective wisdom of managers. The nature of principle of management reflected through the above statement is-------------
1. (A)Universal applicability
2. (B)Flexible
3. (C)Mainly behavioral
4. (D)Formed by practice and experimentation
Try it first, then show our solutionSolution
1. The statement says the principle of discipline grew out of the experience and collective wisdom of managers.
2. Principles of management are derived from practice (experience) and experimentation, so this is the nature being described. Option (D).
  1 mark
Answer: (D) Formed by practice and experimentation
Where the marks are
- Principles arise from experience and experimentation (1 mark)
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Q3 · 1 mark · Assertion-reasonCompetency-basedDirecting
Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative from those given below:
ASSERTION(A): Maslow’s need hierarchy theory of motivation is widely recognised and appreciated yet criticised.
REASON(R): Even though Maslow's theory focuses on needs as a basis of motivation and helps to develop understanding about the motivation phenomenon, his propositions are questioned on their classification and hierarchy.
1. (A)Both Assertion (A) and Reason (R) are true.
2. (B)Both Assertion (A) and Reason (R) are false.
3. (C)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion.
4. (D)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion.
Try it first, then show our solutionSolution
1. The Assertion is true: Maslow's theory is widely recognised yet criticised. The Reason is true: it explains motivation through needs, but its classification and hierarchy of needs are questioned.
2. The questioning of the classification and hierarchy is exactly why the theory is criticised, so R correctly explains A. Option (D).
  1 mark
Answer: (D) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion.
Where the marks are
- Both true, R explains A (1 mark)
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Q4 · 1 mark · MCQPrinciples of Management
Read the following statements carefully:
Statement- I Values are basic truths or guidelines for behaviour which are formed after research in work situations.
Statement- II While practising Principles of Management, values cannot be neglected as business organisations have to fulfil social and ethical responsibility towards society.
In the light of given statements, choose the correct alternative from the following:
1. (A)Both the statements are true.
2. (B)Both the statements are false.
3. (C)Statement I is true, Statement II is false.
4. (D)Statement II is true, Statement I is false
Try it first, then show our solutionSolution
1. Statement I is false: basic truths formed after research in work situations are principles, not values. Values are general rules of behaviour formed by common practice in society.
2. Statement II is true: values cannot be ignored while practising principles, because business has social and ethical responsibilities. Option (D).
  1 mark
Answer: (D) Statement II is true, Statement I is false
Where the marks are
- Values vs principles (1 mark)
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Q5 · 1 mark · MCQCompetency-basedStaffing
Manu Priya is working as the Human Resource Manager of EDT Limited at an annual salary of ₹ 8 lakh per annum and is also offered shares of the company at a set price which is lower than the market price. The method being used to calculate the compensation provided to her is------.
1. (A)Time based direct financial payment
2. (B)Indirect financial payment
3. (C)Time based Pay Plus incentives
4. (D)Performance based direct financial payment
Try it first, then show our solutionSolution
1. A fixed annual salary is a time-based direct payment. The offer of company shares below market price (employee stock option) is an incentive on top of it.
2. Salary plus an incentive is time-based pay plus incentives. Option (C).
  1 mark
Answer: (C) Time based Pay Plus incentives
Where the marks are
- Salary + stock option = time-based pay plus incentive (1 mark)
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Q6 · 1 mark · MCQCompetency-basedBusiness Environment
Out of the following, which is/are the component(s) of the social environment.
1) Rate of inflation has increased by 2% leading to a higher total cost for business enterprises.
2) Various specialty health food and grocery shops have opened in an area where fitness and health enthusiasts live.
3) Life expectancy rate in India has improved over the past 20 years due to adequate health facilities and infrastructure.
4) A company in its human resource manual discloses a zero tolerance policy for racial discrimination and discriminatory practices against employees with disability.
5) The Advertising Standards Council of India prohibits the advertisement that promotes products or services that are banned by law.
Choose the correct option :
1. (A)only 2
2. (B)1,2,3
3. (C)2,4,5
4. (D)2,3,4
Try it first, then show our solutionSolution
1. (1) Inflation is economic. (5) An advertising regulator's prohibition is legal. (2) Health-food shops for fitness enthusiasts reflect lifestyle trends, (3) life expectancy is a demographic trend, and (4) a zero-tolerance policy on discrimination reflects social values.
2. So 2, 3 and 4 are components of the social environment. Option (D).
  1 mark
Answer: (D) 2,3,4
Where the marks are
- Social environment: lifestyle, demography, social values (1 mark)
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Q7 · 1 mark · MCQMarketing
