ISC Class 12 Business Studies Board Exam Question Paper 2010 with Solutions

ICSE Class 12 Business Studies Board Exam Question Paper with Solutions

Part - I

(Answer all questions)

Question 1.
Answer briefly each of the questions (i) to (xv): [15 × 2]

(i) State two merits of internal recruitment. [2 Marks]

Answer:
1. It helps in minimizing labor turnover.
2. It helps in boosting the morale of existing employees.

Teacher's Note:
a) Internal recruitment refers to filling vacancies from within the existing workforce through promotions or transfers.
b) Students must mention clear operational benefits such as cost-effectiveness or motivation, rather than generic advantages.

(ii) ‘Training helps in reducing supervision of employees’. Justify. [2 Marks]

Answer:
Training increases the knowledge and skills of the employees. They get expertise in their related jobs. Therefore, it helps in reducing supervision of employees.

Teacher's Note:
a) Trained employees gain self-confidence and thorough understanding of task execution.
b) Emphasize that reduced supervision saves managerial time and builds employee independence.

(iii) List any two work conditions where time rate system of remuneration is more suitable than the piece rate system. [2 Marks]

Answer:
1. When the number of units cannot be counted or work cannot be measured.
2. When quality of production has to be given weightage over quantity of production.

Teacher's Note:
a) Time rate is ideal for artistic, highly intellectual, or precision-based tasks where speed is secondary.
b) Avoid confusing conditions with financial incentives or piece-rate prerequisites.

(iv) Mention four indicators of low morale amongst employees of an organisation. [2 Marks]

Answer:
1. High rate of wastage and spoilage.
2. High rate of absenteeism.
3. High rate of labor turnover.
4. High rate of strikes.

Teacher's Note:
a) Employee morale reflects the overall attitude and satisfaction of workers towards their workplace.
b) Ensure all four distinct behavioral or operational symptoms are listed to secure full marks.

(v) How does challenging work motivate employees ? [2 Marks]

Answer:
Challenging work certainly motivates employees. By giving challenging work to capable employees, it increases the sense of faith for their institution. Challenging work helps employees in building their reputation in the institution and they are trusted by other employees, which motivates them.

Teacher's Note:
a) Challenging assignments fulfill psychological needs of achievement, recognition, and self-actualization.
b) Highlight that capability must match the challenge to avoid frustration or burnout.

(vi) State two limitations of Maslow’s Theory of the hierarchy of human needs. [2 Marks]

Answer:
1. Recent research challenges the strict order in which needs are imposed by Maslow's pyramid (for example, in some cultures, social needs are placed more fundamentally than safety needs).
2. Maslow's hierarchy fails to explain scenarios like the "starving artist", where individuals neglect physical needs to pursue aesthetic or spiritual goals, and people can satisfy multiple needs simultaneously rather than strictly sequentially.

Teacher's Note:
a) Maslow's model assumes a universal rigid hierarchy which may vary across individuals and cultures.
b) Clearly state specific deviations like simultaneous motivation or cultural differences to earn full credit.

(vii) ‘Transfer is a mild form of punishment’. Explain. [2 Marks]

Answer:
When an employee neglects work, conflicts with other employees, or commits an act of misconduct, management can transfer the erring employee as a disciplinary measure. Transferring an employee from one place to an unimportant or inconvenient branch is a common practice used while penalizing employees mildly.

Teacher's Note:
a) Administrative transfers are normally routine, but punitive transfers aim to correct or discourage undesirable behavior without immediate termination.
b) Distinguish clearly between developmental transfers and punitive transfers.

(viii) What are the functions of a telephone recording and an answering set? [2 Marks]

Answer:
1. It automatically answers incoming calls when the owner is unavailable and plays a pre-recorded message or records messages left by callers.
2. It provides a remote listening facility enabling the owner to check and listen to recorded messages from any external telephone using a special tone or code.

Teacher's Note:
a) Answering machines enhance office communication efficiency by ensuring no missed inquiries during absence.
b) Mention both the recording function and the remote retrieval/playback function for complete credit.

