Strictly Confidential: (For Internal and Restricted Use Only)

Senior School Certificate Examination

March --2024
Marking Scheme---Business Studies (054)
Paper code- 66/3/1
General Instructions:
1 You are aware that evaluation is the most important process in the actual and correct
assessment of the candidates. A small mistake in evaluation may lead to serious
problems which may affect the future of the candidates, education system and teaching
profession. To avoid mistakes, it is requested that before starting evaluation, you must
read and understand the spot evaluation guidelines carefully.
2 “Evaluation policy is a confidential policy as it is related to the confidentiality of
the examinations conducted, Evaluation done and several other aspects. Its’
leakage to public in any manner could lead to derailment of the examination
system and affect the life and future of millions of candidates. Sharing this
policy/document to anyone, publishing in any magazine and printing in News
Paper/Website etc may invite action under various rules of the Board and IPC.”
3 Evaluation is to be done as per instructions provided in the Marking Scheme. It should
not be done according to one’s own interpretation or any other consideration. Marking
Scheme should be strictly adhered to and religiously followed. However, while
evaluating, answers which are based on latest information or knowledge and/or
are innovative, they may be assessed for their correctness otherwise and due
marks be awarded to them. In class -XII, while evaluating two competency-based
questions, please try to understand given answer and even if reply is not from
marking scheme but correct competency is enumerated by the candidate due
marks should be awarded.
4 The Marking scheme carries only suggested value points for the answers
These are in the nature of Guidelines only and do not constitute the complete answer.
The students can have their own expression and if the expression is correct, the due
marks should be awarded accordingly.
5 The Head-Examiner must go through the first five answer books evaluated by each
evaluator on the first day, to ensure that evaluation has been carried out as per the
instructions given in the Marking Scheme. If there is any variation, the same should
be zero after deliberation and discussion. The remaining answer books meant for
evaluation shall be given only after ensuring that there is no significant variation in the
marking of individual evaluators.
6 Evaluators will mark( √ ) wherever answer is correct. For wrong answer CROSS ‘X”
be marked. Evaluators will not put right (✓)while evaluating which gives an
impression that answer is correct and no marks are awarded. This is most common
mistake which evaluators are committing.
7 If a question has parts, please award marks on the right-hand side for each part. Marks
awarded for different parts of the question should then be totaled up and written in the
left-hand margin and encircled. This may be followed strictly.
8 If a question does not have any parts, marks must be awarded in the left-hand margin
and encircled. This may also be followed strictly.

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9 If a student has attempted an extra question, answer of the question deserving more
marks should be retained and the other answer scored out with a note “Extra
Question”.
10 No marks to be deducted for the cumulative effect of an error. It should be penalized
only once.
11 A full scale of marks 80 as given in Question Paper has to be used. Please do not
hesitate to award full marks if the answer deserves it.
12 Every examiner has to necessarily do evaluation work for full working hours i.e., 8
hours every day and evaluate 20 answer books per day in main subjects and 25 answer
books per day in other subjects (Details are given in Spot Guidelines). This is in view
of the reduced syllabus and number of questions in question paper.
13 Ensure that you do not make the following common types of errors committed by the
Examiner in the past:-
● Leaving answer or part thereof unassessed in an answer book.
● Giving more marks for an answer than assigned to it.
● Wrong totalling of marks awarded on an answer.
● Wrong transfer of marks from the inside pages of the answer book to the title page.
● Wrong question wise totalling on the title page.
● Wrong totalling of marks of the two columns on the title page.
● Wrong grand total.
● Marks in words and figures not tallying/not same.
● Wrong transfer of marks from the answer book to online award list.
● Answers marked as correct, but marks not awarded. (Ensure that the right tick
mark is correctly and clearly indicated. It should merely be a line. Same is with
the X for incorrect answer.)
● Half or a part of answer marked correct and the rest as wrong, but no marks
awarded.
14 While evaluating the answer books if the answer is found to be totally incorrect, it
should be marked as cross (X) and awarded zero (0)Marks
15 Any unassessed portion, non-carrying over of marks to the title page, or totaling error
detected by the candidate shall damage the prestige of all the personnel engaged in the
evaluation work as also of the Board. Hence, in order to uphold the prestige of all
concerned, it is again reiterated that the instructions be followed meticulously and
judiciously
16 The Examiners should acquaint themselves with the guidelines given in the
“Guidelines for spot Evaluation” before starting the actual evaluation.
17 Every Examiner shall also ensure that all the answers are evaluated, marks carried over
to the title page, correctly totalled and written in figures and words.
18 The candidates are entitled to obtain photocopy of the Answer Book on request on
payment of the prescribed processing fee. All Examiners/Additional Head
Examiners/Head Examiners are once again reminded that they must ensure that
evaluation is carried out strictly as per value points for each answer as given in the
Marking Scheme