Name the element of marketing mix which includes deciding about the features, quality, packaging, labelling and branding of goods or services or ‘anything of value’ which is offered to the market for sale.
1. (A)promotion
2. (B)place
3. (C)product
4. (D)price
Try it first, then show our solutionSolution
1. Features, quality, packaging, labelling and branding are all decisions about the thing offered for sale.
2. These decisions belong to the product element of the marketing mix. Option (C).
  1 mark
Answer: (C) product
Where the marks are
- Product mix decisions (1 mark)
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Q8 · 1 mark · MCQControlling
Choose the correct statement about the controlling function of management.
1. (A)No corrective action is required when the deviation goes beyond the acceptable range in important areas.
2. (B)Deviations should be analysed for their causes.
3. (C)Measurement of actual performance should be done only after the task is complete.
4. (D)Managers must keep a check on each and every activity, otherwise the entire organisation may suffer.
Try it first, then show our solutionSolution
1. (A) is wrong: deviations beyond the acceptable range in important areas need immediate corrective action. (C) is wrong: performance should be measured during the task as well. (D) is wrong: checking every activity is not economical (control by exception).
2. Deviations must be analysed to find their causes before corrective action is taken. Option (B).
  1 mark
Answer: (B) Deviations should be analysed for their causes.
Where the marks are
- Analysing deviations is a step in controlling (1 mark)
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Q9 · 1 mark · MCQCompetency-basedStaffing
Look at the picture given below and answer the question that follows:
Identify the incorrect statement about the type of source of recruitment depicted above.
1. (A)Management can attract qualified people to apply for vacant positions in the organisation.
2. (B)It may lead to dissatisfaction and frustration among existing employees.
3. (C)Such employees are not likely to be good employees as their background is not sufficiently known.
4. (D)Management has a wider choice while selecting people for employment.
Figure in the paper: Three smiley balls: two red ones on the left each with a speech bubble saying 'Yes!', and a purple one on the right with a speech bubble saying 'I'm looking for Job. Can you Refer Me?' See it in the official paper.
Try it first, then show our solutionSolution
1. The picture shows a person asking existing employees to refer him for a job: recommendations of employees, an external source. A, B and D are correct statements about external sources (qualified people, discontent among existing staff, wider choice).
2. Statement (C) is incorrect: with employee recommendations the candidate's background is in fact reasonably well known, which is the merit of this source. Option (C).
  1 mark
Answer: (C) Such employees are not likely to be good employees as their background is not sufficiently known.
Where the marks are
- Background of referred candidates is known (1 mark)
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Q10 · 1 mark · MCQDirecting
Arrange the following elements of communication process in the correct sequence:
i) Media
ii) Message
iii) Sender
iv) Decoding
v) Receiver
vi) Feedback
vii) Encoding
Choose the correct option:
1. (A)iii,i,vii,ii,v,iv,vi
2. (B)iii,ii,vii,i,iv,v,vi
3. (C)ii,iii,vii,vi,iv,v,i
4. (D)ii,i,vii,iii,v,iv,vi
Try it first, then show our solutionSolution
1. The sender has a message, encodes it into words or symbols, sends it through a medium, the receiver decodes it, receives the meaning and gives feedback.
2. Order: Sender (iii), Message (ii), Encoding (vii), Media (i), Decoding (iv), Receiver (v), Feedback (vi). Option (B).
  1 mark
Answer: (B) iii,ii,vii,i,iv,v,vi
Where the marks are
- Sequence of the communication process (1 mark)
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Q11 · 1 mark · MCQFinancial Markets
Choose the correct statement about the meaning of depository.
1. (A)Depository holds and transfers securities in the Demat Form.
2. (B)Depository serves as an intermediary and buys and sells securities on the instructions of clients.
3. (C)Depository is like a bank and keeps securities in electronic form on behalf of investors.
4. (D)Depository buys securities from a company and sells to the public at a higher price.
Try it first, then show our solutionSolution
1. A depository does not buy or sell securities (that is a broker or underwriter). It is an institution that holds securities electronically for investors.
2. The textbook description: a depository is like a bank and keeps securities in electronic form on behalf of investors. Option (C).
  1 mark
Answer: (C) Depository is like a bank and keeps securities in electronic form on behalf of investors.
Where the marks are
- Meaning of depository (1 mark)
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Q12 · 1 mark · MCQMarketing
A product will be purchased only if it is perceived to be giving the greatest benefit for the money.
Name the feature of marketing reflected in this statement
1. (A)Creating a market offering
2. (B)Customer value
3. (C)Exchange mechanism
4. (D)Needs and wants
Try it first, then show our solutionSolution
1. Buyers compare the benefit a product gives with the price they pay for it.
2. Buying the product that gives the greatest benefit for the money is the idea of customer value. Option (B).
  1 mark
Answer: (B) Customer value
Where the marks are
- Benefit for money = customer value (1 mark)
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Q13 · 1 mark · MCQNature and Significance of Management

