CBSE 2025, BS Set 1 Solutions
CBSE Business Studies (2025)

Explain the following steps in the process of staffing:\n\n(i) Estimating the Manpower Requirements\n\n(ii) Recruitment\n\n(iii) Performance Appraisal

'BNG Ltd.' is a reputed company that manufactures consumer durables. It has a large scale manufacturing unit where products like electric kettles, toasters, blenders, electric irons, etc. are manufactured. Since the production is at a large scale, the average cost of production is low. As a result, the products are widely available across areas at affordable prices contributing to its strong profit margins.

On the other hand, 'KMV Ltd.', another reputed consumer durables manufacturer in the same business is also earning good profits. However, 'KMV Ltd.' focuses on producing the products which are superior in quality, performance and features. It has a dedicated Research and Development team which continually works to bring improvement in the quality of its products.

(a) Identify and explain the marketing management philosophy followed by 'BNG Ltd.' and 'KMV Ltd.'.

(b) Differentiate between the two marketing management philosophies identified in (a) above on the basis of:

(i) Main focus

(ii) Ends

'Green Tech Solutions', a renewable energy company, set a target of reducing its production cost by 15% in the current financial year. After a few months, the management reviews the progress and finds that the cost reduction measures implemented have not been as effective as planned. By reviewing the progress 'Green Tech Solutions' has completed one of the steps of controlling process.\n\nIdentify the step of controlling process from the following:

Explain the following elements of Promotion Mix:\n\n(i) Sales Promotion\n\n(ii) Personal Selling

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

Assertion (A): The principles of management are guidelines to action, but do not provide readymade, straitjacket solutions to all managerial problems.

Reason (R): Real business situations are neither complex, nor dynamic and are not the result of many factors.

Choose the correct alternative from the options given below:

Under ______________, the consumer has a right to get relief for replacement of the product, removal of defect in the product, compensation paid for any loss or injury suffered by the consumer in case the product/service falls short of his expectations.

'To identify the needs of the customers and to take various decisions related to successful marketing of the products and services, it is important to make an analysis of the available opportunities and threats, as well as strengths and weaknesses of the organisation and decide what opportunities can be best pursued by it', highlights one of the functions of marketing, that is:

'The principle of management which emphasizes on obedience to organisational rules and employment agreements necessary for the working of the organisation' is called:

The increase in profit earned by the equity shareholders due to the presence of fixed financial charges is known as:

Identify the incorrect statement with respect to 'functional foremanship' as a technique of scientific management:

Read the following statements carefully:

Statement I: A single-use plan is used for activities that occur regularly over a period of time.

Statement II: Policies are a general form of standing plans that specify the organisation's response to a certain situation.

In the light of the above statements, choose the correct alternative from the following:

If an investor wishes to buy or sell any security, he/she has to first approach a registered broker or sub-broker and enter into an agreement with him. An investor has to sign a broker-client agreement and a client registration form before placing an order to buy or sell securities. Thereafter, the investor has to open a 'Demat' account or 'Beneficial owner' account with a depository participant for holding and transferring securities in the demat form and a bank account for cash transactions in the securities market. The first two steps of 'Trading and Settlement procedure' in stock market have been discussed in the above lines.

Place the next four steps in the correct order:

(i) The broker will then go online and connect to the main stock exchange and match the share and best price available. (ii) After the trade has been executed, within 24 hours the broker issues a contract note. (iii) The investor then places an order with the broker to buy or sell shares. Clear instructions have to be given about the number of shares and the price at which the shares should be bought or sold. (iv) When the shares can be bought or sold at the price mentioned, it will be communicated to the broker's terminal and the order will be executed electronically.

Choose the correct option from the following:

Raghu, on waking up early in the morning, often complained about back pain. When his pain persisted, he consulted a doctor who advised him to purchase a good quality orthopedic mattress. That would ensure correct spinal alignment and reduce the back pain.

Raghu surveyed the market and purchased a good quality orthopedic mattress. As the price of the mattress was very high, he wanted to avoid paying GST. The shopkeeper suggested that he can do so if he does not take a receipt for the purchase of the mattress. Raghu readily agreed for the same.