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1 Q. 'Bonfast Cement Ltd.' supports 7 villages with housing
facilities, schools, safe drinking water, health and hygiene.
The company sends its employees to visit a nearby village
every 15 days to provide support and to see whether the
facilities provided are being implemented on ground. The
objective which 'Bonfast Cement Ltd.' is trying to achieve
is:
(A) Personal objective
(B) Social objective
(C) Organizational objective
(D) Economic objective

Ans. (B) Social objective 1 Mark

2 Q. ________ is concerned with designing jobs that include

greater variety of work content, require higher level of
knowledge and skill, and give workers more autonomy and
providing them opportunity for personal growth and a
meaningful work experience.
(A) Job security
(B) Perquisites
(C) Employee recognition programme
(D) Job enrichment

Ans. (D) Job Enrichment 1 Mark

3 Q. Due to increasing presence of women in the workforce,

‘Kisan Mart' comes out every Friday with big discount
offers on daily use items to attract office-going women to
shop on weekends.
Which dimension of business environment is being
highlighted in the above case?
(A) Social environment
(B) Legal environment
(C) Political environment
(D) Technological environment

Ans. (A) Social environment 1 Mark

4 Q. To motivate its employees on one side, 'Harshita Pearls'

rewards them with increase in pay, promotion,
recognition, etc. whereas on the other side it stops

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increments, gives punishment, threatens employees so that
they may act in a desired manner.
Which feature of motivation is being highlighted in the
above case?
(A) Motivation is a complex process.
(B) Motivation is an internal feeling.
(C) Motivation can be either positive or negative.
(D) Motivation produces goal-directed behaviour.

Ans. (C) Motivation can be either positive or negative. 1 Mark

5 Q. 'Mudro Infratech' got a short-term contract for building

two villas within a period of ten months with the
expectation to earn a huge amount of profit. The Works
Manager accepted this challenge and completed the work
within the given time period. The profit of the company
went up by 40% due to this temporary order. The Finance
Manager was aware that the company would not earn this
huge profit in the near future. So, he decided not to
increase dividend per share as earnings for the year had
gone up, but not the earning potential of the company. He
also knew that this increase in earnings was temporary in
nature.
The factor affecting Dividend Decision being highlighted
above is:
(A) Cash flow position
(B) Shareholders' preference
(C) Growth opportunities
(D) Stability of dividends

Ans.(D) Stability of dividends 1 Mark

6 Q. Raunaq, while studying at the university, felt that there

should be a food joint in the university campus to provide
food to students round the clock After passing out of
college, he set up 'Hunger Point', a food joint with a varied
menu ranging from burgers, pizzas, street food and much
more, in the university campus. For this, he obtained
necessary permissions from the university administration.
Since he was the first one to recognize the need for a food
joint for all the students in an environment where students
study day and night, it soon became a popular eating joint.

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Within six months, 'Hunger Point' started earning good
profits.
Identify the point of importance of business environment
discussed in the above case:
(A) It enables the firm to identify opportunities and get
the first mover advantage.
(B) It helps the firm to identify threats and early warning
signals.
(C) It helps in assisting in planning and policy formulation.
(D) It helps in improving performance.

Ans. (A) It enables the firm to identify opportunities and get the 1 Mark
first mover advantage.

7 Q. 'Maslow's Need Hierarchy theory' is based on certain

assumptions. Identify the incorrect statement with respect
to these assumptions:
(A) People's behaviour is based on their needs.
(B) A satisfied need can no longer motivate a person.
(C) People's needs are in a hierarchical order, starting
from basic needs to higher level needs.
(D) A person moves to lower level of need only when a
higher-level need is satisfied.

Ans. (D) A person moves to lower level of need only when a 1 Mark
higher-level need is satisfied.