Match the concepts of management given in column I with their meaning given in column II

	COLUMN I		COLUMN II
A	Management Hierarchy	i	Involves defining and grouping of activities, resource allocation and establishment of authority relationships.
B	Coordination	ii	Involves establishing performance standards measuring actual performance and taking corrective action
C	Organising	iii	It shows orderly arrangement of individual and group efforts to ensure unity of action in realisation of common objectives.
D	Controlling	iv	Refers to different levels in the organisation created as a result of authority responsibility relationships binding individuals as superiors and subordinates.

Choose the correct option from the following:

(A)A-iv, B-iii, C-ii, D-i
(B)A-ii, B-iii, C-iv, D-ii
(C)A-iv, B-iii, C-i, D-ii
(D)A-iii, B-iv, C-i, D-ii

Try it first, then show our solutionSolution

Hierarchy = levels created by authority-responsibility relationships (iv); coordination = orderly arrangement of efforts for unity of action (iii).
Organising = defining and grouping activities, allocating resources and setting authority relations (i); controlling = standards, measurement and corrective action (ii). Option (C).
1 mark

Answer: (C) A-iv, B-iii, C-i, D-ii

Where the marks are

Matching management concepts (1 mark)

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Q14 · 1 mark · MCQCompetency-basedPlanning
Mr Gun Amroha, the General Manager of Welworth Textiles scans the business environment and adapts the organisation to the changes taking place in different dimensions of the business environment. However, it is still difficult for him to accurately assess the future trends. Identify the limitation of planning related to the above.
1. (A)Planning leads to rigidity.
2. (B)Planning may not work in a dynamic environment.
3. (C)Planning does not guarantee success.
4. (D)Planning reduces creativity.
Try it first, then show our solutionSolution
1. The manager adapts to changes in the environment but still cannot accurately assess future trends.
2. Plans are based on forecasts; in a dynamic, changing environment the future cannot be predicted accurately, so planning may not work. Option (B).
  1 mark
Answer: (B) Planning may not work in a dynamic environment.
Where the marks are
- Dynamic environment limits planning (1 mark)
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Q15 · 1 mark · MCQStaffing
Name the step in the staffing process which enables the organizations to offer opportunities for career advancement to their employees by facilitating learning, thereby helping the organisations to not only attract but also retain its talented people in the organisation.
1. (A)Placement and Orientation
2. (B)Recruitment
3. (C)Training and Development
4. (D)Performance Appraisal
Try it first, then show our solutionSolution
1. Learning opportunities that lead to career advancement help attract and retain talent.
2. This is the training and development step of the staffing process. Option (C).
  1 mark
Answer: (C) Training and Development
Where the marks are
- Learning and career growth (1 mark)
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Q16 · 1 mark · MCQCompetency-basedFinancial Management
‘Game of Clones’, a reputed amusement company has decided to run an advertising campaign for which it is hiring various celebrities. The campaign involves an expenditure of ₹ 150 Crores. Identify the financial decision involved in the above case.
1. (A)Long term investment decision
2. (B)Financing decision
3. (C)Working capital decision
4. (D)Dividend decision
Try it first, then show our solutionSolution
1. A major advertising campaign costing ₹150 crore commits a large amount of funds for long-term benefit and is difficult to reverse.
2. Such commitments are capital budgeting, i.e. long-term investment decisions. Option (A).
  1 mark
Answer: (A) Long term investment decision
Where the marks are
- Large campaign = capital budgeting (1 mark)
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Q17 · 1 mark · MCQCompetency-basedFinancial Management
Arth Nivesh Limited has a high fixed operating cost. The Finance Manager informs the Chief Finance Officer that, in case the company decides to take a loan, for its future financial needs, its fixed financial cost will also increase leading to an overall increase in cost. Identify the factor affecting choice of capital structure discussed above.
1. (A)Cost of debt
2. (B)Floatation cost
3. (C)Risk consideration
4. (D)Control
Try it first, then show our solutionSolution
1. The firm already has high fixed operating costs (high business risk). A loan would add fixed interest (financial risk).
2. When business risk is high, the total risk would rise too much, so the firm should use less debt: the risk consideration. Option (C).
  1 mark
Answer: (C) Risk consideration
Where the marks are
- Business risk + financial risk (1 mark)
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Q18 · 1 mark · MCQCompetency-basedFinancial Markets
The Finance Manager of Elle Pharma Limited, Mr Ashish Manjrekar wants to raise funds through debt or equity to the extent of ₹2 crores. For this purpose, he approaches a well regulated financial market that facilitates the mobilisation of long term capital for companies. Identify the market where Mr Ashish Manjrekar can raise the funds.
1. (A)Money market
2. (B)Secondary market
3. (C)Capital market
4. (D)Wholesale debt market
Try it first, then show our solutionSolution
1. The manager wants long-term funds (debt or equity) worth ₹2 crore.
2. The capital market is the regulated market that mobilises long-term funds for companies. Option (C).
  1 mark
Answer: (C) Capital market
Where the marks are
- Long-term funds = capital market (1 mark)
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Q19 · 1 mark · MCQFinancial Management
‘Companies are required to ensure that the dividend does not violate the terms of loan agreement.’ Identify the relevant factor affecting dividend decisions being discussed above.
1. (A)Access to capital market
2. (B)Legal constraints
3. (C)Stock market reaction
4. (D)Contractual constraints
Try it first, then show our solutionSolution
1. A loan agreement may restrict the dividend the company can pay.
2. Restrictions arising from loan agreements are contractual constraints (legal constraints come from law, e.g. the Companies Act). Option (D).
  1 mark
Answer: (D) Contractual constraints
Where the marks are
- Loan agreement terms (1 mark)
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Q20 · 1 mark · MCQFinancial Management
Read the following statements carefully:
Statement I- The objective of financial management is to maximize the wealth of directors of the company
Statement II- The financing decision of the company is unaffected by the extent of retained earnings.
In the light of given statements, choose the correct alternative from the following:
1. (A)Both the statements are true.
2. (B)Both the statements are false.
3. (C)Statement I is true, Statement II is false.
4. (D)Statement II is true, Statement I is false.
Try it first, then show our solutionSolution
1. Statement I is false: the objective of financial management is to maximise shareholders' wealth, not the directors'.
2. Statement II is false: retained earnings are an internal source of funds, so their amount does affect the financing decision. Option (B).
  1 mark
Answer: (B) Both the statements are false.
Where the marks are
- Wealth of shareholders; retained earnings affect financing (1 mark)
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Section B

