Solved Paper: II
No.of Questions: 100
UGC NET July 2018: Commerce Solved Paper II
1. The central bank can significantly influence the savings, investments and consumer spending in the economy through which of the following policy?
(a) Fiscal Policy
(b) Monetary Policy
(c) Industrial Policy
(d) Foreign Exchange Policy
Answer: (b)
2. Which one of the following is not the characteristic of capitalism?
(a) Individuals and associations behave with economic motive of maximising their profit.
(b) The country’s major means of production are either owned or controlled by the Government.
(c) Producers, consumers and employees compete among themselves.
(d) Price, the invisible hand, plays a predominant role in the flow of factors.
Answer: (b)
3. Which of the following is not the salient feature of the industrial policy developments since 1991?
(a) The scope of the private sector has been enormously expanded.
(b) Public sector has been withdrawing through divestment.
(c) The Indian industry is increasingly exposed to foreign competition.
(d) Monopoly or dominant position for the public sector in most industries.
Answer: (d)
4. Which of the following does not form part of the Memorandum of Association as specified in the Companies Act, 2013?
(a) The name of the company and the state.
(b) The objects for which the company is incorporated.
(c) The rules, regulations and bye-laws for internal management.
(d) The liability of the members.
Answer: (c)
5. Assertion (A): Volume of imports is high during high economic growth and low relative import prices.
Reason (R): High growth is associated with rise in imports; increase in imports is associated with a fall in relative price.
(a) Both (A) and (R) are correct and (R) is the right explanation.
(b) Both (A) and (R) are correct but (R) is not the right explanation.
(c) (A) is correct but (R) is not correct.
(d) (R) is correct but (A) is not correct.
Answer: (a)
6. Which of the following statements is not correct relating to consumerism?
(a) Consumerism is a manifestation of business failure to guarantee rights.
(b) The government does not have any role in consumer protection.
(c) Consumers should accept consumerism to enjoy their rights.
(d) Consumerism is the next stage in the evolution of enlightened marketing.
Answer: (b)
7. Which one of the following is not covered in the approach adopted by “Niti Aayog”?
(a) Five year planning approach
(b) Three year action agenda
(c) Seven year strategy
(d) Fifteen year vision
Answer: (a)
8. Assertion (A): Personal transactions of owners are not recorded in business books.
Reason (R): According to the business entity concept, the enterprise is separate from owners.
(a) Both (A) and (R) are correct and (R) is the correct explanation.
(b) Both (A) and (R) are correct but (R) is not the correct explanation.
(c) (A) is correct but (R) is not correct.
(d) (A) is wrong but (R) is correct.
Answer: (a)
9. Which one of the following is not an example of ‘financing activities’ in a cash flow statement?
(a) Repayment of bank loan
(b) Interest on debentures/Dividend paid
(c) Cash proceeds from public deposits
(d) Sale of fixed assets
Answer: (d)
10. Which statement is true about estimated costs and standard costs?
(a) Standard costs are based on scientific analysis; estimated costs are historical.
(b) Standard cost is “what will be”; estimated cost is “what should be”.
(c) Standard costs are more frequently revised than estimated costs.
(d) Estimated costs are more stable than standard costs.
Answer: (a)
11. Which one of the following statements is not true?
(a) Expenditure for the current year is revenue expenditure.
(b) Amount paid for acquiring goodwill is capital expenditure.
(c) Wages for installation of a new machine is debited to wages account.
(d) Revenue expenditure is not intended to benefit future periods.
Answer: (c)
12. X Ltd. forfeited 20 shares (Rs.10 each, Rs.8 called up). John paid Rs.5. 15 shares reissued as fully paid for Rs.6. What is the balance in Share Forfeiture Account?
(a) NIL
(b) Rs. 5
(c) Rs. 25
(d) Rs. 100
Answer: (c)
13. X and Y (7:3) admit Z for 3/7 share. Z takes 2/7 from X and 1/7 from Y. New ratio?
(a) 7 : 3 : 3
(b) 4 : 2 : 3
(c) 14 : 6 : 15
(d) 29 : 11 : 30
Answer: (d)
14. Assertion (A): A high operating ratio indicates a favourable position.
Reason (R): A high operating ratio leaves a high margin to meet non-operating expenses.
(a) (A) and (R) both are correct and (R) explains (A).