8 Q. Niyati is working as a teacher in a school in Mansarovar

Garden. She always tells the children at the school not to
pollute the environment, and not to throw wrappers of
chips and chocolates here and there. She always carries a
bag with her to collect the wrappers and put them in the
dustbin. By doing this, which responsibility of a consumer
is she discharging:
(A) Reading labels carefully
(B) Asserting to get a fair deal
(C) Respecting the environment
(D) Being honest in the dealings

Ans. (C) Respecting the environment. 1 Mark

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9 Q. Choose the incorrect statement with respect to
demonetization:
(A) The two largest denomination notes of ₹ 500 and ₹
1000 were demonetized with immediate effect, ceasing
to be legal tender except for buying properties.
(B) The aim of this step was to curb corruption and
accumulation of black money.
(C) It led to the tax administration channelizing savings
into the formal financial system.
(D) Restrictions were placed on the convertibility of
domestic money and bank deposits.

Ans. (A) The two largest denomination notes of ₹ 500 and ₹1,000
were demonetized with immediate effect, ceasing to be 1 Mark
legal tender except for buying properties.

10 Q. Read the following statements: Assertion (A) and Reason

(R). Choose the correct alternative from the options given
below:
Assertion (A): When the allocative function is performed well,
scarce resources are allocated to those firms which have
the highest productivity for the economy.
Reason (R): Allocative function allocates or directs funds into
their most productive investment opportunity.
(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, but
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.

Ans. (A) Both Assertion (A) and Reason (R) are true and Reason 1 Mark
(R) is the correct explanation of Assertion (A).

11 Q. The legal framework in India requires the manufacturers

to provide information about ingredients, date of
manufacture, quantity, price, directions for use, etc., on the
label of the product.
From the following, identify the consumer right that is
satisfied by the firm by fulfilling the requirement:
(A) Right to safety
(B) Right to be informed

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(C) Right to be assured
(D) Right to be heard

Ans. (B) Right to be informed. 1 Mark

12 Q. From the following, identify the one which is not a function

of stock exchange:
(A) Providing liquidity and marketability to existing
securities
(B) Spreading of equity cult
(C) Ensuring safety of transactions
(D) Ensuring that there is no scope for speculation

Ans. (D) Ensuring that there is no scope for speculation. 1 Mark

13 Q. Statement 1: Leadership indicates the ability of an

individual which influences the behaviour of others.
Statement II: Leadership is exercised to achieve personal
goals of the leader.
Choose the correct option from the following:
(A) Statement I is true and Statement II is false.
(B) Statement II is true and Statement I is false.
(C) Both the Statements are true.
(D) Both the Statements are false.

Ans. (A) Statement I is true and Statement II is false. 1 Mark

14 Q. Identify from the following what is depicted in the given

picture:

(A) Trade Mark only

(B) Brand Name only
(C) Brand Mark only
(D) Both Brand Name and Brand Mark

Ans. (D) Both Brand Name and Brand Mark. 1 Mark

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15 Q. In the ________________ a securities account can be
opened, all shares can be deposited in it. These can be
withdrawn/sold at any time and instruction to deliver or
receive shares on behalf of the investor can be given.
(A) Primary market
(B) Stock exchange
(C) Bank
(D) Depository

Ans. (D) Depository. 1 Mark

16 Q. Statement 1: The objective of financial management is to

maximize shareholders' wealth.
Statement II: The shareholders gain if the value of shares
in the market increases.
Choose the correct option from the following:
(A) Statement I is true and Statement II is false.
(B) Statement II is true and Statement I is false.
(C) Both the Statements are true.
(D) Both the Statements are false.

Ans. (C) Both the Statements are true. 1 Mark

17 Q. Most of the organizations these days have adapted

themselves to changing environment. To reach and engage
with the target customers, they started to have a strong
presence on social media like Facebook, Instagram, etc.
From the following, identify the feature of management
being highlighted:
(A) Management is a group activity.
(B) Management is a continuous process.
(C) Management is multidimensional.
(D) Management is a dynamic function.

Ans. (D) Management is a dynamic function. 1 Mark

18 Q. Match the Levels of Management given in Column I with

the functions performed at each level given in Column II:

Column I Column II

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1 Top Level Management (i) They directly
oversee the efforts
of the workforce
2 Middle Level (ii) They ensure that
Management their department
has the necessary
personnel
3 Operational (iii) They are
Management responsible
for the welfare and
survival of the
organisation.

