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Business Studies M.C.Q (1 Marks)

Model Paper 2 · CBSE STD 12 Commerce (CBSE - English Medium). 20 questions.

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M.C.Q (1 Marks)

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20 questions · timed · auto-graded

MCQ 21 Mark
Controlling is:
  • ✓
    both forward and backwardslooking
  • B
    Backward-looking
  • C
    neither forward nor backwardslooking
  • D
    Forward-looking
Answer
Correct option: A.
both forward and backwardslooking
(a) both forward and backwards-looking
Explanation: Planning based on facts makes controlling easier and effective. controlling improves future planning by providing information derived from past experience. This way, controlling is both forward and backwards-looking.
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MCQ 31 Mark
Which component of capital structure determines the overall financial risk?
  • A
    Financial need
  • B
    Equity
  • ✓
    Debt
  • D
    Both Debt and Equity
Answer
Correct option: C.
Debt
(c) Debt
Explanation: Debt is cheaper but is more risky for a business because the payment of interest and the return of principal is obligatory for the business.
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MCQ 41 Mark
Match the functions of management in Column I with their explanation in Column II:
(a) Organising(i) Leading, influencing and motivating employees to perform the tasks assigned to them.
(b) Staffing(ii) Recruitment and selection of the personnel.
(c) Directing(iii) Assigning duties, grouping tasks, establishing authority and allocating resources required to carry out a specific plan.
  • A
    (a) - (ii), (b) - (i), (c) - (iii)
  • ✓
    (a) - (iii), (b) - (ii), (c) - (i)
  • C
    (a) - (i), (b) - (iii), (c) - (ii)
  • D
    (a) - (i), (b) - (ii), (c) - (iii)
Answer
Correct option: B.
(a) - (iii), (b) - (ii), (c) - (i)
(b) (a) - (iii), (b) - (ii), (c) - (i)
Explanation: (a) - (iii), (b) - (ii), (c) - (i)
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MCQ 51 Mark
It involves application of high order thinking skills and intellectual faculties, involving vision and foresightedness to decide the things to be done in the future.
Which feature of Planning is stated in the above line?
  • A
    Planning is futuristic.
  • B
    None of these.
  • C
    Planning is pervasive.
  • ✓
    Planning is a mental exercise.
Answer
Correct option: D.
Planning is a mental exercise.
(d) Planning is a mental exercise.
Explanation: Planning requires application of the mind involving foresight, intelligent imagination and sound judgement. It is basically an intellectual activity of thinking rather than doing, because planning determines the action to be taken.
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MCQ 61 Mark
Statement I: Packaging refers to designing and developing the label to be put on the package.
Statement II: Customer support services include after sales services, handling customer complaints and adjustments, procuring credit services, maintenance services, technical services and consumer information.
  • A
    Both the Statements I and II are not correct.
  • ✓
    Statement II is correct and Statement I is not correct.
  • C
    Both the Statements I and II are correct.
  • D
    Statement I is correct and Statement II is not correct.
Answer
Correct option: B.
Statement II is correct and Statement I is not correct.
(b) Statement II is correct and Statement I is not correct.
Explanation: Statement II is correct and Statement I is not correct.
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MCQ 71 Mark
Which of the following is not an objective of financial planning?
  • ✓
    To choose the best investment and financing alternatives by focusing on their costs and benefits.
  • B
    All are the objectives of financial planning.
  • C
    To ensure availability of funds whenever required.
  • D
    To see that the firm does not raise resources unnecessarily.
Answer
Correct option: A.
To choose the best investment and financing alternatives by focusing on their costs and benefits.
(a) To choose the best investment and financing alternatives by focusing on their costs and benefits.
Explanation: The main objectives of financial planning is to ascertain the amount of fixed capital as well as the working capital required in a given period, to determine the amount to be raised through various sources using a judicious debt-equity mix and to ensure that the required amount is raised on time at the lowest possible cost.
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MCQ 81 Mark
A sanitizer manufacturing company wants to become a market leader. For this purpose the manager follows an activity with certain logical steps. The first step suggested by him is to increase profits by at least 30% in the next quarter. What will be the last step of the activity being followed by the manager.
  • A
    Identifying alternative course of action
  • B
    Evaluating alternative courses of action
  • C
    Setting objectives
  • ✓
    Follow-up action
Answer
Correct option: D.
Follow-up action
(d) Follow-up action
Explanation: Follow-up action
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MCQ 91 Mark
Statement I: Under the Consumer Protection Act 2019, a consumer also includes any user of goods if such use is made with the approval of the buyer.
Statement II: Any person who obtains goods or avails services for resale or commercial purpose is nottreated as a consumer and is outside the scope of Consumer Protection Act 2019.
  • A
    Both the Statements I and II are not correct.
  • B
    Statement II is correct and Statement I is not correct.
  • ✓
    Both the Statements I and II are correct.
  • D
    Statement I is correct and Statement II is not correct.
Answer
Correct option: C.
Both the Statements I and II are correct.
