NIOS Business Studies 215 Solved Paper’ April 2017, NIOS Secondary Solved Papers

2017’ April


[Time : 3 Hours ] [ Maximum Marks : 100]

1. ​​ Which of the following principles is followed in a co-operative society?  1

(A) One share one vote.

(B) One man one vote.

(C) Multiple votes.

(D) No vote.

2. Which of the following is not an advantage of rail transport?  1

(A) It is faster than road transport

(B) It is suitable for heavy goods over long distance.

(C) It is flexible mode of transport.

(D) It is a convenient mode of transport for long distance.

3. Ships which belong to a regular shipping company and play over a fixed route on a prescribed time table. Are called:​​   1

(A) Tramps.

(B) Charter Party.

(C) Liners.

(D) Cargo.

4. Ashok got his godown insured for Rs 2 lakhs. Goods of the value of Rs. 1,60,000 was destroyed due to fire Ashok put up a claim of Rs. 2 lakhs to the company took thus decision under which principle of insurance?​​   1

(A) Utmost Good faith.

(B) Insurable Interest.

(C) Indemnity.

(D) Contribution.

5. A person wants to buy goods in bulk, the best mode of purchase for him will be:  1

(A) Purchase by inspection.

(B) Purchase by sample.

(C) Purchase by description.

(D) Purchase from nearest shop.


6. The shops which are owned by the same owner and located in different parts of the city or country are known as:  1

(A) Departmental Store.

(B) Super Bazaar.

(C) Multiple Shops.

(D) Mail Order Business.

7. ‘Clearance Sale – Discount upto 80% ‘ is a/an:1

(A) Sale on Approval.

(B) Auction Sale.

(C) Wash Sale.

(D) Sale through tender.

8. Consumers are unable to make use of their rights due to lack of:​​   1

(A) Awareness.​​ 

(B) Funds.

(C) Education.

(D) Coverage.

9. Samiksha purchased a car for Rs 10 lakhs and found its engine defective. Despite many complaints to the dealer the defect was not rectified. Suggest her the appropriate authority to file her complaint under the Consumer Protection Act, 1986.   1

(A) District Forum.​​ 

(B) State Commission.

(C) National Commission.

(D) Supreme Court.

10. Wage employment means:   1

(A) Doing a business.​​ 

(B) Engaging in some economic activity on his own.

(C) Managing an economic activity on his own.

(D) Serving another person for wages or salary.

11. State any three impacts of ‘Air Pollution’.  3

Ans.​​ Air pollution has a lot of impart on our surroundings and on us. Some of them are-

a)​​ Presence of gases in air, which are not required by human beings, animals and birds, creates serious​​ health problems. It can create diseases like asthma, cough and cold, blindness, hearing loss, skin disease etc.

b)​​ Air pollution creates smog in the winter, which is caused by smoke and dust when they mix with fog.​​ 

c)​​ The temperature of the earth increases due to air pollution.


12. Explain briefly the term ‘Profession’ and give its any two examples.​​   3

Ans.​​ Profession:-​​ A person may not be an expert in every field. So, we require services of others who specialize in one field or other. For example, we need the services of doctors for our treatment, lawyers to get legal support etc. they are all engaged in profession. Thus profession refers to an occupation, which requires specialized knowledge and training to pursue it and primary objective of every profession is to provide service.​​ 

13. ‘Warehouses perform many functions.’ Explain briefly any three such functions.​​   3

Ans.​​ The following are the functions of warehouses:

(1)​​ Storage of goods:-​​ The basic function of warehouses is to store large stock of goods. These goods are stored from the time of their production or purchase till their consumption or use.

(2)​​ Protection of goods:- A warehouse provides protection to goods from loss or damage due to heat, dust, wind and moisture, etc. it makes special preventive arrangements for different products according to their nature. It cuts down losses due to spoilage and wastage during storage.

