Multiple Choice / Objective Questions in Commerce 1) Draft 5 year plan is approved by ---- National Development Council 2) Reducing the

capital of a company is called - Internal reconstruction

3) Laws of increasing and constant returns are temporary phases of Law of Variable Proportion 4) A firm producing large no.of products follow which pricing strategy Price Leadersship 5) Cartels under oligopoly do not survive for long because of Inter-firm rivalry 6) The modern organization structure , usually recommended is Flat 7) Johari Window relates to interpersonal communication 8) Relationship marketing relates to Repeat purchase 9) Capital structure designing has nothing to do with - Solvency 10) Method used to determine wage differentials is Job Evaluation 11) Induction means Orientation 12) Labour productivity means Output is equal to input 13) Trading on Equity means Trading on borrowed funds 14) To manage is the forecast and plan etc Henry Fayol 15) When management pays attention to more important areas looked after by lower level management is known as MBO

16) Policy making is an important part of the process of Planning 17) Job Analysis provides information used for Procedure 18) Human Relations approach of management is associated with Elton Mayo
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19)General definition of economics is Individual and social choice in the face of scarcity. 20) The immediate solvency ratio is Quick ratio, but not Current ratio 21) SEZ Policy in India is motivated by experience of CHINA 22) The term funds used in FFS is CA (-) CL 23) In the long run, in perfect competition, there will be no super normal profits. 24) Theory X Autocratic (wants close supervision) Theory Y Participative Theory Z Democratic (No personal supervision) 25) Over capitalization is desirable 26) A leader uses the following methods a) uses criticism b) encourages growth c) sets objectives d) gives orders and directions (Ans c,d)

27) Laissez Faire policy is adopted in Capitalistic Economic System 28) Land is not depreciable asset, because its value always increases. (But not of its unlimited life) 29) The elasticity of demand for luxury goods is Infinite 30) Out of HR, time, cost, measurable elements, which is not necessary for MBO Human relations 31) Function of attracting, acquiring, retaining and development of HR in a firm is called Staffing 32) Style of production oriented leader in Managerial grid is 9,9 style
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33) Concept of 4Ps in marketing is profound by E.J.Mc Carthy 34) 35) Automatic vending, direct selling, telemarketing are non-store retailing types 36) A product line strategy, wherein a company adds a higher priced product to a line in order to attract a broader market which helps the sale of its existing lower priced product is called Trading Up 37) Use of fixed interest securities in the capital structure is called Financial Leverage 38) If NPV is positive, the IRR will be

K<R

39) As per Walter, the firm should pay 100% dividend , if r=k 40) PIP test seeks to measure Personality, Interest, Preferences 41) Workers Participation in Management bill was introduced in Parliament in the year 1990 42) Decoupling denotes Indian market may be cut off from global market, so that it may not be affected by global volatility. 43) The concept of SSI (Small Scale Industries) was brought in by Industrial Policy Statement 1977 44) Conglomeration merger Merger b/w two companies having no common business area

Consolidation merger Two companies are brought and combined under new entity Purchase merger Market extension merger When one company purchases another Merger b/w two companies , that sell same products in diff markets

45) Deficiency/Surplus Account in Liquidation of a company is called LIST H

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46) In standard costing, basic standard is established for Pre-defined period 47) A consumer consuming two goods will be in equilibrium , when the marginal utilities from both goods are equal. 48) Total production will be maximum, when marginal production is Zero. 49) Under Kinked demand model, the demand curve for the firms product is drawn on the assumption that All rivals follow the oligopolist upto certain price but beyond that they do not. 50) A graph of a cumulative frequency distribution is called OGIVE 51) The term Marketing Mix is coined by James Culliton 52) Sequence in the buying process a) adoption b) legitimization c) attitude d) awareness (d,c,b,a) 53) The presence of fixed cost in the cost structure of a company Presence of fixed return funds in the capital structure of a firm Impact of changes in sales on the earnings available to shareholders Operating leverage Financial Leverage Super leverage

