CBSE Class 12th Exam 2024: Business Studies Important MCQs & Assertion-Reason Questions

Prepare effectively for the upcoming CBSE Class 12th Business Studies Exam 2024 with these essential Multiple Choice Questions (MCQs) and Assertion-Reason questions. These questions are curated to assist you in your last-minute revision:

Multiple Choice Questions (MCQs)

1. A bottle of Anti- dandruff shampoo mentions ' Clean your hair and get rid of dandruff in one squeeze'. The product-related decision involved is

a) Branding

b) Product quality

c) Packaging

d) Labelling

Answer. d) Labelling

2. SEBI calls for information and issues a show cause notice to stock exchange and its officials seeking explanation and conducting audit and enquiry. Which function is SEBI performing?

a) Regulatory function

b) Development function

c) Protective function

d) Both a) and c)

Answer. a) Regulatory function

3. The allocative function of Financial market helps in

a) Bringing transparency in trading procedure

b) Earning higher rate of return to household sector c) Better functioning of depository

d) Determining the prices of securities

Answer. b) Earning higher rate of return to household sector

4. Some employees have been assigned the job of measuring the output in an objective and reliable way. They are applying different techniques for achieving this aim. Some of these are personal-observation, sample-checking etc. They are also keeping the units of measurement same as that of the units in the standards. Name the step of ‘Controlling process applicable in the above paragraph.

a) Analysing deviations

b) Comparing actual performance with standards

c) Establishing standards.

d) Measurement of actual performance

Answer. d) Measurement of actual performance

5. STATEMENT I: Electronic holdings can be converted into physical certificates with the process of dematerialisation.

STATEMENT II: There is no danger of theft, loss or forgery of share certificates in dematerialisation.

Choose the correct option from the following:

a) Statement I is true and II is false

b) Statement II is true and I is false

c) Both the statements are true

d) Both the statements are false

Answer. b) Statement II is true and I is false

6. The aim of demonetisation was not to

a) Curb corruption

b) Reduce the prices of real estate

c) Withhold the accumulation of black money generated by undeclared income

d) Counterfeit the use of high denomination notes for illegal activities

Answer. b) Reduce the prices of real estate

7. Aarohan Ltd. is a company manufacturing automobiles where division of work into key areas includes production, purchase, marketing, accounts and personnel. Which of the following is a disadvantage of the organization structure of Aarohan Ltd.?

a) It may lead to increase in cost

b) Managers may gain power and assert independence and ignore organization interest

c) It ensures that different functions get due attenti

d) Heads do not get training for top management positi

Answer. d) Heads do not get training for top management positions.

8. Identify the reason which makes management important in the light of the fact that it is generally seen that individuals in an organization resist change, as a change often means moving from a familiar, secure environment into a newer and a more challenging one.

a. Management helps in achieving group goals.

b. Management creates a dynamic organization

c. Management increases efficiency

d. Management helps in the development of society

Answer. b) Management creates a dynamic organization

9. Alo a mobility platform is in the process of laying off 400-500 employees in a move aimed at driving cost efficiency. Which objective of management will the firm not be able to achieve by carrying out this process.

a) Efficiency

b) Social

c) Profit

d) Survival

Answer. b) Social

10. Statement-I Transportation helps in creating time utility and warehousing helps in creating place utility

Statement-II The process of classification of products into different groups on the basis of their important characteristics is known as standardization.

Choose the correct option from the options given below:

a. Statement I is true and II is false

b. Statement II is true and I is false

c. Both the statements are true

d. Both the statements are false

Answer. d) Both the statements are false

11. One of the important decision areas under the marketing function of ……………………is managing inventory

a. Branding

b. Pricing

c. Promotion

d. Physical distribution

Answer. d) physical distribution

12. Which of the following statements about Advertising is incorrect?

a. It is a personal form of communication

b. It is a paid form of communication

c. It is a mass selling technique.

d. It is inflexible as the message can’t be adjusted to the needs of the buyer

Answer. a) It is a personal form of communication

13. What is the primary strategic focus of the company, considering its "The Complete Man" tagline, top position in the menswear industry, and longstanding collection that has enriched a modern gentleman's wardrobe for decades?

(a) ensuring ethical sourcing

(b) reinforcing cultural heritage

(d) maximising production efficiency

Answer. (c) establishing a unique identity

14. Zebronics Technology Solutions, a leading tech company, recently announced its plan to raise additional funds to fuel its expansion and research initiatives. The company's board of directors approved an offer to the existing shareholders to purchase additional shares at a discounted price.

This offer will be available for a specific period. How is Zebronics Technology Solutions planning to raise additional funds in the primary market, while offering its existing shareholders the opportunity to purchase more shares?

(a) conducting an e-IPO to reach a wider digital audience

(b) privately placing shares with select institutional investors

(d) issuing right shares for existing shareholders at a discounted price

Answer. (d) issuing right shares for existing shareholders at a discounted price

15. Ms. Arundhati, the CEO of Sunlife Ltd., is delivering a speech to a group of investors. She is emphasising the significance of the company's success and achievement, which relies on the support of customers, shareholders,suppliers, and intermediaries. She also discusses how establishing a positive association with these parties contributes to enhancing the company's public image in the market. What is the primary goal of Ms. Arundhati's speech?