Choose the correct option from the following:

(A) 1-(i), 2-(ii), 3-(iii)
(B) 1-(iii), 2-(ii), 3-(i)
(C) 1-(iii), 2-(i), 3-(ii)
(D) 1-(ii), 2-(iii), 3-(i)

Ans. (B) 1-(iii), 2-(ii), 3-(i) 1 Mark

19 Q. 'Panmol Dairy' started using environment-friendly

'Bilona' method of making ghee, unlike other dairies
which were using modern methods involving machines
and chemicals. By doing this, ‘Panmol Dairy’ is providing
employment to hundreds of illiterate people in the rural
areas. Which objective of management is ‘Panmol Dairy'
trying to achieve:
(A) National objective
(B) Personal objective
(C) Social objective
(D) Economic objective

Ans. (C) Social objective 1 Mark

20 Q. Which of the following statements is not highlighting the

importance of financial planning:
(A) It helps in forecasting what may happen under
different business situations.
(B) It helps in avoiding business shocks and surprises and
helps the company in preparing for the future.
(C) It provides a link between investment and financing
decisions on a continuous basis.

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(D) Detailed plans of action prepared under financial
planning increases waste, duplication of efforts and
gaps in planning.

Ans. (D) Detailed plans of action prepared under financial

planning increases waste, duplication of efforts and gaps 1 Mark
in planning.

21 Q. Two ambitious friends, Sana and Mihir, having passion for

creating innovative software applications, established a
tech startup named ‘Quick Solutions'. Their software was
developed in such a way that it caters to the needs of all
sections. Since its inception, 'Quick Solutions' was earning
enough revenue to cover the costs. They faced countless
challenges from competing with large and well-established
companies. But they learned from their mistakes and
continuously improved their product. Slowly, their software
gained recognition for its quality and uniqueness and the
company started making profits. It was a big incentive for
Sana and Mihir for the continued successful operation of
the enterprise. Within two years, the customer base
increased manifold. Now, Sana and Mihir decided to make
additional capital investment and hired more employees.
They invested in research and development and expanded
their product line to meet emerging market demands.
‘Quick Solutions' ultimately became the industry leader
because of the tireless efforts of Sana and Mihir.
Quoting lines, identify and state the objectives of
management discussed in the above case which 'Quick
Solutions' seeks to achieve.

Ans.
Organisational Objectives

(i) Survival
‘Since its inception, 'Quick Solutions' was earning enough
revenue to cover the costs’
• The basic objective of any business is to ensure that it
continues to survive and exist in the future. An
organisation must earn enough revenue to cover the costs.

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(ii) Profit
‘Slowly, their software gained recognition for its quality and
uniqueness and the company started making profits’
• Profit provides a vital incentive for the continued
successful operation of the enterprise. Profit is essential
for covering costs and risks of the business.

(iii) Growth 1/2 mark for

‘Now, Sana and Mihir decided to make additional capital quoting and
investment and hired more employees.’ identification
OR +
‘They invested in research and development and expanded their 1/2 mark for
product line to meet emerging market demand’. explanation
• Management must exploit the growth potential of the
organisation to remain in the industry which can be 1x3 =
measured in terms of sales volume, increase in the number 3 Marks
of employees.

22 (a) Q. Explain any three psychological barriers to

communication.
1/2 mark for
Ans. Psychological barriers to communication (any three with heading
explanation) +
1/2 mark for
1) Premature evaluation explanation
2) Lack of attention
3) Loss by transmission and poor retention 1x3 Marks
4) Distrust = 3 Marks

(If an examinee has not given the heading as above but has
given the correct explanation, full credit should be given.)
OR

(b) ‘Directing helps in effective and efficient functioning of

the organization.' Explain this statement by giving any
three points.

Ans. Importance of directing (any three points)

• Directing helps to initiate action: Directing helps to initiate

action by people in the organisation towards attainment of
desired objectives.

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• Directing integrates employees’ efforts: Directing integrates
employees’ efforts in the organisation in such a way that
every individual effort contributes to the organisational
performance. Thus, it ensures that the individuals work for
organisational goals.

• Directing guides employees to fully realise their potential :

Directing guides employees to fully realise their potential and
capabilities by motivating and providing effective leadership..

• Directing facilitates introduction of needed changes in the

organisation: Effective directing through motivation,
communication and leadership helps to reduce such
resistance.

• Effective directing helps to bring stability: Effective directing

helps to bring stability and balance in the organisation since it
fosters cooperation and commitment among the people and
helps to achieve balance among various groups, activities and 1x3 Marks
the departments. = 3 Marks

(If an examinee has not given the heading as above but has
given the correct explanation, full credit should be given.)

23 Q. Neeraj Ltd. started an airline to provide good quality air

services. For the same, he purchased ten aircrafts. Out of
these, two aircrafts would be used to train the pilots. It
will help them to achieve proficiency in handling the
aircrafts before they would actually fly them.
(i) Identify and explain the method of training discussed
above.
(ii) State any two advantages the pilots would get from
this training.