section letters not printed on the paper; labelled by the CBSE Business Studies pattern

Answer one of these 2 alternatives.
Q21(A) · 3 marks · Short answerOrganising
State any three points of significance of decentralization.
Try it first, then show our solutionSolution
1. Develops initiative among subordinates: When lower levels are free to take their own decisions they learn to rely on their own judgement, which builds self-reliance and confidence.
  1 mark
2. Develops managerial talent for the future: Subordinates get a chance to prove their abilities, creating a pool of trained people to fill higher positions by promotion.
  1 mark
3. Quick decision making: Decisions are taken close to the point of action without approval from many levels, so they are faster and less distorted. (Also: relief to top management, facilitates growth, better control.)
  1 mark
Answer: Decentralisation develops initiative, develops managerial talent for the future and speeds up decision making (also relief to top management, growth, better control).
Where the marks are
- Any three points: 1 mark each
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OR
Q21(B) · 3 marks · Short answerOrganising
State any three limitations of formal organisation.
Try it first, then show our solutionSolution
1. Procedural delays: The chain of command must be followed for every communication, which increases the time taken to make decisions.
  1 mark
2. Lack of recognition to creative talent: Rigidly laid down policies allow no deviation, so creative talent is not adequately recognised.
  1 mark
3. Incomplete picture of the organisation: It stresses structure and work, not human relationships, so it does not show how the organisation really works.
  1 mark
Answer: Formal organisation causes procedural delays, ignores creative talent and does not give a complete picture of how the organisation works.
Where the marks are
- Three limitations: 1 mark each
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Q22 · 3 marks · Short answerCompetency-basedMarketing
Anabel Creations, an apparel designing company has a huge pile of young men’s and women’s garments to be sold across its branches in various cities. In order to clear the stock, the company has decided to give a heavy discount on its garments, with a view to lure the buyers. It is also visiting various colleges for sponsoring fashion shows in order to push its sales. However, the garments are not liked by the customers as they have not been made as per their needs and preferences.
1. a)
  Identify and state the Marketing Management philosophy being followed by Anabel Creations.
  1 mark
2. b)
  Name and state any two other philosophies of Marketing apart from the one identified in part a.
  2 marks
Try it first, then show our solutionSolution
1. a) Selling concept. Anabel assumes customers will not buy enough unless persuaded, so it relies on aggressive selling and promotion (heavy discounts, sponsored fashion shows) to push products that were not designed around customer needs.
  1 mark
2. b) Production concept: Profit comes from large-scale production at low average cost; consumers favour products that are widely available and affordable.
  1 mark
3. Marketing concept: Long-term profit comes from identifying and satisfying customer needs better than competitors; customer satisfaction is the focus of all decisions. (Also: product concept, societal marketing concept.)
  1 mark
Answer: a) Selling concept. b) Any two of production concept, product concept, marketing concept and societal marketing concept.
Where the marks are
- a) Identifying and stating the selling concept (1)
- b) Any two other philosophies: 1 mark each
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Answer one of these 2 alternatives.
Q23(A) · 3 marks · Short answerFinancial Markets
Give any three points of distinction between the money market and capital market.
Try it first, then show our solutionSolution
1. Participants: Capital market: financial institutions, banks, companies, foreign investors and retail investors. Money market: mainly institutions such as the RBI, banks and finance companies.
  1 mark
2. Instruments: Capital market: equity shares, debentures, bonds, preference shares. Money market: short-term debt instruments such as T-bills, trade bills, commercial paper and certificates of deposit.
  1 mark
3. Duration: Capital market: medium- and long-term securities. Money market: instruments with a maximum tenure of one year, even a single day. (Also: investment outlay, liquidity, safety, expected return.)
  1 mark
Answer: Capital and money markets differ in participants, instruments and duration (also investment outlay, liquidity, safety and expected return).
Where the marks are
- Any three distinctions: 1 mark each
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OR
Q23(B) · 3 marks · Short answerFinancial Markets
Give any three protective functions performed by Securities and Exchange Board of India.
Try it first, then show our solutionSolution
1. Prohibition of fraudulent and unfair trade practices: SEBI prohibits misleading statements, manipulation and price rigging in the securities market.
  1 mark
2. Controlling insider trading: It checks insider trading and imposes penalties for it.
  1 mark
3. Promotion of fair practices and code of conduct: It promotes fair practices and a code of conduct in the securities market. (Also: steps for investor protection, e.g. investor education.)
  1 mark
Answer: SEBI's protective functions include prohibiting fraudulent and unfair trade practices, controlling insider trading and promoting fair practices (also investor protection).
Where the marks are
- Any three protective functions: 1 mark each
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Q24 · 3 marks · Short answerCompetency-basedNature and Significance of Management
Muralidhar Parekh started textile printing business in Gujarat in the year 2022 by using practices like eco-friendly dyeing and printing processes in order to ensure environmental sustainability. Soon the business started flourishing. For the financial year 2024-25, Muralidhar formulated the organisational goal of increasing sales by 10% and framed strategies for their achievement. Since his job was complex and stressful, he appointed subordinates to carry out the main task of implementing and controlling the plans and strategies made by him.
Identify the level at which the necessary workforce was appointed for implementing and controlling the plans and strategies made by Muralidhar Parekh. What will they need to do to carry out this main task? State any two points.
Try it first, then show our solutionSolution
1. Middle level management. Muralidhar (top level) set the goals and strategies; the people appointed to implement and control those plans work at the middle level.
  1 mark
2. Interpret policies: They interpret the policies framed by top management for their departments.
  1 mark
3. Ensure the necessary personnel: They make sure their department has the people it needs. (Also: assign duties and responsibilities, motivate them, cooperate with other departments.)
  1 mark
Answer: Middle level management. They interpret top management's policies and ensure their department has the necessary personnel (also assign duties, motivate, cooperate with other departments).
Where the marks are
- Identification of middle level (1)
- Any two functions: 1 mark each
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Section C

section letters not printed on the paper; labelled by the CBSE Business Studies pattern