After few months of using the mattress, his back pain recurred. He realised that the mattress had caved in from the centre. He approached the shopkeeper who refused to entertain Raghu.

Raghu wanted to approach the court for redressal of his grievance. However, one of his friends told him that he would not be able to do so as he had not fulfilled one of his responsibilities.

From the following, identify the responsibility which Raghu failed to fulfill:

Which of the following is not a limitation of planning function of management?

Seeing the increasing demand for automobiles in Buleti, 'Veso Cars', a global car manufacturing company planned to expand its operations and sell its cars there. However, the government of Buleti imposed high import duties on foreign made cars to protect local manufacturers from foreign competition. This attitude of the Buleti government towards foreign car manufacturers increased the cost of importing cars, making it less affordable for 'Veso Cars' to sell its cars at competitive prices in Buleti.

The component of business environment highlighted above is:

Identify the incorrect statement with respect to importance of 'Directing':

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

Assertion (A): A buyer buys a product or service for what it does for him/her or the benefit it provides to him/her.

Reason (R): From the customer's point of view, a product is a bundle of utilities which is purchased because of its capability to provide satisfaction of a certain need.

Choose the correct alternative from the options given below:

'Green Tech Solutions', a manufacturer of eco-friendly products had an organisational structure with separate departments for production, marketing, sales, etc. Each department had its own objectives, policies and style of working. The company was facing challenges as the production department would focus on producing goods without consulting the sales department and the marketing department developed advertising campaigns without considering the production timelines, leading to confusion and conflicts. To resolve this, the Chief Executive Officer, Madhur arranged inter-departmental meetings explaining to the respective managers that they have to consult each other while performing their activities. All the departmental managers agreed to this.

By linking the activities of all the departments, the Chief Executive Officer was able to ensure that the right products are available when needed, marketing efforts match with the product availability and sales targets are achieved.

The concept of management followed by the Chief Executive Officer to resolve confusion and conflicts between departments was:

Read the following statements carefully:

Statement I: Planning and Controlling are both backward-looking as well as forward-looking functions.

Statement II: Planning is prescriptive whereas Controlling is evaluative.

In light of given statements, choose the correct alternative from the following:

An incentive offered over and above the wages/salary to the employees is known as:

After moving to Dama from his home town in Rasha, Ramu and his family were staying in a rented accommodation for the last 5 years. Ramu and one of his office colleagues decided to buy a flat each in close proximity to their office. After a lot of research, they settled for a housing project which would cost them ₹1.25 crore each for a three bedroom flat. The housing project developers promised to deliver their flats within 36 months. An amount of ₹20 lakh each was paid to the developers of the housing project at the time of booking the flat. Since the payment schedule was time bound, they paid additional ₹80 lakh each over a period of 2 years. The balance of ₹25 lakh was to be paid at the time of registration. Despite having taken the major part of the cost of the flats, the housing project developers hadn't started the construction work.

Ramu and his colleague asked the housing project developers to refund the amount paid. On refusal of refund of the amount paid by the housing project developers, Ramu and his colleague decided to approach the consumer court.

The redressal agency which Ramu and his colleague should approach for redressal of their grievance is:

Which of the following is a regulatory function of Securities and Exchange Board of India?

'Alpha Manufacturing Ltd.' is a company manufacturing high quality car spare parts. The company has a well-established production line and its products are highly demanded in the market. However, it was noticed that the defect rate in the manufacturing process was higher than the standard of 10 per 1,000 pieces produced. In spite of best efforts, the Production Manager was not able to reduce the defect rate. So, he decided to revise the standards.

The step of the controlling process, followed by the Production Manager after not being able to reduce the defect rate, will be:

Explain the following points of importance of 'Controlling' function of management:

(i) Ensuring order and discipline

(ii) Judging accuracy of standards

State any three points of importance of 'Staffing' function of management.

