Gujarat SET 2014 October Commerce – Paper II

  1. Internal environment is also called as:
    (a) Macro – Environment
    (b) Micro – Environment
    (c)International – Environment
    (d) Technological Environment
  2. Environmental scanning is done:
    (a) For increasing business environment
    (b) For giving new direction to the business
    (c) For creating new ventures in business
    (d) For meeting growing competition from the rivals
  3. Which one of the following is not a feature of capitalism?
    (a) No freedom in fixing the price
    (b) Freedom of enterprises
    (c) Profit maximization
    (d) Freedom of choice
  4. Which one is not an element of second generation reforms?
    (a) High growth of agriculture
    (b) Growing Indian transnational corporations
    (c) Empowering the poor
    (d) HYVP and GRT
  5. The liberalization has:
    (a) Expanded the scope of private sector
    (b) Restricted the scope of private sector
    (c) Maintained the status quo of private sector
    (d) Expanded the scope of public sector
  6. All of the following are fundamental accounting assumptions, except:
    (a) Business entity
    (b) Accrual
    (c) Going concern
    (d) Consistency
  7. Outgoing partner is compensated for parting with firm’s future profits in favour of remaining partners. In what ratio do the remaining partners contribute to such compensation amount?
    (a) Gaining ratio
    (b) Capital ratio
    (c) Sacrificing ratio
    (d) Profit sharing ratio
  8. When the object of reconstruction is usually to reorganise capital or to usually to reorganize capital or to compound with creditors or to effect economies, then such type of reconstruction is called:
    (a) Internal reconstruction with liquidation of a company
    (b) Internal reconstruction without liquidation of a company
    (c) External reconstruction
    (d) Absorption
  9. The contribution margin increases when revenues remain the same and:
    (a) Variable cost per unit increases
    (b) Variable cost per unit decreases
    (c) Fixed cost decreases
    (d) Fixed cost increases
  10. The interest on calls in advance is paid for the period from the______.
    (a) Date if receipt of application money to the due date of call
    (b) Date of receipt of allotment money to the due date of call
    (c) Date of receipt of advance to the due date of call
    (d) Due date of call to the date of dividend payment
  11. The demand curve slopes downward because:
    (a) Increase in prices increases quantity demanded
    (b) Decrease in prices increases quantity demanded
    (c) Price change does not change quantity
    (d) Change in quantity does not depend on changes in prices
  12. The income elasticity of a product was found to be negative which indicates that:
    (a) More quantity would be purchased if income decreased
    (b) More quantity would be purchased if income increased
    (c) Less quantity would be purchased if income decreased
    (d) Same quantity would be purchased if income increased
  13. For maximizing utitlity a consumer is contrained by:
    (a) Its income
    (b) Choices of the products
    (c) Prices of the products
    (d) All of the above
  14. A consumer benefits most in:
    (a) Oligopolistic market
    (b) Perfectly competitive market
    (c) Prices of the products
    (d) All of the above
  15. A seller sells in two different markets. In first market the price elasticity of demand is – 0.6 and in the second market it is – 0.3. The seller wants to increase sales by 10% in both the markets. The seller will:
    (a) Reduce the price by the same percentage in both markets
    (b) Increase the price in the first market and decrease the price in the second market
    (c) Decrease the price in the first market and increase the price in the second market
    (d) Decrease the price in the first market and second market both, but a larger decrease in the second market