(b) Both (A) and (R) are correct but (R) does not explain (A).
(c) Both (A) and (R) are incorrect.
(d) (A) is correct but (R) is incorrect.
Answer: (c)
15. Statement (I): Accounting profit is revenue minus paid-out costs.
Statement (II): Economic profit is residual left after all contractual and transfer costs.
(a) Both statements are correct.
(b) Both statements are incorrect.
(c) (I) is correct, (II) is incorrect.
(d) (I) is incorrect, (II) is correct.
Answer: (a)
16. Which relationship between price elasticity, price change, and Total Revenue is incorrect?
(a) Zero Elasticity: Price Increase -> TR Increase
(b) Less than 1: Price Increase -> TR Decrease
(c) Equal to 1: Price Increase -> No change in TR
(d) More than 1: Price Increase -> TR Decrease
Answer: (b)
17. Which is not a basic property of indifference curves?
(a) They have a negative slope.
(b) Curves of imperfect substitutes are concave to the origin.
(c) They do not intersect.
(d) Upper curves indicate higher satisfaction.
Answer: (b)
18. Regarding Iso-quants (Labour on X, Capital on Y), which is false?
(a) MRTS is equal to the slope of the iso-quant.
(b) MRTS is equal to ΔCapital / ΔLabour.
(c) MRTS is the ratio of MP of Capital to MP of Labour.
(a) (a) and (b)
(b) Only (c)
(c) Only (a)
(d) Only (b)
Answer: (b)
19. Match Economies of Scale/Scope:
(a) Economies of scale -> (ii) Lowering costs by bulk production
(b) Internal economies -> (iii) Depends on size of the firm
(c) External economies -> (iv) Depends on size of the industry
(d) Economies of scope -> (i) Lower costs when producing complementary products
(a) ii, iv, i, iii
(b) i, ii, iii, iv
(c) ii, iii, iv, i
(d) iv, iii, ii, i
Answer: (c)
20. A firm producing highly substitute goods can adopt:
(a) Transfer pricing
(b) Going Rate pricing
(c) Product bundling
(d) Full cost pricing
Answer: (b)
21. In a perfectly competitive market, a firm in the long run operates at:
(a) AC = MC when MC is lowest
(b) MC = AR = MR when MC is lowest
(c) MR = MC
(d) AR = MR = AC = MC
Answer: (d)
22. Assignment of numerals to objects to represent attributes is:
(a) Nominal data
(b) Ordinal data
(c) Interval data
(d) Ratio data
Answer: (a)
23. A graph of a cumulative frequency distribution is:
(a) Frequency polygon
(b) Frequency curve
(c) Ogive
(d) Pie diagram
Answer: (c)
24. Data classification where the upper limit is the lower limit of the next class is:
(a) Open ended
(b) Close ended
(c) Exclusive class
(d) Inclusive class
Answer: (c)
25. For a standard normal distribution, mean (µ) and standard deviation (σ) are:
(a) µ=0, σ= 1
(b) µ=16, σ=4
(c) µ=25, σ=5
(d) µ=100, σ=10
Answer: (a)
26. Match Statistics Terms:
(a) Standard error of mean -> (iv) SD of sampling distribution
(b) Base of point estimate -> (iii) Mean of sampling distribution
(c) Non-specific hypothesis -> (i) Ha : µ1 ≠ µ2
(d) Parameter value -> (ii) Values based on all observations
(a) iv, iii, i, ii
(b) i, ii, iii, iv
(c) iv, iii, ii, i
(d) iii, iv, i, ii
Answer: (a)
27. High inverse relationship between ‘Overweight’ and ‘life expectancy’. Which correlation coefficient fits?
(a) 0.80
(b) 0.20
(c) −0.20
(d) −0.80
Answer: (d)
28. Match the Tests:
(a) Chi-square -> (ii) Goodness of fit
(b) ANOVA -> (i) Mean differences among >2 groups
(c) Z-test -> (iii) Mean difference between 2 large samples
(d) t-test -> (iv) Mean difference between 2 small samples (σ unknown)
(a) i, ii, iii, iv
(b) iv, iii, ii, i
(c) i, ii, iv, iii
(d) ii, i, iii, iv
Answer: (d)
29. Match Management Levels:
(a) Sales Executive -> (iv) Operating Force
(b) Branch Manager -> (ii) Middle Management
(c) Foreman -> (iii) Lower Management
(d) Production Manager -> (i) Top-middle Management
(a) iv, ii, iii, i
(b) ii, iii, iv, i
(c) iii, iv, ii, i
(d) i, ii, iii, iv
Answer: (a)
30. Statement (I): Humans plan.
Statement (II): A plan is a trap to capture the future.