Sweets has been the mainstay for several large homegrown restaurant brands. Increased life expectancy of people and increased awareness for health care amongst consumers has increased the demand for healthy food options. Young consumers are moving away from consuming traditional sweets to buying more western style premium products which are baked or steamed. With this shift in consumer preferences, 'Shree Restaurants', a well known restaurant brand, is gearing itself up for playing a greater role in the healthy packaged foods market. In addition to traditional sweets, the company is also planning to expand to healthy savoury and sweet items and some ready-to-eat items. These new healthy products are expected to change people's lifestyles.

Identify and explain the two features of Business Environment highlighted in the above case.

Explain the following internal sources of recruitment:

(i) Transfers

(ii) Promotions

Explain the following methods of training:

(i) Internship training

(ii) Vestibule training

'Verso Cars' opened their new car showroom in Kainvad. They appointed Tarun as a General Manager for managing their operations. He was responsible for meeting sales targets, keeping a check on inventory, building customer relations, ensuring compliance with regulations, etc. However, the high volume of work made it impractical for him to handle it all by himself. To meet the company's goals, and to ensure that all work is accomplished, he appointed Nikhil as a Sales Manager. Nikhil was given the authority to take decisions inherent in his managerial position and to tell people what to do and expect them to do it. He not only had to ensure that sales targets are met but was also to guide sales representatives and had to report directly to Tarun. As a result, Tarun was able to concentrate on more important matters and ensure that all work is accomplished.

(a) Identify the concept followed by Tarun which helped him in achieving the company's goals.

(b) Explain any two points of importance of the concept identified in (a) above.

Explain the following points of importance of 'Planning' function of management:

(i) Planning provides direction.

(ii) Planning reduces the risk of uncertainty.

Explain the following features of 'Planning' function of management:

(i) Planning is futuristic.

(ii) Planning is a mental exercise.

Rushil opened 'RK Hair and Beauty Salon' in a reputed locality and appointed fifteen people as salon staff. However, within just a few months, he observed that the employees were leaving the salon one by one and the business was not able to meet even the monthly targets.

Rushil asked his manager to find out the reason. The manager reported that quite often, according to the requirement, the hair stylist was asked to do the work of a makeup artist and a makeup artist was asked to do nail care, etc. As a result, the employees were not happy and wanted to work at a salon where work was divided according to their competence and would enhance their specialisation.

The manager also added that there was neither any fixed place for hair care, skin care or nail care materials nor for the employees. This created confusion and hindrance in the work and led to further dissatisfaction amongst the staff. As a result, the employees kept leaving the salon leading to high employee turnover ratio and a shortage of experienced staff.

Identify and explain the two principles of management that are not followed in 'RK Hair and Beauty Salon'.

State any four features of 'Motivation' as an element of Directing.

Explain the following non-financial incentives:

(i) Job enrichment

(ii) Employee participation

Shreedar had worked as an Operations Manager at a cab aggregator firm for ten years, gaining in-depth knowledge of the business. He then decided to leave the job and started his own cab aggregator business 'Easy Cab' with his friend Mukesh. Shreedar became the Chief Executive Officer and Mukesh the Chief Operating Officer in 'Easy Cab'. They decided to initially offer their services only in Goregram. To finance the venture, they applied for a loan to purchase electric cars for their fleet aiming to provide a sustainable and eco-friendly way to travel.

(a) Identify the level of management at which Shreedar and Mukesh are working in 'Easy Cab'.

(b) State any three functions required to be performed by both Shreedar and Mukesh at the level of management they are working.

'Nurata Ltd.' is a leading manufacturer of clothing in India, known for good quality casual wear as well as formal wear for children. The company is earning good profits and now wants to expand its business by entering into the business of electronics and home appliances too. The management decided to create separate business units, where each unit head would be responsible for a specific product category and for its performance. All key functions, such as marketing, finance, production, etc. would be handled within each unit.

(a) Identify the organizational structure adopted by 'Nurata Ltd.' on expansion of its business.

(b) State any two advantages and one disadvantage of the organizational structure identified in (a) above.