  16. Classification of M.Com students according to their specialization is an example of the following:
    (a) Nominal data
    (b) Ordinal data
    (c) Interval data
    (d) Ratio data
  17. Type – I error is defined as the probability to:
    (a) Accept a hypothesis when it is true
    (b) Accept a hypothesis when it is false
    (c) Reject a hypothesis when it is false
    (d) Reject a hypothesis when it is true
  18. Which of the following is not a standard type of sampling?
    (a) Startified sampling
    (b) Simple cluster sampling
    (c) Cluster sampling
    (d) Systematic sampling
  19. Which of the following statements, on testing of a hypothesis is always true?
    (a) When the null hypothesis is rejected at 5% level of significance, it is always rejected at 1% level also
    (b) When the null hypothesis is rejected at 1% level of significance, it is also rejected at 5% level also
    (c) When the null hypothesis is rejected at 1% level of significance, it is also rejected at 5% level also
    (d) No definite assertion can be made
  20. Which of the following software’s has applications in both Mathematics and Statistics?
    (a) SPSS
    (b) SAS
    (c) R
    (d) None of the above
  21. The original source of an organizations culture is most organizations culture is most strongly associated with any one of the following:
    (a) Influences of overseas
    (b) General economics trends
    (c) The vision of the organizations founder (s)
    (d) Political factors in the external environment.
  22. It is the organization structure which brings about horizontal coordination to project and hence the change of success of the projects are higher. It is called as:
    (a) Functional structure
    (b) Matrix organization structure
    (c) Hybrid structure
    (d) Divisional structure
  23. Which is not a characteristic of informal organization?
    (a) General nature is official
    (b) Authority and responsibility are major concepts
    (c) Primary focus on person not position
    (d) Guidelines for behavior is rules
  24. Which is not a characteristic of planning in an organization?
    (a) Pervasive
    (b) Non-rational
    (c) Perpetual
    (d) Integrated process
  25. It is the strategy of large organization, the purpose of which is to identify the business areas in which an organization will carry out its operations and states how these business can be coordinated to make the organization more competitive:
    (a) Operational strategy
    (b) Business level strategy
    (c) Corporate level strategy
    (d) None of the above
  26. Consumers are buying all products put into the market place. This demand state is called as:
    (a) Latent demand
    (b) Full demand
    (c) Overfull demand
    (d) Unwholesome demand
  27. The marketing audit is a part of the following:
    (a) Annual plan control
    (b) Efficiency control
    (c) Profitability control
    (d) Strategic control
  28. Family can be regarded as following type of reference groups:
    (a) Secondary reference group
    (b) Primary reference group
    (c) Aspirational reference group
    (d) Disassociative reference group
  29. An element of the buyer’s image of the product performance is related to the following:
    (a) Mark- up pricing
    (b) Target return pricing
    (c) Perceived value pricing
    (d) Going rate pricing
  30. All the product classes that can satisfy a core need with reasonable effectiveness, it is known as:
    (a) Product type
    (b) Product class
    (c) Product line
    (d) Brand and Item
  31. The most important goal of financial management is:
    (a) Profit maximisation
    (b) Matching income and expenditure
    (c) Using business assets effectively
    (d) Wealth maximization
  32. A project having discount rate of 10% has the following cash-flows:
    Year cash flows (Rs. Lacs)
    0 -50
    1 60
    2 -30
    3 80

