MODEL PAPER 2025 Business Studies - MODEL PAPER 2025

Read the following statements carefully:
Statement I: Cost of debt is lower than cost of equity for a company.
Statement II: The objective of financial management is to increase shareholder’s wealth.
In the light of given statements, choose the correct alternative from the following:

Consumers can ask anything regarding the date of manufacturing, MRP, etc, about the product that he intend to buy.
Identify the consumer right highlighted in the above lines.

What are the factors that affect financing decisions?
(a) Cash flow position of the company
(b) Stability of earnings
(c) Degree of financial risk
(d) Contractual constraints
(e) State of capital market
(f) Level of competition
Choose the correct alternative from the following:

Identify the decision which is not taken under financial management.

Mr. Vivek Vaswani, a foodpreneur combined his passion for food with his entrepreneurial skills and started his innovative fast food outlet OH CHILLI! in 2021. He had started his career as a food blogger and had noticed that numerous Indian consumers were looking for reasonable and pure vegetarian fast food options for dining out. The high end restaurants were not opted by many as they were exorbitantly priced. Though many global fast food chains were running across the country, yet not many outlets offered reasonable and healthy pure vegetarian fast food options to consumers. OH CHILLI! became a pioneer in offering a healthy and delicious variety of food.
What came as a surprise for consumers was that even without using onion or garlic in the pasta sauce, marinade and ketchup ,the food could actually taste great. The company witnessed an increase in net profit of 26% in its second financial year and became a market leader.
(I) State the concept of business environment.
(II) Identify and explain in what way, a good understanding of business environment enabled Mr. Vivek Vaswani to improve the performance of the enterprise.

Explain the concept of leadership. Give two situations in which autocratic leadership style is most effective.

Explain the concept of leadership. Give two situations in which autocratic leadership style is most effective.

State how planning
(I) reduces creativity
(II) leads to rigidity.

Give any four points of difference between advertising and personal selling.

When Chandrashekhar Shukla returned to India after completing a Certificate course in Food Quality Assurance and Quality Control from the Netherlands, he was convinced that he would fulfil his grandfather's dream of converting their 58 acre land into a fertile farm. He started by setting out specific goals and laid down related activities to be performed to achieve the goals. Soon he launched his own company ‘Food and Agribusiness Solutions Private Limited’.
He sought to ensure that the future events effectively meet the best interest of the company. He prepared an annual statement for production and sales, based on sales forecasting. He noticed that the farmers grew only paddy due to which land remained idle for the subsequent 8 to 9 months of the year. He identified and assessed various alternatives through which farms could be utilised for the remaining months of the year.
Through his accurate vision, judgement and systematic thinking based on analysis of the facts, he presented a scheme to the farmers where both paddy and vegetables could be grown.
Identify and explain the features of one of the functions of Management highlighted above.

The first step in the controlling process is setting up performance standards.
Explain the subsequent two steps in the process of controlling.

Explain how Planning and controlling are both backward looking, as well as forward looking functions.

When Bhaanupriya joined as technical head of Logic Lotus Innovators, she was keen on increasing the productivity and profitability of the company. However, she observed that the employees were demotivated as no attention was given to their work. Also, the workers were given little freedom to make decisions.
Bhaanupriya decided to stimulate the employees by giving each worker Tshirts with their name on it. She also decided to include workers in work committees. This helped in improving the performance of the workers.
(I) On the basis of the understanding of Maslow’s Need Hierarchy Theory of motivation, identify the human need that Bhaanupriya has recognised in order to make the subordinates act towards achievement of organisational goals.
(II) Identify and explain two incentives that have been provided by Bhanupriya to improve the performance of the employees.

Explain any four factors affecting determination of the price of a product or service.

Explain the four elements of marketing mix.

Leena has been appointed as the Operations Manager in a small trading company dealing in garments, with growing online sales. The company has recently rented space in a warehouse to store garments and mail out orders. In order to take over the responsibilities of order fulfilment, Leena promotes an associate, Kushagra to the post of Inventory and Order fulfilment Supervisor. Kushagra has been given the task to assess whether it is best to process orders as they come in or let them accumulate and then to process them in batches. He concludes that accumulating and then processing them in batches is the best way of fulfilling orders, in order to minimise cost and maximise customer satisfaction.
Through several readings Leena finds that the standard time taken from the placement of order to the delivery of garments for a batch of 100 pieces is 72 hours. This helped her to determine the labour cost.
On the basis of the understanding of concepts of scientific management, identify and explain the techniques used by Leena and Kushagra to improve the performance of the employees.

‘Delegation helps a manager to extend his area of operations as without it, his activities would be restricted to only what he himself can do.’
In light of the above statement, explain how effective delegation helps the organisation in achieving objectives.

Differentiate between functional structure and divisional structure on the basis of:
(I) Formation
(II) Specialisation
(III) Responsibility
(IV) Managerial development
(V) Cost
(VI) Coordination