Model answers of Business Studies Class XI

MODEL ANSWER PAPER

CLASS: XI B

SUBJECT: BUSINESS STUDIES

FIRST UNIT TEST

Ans.1 (1) Employment

(2) Tertiary industries

(3) Unlimited

Ans.2 Business may be defined as an economic activity involving the production and sale of goods and services undertaken with a motive of earning profit by satisfying human needs in society.

Ans.3 Examples of economic activities:

(i) The teacher teaching in school to get salary.

(ii) The doctor treating patients for fees.

(iii) Businessman selling goods to earn money by profit.

Examples of non-economic activities:

(i) Mother cooking food for family.

(ii) Helping an old man to cross road.

(iii) Distributing things as charity.

Ans.4 Causes of business risk:

(i) Natural Causes: human beings have little control over natural calamities like flood, earthquake, lightening, famine etc. They result in heavy loss of life, property and income in business.

(ii) Human Causes: Human causes include such unexpected events like dishonesty, carelessness or negligence of employees, stoppage of work due to power failure, strike, riots etc.

(iii) Economic Causes: These include uncertainties relating to demand of goods, competition, price, collection dues from customers, change of technology etc.

(iv) Other Causes: These are unforeseen events like political disturbances, mechanical failures such as the bursting of boiler, fluctuations in exchange rates etc. which leads to the possibility of business risk.

Ans.5 Various forms of business organizations are:

(i) Sole proprietorship 

(ii) Partnership

(iii) Joint Hindu Family Business

(iv) Cooperative Societies

(v) Joint Stock Company

Ans.6 Various types of Industries:

(i) Primary Industries – (a) Extractive  (b) Genetic

(ii) Secondary Industries  - (a) Manufacturing – Analytical, Synthetical, Processing and Assembling

                                                (b) Construction

(iii) Tertiary Industries

Ans.7 (a) Wholesale trade: When goods are purchased and sold in bulk. It is known as Wholesale trade.

(b) Entrepot trade: When goods are imported for export to other countries, it is known as entrepot trade.

Ans.8 Multiple objectives of business: (any three)

(i) Market standing: It refers to the position of any enterprises in relation to its competitors.

(ii) Innovation: Innovation is the introduction of new ideas or methods in the way something is done or made.

(iii) Producivity: Productivity is calculated by comparing the value of outputs with the value of inputs. It used as a measure of efficiency.

(iv) Physical and financial resources: Any business requires physical resources like plants, machines, officers etc, and financial resources i.e. funds to be able to produce and supply goods and services to its customers.

(v) Earning profits: One of the objectives of business is to earn profits on the capital employed.

Ans. 9 Sole proprietor is a form of organization which is owned, managed and controlled by an individual who is the recipient of all profits and bears of all risks.

Features of  Sole proprieitorship firm:

(i) Formation and closure

(ii) Unlimited liability

(iii) Sole risk bearer and profit recipient

(iv) Control

(v) No separate entity

(vi) Lack of business continuity

Ans.10 Characteristic features of Business:

(i) An economic activity

(ii) Production or procurement of goods and services

(iii) Sale or exchange of goods and services for the satisfaction of human needs

(iv) Dealings in goods and services on a regular basis

(v) Profit earning

(vi) Uncertainty of return

Ans.11 Difference between between Business, Profession and Employment:

Point of difference	Business	Profession	Employment
Qualification	No minimum qualificaition is required	Expertise and training in a specific field is a must.	Qualification and training as prescribed by the employer
Return or reward	Profit earned	Professional fee	Salary or wages
Transfer of interest	Transfer possible with some formalities	Not possible	Not possible