Answer one of these 2 alternatives.
Q25(A) · 4 marks · Short answerMarketing
Explain the following functions of Marketing:
a. Customer support services
b. Packaging and labelling
Try it first, then show our solutionSolution
1. a) Customer support services: After-sales service, handling complaints and adjustments, credit, maintenance, technical services and consumer information aim at maximum customer satisfaction; they bring repeat sales and build brand loyalty.
  2 marks
2. b) Packaging and labelling: Packaging is designing and developing the package; labelling is designing the label put on it, from a simple tag to complex graphics. They protect the product and also act as promotional tools, and are called pillars of marketing.
  2 marks
Answer: Customer support services satisfy customers and build loyalty; packaging and labelling protect, inform and promote the product.
Where the marks are
- Each function: 2 marks
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OR
Q25(B) · 4 marks · Short answerMarketing
Explain two features of the following:
a. Personal selling
b. Advertising
Try it first, then show our solutionSolution
1. a) Personal form: Personal selling is a direct face-to-face, two-way dialogue between seller and buyer.
  1 mark
2. Development of relationship: The salesperson builds personal relationships with prospects, which helps in making sales.
  1 mark
3. b) Paid form: Advertising is paid communication: the sponsor bears the cost.
  1 mark
4. Impersonality: There is no face-to-face contact; advertising is a monologue, not a dialogue. (Also: identified sponsor.)
  1 mark
Answer: Personal selling: personal form and development of relationship. Advertising: paid form and impersonality (also identified sponsor).
Where the marks are
- Two features each of personal selling and advertising: 1 mark each
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Answer one of these 2 alternatives.
Q26(A) · 4 marks · Short answerPlanning
Explain why planning is considered as
a) pervasive
b) futuristic function of management.
Try it first, then show our solutionSolution
1. a) Planning is pervasive: Planning is needed at all levels and in all departments, not only by top management, although its scope differs: top management plans for the whole organisation, middle management for departments and lower levels for day-to-day operations.
  2 marks
2. b) Planning is futuristic: Planning looks ahead and prepares for the future; through forecasting, future events are anticipated so that the organisation can meet them to its best advantage.
  2 marks
Answer: Planning is pervasive because it is done at every level and in every department; it is futuristic because it looks ahead through forecasting.
Where the marks are
- Each feature: 2 marks
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OR
Q26(B) · 4 marks · Short answerPlanning
Explain the following as a type of plans :
a) strategy
b) procedure
Try it first, then show our solutionSolution
1. a) Strategy: A comprehensive plan for achieving organisational objectives that sets the broad direction and scope in the long run: it fixes long-term objectives, a course of action and the allocation of resources, keeping the business environment in view.
  2 marks
2. b) Procedure: Routine steps, in chronological order, on how to carry out an activity; they detail the exact manner of doing the work and are meant mainly for insiders.
  2 marks
Answer: A strategy is a comprehensive long-term plan for the organisation's direction; a procedure is the chronological sequence of routine steps for doing a task.
Where the marks are
- Each plan: 2 marks
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Q27 · 4 marks · Short answerCompetency-basedBusiness Environment
The Marketing Research Manager of ‘Trendy Textiles’ has been assigned the task of analysing the influence of Generation Z on fashion trends. On studying the forces that affect business, he observed that increased awareness amongst Generation Z, with respect to, environmental protection, preference of individuality over trends, rejection of traditional norms in clothing, greater use of social media have increased the demand for sustainable and innovative styles in clothing, ‘Do It Yourself’ (DIY) products, promotion of products on various social media platforms by companies.
1. a)
  In context of the above case, identify and explain the feature of the business environment highlighted above.
  2 marks
2. b)
  Explain any two features of the business environment, apart from the one identified in part a).
  2 marks
Try it first, then show our solutionSolution
1. a) Inter-relatedness. The elements of the environment are closely linked: social awareness of Generation Z (environment, individuality) combined with technology (social media) raised demand for sustainable styles and DIY products and changed how firms promote them.
  2 marks