(ix) List the steps involved in report writing. [2 Marks]

Answer:
1. Clarifying purpose and expectations
2. Deciding on an appropriate structure for the report
3. Drafting
4. Circulating the draft
5. Integrating comments
6. Writing executive summary
7. Circulating final draft
8. Editing
9. Layout

Teacher's Note:
a) Systematic report writing ensures logical flow and comprehensive coverage of facts.
b) Students can list key sequential milestones accurately as accepted in standard secretarial practice.

(x) What is meant by casting vote ? [2 Marks]

Answer:
A casting vote is the deciding vote given by the chairman or person in charge of a meeting when votes for and against a motion are equally divided. It breaks the deadlock to achieve a majority decision.

Teacher's Note:
a) A casting vote is exercisable only when there is a tie, distinct from a regular vote.
b) Emphasize that the chairman does not possess a casting vote inherently unless permitted by company articles.

(xi) Explain the term Point of Order. [2 Marks]

Answer:
A Point of Order is a motion raised by a member to express an objection or complaint against a departure from the correct procedure of a meeting, irrelevant speeches, use of unparliamentary language, or lack of quorum.

Teacher's Note:
a) Points of order take precedence over normal business and require immediate ruling by the chairman.
b) Give examples such as breach of rules or quorum failure to demonstrate thorough understanding.

(xii) Why is a histogram called a two dimensional graph? [2 Marks]

Answer:
A histogram is a bar chart representing a frequency distribution where both the height and the width of the rectangular bars are taken into consideration to depict frequencies across class intervals using both the X-axis and Y-axis. Therefore, it is called a two-dimensional graph.

Teacher's Note:
a) Unlike one-dimensional simple bar charts where only height represents magnitude, histograms utilize area (height and width).
b) Mention the involvement of both horizontal and vertical axes to justify the term clearly.

(xiii) How does a business reply card help a business concern? [2 Marks]

Answer:
A business reply card helps a business concern to procure mail orders, suggestions on its products, and survey reports easily. It is a prepaid card where the sender does not need to affix postage stamps, as the postage is borne entirely by the business concern.

Teacher's Note:
a) Pre-paid response mechanisms encourage customers to reply promptly without incurring personal expenses.
b) Highlight that postage cost is paid by the recipient company upon delivery.

(xiv) Explain the term adjournment in the context of company meetings. [2 Marks]

Answer:
Adjournment means the suspension or postponement of a meeting to a future date, time, or place. In company meetings, if an AGM cannot complete its agenda or if accounts are delayed, business is suspended and the meeting is adjourned to be continued later.

Teacher's Note:
a) Adjourned meetings are legally a continuation of the original meeting.
b) Note that proper notice and quorum requirements apply as governed by company law.

(xv) Write the expanded forms of the following:
(a) N.B.
(b) PABX [2 Marks]

Answer:
(a) N.B. means Nota Bene (Note well).
(b) PABX means Private Automatic Branch Exchange.

Teacher's Note:
a) Latin abbreviations and office automation terminology must be reproduced with accurate spelling.
b) Avoid common spelling slips in abbreviations like Nota Bene.

Part - II

(Answer any five questions)

Question 2.
(a) Why is induction training important in an organization ? [4]
(b) Discuss any five methods of raising staff morale in an organization. [10]

Answer:
(a) Importance of induction training:
1. It helps new employees settle into the organization smoothly by familiarizing them with rules, policies, culture, and colleagues.
2. It reduces initial anxiety, confusion, and turnover rates among fresh recruits.
3. It improves productivity quickly by making employees aware of their specific functions and workplace layout.
4. It builds a positive first impression and enhances loyalty toward the institution.

(b) Methods of raising staff morale:
1. Monetary Incentives: Providing fair and adequate salaries, wages, bonuses, and allowances enabling workers to live a decent life.
2. Non-Monetary Incentives: Offering medical aid, recreational facilities, holiday homes, and creche facilities.
3. Job Security: Ensuring stable employment and clear policies regarding job tenure and alternative placement.
4. Sound Promotion Policy: Adopting a balanced promotion policy giving due weightage to both merit and seniority.
5. Redressal of Grievances: Establishing a prompt, fair, and impartial mechanism to address and resolve employee complaints quickly.