    The NPV of the product is:
    (a) Rs. 39.84 Lakhs
    (b) Rs. 39.48 Lakhs
    (c) Rs. 40.48 Lakhs
    (d) Rs. 93.84 Lakhs

  33. PQR Ltd. has taken a term loan of Rs. 20 lakhs at an interest rate of 14% p.a. If the tax rate applicable is 30%, the cost of term loan is:
    (a) 8.9%
    (b) 9.8%
    (c) 14.0%
    (d) 4.2%
  34. In Miller- Orr model of cash management:
    (a) The lower limit of cash balance is set by the management and the upper limit and return point for cash balance are derived.
    (b) The lower limit and the upper limit of cash balance are predecided by the management and return point for cash balance is derived.
    (c) The lower limit for cash balance and the return point for the cash balance are predecided by the management and upper limit for cash balance is derived.
    (d) Both upper limit for cash balance and return point for cash balance are pre-decided by the management and lower limit for cash balance is derived.
  35. According to net income approach, the average cost of capital of firm:
    (a) Decline as debt-equity ratio increases
    (b) Increases as debt-equity ratio increases
    (c) Remains constant irrespective of change in debt equity ratio
    (d) Keeps on fluctuating with increase in debt-equity ratio
  36. Which of the following is not an environmental challenge facing human resources?
    (a) Competition for scarce resources
    (b) Government rules and regulations
    (c) Global competition
    (d) Changing workers
  37. Job evaluation is:
    (a) Determining the equal pay for the job of same value
    (b) Systematic procedure used to determine the related worth of the job
    (c) The minimum and maximum pay rates for each job class
    (d) None of the above
  38. Which of the following is not offered by job analysis?
    (a) Workers attributes
    (b) Performance appraisals
    (c) Working conditions
    (d) Job specifications
  39. From the below which is the first step in the systematic approach to training?
    (a) Determination of training objectives
    (b) Design of training program
    (c) Selection of training method
    (d) Assessment of training needs
  40. Grievance adversely affects:
    (a) Trade unions
    (b) Shareholders
    (c) Employees
    (d) Management
  41. The capital to Risk Weighted Asset Raito is used to determine:
    (a) Non-Performing assets of the bank
    (b) Profitability of Bank
    (c) Capital adequacy position
    (d) All of the above
  42. Which of the following is most important for a bank?
    (a) Systemic risk
    (b) Country risk
    (c) Credit risk
    (d) Sovereign risk
  43. EXIM banks are created for financing:
    (a) Industrial manufacturing
    (b) Mining
    (c) Oil exploration
    (d) Trade promotion
  44. Which one is a rediscounting rate used by Reserve Bank of India?
    (a) Repo Rate
    (b) Bank Rate
    (c) Credit Rate
    (d) Growth Rate
  45. Match the items of List I with the items of List II and choose the correct option from the codes given below:
    List I List II
    (a) Central Bank of India  (i) Central bank
    (b) Industrial Finance corporation (ii) IRDA
    (c) Reserve Bank of India  (iii) Industrial Bank
    (d) Insurance  (iv) Commercial Bank

    Codes:
    a, b, c, d
    (a) i, ii, iii, iv
    (b) iv, iii, i, ii
    (c) iii, iv, ii, i
    (d) ii, i, iv, iii

  46. Which of the following is not included in the current account of the balance of payments account?
    (a) Transactions for exports
    (b) Interest Payments
    (c) Remittances made by nationals working abroad
    (d) Long term loans received by the country from Word Bank in foreign currency
  47. The Dunkel draft was responsible for:
    (a) Liberalizing trade
    (b) Abolition of GATT
    (c) Establishment of WTO
    (d) All of the above
  48. The difference between foreign Direct Investment (FDI) and foreign Institutional Investment (FII) is:
    (a) FDI is in domestic currency and FII in foreign currency
    (b) FDI brings in real foreign capital and FII is speculative
    (c) FII involves production and FDI does not
    (d) None of the above
  49. The “Most Favoured Nation Clause”:
    (a) Promotes trade discrimination
    (b) Reduces trade discrimination
    (c) Creates trade Blocs
    (d) Creates customs unions
  50. Country’s balance sheet is called:
    (a) Balance of payments
    (b) Terms of trade
    (c) Trade ratios
    (d) Direction of trade

    Answer Key

    1 (b) 2 (d) 3 (a) 4 (d) 5 (a) 6 (a) 7 (a) 8 (b) 9 (b) 10 (c) 11 (b) 12 (a) 13 (d) 14 (b) 15 (d) 16 (a) 17 (d) 18 (b) 19 (b) 20 (d) 21 (c) 22 (b) 23 (c) 24 (d) 25 (c) 26 (b) 27 (d) 28 (b) 29 (c) 30 (b) 31 (d) 32 (a) 33 (b) 34 (a) 35 (a) 36 (a) 37 (b) 38 (b) 39 (d) 40 (c) 41 (c) 42 (c) 43 (d) 44 (b) 45 (b) 46 (d) 47 (d) 48 (b) 49 (b) 50 (a)