Ans.
(i) Vestibule Training 1/2 mark for
• Employees learn their jobs on the equipment they will be identification
using, but the training is conducted away from the actual +
work floor. 1/2 Mark for
• This is usually done when employees are required to handle explanation
sophisticated machinery and equipment. = 1 Mark

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(If the examinee has identified the method of training as Off the
Job then only ½ mark has to be awarded)

(ii) Advantages to the pilots (any two)

(i) Improved skills and knowledge due to training lead to

better career of the individual.

(ii) Increased performance by the individual help him to earn

more. 1x2 Marks

(iii) Training makes the employee more efficient to handle

machines thus, less prone to accidents.
1+ 2
(iv) Training increases the satisfaction and morale of = 3 Marks
employees.

24 (a) Q. Give the meaning of 'Contract Note' and ‘T+2' system

in the trading procedure in a stock exchange.

Ans. (a)
Contract Note
Contract note is a document that contains details of the
number of shares bought or sold, the price, the date and
time of deal and the brokerage charges along with a unique
order code assigned to each transaction.
After the trade has been executed, within 24 hours the
broker issues a Contract Note.

T+2 system
All trading transactions are to be completed within 2 days
delivery of shares and payment received from the buyer is
on a T+2 basis, settlement period.
Cash is paid or securities are delivered on pay-in day, which
is before the T+2 day. On the T+2 day, the exchange will 1½ x 2
deliver the share or make payment to the other broker. This = 3 Marks
is called the pay-out day.

OR OR

(b) Q. State any three regulatory functions of Securities and

Exchange Board of India.

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Ans. Regulatory Functions (any three)
1. Registration of brokers and sub brokers and other players in the
market.
2. Registration of collective investment schemes and Mutual
Funds.
3. Regulation of stockbrokers, portfolio exchanges, underwriters
and merchant bankers and the business in stock exchanges and
any other securities market.
4. Regulation of takeover bids by companies.
5. Calling for information by undertaking inspection, conducting
enquiries and audits of stock exchanges and intermediaries.
6. Levying fee or other charges for carrying out the purposes of
the Act.
7. Performing and exercising such power under Securities
Contracts (Regulation) Act 1956, as may be delegated by the 1x3 =3 Marks
Government of India.

25 (a) Q. Explain the following functions of marketing:

(i) Customer support services
(ii) Product designing and development

Ans.
(i) Customer support services
• Customer support services include after sales services, 2 Marks
handling customer complaints and adjustments, procuring
credit services, maintenance services, technical services
and consumer information.
• These services aim at providing maximum satisfaction to
the customers and are very effective in bringing repeat
sales from the customers and developing brand loyalty for a
product.

(ii) Product designing and development

• The design of the product contributes to making the 2 Marks
product attractive to the target customers.
• A good design can improve performance of a product and
also give it a competitive advantage in the market. 2+2 = 4 Marks

OR OR

(b) Q. Explain 'Advertising' and 'Personal Selling' as tools of

promotion used by the marketers.

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Ans.
Advertising
• Advertising is an impersonal form of communication, 2 Marks
which is paid for by the marketers (sponsors) to promote
some goods or service.
• The most common modes of advertising are ‘newspapers’,
‘magazines’, television’, and ‘radio’.

Personal Selling
• Personal selling involves oral presentation of message in 2 Marks
the form of conversation with one or more prospective
customers for the purpose of making sales. It is a personal
form of communication.
• Companies appoint salespersons to contact prospective
buyers and create awareness about the product and develop 2+2 = 4 Marks
product preferences with the aim of making sale.

26 Q. Vibhas recently joined as a Human Resource Manager of

Bajanta Enterprises'. The company had embarked on a
special project for which Vibhas had appointed twenty new
employees. After the employees underwent on-the-job
training for a month and had been on the job for some
time, there was a need to evaluate their performance
against certain pre-determined standards. Not only this,
'Bajanta Enterprises' had to address the career related
issues and promotional avenues for their employees. Vibhas
was designing activities to serve their employees' long-term
interests. By doing this, 'Bajanta Enterprises' had
completed the two important steps of staffing process.
Identify and explain those steps.

Ans.
Two steps of staffing:

(i) Performance Appraisal

Performance appraisal means evaluating an employee’s
current and/or past performance as against certain
predetermined standards.
The employee is expected to know what the standards are
and the superior is to provide the employee feedback on
his/her performance.