Sara recently received her degree in automobile engineering and decided to join her father's electric vehicle business. They were not only selling electric vehicles but also providing related services like charging vehicles and their maintenance, etc. Sara had worked on a practical project related to electric vehicles during her automobile engineering course and won first prize for it. She was impressed by electric vehicles because of their potential to revolutionize the automotive industry as these are more sustainable and eco-friendly alternative to traditional vehicles.

She was exploring the possibility of entering into partnerships with the government for electric vehicle charging stations. This could be shared investment, with the government providing land and incentives and her company contributing technical expertise and operational management. Sara shared her thoughts and ideas with her father. She prepared a proposal to collaborate with the government for setting up electric vehicle charging stations. The proposal contained her ideas, feelings and suggestions which she intended to convey to the government. She then converted her ideas, feelings and suggestions into words and pictures. She used clear concise language and visual aids such as charts and graphs, to make complex information more understandable. She now had to choose a path through which her proposal would be transmitted to the government. Sara had a face-to-face meeting with the government and presented her ideas directly.

(a) The above case highlights an element of one of the functions of management. Identify and explain the element.

(b) Quoting lines from the above case, name the four elements of the concept identified in (a) above.

(c) State three other elements of the concept identified in (a) above, not discussed in the above case.

Explain the following factors affecting working capital requirements of a business:

(i) Nature of business

(ii) Credit availed

(iii) Operating efficiency

(iv) Seasonal factors

Distinguish between 'Money Market' and 'Capital Market' on any six basis.

After completing his civil engineering degree, Sankalp decided to start his own business. He started a construction company 'Sankalp Builders'. He entered into an agreement for construction of residential flats on a land of 30 acres. Building of the flats on such a large scale required expensive machinery like bulldozers, excavators, etc. He had the option to buy the machinery or take it on lease. Though Sankalp was in favour of buying, his father advised him to take the decision with caution as construction machinery becomes outdated very fast and needs to be replaced. He also told Sankalp that in future he may think of diversifying his operations and would need funds for that too.

Identify and state any four factors discussed above affecting the fixed capital requirements of 'Sankalp Builders'.

Explain any four major components of Physical Distribution.

Explain any four communication tools used by the marketers to inform and persuade customers about their firm's products.

Read the following statements: Assertion (A) and Reason (R).\n\nAssertion (A): Informal organisation has a definite structure or form.\n\nReason (R): Informal organisation is a complex network of social relationships among members.\n\nChoose the correct alternative from the options given below:

'Through the process of disinvestment and reinvestment, savings get channelized into their most productive investment avenues.'\n\nThe function of the stock exchange highlighted above is:

After identifying the needs and wants of the target market and understanding that parents were increasingly looking for eco-friendly and safe toys for their children, a toy manufacturing company 'Deepak Toys Ltd.' decides to use eco-friendly materials for their toys. The company also ensures that their manufacturing process will not harm the environment.\n\nThe marketing management philosophy that guided the efforts of 'Deepak Toys Ltd.' is:

'KM Creations', a leading fashion brand, has been expanding its business into new markets. However, recently the company is facing challenges due to changes in inflation rates and disposable income of people. These factors have started affecting the company's pricing strategy and profitability. 'KM Creations' is now closely monitoring these changes to minimise their impact on its operations.\n\nThe component of business environment highlighted in the above para is:

Identify the type of plan shown on the Notice Board of the factory, from the picture given below:\n\n\n\nThe Notice Board reads: No Food or Drink Allowed

Read the following statements: Assertion (A) and Reason (R).\n\nAssertion (A): The dividend in growth companies is smaller than that in the non-growth companies.\n\nReason (R): Companies having good growth opportunities retain more money out of their earnings so as to finance the required investment.\n\nChoose the correct alternative from the options given below:

Read the following statements carefully:\n\nStatement I: Staffing is the most fundamental and critical drive of organisational performance and this function has assumed greater importance because of rapid advancement of technology.\n\nStatement II: Understanding manpower requirements is, only to know the number of persons needed in the organisation.\n\nIn the light of the statements given, choose the correct alternative from the following:

'With the growth of computers, more and more companies are using interactive sites on the Internet, to gather customer views and opinions, before taking important business decisions.'\n\nIdentify the marketing function highlighted in the above lines.