(3)​​ Risk bearing:- ​​ Warehouses take over the risks incidental to storage of goods. Once goods are handed over to the warehouse-keeper for storage, the responsibility of these goods passes on to the warehouse-keeper. Thus, the risk of loss or damage to goods in storage is borne by the warehouse keeper.

14. State any three advantages of Departmental Store.   3

Ans.​​ The following are the advantages of Departmental Store:-

a)​​ Convenience of shopping:-​​ Since a large variety of goods are sold under one roof, we need not move from one bazaar to another or from one shop to another to buy goods.

b)​​ Wide choice of products:- A wide variety of products from different manufactures are sold in these stores. Thus, a customer has a wide choice of goods from which he/she can select the best product as needed.

c)​​ Economies of large-scale purchase and sale:-​​ Departmental stores buys goods on large scale. So it can bypass wholesalers and gets the goods directly from the manufacturers. This way it enjoys the benefits of discounts from the manufacturers.

15. List the various consumers courts and mention their pecuniary jurisdiction.​​   3

Ans.​​ The judicial system set up under the Consumer Protection Act, 1986, consists of consumer courts at the district level, state level and national level.

The district forum has the jurisdiction to deal with all complaints where the value of the goods or services or the compensation claimed does not exceed Rs.20 lakhs. The State Commissions are empowered to deal with cases where the value or amount involved exceed Rs 20 lakh but does not exceed Rs. One crore. The State commissions also deal with appeals against orders of the District Forum. The National Commission has the jurisdiction to take up all claims and grievances exceeding the value of Rs. One crore. It has also appellate jurisdiction, which is power to deal with appeals against orders passed by State Commissions.

16. Describe briefly any four characteristics of sole proprietorship business.  4

Ans.​​ Sole proprietorship has the following characteristics​​ 

(1)​​ Ease of formation:-​​ An ideal form of ownership should be easy to form. Ease of formation implies minimum of legal and other formalities. Sole proprietorship is easy to form.

(2)​​ Single Ownership:- A single individual always owns sole proprietorship form of business organization. That individual owns all assets and properties of the business. Hence, he alone bears all the risk of the business.

(3)​​ No sharing of Profits and Loss:- The entire profit arising out of sole proprietorship business goes to the sole proprietor. If there is any loss it is also to be borne by the sole proprietor alone. Nobody else shares the profit and loss of the business with the sole proprietor.

(4)​​ One man’s Capital:- The capital required by a sole proprietorship form of business organisation is totally arranged by the sole proprietor. He provides it either from his personal resources or by borrowing from friends, relatives, banks or other financial institutions.

17. Sate any four secondary functions of a commercial bank.  4

Ans.​​ The following are the secondary functions of a commercial bank

1. Issuing letters of credit, travellers’ cheque, etc.

2. Undertaking safe custody of valuables, important document and securities by providing safe deposit vaults or lockers.

3. Providing customers with facilities of foreign exchange dealings.

4. Transferring money from one account to another and from one branch to another branch of the bank through cheque, pay order, demand draft.

18. Explain briefly the following types of warehouses:  4

(A) Bonded Warehouses. (B)Public warehouses.

Ans.​​ (a)​​ Bonded warehouse:-​​ These warehouses are owned, managed and controlled by government as well as private agencies. Private bonded warehouses have to obtain license from the government. Bonded warehouses are used to store imported goods for which import duty is yet to be paid.

(b)​​ Public warehouse:-​​ The warehouses which are run to store goods of the general public are known as public warehouses. Anyone can store his goods in these warehouses on payment basis. An individual, a partnership firm or a company may own these warehouses. To start such warehouses a license from the government is required.

19. Describe briefly “Tele-shopping’ and ‘Internet-shopping’ as types of ‘Non-store retailing’.  4

Ans.​​ Types of ‘Non-store retailing’:-

Tele-shopping:-​​ They contact the prospective buyers through telephone and persuade them to buy their products. In some cases they advertise their product on television or other media. They clearly explain the features and also make live demonstration of the products.