(c) Both the Statements I and II are correct.
Explanation: Both the Statements I and II are correct.
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MCQ 101 Mark
Public issue of shares and debentures have to be made under SEBI guidelines. Raising funds from banks and other financial institutions require fulfillment of other norms. The relative ease with which these norms can be met or the procedures completed may also have a bearing upon the choice the source of finance. The factor affecting the choice of capital structure is ________.
  • A
    Capital structure of other countries
  • ✓
    Regulatory framework
  • C
    Stock market conditions
  • D
    Flexibility
Answer
Correct option: B.
Regulatory framework
(b) Regulatory framework
Explanation: Regulatory framework
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MCQ 111 Mark
Which of the following is not a function of Securities and Exchange Board of India (SEBI)?
  • A
    Registration of brokers and subbrokers and other players in the market
  • B
    Training of intermediaries of the securities market
  • C
    Controlling insider trading
  • ✓
    Pricing of securities
Answer
Correct option: D.
Pricing of securities
(d) Pricing of securities
Explanation: Pricing of securities
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MCQ 121 Mark
Assertion (A): Delegation has four major elements.
Reason (R): Delegation is necessary so that the top-level management gets enough time to relax in that time.
  • 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.
  • ✓
    A is true but R is false.
  • D
    A is false but R is true.
Answer
Correct option: C.
A is true but R is false.
(c) A is true but R is false.
Explanation: Delegation is necessary so that the top-level management can focus on more important and critical work at that time.
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MCQ 131 Mark
Which of the following statement is true?
a. A higher tax rate makes debt relatively costlier.
b. A company cannot use debt beyond a point.
c. For maximisation of shareholder’s wealth, debt can be used up to any level if ROI is greater than cost of debt.
d. During a bearish phase, equity shares are more easily sold even at a higher price.
  • A
    option (c)
  • B
    option (a)
  • ✓
    option (b)
  • D
    option (d)
Answer
Correct option: C.
option (b)
(c) option (b)
Explanation: A company cannot use debt beyond a point.
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MCQ 141 Mark
The CEO of SCT Services, Rajan Gopinaths compensation includes salary, commission and other allowances. The company also pays for his insurance and vacations. Identify one indirect payment being made by the company to the CEO.
  • A
    Allowances
  • B
    Salary
  • ✓
    Employer paid Insurance
  • D
    Commission
Answer
Correct option: C.
Employer paid Insurance
(c) Employer paid Insurance
Explanation: Employer paid Insurance
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MCQ 151 Mark
In the ________ market, prices are determined and decided by the management of the company.
  • ✓
    Primary
  • B
    Money
  • C
    Stock
  • D
    Secondary
Answer
Correct option: A.
Primary
(a) Primary
Explanation: Primary
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MCQ 161 Mark
________ is not included in the controlling process.
  • A
    Comparison of actual performance with standards
  • ✓
    Doing work of financial management
  • C
    Measurement of actual performance
  • D
    Analysing deviations
Answer
Correct option: B.
Doing work of financial management
(b) Doing work of financial management
Explanation: Measurement of actual performance, Comparison of actual performance with standards and Analyzing deviations are part of the controlling process.
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MCQ 171 Mark
Financial leverage is called favourable if:
  • A
    If the degree of existing financial leverage is low
  • B
    Return on Investment is lower than the cost of debt
  • ✓
    ROI is higher than the cost of debt
  • D
    Debt is easily available
Answer
Correct option: C.
ROI is higher than the cost of debt
(c) ROI is higher than the cost of debt
Explanation: Financial leverage is the degree to which a company uses fixed-income securities such as debt. Therefore, financial leverage is favourable when the uses to which debt can be put generate returns (ROI) greater than the interest expense associated with the debt (Cost of Debt).
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MCQ 181 Mark
Which one of the following is not a limitation of planning?
  • A
    Dynamic environment
  • ✓
    Top management approach
  • C
    Costly process
  • D
    Rigidity
Answer
Correct option: B.
Top management approach
(b) Top management approach
Explanation: Top management approach is not a limitation of planning.
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MCQ 191 Mark
To be listed on OTCEI, the minimum capital requirement for a company is:
  • A
    Rs. 10 crores
  • B
    Rs. 25 crore
  • C
    Rs. 5 crores
  • ✓
    Rs. 3 crores
Answer
Correct option: D.
Rs. 3 crores
(d) Rs. 3 crores
Explanation: The minimum capital requirement for a company to be listed on the OTCEI is Rs 3 crores and the maximum is Rs 50 crores.
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MCQ 201 Mark
In order to enter into a profession, one has to acquire an educational degree by clearing a specified examination conducted by registered institutes. Which feature of the profession is being revealed?
  • A
    Ethical code of conduct
  • B
    Well defined body of knowledge
  • C
    Professional association
  • ✓
    Restricted entry
Answer
Correct option: D.
Restricted entry
(d) Restricted entry
Explanation: Restricted entry feature of the profession is revealed here.
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M.C.Q (1 Marks) - Business Studies STD 12 Commerce Questions - Vidyadip