Teacher's Note:
a) Induction (orientation) is the bridge between recruitment and active job performance.
b) Ensure both financial and non-financial morale boosters are explained thoroughly under part (b).

Question 3.
(a) Explain Laissez-Faire leadership. Discuss its advantages and disadvantages. [6]
(b) Define promotion. Explain three advantages and three disadvantages of seniority based promotion. [8]

Answer:
(a) Laissez-Faire Leadership:
It is a "hands-off" leadership style where the leader provides little or no direction, giving followers complete freedom to make decisions and organize their work. The leader merely provides resources and answers queries.
Advantages:
1. Highly effective when subordinates are professionally competent, highly responsible, and self-motivated.
2. Fosters creativity and personal growth.
Disadvantages:
1. Can lead to a total lack of direction, coordination, and focus if employees are irresponsible.
2. Reflects poor managerial involvement, leading to employee dissatisfaction and chaos.

(b) Definition of Promotion:
"A promotion involves a change from one job to another that is better in terms of status and responsibilities." - Edwin B. Flippo.
Advantages of Seniority-Based Promotion:
1. Simple and objective to measure based on length of service, avoiding subjective bias.
2. Instills a sense of security and loyalty among senior employees, reducing frustration.
3. Economical and peaceful as it is readily accepted by trade unions without costly testing procedures.
Disadvantages of Seniority-Based Promotion:
1. Ignores merit, leading to inefficient employees occupying senior management positions.
2. Frustrates young, highly talented, and ambitious employees who may leave the organization.
3. Lowers overall organizational productivity and fails to adapt to rapidly changing technology.

Teacher's Note:
a) Laissez-faire works only with expert teams; otherwise, it causes chaos.
b) Balance the merits and demerits of seniority promotions by mentioning both employee security and the sacrifice of merit.

Question 4.
In the context of staff remuneration, explain Halsey Plan and Rowan Plan of incentive wage payment with the help of appropriate examples. [14]

Answer:
Halsey Premium Plan:
Developed by F. A. Halsey, standard time is fixed for a job. A worker completing the job in less than standard time is paid guaranteed time wages plus a bonus calculated as a fixed percentage (usually 50%) of the wages of time saved.
Illustration: Standard time = 10 hours, Actual time = 8 hours, Rate = Rs. 10 per hour, Bonus = 50%.
Time saved = 10 - 8 = 2 hours.
Bonus = 50% of (2 × 10) = Rs. 10.
Wages for 8 hours = 8 × 10 = Rs. 80.
Total wages = Rs. 80 + Rs. 10 = Rs. 90.

Rowan Premium Plan:
Introduced by James Rowan, standard time and rate are fixed similarly. The bonus is proportioned to the time taken as well as time saved.
Bonus Formula: \(\frac{\text{Time Saved}}{\text{Standard Time}} \times \text{Actual Time} \times \text{Rate per hour}\)
Illustration: Standard time = 10 hours, Actual time = 8 hours, Rate = Rs. 10 per hour.
Time saved = 10 - 8 = 2 hours.
Bonus = \(\frac{2}{10} \times 8 \times 10 = \text{Rs. } 16\).
Actual wages for 8 hours = 8 × 10 = Rs. 80.
Total wages = Rs. 80 + Rs. 16 = Rs. 96.

Teacher's Note:
a) Halsey gives a fixed percentage of time saved, whereas Rowan calculates bonus as a proportion of time taken to standard time.
b) Always show formula substitutions and step-by-step arithmetic clearly in numerical questions.

Question 5.
(a) Discuss the importance of feedback in communication. [2]
(b) What is meant by face to face communication ? [2]
(c) Explain any five advantages and five disadvantages of face to face communication. [10]

Answer:
(a) Importance of Feedback:
Feedback is the return flow of communication where the receiver responds to the sender. It is vital because it confirms whether the message has been accurately received, understood, and interpreted, thus completing the communication loop.

(b) Face-to-Face Communication:
It is a direct, oral interaction between two or more persons where participants interchange roles as speakers and listeners in person, allowing immediate exchange of thoughts and non-verbal cues.