(a) (I) is correct, (II) is incorrect.
(b) (II) is correct, (I) is incorrect.
(c) Both (I) and (II) are correct.
(d) Both (I) and (II) are incorrect.
Answer: (c)
31. Assertion (A): Management is a set of functional principles.
Reason (R): Management is essential for all organizations.
(a) (A) and (R) are correct; (R) explains (A).
(b) (A) and (R) are correct; (R) does not explain (A).
(c) Both are incorrect.
(d) (A) is correct; (R) is incorrect.
Answer: (b)
32. Match Control Standards:
(a) Physical standards -> (ii) Labour hours per unit
(b) Cost standards -> (i) Material cost per unit
(c) Revenue standards -> (iv) Average sales per customer
(d) Program standards -> (iii) Timing of production
(a) ii, i, iv, iii
(b) ii, i, iii, iv
(c) i, ii, iv, iii
(d) iv, i, iii, ii
Answer: (a)
33. Which is incorrect regarding Corporate Governance in India?
(a) Auditor must be appointed.
(b) Independent directors must attend at least three meetings a year.
(c) Women directors are recommended for certain classes.
(d) Max directors cannot exceed 15 in a public company.
Answer: (b)
34. “If all you have is a hammer, everything looks like a nail” was said by:
(a) A.H. Maslow
(b) Henry Fayol
(c) F.W. Taylor
(d) Fredrick Herzberg
Answer: (a)
35. Functional Leadership Theory is associated with:
(a) Hackman, Walton, McGrath
(b) Bernard, Ordway Tead
(c) Koontz, O’Donnell
(d) Alford, Beatty
Answer: (a)
36. Two separate brands on a single product is called:
(a) Differential Branding
(b) Cobranding
(c) Dual Branding
(d) Both (b) and (c)
Answer: (d)
37. Goods consumers compare for quality/price before buying:
(a) Convenience Goods
(b) Shopping Goods
(c) Speciality Goods
(d) Unsought Goods
Answer: (b)
38. Treating each customer as a separate segment is:
(a) Niche Marketing
(b) Nano Marketing
(c) Single Marketing
(d) Micro Marketing
Answer: (d)
39. Consumer involvement is NOT high when:
(a) Money involved is large.
(b) Product is seen as having low potential for benefits.
(c) Consumer lacks info about alternatives.
(d) Product has social importance.
Answer: (b)
40. Statement (I): Mindset where demand exceeded supply (Production era).
Statement (II): Product orientation assumes customers buy well-made products.
(a) Both are incorrect.
(b) Both are correct.
(c) (I) is correct, (II) is incorrect.
(d) (I) is incorrect, (II) is correct.
Answer: (d)
41. Match Legal Forces:
(a) Tariff -> (ii) Tax on imports
(b) Import Quota -> (iv) Limiting product amount
(c) Local-content -> (i) Regulation on components/labour
(d) Local-operating -> (vi) Constraints on retailing
(e) Standards -> (iii) Ingredient/certification rules
(f) Boycott -> (v) Refusal to buy
(a) iii, iv, ii, i, vi, v
(b) vi, ii, i, iv, iii, v
(c) ii, iv, i, vi, iii, v
(d) iv, vi, i, ii, iii, v
Answer: (c)
42. Match Selling Process:
(a) Prospecting -> (ii) Identifying leads/capability
(b) Preapproach -> (iv) Information/preferences
(c) Presentation -> (i) AIDA
(d) Post sales -> (iii) Reduce dissonance
(a) i, iii, iv, ii
(b) iii, iv, ii, i
(c) ii, iv, i, iii
(d) iv, iii, ii, i
Answer: (c)
43. Which is NOT an approach to Capital Structure?
(a) Gross Profit Approach
(b) Net Operating Income
(c) Net Income
(d) Modigliani and Miller
Answer: (a)
44. Which method assumes cash-inflows are reinvested at the project’s rate of return?
(a) NPV
(b) ARR
(c) IRR
(d) Pay Back
Answer: (c)
45. Cost of Equity is higher than Debt because:
(a) Equity is not easily saleable.