2. b) Dynamic nature: The environment keeps changing through new technology, shifting preferences and new competition.
  1 mark
3. Uncertainty: Future happenings are hard to predict, especially where change is fast, as in fashion or IT. (Also: totality of external forces, specific and general forces, relativity, complexity.)
  1 mark
Answer: a) Inter-relatedness. b) Any two other features, e.g. dynamic nature and uncertainty.
Where the marks are
- a) Identification (1) + explanation (1)
- b) Any two other features: 1 mark each
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Q28 · 4 marks · Short answerControlling
‘A good control system helps the organisation in various ways’. State any four points to support the statement.
Try it first, then show our solutionSolution
1. Accomplishing organisational goals: Control measures progress towards goals, brings deviations to light and indicates corrective action.
  1 mark
2. Judging accuracy of standards: It shows whether the standards are accurate and helps revise them as conditions change.
  1 mark
3. Making efficient use of resources: Activities follow set standards, so wastage and spoilage are reduced.
  1 mark
4. Improving employee motivation: Employees know in advance what is expected and how they will be appraised. (Also: order and discipline, coordination in action.)
  1 mark
Answer: A good control system helps accomplish goals, judge the accuracy of standards, use resources efficiently and motivate employees (also order and discipline, coordination).
Where the marks are
- Any four points: 1 mark each
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Q29 · 4 marks · Short answerCompetency-basedPrinciples of Management
The Factory Manager of Manik Steel Plant, Mussadi Lal was in dilemma over workers shirking work. It was becoming difficult for him to identify the workers who sometimes faked illness to skip work and on various other times, intentionally wasted time, which led to underutilisation of resources. The job of the workers was complex and intricate. He discussed the problem with one of his retired friends, Kantilal, who suggested him to appoint eight supervisors who would be specialists in their own fields and would be assigned work according to his/her qualities. Identify and explain the technique of scientific management discussed above.
Try it first, then show our solutionSolution
1. Functional foremanship. Eight specialist supervisors, each assigned work matching his or her qualities, is Taylor's technique.
  1 mark
2. It extends the separation of planning and execution down to the shop floor. Under the factory manager are a planning in-charge and a production in-charge.
  1 mark
3. Planning in-charge: instruction card clerk (drafts instructions), route clerk (specifies the route of production), time and cost clerk (prepares time and cost sheets) and disciplinarian (ensures discipline).
  ½ mark
4. Production in-charge: speed boss (timely completion), gang boss (keeps machines and tools ready), repair boss (keeps them in working order) and inspector (checks quality).
  ½ mark
5. Each worker takes orders from these eight specialist foremen, so expert supervision checks shirking and wasted time.
  1 mark
Answer: Functional foremanship: eight specialist foremen, four under the planning in-charge and four under the production in-charge.
Where the marks are
- Identification (1)
- Explanation (3)
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Q30 · 4 marks · Short answerCompetency-basedStaffing
PP Motors is a reputed automobile company known for manufacturing high performance four wheelers. The company plans to hire eight new engineers. Akhilesh Banerjee, the Human Resource Manager has eliminated unfit job seekers based on the information supplied in the application forms, conducted various tests and interviews and verified the information of the applicants.
Identify and explain the remaining steps that Mr Banerjee must undertake in order to ensure that the organisation gets the best among the available, from the pool of prospective job candidates.
Try it first, then show our solutionSolution
1. Selection decision: The final choice is made from candidates who passed the tests, interviews and reference checks, giving weight to the views of the manager concerned.
  1 mark
2. Medical examination: Before the job offer the candidate must pass a medical fitness test.
  1 mark
3. Job offer: A letter of appointment is issued to those who cleared every stage, with reasonable time to report.
  1 mark
4. Contract of employment: Documents such as the attestation form and a written contract (title, duties, pay, hours, leave, termination, etc.) are executed.
  1 mark
Answer: The remaining steps are selection decision, medical examination, job offer and contract of employment.
Where the marks are
- Four remaining steps: 1 mark each
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Section D