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(ii) Promotion and career planning 1 Mark for
Managers need to design activities to serve employees’ identification
long-term interests also and encourage employees to grow +
and realise their full potential. 1 Mark for
Promotions are an integral part of people’s career where an Explanation
employee is in position of increased responsibility. 2x2 Marks
= 4 Marks
27 (a) Q. Explain any four limitations of 'Planning'.

Ans. Limitations of 'Planning' (any four with explanation) 1/2 Mark for
1. Planning leads to rigidity heading
2. Planning may not work in a dynamic environment +
3. Planning reduces creativity 1/2 Marks for
4. Planning involves huge costs Explanation
5. Planning is a time-consuming process
6. Planning does not guarantee success 1x4 Marks =
4 Marks
(If an examinee has not given the heading as above but has
given the correct explanation, full credit should be given.)

OR OR

(b) Q. Explain any four points of importance of 'Organising'.

Ans. Importance of 'Organising'(any four with explanation)

1. Benefits of specialisation. 1/2 Mark for
2. Clarity in working relationships heading
3. Optimum utilisation of resources +
4. Adaptation to change. 1/2 Marks for
5. Effective administration Explanation
6. Development of personnel
7. Expansion and growth. 1x4 Marks =
4 Marks
(If an examinee has not given the heading as above but has
given the correct explanation, full credit should be given.)
28 Q. State any four functions performed by consumer
organizations and non-governmental organizations for
protecting and promoting the interest of consumers.

Ans. Functions performed by consumer organizations and non-

governmental organizations for protecting and promoting the
interest of consumers (any four)

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1. Educating the general public about consumer rights by
organising training programmes, seminars and workshops.
2. Publishing periodicals and other publications to impart
knowledge about consumer problems, legal reporting, reliefs
available and other matters of interest.
3. Carrying out comparative testing of consumer products in
accredited laboratories to test relative qualities of competing
brands and publishing the test results for the benefit of
consumers.
4. Encouraging customers to strongly protest and take an action
against unscrupulous, exploitative and unfair trade practices of
sellers.
5. Providing legal assistance to consumers by way of providing
aid, legal advice etc. in seeking legal remedy.
6. Filing complaint in appropriate consumer courts on behalf of 1x 4 Marks
the consumers. = 4 Marks
7. Taking an initiative in filing cases in consumer courts in the
interest of the general public, not for any individual.

(If an examinee has only listed the underlined points,1/2 mark

for each point should be awarded)

29 Q. ‘Leno' is a reputed car manufacturing company, which is

going to complete its 75 years in October 2024. The Chief
Executive Officer of the company decided to take the
company to a higher level. For this he called a meeting of
all departmental heads of the company. In the meeting, the
Chief Executive Officer proposed a target to increase sales
by 10% and profits by 20% in its Platinum Jubilee year.
The Human Resource Manager estimated that an increase
of 500 workers would be required to achieve the target. The
Finance Manager suggested that the company must hold
adequate cash balances for various purposes, and he will
prepare a statement showing the estimated cash inflows
and outflows for this particular period.
Identify and explain two types of plans discussed in the
above case.

Ans.
Two types of Plans are:

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(i) Objectives
Objectives, can be said to be the desired future position or the
desired ends that the management would like to reach.
Objectives are very basic to the organisation. They are usually
set by top management of the organisation and focus on broad,
general issues. 1 Mark for
Objectives need to be expressed in specific terms i.e., they identification
should be measurable in quantitative terms. +
1 Marks for
(ii) Budget Explanation
A budget is a statement of expected results expressed in
numerical terms quantifying future facts and figures. 2x2 =
A budget is also a control device from which deviations can be 4 Marks
taken care of.

30 Q. Arushi successfully runs a bookstore 'Children's Delight'

catering to children of the age group 5-15 years. They have
the complete range of children's books like activity books,
colouring books, fiction and much more. The books are of
good quality and are highly appreciated by schools, parents
and children. They have 16 stores all over India, where
children can not only purchase the books, but can also
come and read, and participate in quiz competitions and
experience the joy of reading. They have their own well-
managed inventory management, storage, and warehousing
to deliver books to locations all over India. The bookstore
regularly communicates the availability, features, merits,
etc. of the books to target customers and persuades them to
buy the books.
Quoting lines in the situation, identify and explain the two
elements of marketing mix in addition to 'Product'
highlighted in the above case.