(b) Equity does not provide fixed dividends.
(c) Face value is lower.
(d) Equity has higher risk than debt.
Answer: (d)
46. Negative Net Working Capital implies:
(a) Long-term funds used for fixed assets.
(b) Short-term funds used for fixed assets.
(c) Long-term funds used for current assets.
(d) Short-term funds used for current assets.
Answer: (b)
47. What is an implicit cost of increasing debt?
(a) P.E. Ratio increases.
(b) Rate of return decreases.
(c) Tax-shield is unavailable.
(d) Shareholders demand higher return.
Answer: (d)
48. Profitability Index is the ratio of PV of cash inflows to:
(a) Total cash inflows
(b) Total cash outflows
(c) PV of cash outflows
(d) Initial cost minus Dep.
Answer: (c)
49. Which statement is false?
(a) Wealth maximisation is the goal of dividend policy.
(b) Walter says optimal payout for a growth firm is 100%.
(c) MM model says dividends don't affect firm value.
(d) ‘Bird-in-the-hand theory’ was by Myron Gordon.
Answer: (b)
50. What is “boundary spanning”?
(a) Obligation to account for activities.
(b) Process linking organization to external environment.
(c) Science of morals/principles.
(d) Multiculturism management.
Answer: (b)
UGC NET July 2018: Commerce Solved Paper II (Questions 51-100)
51. The VRIO framework, used in HR function in today’s era, refers to four criteria. Identify the correct code which stands as correct explanation to VRIO as proposed by Barney.
(a) Valence - Recruiting - Industrial relations - Opportunities
(b) Vision - Rewards - Improvements - Options
(c) Value - Rarity - Imitability - Organization
(d) Versatile - Resource - Information - Outsourcing
Answer: (c)
52. Assertion (A) : Induction is an informal information sharing session on miscellaneous issues in an organization.
Reasoning (R) : The rationale of induction is to ensure effective integration of staff into or across the organization for their mutual benefit.
(a) Assertion (A) and Reasoning (R) both are correct and (R) is correct explanation of (A).
(b) Assertion (A) and Reasoning (R) both are correct but (R) is not the correct explanation of (A).
(c) Assertion (A) is correct statement but Reasoning (R) is an incorrect statement.
(d) Assertion (A) is an incorrect statement but Reasoning (R) is a correct statement.
Answer: (d)
53. Match the ranking methods (List-I) with methodology (List-II):
(a) Simple ranking -> (i) Based on overall performance.
(b) Alternation ranking -> (iv) Based on a trait or a set of trait and avoids central tendency.
(c) Paired comparison -> (iii) Based on particular trait only for quantity/quality of work.
(d) Forced distribution -> (ii) Ends up with predetermined number of people in each group.
(a) ii, iii, iv, i
(b) i, iv, iii, ii
(c) iv, ii, i, iii
(d) iii, i, ii, iv
Answer: (b)
54. Assertion (A) : Compensation has two vital domains economic concept and psychological concept.
Reasoning (R) : Compensation basically represents an employment contract.
(a) (A) is correct and (R) is right explanation of (A).
(b) (A) is correct but (R) is not the right explanation of (A).
(c) (A) is correct but (R) is incorrect.
(d) (A) is incorrect but (R) is correct.
Answer: (b)
55. Which of the following is not the primary objective of industrial relations and labour laws?
(a) Maintaining social equity
(b) Providing credit facilities to industries
(c) International uniformity
(d) Promoting economic growth
Answer: (b)
56. Assertion (A) : In real terms, workers’ participation in management has failed in India.
Reasoning (R) : There is lack of attitudinal change, multiplicity of unions and absence of a procedure to determine a sole bargaining agent.
(a) (A) is correct and (R) is correct explanation of (A).
(b) (A) is correct but (R) is not the correct explanation of (A).
(c) (A) is correct but (R) is incorrect.
(d) (A) is incorrect but (R) is correct
Answer: (a)
57. Which one of the following is not the function of NABARD?
(a) To provide refinance assistance by way of short term credit.
(b) To undertake inspection of cooperative societies other than primary societies.