section letters not printed on the paper; labelled by the CBSE Business Studies pattern

Q31 · 6 marks · Long answerCompetency-basedFinancial Management
Satya Prakash has been successfully running a dry fruit wholesale business in Rajasthan for the past five years. He makes sufficient investments in current assets in order to facilitate smooth day-to-day operations of the business. The company has recently sold dry fruits worth ₹ 50 lakhs to one of its corporate customers, ‘Deshmukh Pure Grains’ on a strict credit policy. Satya Prakash then immediately placed an additional order for replenishment of stock. However, he received the dry fruits from his supplier after a large time lag.
1. a)
  State the concept of Financial Management discussed above.
  2 marks
2. b)
  Briefly explain the factors highlighted above that will affect the requirement of the concept identified in part a).
  4 marks
Try it first, then show our solutionSolution
1. a) Working capital decision. It concerns the levels of cash, inventory and receivables, the current assets that support day-to-day operations.
  2 marks
2. b) Credit allowed: Satya sold on a strict credit policy; strict credit means fewer debtors, so less working capital is needed (a liberal policy would need more).
  2 marks
3. Availability of raw material: Stock arrived after a long time lag (long lead time); the longer the lead time, the more stock must be held and the more working capital is needed.
  2 marks
Answer: a) Working capital decision. b) Credit allowed and availability of raw material (lead time).
Where the marks are
- a) Identification (1) + stating (1)
- b) Two factors: 2 marks each
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Q32 · 6 marks · Long answerCompetency-basedDirecting
Mr Pankaj Kumar is working as the Human Resource Manager in Alankaar Fabrics Limited heading a team of fifteen people in his department. He has played a key role in the success of his organisation by maintaining good interpersonal relations with his subordinates and influencing their behaviour. The subordinates willingly cooperate with him and his working style to increase the output of the organisation.
1. a)
  Identify and explain the element involved in one of the functions of management discussed in the above case.
  2 marks
2. b)
  State any four features of the element identified in part a).
  4 marks
Try it first, then show our solutionSolution
1. a) Leadership, an element of directing: the process of influencing the behaviour of people so that they strive voluntarily towards organisational goals.
  2 marks
2. b) Ability to influence others: Leadership is the ability of a person to influence others.
  1 mark
3. Brings change in behaviour: It tries to change the behaviour of others.
  1 mark
4. Interpersonal relations: It shows the relationship between the leader and the followers.
  1 mark
5. Achievement of common goals: It is exercised to achieve the common goals of the organisation. (Also: it is a continuous process.)
  1 mark
Answer: a) Leadership. b) Ability to influence, change in behaviour, interpersonal relations, achievement of common goals (also continuous process).
Where the marks are
- a) Identification (1) + explanation (1)
- b) Any four features: 1 mark each
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Q33 · 6 marks · Long answerCompetency-basedOrganising
Malini and Shalini recently completed their web designing course from a reputed University in Mumbai. Malini opened her own website development company ’ Rapid Software Private Limited’ .In order to ensure a smooth flow of communication and better control over the operations of her business, she divided the entire work of a company into four departments i.e web designing, accounting, research and development and customer service. All departments are required to report to a coordinating head. The company became successful in the market as all operations were carried out with a high degree of specialisation.