Ans.
(i) Place
‘They have 16 stores all over India’.
OR
‘They have their own well-managed inventory management,
storage, and warehousing to deliver books to locations all over
India’.
Place or Physical Distribution include activities that make
firm’s products available to the target customers.

66/3/1 CBSE 2024 Page 18 of 24

The other decision areas relate to managing inventory, storage 1/2 Mark for
and warehousing and transportation of goods from the place it quoting
is produced to the place it is required by the buyers. +
1/2 Mark for
(ii) Promotion identification
'The bookstore regularly communicates the availability, features, +
merits, etc. of the books to target customers and persuades them 1 Mark for
to buy the books’. explanation
Promotion of products and services include activities that
communicate availability, features, merits, etc., of the products
to the target customers and persuade them to buy it. 2x2 Marks
Most marketing organisations use number of tools such as = 4 Marks
advertising, personal selling and sales promotion techniques.

31 (a) Q. Explain the following techniques of Scientific

Management:
(i) Time study
(ii) Method study
(iii) Differential piece wage system

Ans.
(i)Time Study 2 Marks
• It determines the standard time taken to perform a well-
defined job.
• The objective of time study is to determine the number of
workers to be employed; frame suitable incentive schemes
and determine labour costs.

(ii) Method Study:

• Method study is the study to find out one best way of doing 2 marks
the job.
• The objective is to minimise the cost of production and
maximise the quality and satisfaction of the customer.

(iii) Differential Piece Wage System 2 Marks

• Differential Piece Wage system is a technique which
differentiates between efficient and less efficient workers.
It rewards the efficient workers and motivates the less
efficient ones to improve their efficiency.
• In this plan, there are two piece rates – one for those
workers who produce the standard output or more, and the 2+2+2
other for those who produce less than the standard output. = 6 Marks

66/3/1 CBSE 2024 Page 19 of 24

OR

(b) Q. Explain the following features of principles of

management:
(i) Universal applicability
(ii) Formed by practice and experimentation
(iii) Flexible

Ans
(i) Universal applicability:
• The principles of management are intended to apply to all 2 Marks
types of organisations, business as well as non-business,
small as well large, public sector as well as private sector,
manufacturing as well as the services sectors.
• However, the extent of their applicability would vary with
the nature of the organisation, business activity, scale of
operations etc.

(ii) Formed by practice and experimentation: 2 Marks

• The principles of management are formed by experience
and collective wisdom of managers.
• These principles are formed by experimentation as well.

(iii) Flexible: 2 Marks

• The principles of management are not rigid prescriptions.
• They give discretion to the managers to modify them when
the situation so demands. 2+2+2
= 6 Marks
32 (a) Q. Explain the following factors affecting the requirement
of fixed capital of a company:
(i) Choice of technique
(ii) Financing alternatives
(iii) Growth prospects

Ans.
Factors affecting the Requirement of Fixed Capital:

(i) Choice of Technique: 2 Marks

• A capital-intensive organisation requires higher investment
in plant and machinery as it relies less on manual labour.
• Labour intensive organisations on the other hand require
less investment in fixed assets. Hence, their fixed capital
requirement is lower.
66/3/1 CBSE 2024 Page 20 of 24
(ii) Financing Alternatives:
• When an asset is taken on lease, the firm pays lease rentals 2 Marks
and uses it. By doing so, it avoids huge sums required to
purchase it.
• Availability of leasing facilities, thus, may reduce the
funds required to be invested in fixed assets, thereby
reducing the fixed capital requirements.

(iii) Growth Prospects: 2 Marks

• Higher growth of an organisation generally requires higher
investment in fixed assets.
• When such growth is expected, a company may choose to
create higher capacity in order to meet the anticipated
higher demand quicker. This entails larger investment in 2+2+2
fixed assets and consequently larger fixed capital. = 6 Marks

OR
OR
(b) Q. Explain the following factors affecting choice of capital
structure of a company
(i) Cost of equity
(ii) Control
(iii) Stock market conditions
Ans
(i) Cost of Equity:
• When a company increases debt, the financial risk faced by 2 Marks
the equity holders increases, so their desired rate of return
may increase. It is for this reason that a company cannot use
debt beyond a point.
• If debt is used beyond that point, cost of equity may go up
sharply and share price may decrease inspite of increased
earning per share (EPS)