(c) Advantages of face-to-face communication:
1. Prompt communication with immediate exchange of responses.
2. High effectiveness as doubts can be clarified instantly on the spot.
3. Flexibility to modify or adjust messages based on listener reactions.
4. Immediate availability of feedback and non-verbal cues.
5. High degree of privacy and secrecy.
Disadvantages of face-to-face communication:
1. Absence of written record or legal validity.
2. Poor retention over long periods of time.
3. Inability to fix legal responsibility due to lack of documentation.
4. Unsuitable for lengthy, complex messages or large audiences.
5. Prone to misunderstandings if emotional factors interfere.

Teacher's Note:
a) Feedback is the touchstone of effective two-way communication.
b) Ensure distinct separation between procedural advantages and recording limitations.

Question 6.
(a) What is an agenda ? Why is it an essential part of notice? [4]
(b) Explain any five ways in which the sense of a meeting can be ascertained. [10]

Answer:
(a) Agenda:
An agenda is a list of items, business matters, or topics to be discussed at a meeting, sent along with the notice. It is essential because without an agenda, members cannot prepare adequately, and the notice may be treated as invalid, rendering decisions legally ineffective.

(b) Ascertaining the sense of a meeting:
1. Voting by Show of Hands: The primary method where members raise hands in favor or against a motion.
2. Voting by Poll: Conducted when demanded by members or ordered by the chairman, counting individual votes accurately.
3. Division of the House: Members physically separating into lobbies or groups to count votes.
4. Ballot or Secret Voting: Used for sensitive matters like director elections to ensure confidentiality.
5. Voice Vote (Acclamation): Judging agreement or disagreement by the volume of voices shouting 'Aye' or 'No'.

Teacher's Note:
a) Agenda ensures orderly conduct and prevents deviation from meeting objectives.
b) Chairman's duty is to correctly ascertain the true sense (majority opinion) of the assembly.

Question 7.
(a) Discuss the procedure for handling the outgoing mail in a big business concern. [12]
(b) Mention any four mechanical aids associated with the above procedure. [2]

Answer:
(a) Procedure for handling outgoing mail:
1. Drafting of Letters: Preparing clear, polite, and concise drafts of letters to be sent out.
2. Typing of Letters: Typing the approved draft accurately with proper alignment, date, and address.
3. Filing of Letters: Verifying typed copies against drafts, securing necessary signatures, and placing office copies in files.
4. Entering in Despatch Register: Entering details such as date, recipient name, subject, and postage in the outgoing despatch register.
5. Enveloping and Stamping: Inserting letters into properly addressed envelopes, sealing them, and affixing correct postage stamps.
6. Actual Despatch: Handing ordinary, registered, or courier mail to postal authorities or delivery agents and obtaining proofs of despatch.

(b) Mechanical aids associated with outgoing mail:
1. Weighing Machine: To determine accurate letter weight for correct postal stamping.
2. Franking Machine: To print official postal stamps automatically on envelopes.
3. Stapling Machine: To fasten multiple pages or documents securely.
4. Dating Machine: To stamp dates rapidly on letters and documents.

Teacher's Note:
a) Systematic handling of outgoing mail ensures cost control and punctual business communication.
b) List both clerical steps and mechanical aids clearly as requested in parts (a) and (b).

Question 8.
(a) What are memos ? State two situations in which they can be used effectively. [4]
(b) What are circulars ? Give any two situations in which they are effective. [4]
(c) On behalf of a multinational corporation, draft an interview letter for the post of a management trainee. [6]

Answer:
(a) Memos (Memorandums):
A memo is an informal internal written communication used between managers and subordinates within the same organization.
Two situations for effective use:
1. Issuing routine instructions or policy changes to staff members.
2. Seeking explanations from an employee regarding misconduct or performance lapses.

(b) Circulars:
A circular letter is a written document sent simultaneously to a large number of people both internally or externally to convey identical information.
Two situations for effective use:
1. Announcing the launch of a new product or service to customers.
2. Notifying a change of business address or opening of a new branch.

(c) Interview Letter Draft:

Teacher's Note:
a) Memos are strictly internal; circulars have a wider reach.
b) Ensure business letters contain all standard components: sender address, date, recipient address, reference, subject/salutation, body, and formal sign-off.