Class 11 Business Studies Sample Paper

We have provided Class 11 Business Studies Sample Paper as per the latest CBSE examination pattern for the current academic year. The following CBSE Sample Papers for Class 11 Business Studies has been prepared based on the guess papers issued recently. Students will be able to practice these papers and get good marks in upcoming Business Studies exams for Class 11.

CBSE Sample Papers for Class 11 Business Studies

Term 2 Sample Papers

Class 11 Business Studies Sample Paper Term 2 With Solutions Set A

Class 11 Business Studies Sample Paper Term 2 With Solutions Set A

1. Explain the following
(a) GDR
(b) ADR
Ans. (a) Global Depository Receipts (GDR’s): The local currency shares of a company are delivered to the depository bank. The depository bank issues depository receipts against these shares. Such depository receipts denominated in US dollars are known as Global Depository Receipts (GDR).
(b) American Depository Receipts (ADRs): The depository receipts issued by a company in the USA are known as American Depository Receipts. ADRs are bought and sold in American markets, like regular stocks. 

2. What do you mean by Intellectual Property Rights?
Ans. Intellectual property (IP) refers to the creations of the human mind, like inventions, literary and artistic works, symbols, names, images and designs used in business. Intellectual property is divided into two broad categories: industrial property, which includes inventions (patents), trademarks, industrial designs and geographical indications, while the other is copyrights, which includes literary and artistic works, such as novels, poems, plays, films etc.

3. ‘Retailer is an important link in the channel of distribution.’ Explain any two services he provides to consumers.
Ans. 1. Regular availability of the goods: Retailers maintain regular availability of variety of product from different manufacturers. This helps the customers to buy the products of their choice as and when they require.
2. Information about the goods: By effectively displaying the goods and through personal selling efforts; retailers provide important information about the arrival of the new goods, their special features etc. thus helps them in making their purchase decision.

4. Explain the concept of International trade.
Ans. Manufacturing and trade beyond the boundaries of one’s own country is known as international business. It involves not only the international movements of goods and services, but also of capital, personnel, technology and intellectual property like patents, trademarks, know-how and copyrights.

5. Identify the source of finance in the following cases:
(a) It is a source of finance which converts the value of purchases into trade payables
(b) Owners of capital with preferential rights
(c) It provides an option to raise funds in American currency
Ans. (a) Trade credit
(b) Preference Sharecapital
(c) ADR

OR

Distinguish between Debentures and Shares on the following basis:
(a) Tax advantage
(b) Refund of capital
(c) Relation with company
Ans.

6. ‘Protection of small-scale industries (SSI) by the Government is essential for equality of opportunity.’ Comment.
Ans. The given statement is correct. Small-scale industries occupy a very important place in the industrial structure of the country. However, they cannot compete with the big industrialfirms. They can flourish only when they are protected from the large firms. The government has reserved production of a number of products for the small scale industry. Moreover, small-scale industries were also given concessions, so steps taken by the Government for their growth are justified.

7. “Spencers”, “Big Apple” and “Big Bazar” are examples of which type of fixed shop (large store)? Give any two merits of these types of Stores.
Ans. Departmental Stores
Merits of departmental stores.
1. Convenience in buying
2. Attract large number of customers

8. Explain any three services of wholesalers to the retailers 
Ans. 1. Availability of goods: Retailers have to maintain adequate stock of varied commodities so that they can offer variety to their customers. The wholesalers make the products of various manufacturers readily available to the retailers. This relieves the retailers of the work of collecting goods from several producers.
2. Marketing support: The wholesalers perform various marketing functions and provide support to the retailers. They undertake advertisements and other sales promotional activities to induce customers to purchase the goods.
3. Grant of credit: The wholesalers generally extend credit facilities to their regular customers. This enables the retailers to manage their business with relatively small amount of working capital.

9. Explain the role of DIC and NSIC in supporting Small scale industries
Ans. District Industries Centres (DICs):
• Established in 1978 To support small entrepreneurs at district level.
• Provides all facilities and support to set up small and village industries.
• Identification of suitable schemes for entrepreneurs by Central and State Govts.
• Preparation of feasibility reports on each industry.
• Arrangement of credit facilities and equipments.
• Arrangement of raw materials.
• To impart training for artisans, entrepreneurs etc. (any three points: 2.5 marks)
National Small Industries Corporation (NSIC):
• Set up in the year 1955 to promote and foster the growth of SSIs in India.
• Supply of indigenous and imported machines on hire purchase basis.
• Supply of raw materials – locally and imported.
• Support in export of products.
• Monitoring and advisory services.
• Providing latest technology.
• Awareness on technological upgradation.
• Development of software technology parks and technology transfer centres.