(ii) Control: 2 Marks

• Debt normally does not cause a dilution of control.
• A public issue of equity may reduce the management’s
holding in the company and make it vulnerable to takeover.
2 Marks
(iii) Stock market conditions:
• If the stock markets are bullish, equity shares are more
easily sold even at a higher price.
2+2+2
• During a bearish phase, a company, may find raising of = 6 Marks
equity capital more difficult and it may opt for debt.
66/3/1 CBSE 2024 Page 21 of 24
33 Q. Rewton Ltd. was a reputed computer software company
providing unique software all over India. The turnover of
the company was very high resulting in good profits. The
Chief Executive Officer, Vihaan, was very strict and
disciplined. He specified the boundaries of authority and
responsibility for achieving organizational goals. There was
systematic coordination among the various activities and
specific relationships among various job positions. The
company provided facilities like a canteen, a gym, a library,
a music room, and a rest area for its employees, which they
could use during rest intervals. Using these facilities, the
employees developed friendships and discussed not only
their personal. social and emotional issues, but also the
official ones.
The General Manager was of a different view. He told the
Chief Executive Officer that there was no use providing
these facilities to the employees as it is an extra financial
burden on the organization on one hand and on the other
hand, it encourages groupism and whenever any change is
required in the organization, they all resist. He suggested
that they should do away with these facilities. But the Chief
Executive Officer, Vihaan, explained to the General
Manager that this type of social interaction is necessary,
and is in the best interest of the organization. These
interactions among people at work give rise to a network of
social relationships among employees and have many
benefits.
(i) Identify and explain the type of organisation whose
existence the Chief Executive Officer felt was necessary.
(ii) State any two advantages and two disadvantages of the
type of organization identified in (i) above.

Ans.
(i) Informal Organisation
It is a ‘network of social relationships among employees’.
It emerges from within the formal organisation when people
interact beyond their officially defined roles. 1 Mark for
identification
(ii) Advantages (any two) +
1. As prescribed lines of communication are not followed, It 1 Mark for
leads to faster spread of information as well as quick Explanation
feedback. +

66/3/1 CBSE 2024 Page 22 of 24

2. It helps to fulfil the social needs of the members and gives 2 Marks for
them a sense of belongingness in the organisation. Advantages
+
3. It contributes towards fulfilment of organisational
objectives by compensating for inadequacies in
the formal organisation.

Disadvantages: (any two) 2 Marks for

1. An informal organisation spreads rumours and it becomes a Disadvantages
destructive force.
2. The management may not be successful in implementing
changes if the informal organisation opposes them.
3. It pressurises members to conform to group expectations
which may be against organisational interests.

= 6 Marks
34. Q. Nishtha runs a chain of famous restaurants, 'Indian
Kitchen', in different parts of Delhi. The restaurant chain
was known for good quality food and quick service. 'Indian
Kitchen' was generating good revenue and had goodwill in
the market. Nishtha would take a weekly report from all
the Restaurant Managers and take necessary action to
resolve the problems, if any. Nishtha noticed a sudden
decline in sales in one of the restaurants. She questioned
the Restaurant Manager who mentioned that the
restaurant is seeing a gradual decrease in the number of
customers but could not provide a clear explanation for it.
So, Nishtha formed a team to find out the causes of the
declining customers as this is the key area for restaurant
business and is critical to the success of business. By doing
this, Nishtha is performing a step of the process of a
function of management.
i) Identify and explain the function of management
discussed above.
ii) Explain the step of the function identified in (i) above,
followed by Nishtha to find out the causes of declining
revenue.
iii) Explain the step Nishtha will take after she gets the
report from the team formed to find out the causes of
declining revenue.

66/3/1 CBSE 2024 Page 23 of 24

Ans.
(i) Controlling
Controlling means ensuring that activities in an 1 Mark for
organisation are performed as per the plans. identification
+
(any other suitable meaning) 1 Mark for
Explanation
(ii) Analysing Deviations: +
Some deviation in performance can be expected in all 2 Marks
activities. Critical point control and management by
exception should be used by a manager in this regard. +

1. Critical Point Control

Control should, therefore, focus on key result areas
(KRAs) which are critical to the success of an
organization. If anything goes wrong at the critical points,
the entire organisation suffers.

2. Management by Exception:
An attempt to control everything results in controlling
nothing. Thus, significant deviations which go beyond the
permissible limits should be brought to the notice of
management.
However, in case of major deviation from the standard
the matter has to receive immediate action of management
on a priority basis.

(iii) Taking Corrective Action:

When the deviations go beyond the acceptable range, 2 Marks
especially in the important areas, it demands immediate
managerial attention so that deviations do not occur again = 6 Marks
and standards are accomplished.

66/3/1 CBSE 2024 Page 24 of 24

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