Internet Shopping:-​​ Shopping through Internet or Internet shopping is a system of retailing of goods through the Internet. The seller or manufacturers provides all information regarding the product, its specification, uses, etc. through its website. As a customer you have to access the website and view different products according to your need. Then you can compare the price of similar products available and also give special instructions to the seller regarding the goods. You have to make all payments through your credit card.​​  ​​​​ 

20. Explain briefly any four functions of a wholesaler.  4

Ans.​​ Following are the functions, which a wholesaler usually performs.

(a)​​ Collection of goods:- ​​ A wholesaler collects goods from manufacturers or producers in large quantity.

(b)​​ Storage of goods:- ​​ A wholesaler collects the goods and stores them safely in warehouses, till they are sold out. Perishable goods like fruits, vegetables, etc. are stored in cold storage.

(c)​​ Distribution:​​ A wholesaler sells goods to different retailers. In this way, he also performs the function of distribution.

(d)​​ Financing:- The wholesaler provides financial support to producers and manufacturers by providing money in advance to them. He also sells goods to the retailer on credit. Thus, at both ends the wholesaler acts as a financier.

21. Describe briefly any five advantages of Multinational companies.  5

Ans.​​ Advantages of Multinational companies

1)​​ Investment of Foreign Capital:-​​ Direct investment of capital by Multinational Companies helps under-developed counties to speed up their economic development.

2)​​ Generation of Employment:- Expansion of industrial and trading activities by Multinational Companies leads to creation of employment opportunities and raising the standard of living in host countries.

3)​​ Increase in Exports and Inflow of Foreign Exchange:- Goods produced in the host countries are sometimes exported by Multinational Companies. Foreign exchange thus earned contributes to the foreign exchange reserves of host countries.

4)​​ Healthy Competition:- Efficient production of quality goods by Multinational Companies prompt the domestic producers to improve their performance in order to survive in the market.

5)​​ Use of Advanced Technology:- With substantial resources Multinational Companies undertake Research and Development activities which contribute to improved methods and processes of production and thus, increase the quality of products. gradually, other countries also acquire these technologies.

22. What is meant by Partnership? Explain briefly any three advantages of partnership form of business organization.​​   5

Ans.​​ Section 4 of the Indian Partnership Act, 1932, “a relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.”The following are the advantages of partnership form of business organization:

(a)​​ Easy to form:-​​ Like sole proprietorship, the partnership business can be formed easily without any legal formalities. It is not necessary to get the firm registered. A simple agreement, either oral or in writing, is sufficient to create a partnership firm.

(b)​​ Availability of large resources:-​​ Since two or more partners join hands to ​​ start partnership business it may be possible to pool more resources as compared to sole proprietorship. The partners can contribute more resources as compared to sole proprietorship.

(c)​​ Balanced decision:-​​ The partners are the owners of the business. Each of them has equal right to participate in the management of the business. In case of any conflict they can sit together to solve the problems, since all partners participate in decision-making, there is less scope for reckless and hasty decisions.

23. Differentiate between Fire Insurance and Life Insurance on any five basis.  5

Ans.​​ The following are the differences between Life Insurance and Fire Insurance:-

Basis of Difference

Life Insurance

Fire Insurance


No loss is compensable specific amount is paid.

Amount insured or Actual loss whichever is less is given as compensation.

Insurable Interest

Insurable interest must exist at the time of taking policy.

Insurable interest must exist both at the time of taking policy as well as the time of loss.

Assignment of Policy

No Assignment is done

No assignment without permission of Insurance Company.

Nature of Risk​​ 

Certain but the time is uncertain.



It is taken for a long term.

Normally for one year.


24. Describe briefly the role of Non-Governmental Organizations in protecting.  5

Ans.​​ The role of NGOs has become increasingly more significant over the last two decades. There are now more than 800 such organisations in India. These organisations are registered under the Societies Registration Act or the Companies Act or as Charitable Trusts. NGOs have undertaken various activities as part of the consumer movement. They perform several functions, like:-

(1)​​ Create awareness about consumer rights and educate the general public about consumer problems and remedies through seminars, workshops and training programmes.