54) Who introduced Seven Point Plan for taking interview Prof. A. Rozar 55) The devaluation of currency of a country I done when, it has adverse balance of payments 56) Bank rate Rate at which RBI gives loan to commercial banks by

discounting bills Repo Rate Rate at which RBI borrows from commercial banks 57) Purchases/Sales/Bills Receivables/Assets books which is not subsidiary book Assets book
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58) The various degrees of price elasticity of demand can be shown on a single demand curve as per Geometrical method 59) Price discrimination by monopolist tends to a) maximize sales/profit b) share consumers surplus c) reduce welfare of masses (But not increase welfare of masses) 60) Return to scale , involve in the quantities of the various factors of production proportionately, but not simultaneously. 61) The firm under perfect competition will be in short-run equilibrium when MR = MC 62) Law of demand is fully applicable Law of demand is not at all applicable Law of demand is partly applicable Normal Goods

Giffen Goods (Buy when their income falls/ price raises) Eg. If meet price goes up, then they buy cheaper substitute of bread) Veblon Goods (they buy it, though expensive, but as a matter of show of wealth)

63) Heading for column is called Caption, Stub

Heading for row is called

64) Which is not covered under Corporate Governance {a) Corporate Social Responsibility b) Business Ethics c) Role of independent directors d) Govt monitoring ) Ans is d) 65) Market Gridding A technique for dividing market into segments

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66) Not a part of Strategic Planning Purpose, objective, business choice, social responsibility ( d) 67) Promotion of a company with inflated assets, application of low capitalization rate, liberal dividend policy lead to Overcapitalization. (Shortage of capital has no link with overcapitalization) 68) Dividend Irrelevance theory on Share Valuation was profound by Modigliani Miller 69) Subsistence Theory (Baatak Siddantam) Wages Fund Theory Surplus value Theory Bargaining Theory David Ricardo Adam Smith Karl Marx John Davidson

70) High morale always leads to higher productivity. 71) From which date, banks have started sharing their ATMs free of cost to others 1st April 2009. 72) In France, Germany, England, USA first Industrial Revolution took place England 73) ASBI (Accounting Standards Board of India) was set up in 1977 74) Theory of Revealed Preference was profound by Paul Samuelson 75) Perfect competition is a myth (But oligopoly, monopoly are not myths)

76) When a population is heterogeneous, it is divided into groups, so that there is homogeneity within the group and heterogeneity between groups and some items are selected at random from each group. It is a cause of Stratified Random Sampling. 77) SPSS software is used for Research Analysis
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78) Concept of M.B.O originally came from Peter F Drucker 79) Road blocking advertising means Advt a product on all similar TV/Radio channels at same time. 80) DFEC stands to Duty Free Export Credit 81) The first major foreign exchange crisis occurred in the year 1991 82) Profits as per Marginal Costing and Absorption Costing are different due to Closing Stock 83) Combining main industrial unit with all other related units is called Vertical Combination 84) Post purchase dissatisfaction in marketing is known as Cognitive Dissonance 85) Modigliani Miller Approach is similar to Net Operating Income Approach 86) Recruitment and selection do not involve Reduction of work force. 87) Which is not leverage ratio a) total debt ratio b) debt-equity ratio c) ICR d) Quick Ratio (Ans d) 88) Attrition is related to Resignation / Termination 89) Limit of investment in plant & machinery is Rs. 5 Crore. 90) Total cost is considered for make/buy decision (But not prime cost, relevant cost, production cost) 91) The tool adopted to change Corporate Culture is called Managerial Grid 92) Employee morale relates to Attitude. 93) Glass Ceiling relates to Gender bias. 94) What is Euro II Pollution control scale
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95) Soft Loan window of world bank is IDA 96) 21st Country to join in G-20 is Sri Lanka. 97) Kyoto Protocol is related to Environmental Protection 98) Lower Debtor-Turnover Ratio related to Delay in Recovery 99) Price discrimination helps to increase profits in case of Monopoly 100) Derivative is a derived asset. 101) Food Grains Air Lines Railway Cars Pure Competition Oligopoly Monopoly Monopolistic

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