Shalini joined a big group named Babylon.com,Inc. which offered a variety of services like Babylon Web Services, Babylon Prime, Babylon Retail. She was appointed as the head of Babylon Web Services division and was made responsible for the profit or loss of her service division. She was happy to take the responsibility as the division would function as an autonomous unit, thus enabling her to make faster decisions.
1. (a).
  Identify the types of the framework within which managerial and operating tasks are performed, in the organisations, of which, Malini and Shalini were a part of.
  2 marks
2. (b).
  Give any four differences between the frameworks identified above.
  4 marks
Try it first, then show our solutionSolution
1. a) Malini: functional structure (work grouped by functions under a coordinating head); Shalini: divisional structure (an autonomous product/service division responsible for its own profit).
  2 marks
2. b) Formation: Functional: based on functions. Divisional: based on product lines, supported by functions.
  1 mark
3. Specialisation: Functional: functional specialisation. Divisional: product specialisation.
  1 mark
4. Responsibility: Functional: difficult to fix on a department. Divisional: easy to fix for performance.
  1 mark
5. Cost: Functional: no duplication of functions, so economical. Divisional: duplication of resources, so costly. (Also: managerial development, coordination.)
  1 mark
Answer: a) Functional structure (Malini) and divisional structure (Shalini). b) Differences in formation, specialisation, responsibility and cost (also managerial development, coordination).
Where the marks are
- a) Two structures: 1 mark each
- b) Any four differences: 1 mark each
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Answer one of these 2 alternatives.
Q34(A) · 6 marks · Long answerConsumer Protection
State any six reliefs available to a consumer under Consumer Protection Act, 2019.
Try it first, then show our solutionSolution
1. Remove the defect: Remove the defect in goods or the deficiency in service.
  1 mark
2. Replace the product: Replace the defective product with a new, defect-free one.
  1 mark
3. Refund the price: Refund the price paid for the product or the charges paid for the service.
  1 mark
4. Pay compensation: Pay reasonable compensation for loss or injury caused by the negligence of the opposite party.
  1 mark
5. Pay punitive damages: Pay punitive damages in appropriate circumstances.
  1 mark
6. Discontinue unfair trade practice: Stop the unfair or restrictive trade practice and not repeat it. (Also: withdraw or stop making hazardous goods, corrective advertisement, pay costs, contribution to the Consumer Welfare Fund.)
  1 mark
Answer: Reliefs include removal of defect, replacement, refund, compensation, punitive damages and discontinuing unfair trade practices.
Where the marks are
- Any six reliefs: 1 mark each
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OR
Q34(B) · 6 marks · Long answerConsumer Protection
State the rights available under Consumer Protection Act, 2019 for the protection and promotion of interest of consumers.
Try it first, then show our solutionSolution
1. Right to safety: To be protected against goods and services hazardous to life and health (e.g. buy ISI-marked appliances).
  1 mark
2. Right to be informed: To have complete information about the product: ingredients, date of manufacture, price, quantity, directions for use.
  1 mark
3. Right to choose: To choose freely from a variety of products at competitive prices.
  1 mark
4. Right to be heard: To file a complaint and be heard in case of dissatisfaction.
  1 mark
5. Right to seek redressal: To get relief such as replacement, removal of defect or compensation when a product or service falls short.
  1 mark
6. Right to consumer education: To acquire knowledge and be a well-informed consumer throughout life.
  1 mark
Answer: The six rights: safety, to be informed, to choose, to be heard, to seek redressal and to consumer education.
Where the marks are
- Six rights: 1 mark each
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Source: official sample paper, cbseacademic.nic.in. Chapter tags and solutions are ours. Spotted a transcription error? Write tosupport@questionbuddy.in.