The process of holding securities in an electronic form is known as:

Match the concepts given in Column-II with their meanings given in Column-I.\n\n

\n\nChoose the correct option from the following:

From the following, identify the incorrect statement with respect to 'Delegation':

__________ is a legally enforceable document issued by the broker to the investor within 24 hours of executing trade which helps to settle disputes/claims between the investor and the broker.

Which of the following is not a factor affecting investment decision?

Read the following statements carefully:\n\nStatement I: Financial market is the market for the creation and exchange of financial assets.\n\nStatement II: On the basis of 'maturity of financial instruments traded', financial market is classified into money market and capital market.\n\nIn the light of the given statements, choose the correct alternative from the following:

'Chaman Pharmaceuticals Ltd.' is a company providing medicines all over the country. After establishing itself and making a name in the field of medicines, it decided to enter into the field of medical devices, baby care products and nutritional supplements. Each product category had a different head accountable for profits, revenues and costs. In case of poor performance of their product, the heads were held responsible. But as the heads of different product categories were different, conflict could arise among different heads with reference to allocation of funds. Also providing a separate set of similar functional heads for each product category increased expenditure.\n\n(i) Identify and explain the type of organisation structure 'Chaman Pharmaceuticals Ltd.' had followed after entering into the field of medical devices, baby care products and nutritional supplements.\n\n(ii) Also state any one advantage and any one disadvantage of the organizational structure discussed in the above para by quoting lines.

State any three 'Protective functions' of the Securities and Exchange Board of India.

Give the meaning of 'Capital Market'. Differentiate between 'Capital Market' and 'Money Market' on the basis of the following:\n\n(i) Participants\n\n(ii) Instruments

'Refresh Zone' was a popular coffee house chain offering premium coffee and snacks in a cozy environment. However, over time, the company began to face challenges in maintaining its market position. Customers had started complaining about lack of variety failing to cater to evolving consumer preferences. Also the price of coffee in 'Refresh Zone' was significantly higher than its competitors. Many consumers felt that the quality of coffee was not justifying its premium pricing.\n\nIdentify and explain two components of marketing mix that the management of 'Refresh Zone' needs to work on.

State the three leadership styles.

State any three financial incentives which may be used to motivate people.

Kapila is working at 'Cresa Engineering Solutions', an engineering consultancy firm. Despite being frequently enticed by many competitive companies offering her a higher pay package, Kapila chooses to stay with 'Cresa Engineering Solutions'. She enjoys her work as her job is designed with greater variety of work content requiring higher level of knowledge and skill and provides the opportunity for personal growth. The company has appropriate skill development programmes and a sound promotion policy due to which Kapila has been getting promotions year after year. Not only this, Kapila's work is being appreciated by the management from time to time. She always gives valuable suggestions and is being rewarded for that also. Over and above, the company implements measures to ensure stability of the employees in the organisation. All these factors motivate Kapila to continue to work in 'Cresa Engineering Solutions'.\n\nIdentify and explain the four non-financial incentives discussed in the above case.

'Pestle', is the country's largest biscuit manufacturing company, that makes high quality biscuits with focus on customer satisfaction. The company strives to understand what people want and provides tasty and healthy biscuits. To ensure the quality, a robust control system has been installed by the company. This helps the organisation to measure progress towards its goals and brings to light the deviations, if any. It also enables the management to verify whether the standards set are accurate and objective or not.\n\nThe above para highlights the importance of the Controlling function of management. Identify and explain any two points of importance of the Controlling function discussed above.

Explain the following features of Coordination:\n\n(i) Coordination is a continuous process.\n\n(ii) Coordination is an all-pervasive function.

Explain the following characteristics of Management:\n\n(i) Management is a dynamic function.\n\n(ii) Management is a group activity.