(a) to increase sales

(b) to generate positive publicity

(d) to build relationships with stakeholders

Answer. (d) to build relationships with stakeholders

16. Which step of the Organising Process involves stating the job description, a document that clearly defines the contents and responsibilities related to a job?

(a) Departmentalization

(b) Assignment of duties

(d) Identification and division of work

Answer. (b) Assignment of duties

17. Startup 20 India Chair Chintan Vaishnav highlighted the G20 startup group's goal of pushing for $1 trillion investment in the global startup ecosystem. Which of the following dimensions of the Business Environment will this goal most likely to influence?

(a) fiscal policy of the government

(b) foreign policy of the government

(d) foreign exchange policy of the government

Answer. (b) Foreign policy of the government

18. The GST Council, during its 50th meeting, resolved a prolonged debate on the tax treatment of online gaming, casinos, and horse racing, deciding to impose a 28% levy on bets and wagers for all three activities and amend GST laws to include online gaming. Which of the following is the most likely impact of the GST council's decision on businesses in the industry?

(a) The cost of doing business will increase, leading to higher prices for consumers.

(b) Businesses will move their operations to other countries with lower tax rates.

(d) The industry will become more competitive.

Answer. (a) The cost of doing business will increase, leading to higher prices for consumers.

19. What aspect of the profession is exemplified in the scenario where Ayesha needs to register herself as a member of ICAI to become a Chartered Accountant?

(a) Service motive

(b) Restricted entry

(d) Ethical code of conduct

Answer. (c) Professional association

20. What is the significance of delegation in the scenario where Sara, as a superior, entrusts her authority to Tiara, her subordinate, to enable her learning, skill development, and better chances of promotion?

(a) facilitation of growth

(b) effective management

(d) motivation of employees

Answer. (c) Employees' development

21. Aarti Steel limited is a large creditworthy company manufacturing Steel. The company seeks to enter the Asian market and therefore wants to raise additional funds of ₹1 crore from the primary market. The finance manager of the company Mr. Sundaram has suggested raising funds by issuing debentures, in order to take advantage of ‘Trading On Equity’. Identify the factor which is an important determinant of the company’s ability to use the ‘Trading on Equity’ and thus the capital structure.

a) return on investment

b) cost of debt

c) cost of equity

d) risk consideration

Answer. a)Return on Investment

22. With the advent of ‘Talk GPT, in the Information Technology industry, companies have started investing in Artificial Intelligence in order to fulfill the expectations of the customers. Largely the customers are showing a positive attitude to the new Artificial Intelligence based Talkbot. Identify the dimensions of the business environment being referred to here.

a) social and economic environment

b) technological and social environment

c) economic and technological environment

d) legal and social environment

Answer. b) technological and social environment

23. Business environment is said to be uncertain as

a) different elements or parts of business environment are closely interrelated

b) it differs from country to country

c) it consists of interrelated forces which arise from different sources

d) it is very difficult to predict future happenings especially when environmental changes are taking place too frequently.

Answer. d) it is very difficult to predict future happenings especially when environmental changes are taking place too frequently.

24. Demonetisation has shown a major impact on all major sectors of the economy. Choose the incorrect statement about the impact of demonetisation.

a) decline in cash transactions

b) increase in bank deposits

c) increase in real estate prices

d) increase in financial savings

Answer. c)increase in real estate prices

25. As the Production Manager of a large company, which method will be followed for Mr Gopesh to gauge the performance of his department

a) sample checking of certain random pieces for quality

b) checking each piece for quality specifications

c) calculation of certain financial ratios

d) checking increase in market share

Answer. a)sample checking of certain random pieces for quality

26. Mr Anand Niketan has been successfully running a chain of restaurants in Delhi and Gurgaon for the past 15 years. Aadhavan, his son, returned to India after acquiring a Master’s degree in Social Work. He suggested to his father that they should enter into a new line of business of Coffee Bars, and provide employment opportunities to differently abled people and in the process create greater economic value for different sections.

After a lot of deliberation, Aadhavan opened his first Coffee Bar under the name of ‘SPESH’ near the college campus. The idea of taking orders was unique. The staff gave a pen and a pad and had codes on the menu in front of the dishes. On pressing the bell, the light would pop and the staff would come to assist customers. The users loved the concept and very soon ‘SPESH’ expanded its outlets to other parts of the city. Aadhavan hired additional 70 employees to manage the new outlets.

Identify the objective(s) that SPESH seeks to achieve through its new venture.

a. organisational and personnel objective

b. organisational and social objective

c. social and personnel objective

d. social objective

Answer. b) organisational and social objective

27. ABC & Co. is conducting a training to help its managers understand the principles of management. However, one employee does not want to attend it as he thinks that such trainings only benefit employees of large organizations and not small firms like his. Which of the following nature of principles of management has the employee NOT understood?