(2)​​ Provide legal aid to consumers by way, of assistance in seeking legal remedy.

(3)​​ Undertake advocacy of consumers’ point of view as representative members of consumer protection councils and others official boards.

25. Explain briefly any five essential qualities that an individual should possess.5

Ans.​​ The qualities that a sales person should possess are:-

1.​​ Physical qualities:-​​ A salesperson should ​​ have a good appearance and an impressive personality. He should also have sound health.

2.​​ Mental qualities:- A good salesperson should posses certain mental qualities like imagination, initiative, self-confidence, sharp memory, alertness etc. he should be able to understand the needs and preferences of customers.

3.​​ Integrity of character:- A good ​​ salesperson should posses the qualities of honesty and integrity. He is to gain the confidence of the customers. He should be able to understand their needs and guide them how to satisfy those needs.

4.​​ Knowledge of the product and the company:- A salesperson should have full knowledge of the product and the company he is representing. He should be able to explain each and every aspect of the product i.e. its qualities, how to use it, what precautions to be taken etc.

5.​​ Good behaviour:-​​ A salesperson should be co-operative and courteous. Good behaviour enables one to win the confidence of the customers. He should not feel irritated if the buyer puts up many questions even if the questions are irrelevant.

26. Explain briefly any three “Social objectives’ and any three “Global objectives’ of business. ​​   6

Ans.​​ Social objectives of business

1)​​ Production and supply of quality goods and services:-​​ Since the business utilizes the various resources of the society, the society expects to get quality goods and services from the business. The objective of business should be to produce better quality goods and supply them at the right time and at a right price.

2)​​ Adoption of fair trade practices:- The business unit must not create artificial scarcity of essential goods or raise prices for the sake of earning more profits. All these activities earn a bad name and sometimes make the businessmen liable for penalty and even imprisonment under the law. Therefore, the objective of business should be to adopt fair trade practices for the welfare of the consumers as well as the society.

3)​​ Contribution to the general welfare of the society:- Business units should work for the general welfare and upliftment of the society. This is possible through running of schools and colleges for better education, opening of vocational training centres to train the people to earn their livelihood etc.

Global objectives of business

1)​​ Raise general standard of living:-​​ Growth of business activities across national borders makes available quality goods at reasonable prices all over the world. The people of one country get to use similar types of goods that people in other countries are using. This improves the standard of living of people.

2)​​ Reduce disparities among nations:- Business should help to reduce disparities among the rich and poor nations of the world by expanding its operation. By way of capital investment in developing as well as underdeveloped countries. It can foster their industrial and economic growth.

3)​​ Make available globally competitive goods and services:- Business should produce goods and services which are globally competitive and have huge demand in foreign markets. This will improve the image of the exporting country and also earn more foreign exchange for the country.

27. What is meant by ‘Business Process Outsourcing’? State it’s any four advantages.  6

Ans.​​ Business Process Outsourcing (BPO) can be defined as the act of giving a other party responsibility what would otherwise be an internal system or service.​​ 

Following are the advantages of Business Process Outsourcing

a)​​ Achieve cost reductions:-​​ This is made possible through process improvements, reengineering, and use of technologies that reduce and bring administrative and other costs under control.

b)​​ Key in on company’s main business:- With the day-to-day back office operations taken care of, the management is free to devote more time to building the company’s core businesses.

c)​​ Obtain outside expertise:- Rather than recruiting and training personnel, BOP ensures that domain experts from another company provide the needed guidance and skills.

d)​​ Meet constantly changing customer demands:- Many BPO vendors provide the management with flexible and scalable services to meet the customers’ changing requirements, and to support company acquisitions, consolidations, and joint ventures.