'Global Foods Ltd.', a multinational company in the food processing industry, has a good customer base. Recently it has expanded into new international markets. But due to increased awareness for health care, there is a shift in consumer demand for healthier food options. For this reason, the company needs to adapt to frequent technological advancements in production processes so that healthy food product options can be made available in the market. Additionally, the company is concerned about fluctuations at global level in commodity prices, exchange rates and political conditions. 'Global Foods Ltd.' is finding it increasingly difficult to predict future outcomes due to the constantly changing nature of the market. In order to effectively cope up with these significant changes, managers have to understand and examine the environment to develop suitable courses of action. By continuously monitoring the environment and adopting suitable business practices, the company will not only improve its present performance but also continue with it for a long period in achieving its objectives.\n\nIdentify and explain two features and two points of importance of business environment discussed in the above para.

Explain any two points of importance of consumer protection from the point of view of business.

Explain the following features of Marketing:\n\n(i) Needs and wants\n\n(ii) Creating a market offering

A company, 'SK Energy Ltd.' is providing solar energy solutions in some states of the country. Now it wants to expand its operations in some other states also. It needs ₹ 30,00,000 for its expansion. The Chief Financial Officer suggested two options for this.\n\nOption I: To raise the entire funds through issue of shares of ₹ 10 each.\n\nOption II: To raise ₹ 10,00,000 through issue of shares of ₹ 10 each and ₹ 20,00,000 by raising debt @ 10% p.a.\n\nThe return on investment of the firm is 12% and tax rate is 30%.\n\n(i) Which of the two options will maximise shareholders' wealth? Give reason in support of your answer.\n\n(ii) Will the earning per share improve if return on investment of the company is 8%? Give reason in support of your answer. Show your working clearly.

Explain the following features of planning:\n\n(i) Planning is a mental exercise.\n\n(ii) Planning is continuous.\n\n(iii) Planning is futuristic.\n\n(iv) Planning involves decision-making.

Explain any four points of importance of Organising function of management.

Explain any four psychological barriers to communication.

'Marut Enterprises' is a large company manufacturing washing machines. From the last few months, employees have been reporting dissatisfaction with the overall work environment which has led to a decline in productivity. The management realized that there is no coordination between various departments. On one hand, the Production Manager is giving instructions to the workers to speed up the work to achieve the targets whereas on the other hand, the Sales Manager is also giving instructions to the workers of the production department to slow down the production as sales are not picking up. It was also observed by the company's management that there is a lack of proper communication among different levels of superiors and subordinates. Even in case of emergencies, a worker is not in a position to contact the Chief Executive Officer directly, which is affecting the productivity and the morale of the workforce. The management felt a need to foster a positive environment which may promote team spirit of unity and harmony among the employees.\n\nIdentify and explain the three principles of management given by Henri Fayol which can help in addressing the challenges faced by the company.

Match the steps of organising process given in Column I with their explanation given in Column II.

Choose the correct option from the following:

Bisphenol A is one of the most harmful chemicals used to make plastic water bottles. Its levels increase when the water is stored in these bottles for a long period of time. Keeping health considerations in mind, Ketan ordered six glass water bottles and decided not to use plastic bottles in the future. On receiving the parcel, he found that two bottles were broken as the container or wrapper was not adequate to protect the bottles.\n\nThe product-related decision neglected by the marketer was:

Which of the following are 'Standing Plans'?\n\n(i) Budgets\n(ii) Policies\n(iii) Programmes\n(iv) Procedures\n(v) Methods\n(vi) Rules\n\nChoose the correct alternative:

'GEO Builders' were to complete a housing project by December 2024 and hand over the flats to the buyers. Due to excessive heat in the month of May and June 2024, the work slowed down and the project was getting delayed. The firm, in order to complete the project on time, hired more workers through a contractor and asked all the workers to work overtime. Due to the above measures taken by the management, the project was completed on time but the cost of building the flats increased by 10%.\n\nIdentify the correct option. 'GEO Builders' were:

Organising involves a series of steps that need to be taken in order to achieve the desired goal.\n\nIdentify the correct sequence of steps of organising function of management from the following:

Identify the incorrect statement with respect to 'Product' as an element of Marketing Mix: