Business Studies – Test Paper 1
Time : 30 Minutes Marks: 100
Each correct answer carries 4 marks while 1 mark will be deducted for each incorrect answer.
- The limitations of cooperative societies is –
(a) Equality in voting status
(b) Stable existence
(c) Limited liability
(d) Limited finance - What is the minimum number of members required to establish a public company?
(a) 8
(b) 6
(c) 7
(d) 5 - A worker was working in a factory. He noticed a leakage in the cooling systems pipeline. The company suffers a huge loss due to this. Which of the following business-risks is being exhibited here?
(a) Human Cause
(b) Physical and technical cause
(c) Natural Cause
(d) Political Cause - An Indian firm purchases goods from Taiwan and then sells those goods to the European Union countries. Which of the following is the above-mentioned trade an example of?
(a) Import Trade
(b) Retail Trade
(c) Entrepot Trade
(d) Export Trade - Continuous existence of a company irrespective of change in membership of the same is known as _______.
(a) Perpetual succession
(b) Separate entity
(c) Common seal
(d) Voluntary association - From the following given statements identify which is not the function of promoter.
(a) To enter into preliminary contract with vendors
(b) To make secret profits
(c) Nomenclature
(d) Arrangement of capital - Robbin suffered a loss in business due to fluctuation in price of goods. Identify the cause of business risk.
(a) Economic Cause
(b) Natural Cause
(c) Political Cause
(d) Physical Cause - Which of the following statements about the HUF form of Business Organisation is incorrect?
(a) All coparceners have equal share in the profits of the business.
(b) The karta’s (senior-most member of the family) personal property can also be utilised to meet the business liability.
(c) In HUF business, there must be at least three members in the family
(d) In HUF business outsiders are not allowed to become the coparcener - Which of the following is not a characteristic of Sole Proprietorship Form of Business Organisation?
(a) The liability of the sole proprietor is limited
(b) There is no separation of ownership and management
(c) The business unit does not have an entity separate from the owner
(d) The formation and operation of this form of business organisation does not involve any legal formalities - Which of the following is not a function of warehouses in present times?
Risk bearing
2. Financing
3. Processing of stored materials
4. Transportation
(a) Only 2 and 4
(b) Only 3 and 4
(c) Only 1 and 2
(d) Neither 1 nor 2 nor 3 nor 4 - State which term is not used in insurance process?
(a) Proposer
(b) Premium
(c) Sum assured
(d) Bills - A ship carrying orange was insured against losses arising from accident. The ship reached the port safely and there was a delay in unloading the oranges from the ship. As a result, the oranges got spoilt. The insurer did not pay any compensation for the loss because the proximate cause of loss was delay in unloading and not an accident during the voyage. This displays –
(a) Principle of Indemnity
(b) Principle of Mitigation
(c) Principle of Causa-proxima
(d) Principle of Contribution - The classification of partners as sleeping and active partners is a classification based on –
(a) The liability
(b) The behaviour and conduct exhibited
(c) The sharing of profits
(d) The extent of participation - _______ is paid by the insured to issuer in consideration to insurance contract.
(a) Deposit
(b) Premium
(c) Cheque
(d) Discount - Which of the following functions is not treated as primary function of insurance?
(a) Insurance provides certainty of payment
(b) Insurance provides capital
(c) Insurance provides protection against the probable chance of loss
(d) Insurance helps in Risk – sharing towards uncertainty - A’ gets injured in a road accident, due to reckless driving of a third party B. What will the insurance company, that has insured A’s car, do in this case under the principle of subrogation?
(a) It will compensate the loss of A but cannot sue B to recover the money paid as claim
(b) It will compensate the loss of A and can sue B to recover the money paid as claim
(c) Insurance company will compensate to A only after recovering loss from B
(d) Insurance company will not compensate the loss of A - Consider the following two lists :-
List 1 List 2 i. Principal of contribution a. The insured is not allowed to make any profit from the insurance contract on the happening of the event that is insured against. ii. Principal of subrogation b. The same subject matter may be insured with more than one insurer. iii. Principal of indemnity c. This principal ensure that the insure does not become negligent about the safety of the subject matter after taking an insurance policy. iv. Principal of mitigation d. Once the claim of the insured has been settled, the ownership right of the subject matter of insurance passes on to the insurer. Choose the code that correctly matches the contents of List I with List II.
(a) 1-b, 2-d, 3-a, 4-c
(b) 1-d, 2-b, 3-c, 4-a
(c) 1-c, 2-d, 3-b, 4-c
(d) 1-b, 2-c, 3-a, 4-d - When did India become a WTO member?
(a) 1 January 1995
(b) 26 January 1999
(c) 1 February 1996
(d) 15 March 1997 - The VIIIth Round of GATT (Uruguay Round) finally resulted in the conversion of GATT into—–
(a) World Bank
(b) International Monetary Fund
(c) World Trade Organization
(d) International Court of Justice - This is a document which is issued by the master of the ship or the ship owner or an agent, stating that the goods mentioned in it have been taken on board the ship for transportation as per terms and conditions specified in it. It also serves as a contract of affreightment and as a document of title to the goods. This document is termed as:
(a) Custom Export Pass
(b) Bill of Lading
(c) Dock’s Receipt
(d) Mate’s Receipt - In cash credit arrangement, interest is charged on:
(a) Approved limit of cash credit – amount withdrawn
(b) Interest is not charged under this arrangement
(c) Approved limit of cash credit
(d) Amount withdrawn - Which one is correct?
(a) Trade credit is a cost-free source of finance
(b) Trade credit involved implicit cost
(c) With the increase in the firm’s purchases, trade credit decreases if other things remain the same
(d) Increase in deferred income reduces the firm’s liquidity. - Business Ethics is ______ in nature.
(a) Absolute
(b) Not Absolute
(c) Permanent
(d) None of the above - Which of the following areas is relevant for knowledge process outsourcing?
(a) Administrative support
(b) Investment research services
(c) Customer support services
(d) Customer relationship management - Which of the following is not a benefit of e- Business?
(a) Customer Satisfaction
(b) Convenience
(c) Personal touch
(d) Global reach