OR

Explain any five ways to fund start-up
Ans. 1. Crowd funding
2. Boot strapping
3. Angel investment
4. Incubator
5. Self-financing

10. Read the following text and answer the following questions 
Footwear Ltd. located in Mumbai manufactures shoes. It imports raw material from Italy and dyes from Japan. The design quality and durability of the shoes manufactured by this Company has made it number one company in that area. Now the company wishes to sell its products in all the states of India as well as in international markets.
The marketing managers advised to strengthen the distribution channel by appointing more wholesalers for each area. But one of the board of directors was of the view that if they sell the product directly to retailers, they will be able to get the competitive price for their products, which will result in increased sales turnover and eventually the profits.
The promoters of the company have come up with a different proposition. They believe that the company should open its own stores in different parts of the country. After lot of discussion, it was decided to go ahead with the board of director’s proposal that they should sell the products directly to retailers. They also believe that retailers will provide important information about the arrival of products to the customers by arranging effective display of products.

i. …………serves as the link between wholesalers and customers
(a) Suppliers
(b) Retailers
(c) Manufacturers
(d) All of these

ii. Which of the following is incorrect regarding the services provided by retailers to customers?
(a) Provide after sales services
(b) Offer wide selection of goods
(c) Provide credit facilities to regular buyers
(d) None of the above

iii. Which of the following statements regarding reasons for international business are correct?
(a) Unequal distribution of natural resources among nations or differences in their productivity levels
(b) Availability of various factors of production differs among nations
(c) Labour productivity and production costs differ among nations due to various socio-economic, geographical and political reasons.
(d) All of the above

iv. Which of the following is the proposition of promoters?
(a) Mail order houses
(b) Chain stores
(c) Departmental stores
(d) None of these

v. Which services to customer by retailer is highlighted in the line “They also believe that retailers will provide important information about the arrival of products to the customers by arranging effective display of products”?
(a) Regular availability of products
(b) New products information
(c) Convenience in buying
(d) Wide selection

11. Read the following text and answer the question no. (i) to (v) on the basis of the same
A company is searching options to raise Rs 20,000 crore from the financial market for diversification and modernisation of existing projects. It hired the services of a renowned financial consultancy firm for suggesting options for the same. The financial consultancy firm suggested a list of options to the board of directors of the company.
It was decided that for the immediate requirement of Rs 1,00 crore, the company will make a new issue of shares without diluting the right of existing shareholders according to the terms and conditions of the company and Rs 4,00 crore, would be raised by taking loans from financial institutions.
It was further decided to raise capital to the term of Rs 6,000 crore through debentures. All these options were accepted by the board of directors. The board further decided that trade credit can be used to finance short-term capital requirements. The company also decided that they will use their undistributed profits in case of shortfall of funds.

i. It was decided that for the immediate requirement of Rs 1,00 crore, the company will make a new issue of shares at a fixed rate of dividend without diluting the control of existing shareholders, according to the terms and conditions of the company. Name the type of financial securities issued by the company.
(a) Equity shares
(b) Debentures
(c) Commercial papers
(d) Preference share 

ii. Which of the following sources of finance used by the company does not involve any cost?
(a) Shares
(b) Debentures
(c) Trade credit
(d) Loans from financial institutions 

iii. Debentures are said to be the economical source of finance because of which of the following?
(a) Low floatation cost
(b) Tax benefits
(c) No loss of control
(d) Fixed interest 

iv. The usage of undistributed profits indicates the usage of which source of capital?
(a) Bonds
(b) Equity shares
(c) Preference shares
(d) None of these

v. The board of directors further decided that trade credit can be used to finance short-term capital requirements. Identify one of the sources of trade credit
(a) Banks
(b) Traders
(c) Suppliers
(d) Customers

12. Explain any two benefits of International business to the firm and three benefits to the nation. 
Ans. Benefits to Firms
1. Prospects for higher profits
2. Increased capacity utilisation
3. Prospects for growth
4. Way out to intense competition in domestic market
5. Improved business vision (any two benefits with explanation 
Benefits to Countries
1. Earning of foreign exchange
2. More efficient use of resources
3. Improving growth prospects and employment potentials
4. Increased standard of living

OR

What are Multiple Shops? Explain any four features of Multiple shops.
Ans. Multiple shops refer to the network of retail shops established in localities spread in different parts of the country.
features of Multiple shops
1. Central ownership and control. 
2. Uniformity in price and cash sales.  
3. Buying and selling policy.
4. Limited range of products.