A. flexible

B. general guidelines

C. universal applicability

D. formed by practice and experimentation

Answer. C. universal applicability

28. The revenue of Khazana Ltd has nearly doubled in the last three years. However, due to huge production costs, the company is not making any profits. Considering the financial situation of the company, the management has decided not to declare any dividends. This has made the shareholders of Khazana Ltd very upset. Is the shareholders' reaction justified in this scenario? Choose the correct answer.

A. Yes. The management has no right to decide whether or not dividend can be declared. This right is with the shareholders

B. The management is right in not declaring dividend since the company will need cash to meet the huge costs

C. Ye The revenue of the company has doubled and hence dividend should be given to the shareholders

D. No. The management is right in not declaring dividend since the company does not have any profits

Answer. D. No. The management is right in not declaring dividend since the company does not have any profits

29. The Finance Head of Siddhi & Co informs the CEO that the percentage of net income to sales is 10%. What type of ratio of control is being used here?

A. Profitability ratio

B. Solvency ratio

C. Turnover ratio

D. Liquidity ratio

Answer. A. Profitability ratio

30. Which among the following BEST describes formal organisation?

A ata and Geeta sit close to each other in the office and hence have a very good relationship.

B. The senior leadership is rarely involved in the projects in the middle management.

C. The management has created a separate team for each product line.

D. The primary roles of several team members are undefined

Answer. C. The management has created a separate team for each product line.

Assertion-Reason Questions

1. ASSERTION (A): Management is concerned with efficient use of resources.

REASONING (R): For management both efficiency and effectiveness need to be balanced.

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)

c) Assertion (A) is true but Reason (R) is False

d) Assertion (A) is False but Reason (R) is True

Answer. b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

2. (A) : The Supervisory Level performs the activities according to the plans of Top and Middle level management.

(R) : The Supervisory Level motivates the employees and boosts their morale.

(a) Both (A) and (R) are true and (R) is the correct explanation of (A)

(b) Both (A) and (R) are true but (R) is not the correct explanation of (A)

(d) (A) is false but (R) is true

Answer. (b) Both (A) and (R) are true but (R) is not the correct explanation of (A)

3. A: Planning and controlling are interdependent and interlinked.

R: Planning provides the goals and objectives that the controlling function uses to measure performance.

(a) Both A and R are true, but R is not the correct explanation of A.

(b) Both A and R are true, and R is the correct explanation of A.

(d) A is false, but R is true.

Answer. (b) Both A and R are true, and R is the correct explanation of A.

4. ASSERTION: controlling helps in making efficient use of resources

REASON: An efficient control system keeps a check on the changes taking place in the organisation and in the environment and helps to review and revise the standards in light of changes

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)

c) Assertion (A) is true but Reason (R) is False

d) Assertion (A) is False but Reason (R) is True

Answer. b)Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)

5. Statement-I: The concept of product relates to not only the physical product but also the benefits offered by it from customer's point of view.

Statement-II: The concept of product does not include the extended product by way of after sale services, availability of spare parts, handling complaints etc.

(A) Both Statement-I and Statement-II are correct.

(B) Both Statement-I and Statement-II are incorrect.

(D) Statement-I is incorrect and Statement-II is correct.

Answer. (A) Both Statement-I and Statement-II are correct.

6. Statement I: For products requiring long term storage like agricultural products, the warehouses are located near to the market.

Statement II: Higher the level of inventory, higher will be the level of service to customers but the cost of carrying the inventory will also be high.

a) Statement I is true and II is false

b) Statement II is true and I is false

c) Both the statements are true

d) Both the statements are false

Answer. b) Statement II is true and I is false

7. STATEMENT I: Electronic holdings can be converted into physical certificates with the process of dematerialisation.

STATEMENT II: There is no danger of theft, loss or forgery of share certificates in dematerialisation.

a) Statement I is true and II is false

b) Statement II is true and I is false

c) Both the statements are true

d) Both the statements are false

Answer. b) Statement II is true and I is false

8. Statement-I : Transportation helps in creating time utility and warehousing helps in creating place utility

Statement-II : The process of classification of products into different groups on the basis of their important characteristics is known as standardization.

a) Statement I is true and II is false

b) Statement II is true and I is false

c) Both the statements are true

d) Both the statements are false

Answer. d) Both the statements are false

9. Statement I: Channel of distribution is important as goods are produced at one place and customers are scattered all over in the nook and corner of the country, so the producer needs to distribute the goods through middlemen.

Statement II: Physical movement of goods is transportation of goods from place of production to place of ultimate consumption.

(a) Statement I is true and II is false

(b) Statement II is true and I is false

(d) Both the statements are false

Answer. (c) Both the statements are true

10. Statement I: Demutualisation refers to the legal structure of an exchange whereby the ownership, the management and the trading rights at the exchange are segregated from one another.

Statement II: Demutualisation refers to the process by which a public share company converts into a mutual company.

(a) I is true and II is false

(b) II is true and I is false

(d) Both I and II are false

Answer. (a) Statement I is true and II is false

Utilize these questions to enhance your preparation and boost your confidence for the upcoming exam. Best of luck!