28. The manager of Vikas Enterprises dealing in consumer goods, is facing the problem of poor sales. Explain briefly to him any six tools of sales promotion that he should use to improve his sales.  6

Ans.​​ The manager can use the following six tools of sales promotion to improve his sales:-

1)​​ Free samples:-​​ We might have received free samples of shampoo, washing powder, coffee powder, etc. while purchasing various items from the market. Sometimes these free samples are also distributed by the shopkeeper even without purchasing any item from his shop. These are distributed to attract consumers to try out a new product and thereby create new customers.

2)​​ Premium or Bonus offer:- A milk shaker along with Nescafe, mug with Bournvita, toothbrush with 500 grams of toothpaste, 30% extra in a pack of one kg. Are the examples of premium or bonus given free with the purchase of a product. They are effective in inducing consumers to buy a particular product.

3)​​ Exchange schemes:- It refers to offering exchange of old product for a new product at a price less than the original price of the product. This is useful for drawing attention to product improvement. For example ‘Bring your old mixer-cum-juicer and exchange it for a new one just by paying Rs.500 etc.

4)​​ Price-off offer:-​​ Under this offer, products are sold​​ at a price lower than the original price. For example Rs.2 off on purchase of a lifebuoy soap, Rs. 15 off on a pack of 250 grams of Taj Mhal tea etc.

5)​​ Coupons:- Sometimes, coupons are issued by manufacturers either in the packet of a product or through an advertisement printed in the newspaper or magazine or through mail. For example 20% off on purchase of 5 kg. Of​​ Annapurna Atta.’ The reduced price under this scheme attracts the attention of the prospective customers towards new or improved products.

6)​​ Fairs and Exhibitions:- Fairs and exhibitions may be organised at local, regional, national or international level to introduce new products, demonstrate the products and to explain special features and usefulness of the products. goods are displayed and demonstrated and their sale is also conducted at a reasonable discount.

29. Describe briefly the following rights of consumers:  6

(1) Right to safety (2) Right to be informed (3) Right to choose

Ans.​​ Rights of consumers:-

(1)​​ Right to safety:-​​ Consumers have a right to be protected against marketing of goods which are injurious to health and like. As a consumer if you are conscious of this right, you can take precautions to prevent the injury or if injury is caused in spite of precaution, you have a right to complain against the dealer and even claim compensation.

(2)​​ Right to be informed:- Consumers also have the right to be informed about the quantity, quality, purity, standard or grade and price of the goods available so that they can make proper choice before buying any product or service.

(3)​​ Right to choose:- Every consumer has the right to choose the goods needed from a wide variety of similar goods. Very often dealers and traders try to use pressure tactics to sell goods of inferior quality.

30. State any six functions of an entrepreneur.  6

Ans.​​ Some of the major functions of an entrepreneur are:-

a)​​ Identifying entrepreneurial opportunity:-​​ There are many opportunities in the world of business. These are based on human needs like food, fashion, education, etc. which are constantly changing. These opportunities are not realized by common man, but an entrepreneur senses the opportunities faster than others do.

b)​​ Turning ideas into action:- An entrepreneur should be capable of turning his ideas into reality. He collects information regarding the ideas, products, practices to suit the demand in the market. Further steps are taken to achieve the goals in the light of the information collected.

c)​​ Feasibility study:-​​ The entrepreneur conducts studies to assess the market feasibility of the proposed product or services of inputs required to run the enterprise. Such a blue print of all the activities is termed as a ‘business plan’ or a ‘project report’.

d)​​ Resourcing:- An entrepreneur needs various resources in terms of money, machine, material, and men to running the enterprise successfully. An essential function of an entrepreneur is to ensure the availability of all these resources.

e)​​ Setting up of the Enterprise:- For setting up an enterprise the entrepreneur will have to fulfil some legal formalities. He also tries to find out a suitable location, design the premises, install machinery and do many other things.

f)​​ Managing the enterprise:- One of the important functions of an entrepreneur is to run the enterprise. He has to manage men, material, finance and organize production of goods and services. He has to market each product and service, after ensuring appropriate returns/profits on the investment.

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