(c) To promote research in various aspects of the problems of urban development.
(d) To subscribe to share capital or invest in securities for agricultural development.
Answer: (c)
58. Which financial institution co-ordinates all financial institutions into a single integrated structure?
(a) IFCI
(b) UTI
(c) IDBI
(d) SIDBI
Answer: (c)
59. Assertion (A) : RBI is entrusted with the management of public debt and issue of new loans on behalf of Governments.
Reasoning (R) : The Governor and Deputy Governors of RBI are appointed by the Central Government.
(a) (A) is correct but (R) is not correct.
(b) (A) and (R) both are correct but (R) is not the right explanation of (A).
(c) (A) and (R) both are correct and (R) is the right explanation of (A).
(d) (A) and (R) both are not correct.
Answer: (b)
60. __________ refers to the process of removing or stripping the legal status of a currency.
(a) Digitisation
(b) Financial Inclusion
(c) Demonetisation
(d) Micro finance
Answer: (c)
61. Which one of the following is not the objective of UTI?
(a) To mobilise savings by offering safety, liquidity, and profitability.
(b) To channelise pooled savings into productive outlets.
(c) To provide finance under hire purchase and housing finance to its members.
(d) To give everyone a chance to indirectly own shares in large companies.
Answer: (c)
62. Which one of the following is the main objective of IFCI?
(a) To offer small/large investors means of acquiring shares.
(b) To upgrade technology and promote marketing for small scale sectors.
(c) To serve as the apex institution for term finance for industry.
(d) To provide medium and long term financial assistance to industrial undertakings.
Answer: (d)
63. Match the items of List-I and List-II:
(a) Term finance -> (iv) Finance for expansion/modernization of plant.
(b) Refinance -> (iii) Replenishment finance to eligible institutions.
(c) Financial inclusion -> (ii) Delivering services at affordable cost to low income groups.
(d) Venture capital -> (i) Finance to new units for commercial application of technology.
(a) i, ii, iii, iv
(b) i, ii, iv, iii
(c) iv, iii, ii, i
(d) iv, iii, i, ii
Answer: (c)
64. Assertion (A) : An export processing zone (EPZ) is different from a free trade zone (FTZ).
Reasoning (R) : FTZ goods may be re-exported without processing; EPZ goods undergo value addition.
(a) (A) is correct and (R) is correct explanation of (A).
(b) (A) is correct but (R) is not the correct explanation of (A).
(c) (A) is correct but (R) is incorrect.
(d) (A) is incorrect but (R) is correct.
Answer: (a)
65. Match agricultural trade liberalisation terms:
(a) Tariffication -> (iii) Replacement of non-tariff restrictions.
(b) Prohibited subsidies -> (ii) Contingent upon export performance.
(c) Actionable subsidies -> (i) Adverse effects on other member countries.
(d) Non-actionable subsidies -> (iv) For industrial research in disadvantaged regions.
(a) ii, iii, i, iv
(b) iv, i, ii, iii
(c) iii, ii, i, iv
(d) ii, iv, iii, i
Answer: (c)
66. Match WTO impact terms:
(a) NAMA -> (ii) Includes industrial goods, textile, fish, etc.
(b) GATTS -> (iii) Liberalisation of trade in goods and services.
(c) TRIMs -> (i) Liberalisation of international investments.
(d) TRIPs -> (iv) Monopoly power to owners of intellectual property.
(a) ii, i, iv, iii
(b) iv, ii, iii, i
(c) ii, iii, i, iv
(d) iii, ii, iv, i
Answer: (c)
67. Statement (I) : The capital account consists of long-term capital transactions only.
Statement (II) : The current account includes all transactions which give rise to or use up national income.
(a) Both the statements are correct.
(b) Both the statements are incorrect.
(c) (I) is correct while (II) is incorrect.
(d) (I) is incorrect while (II) is correct.
Answer: (d)
68. Statement (I) : International liquidity encompasses the international reserves only.
Statement (II) : International liquidity covers only official holdings (gold, FX, SDRs) for settlement.
(a) Both the statements are correct.
(b) Both the statements are incorrect.
(c) (I) is correct while (II) is incorrect.
(d) (I) is incorrect while (II) is correct.
Answer: (d)
69. Match International Trade Theories:
(a) Comparative Cost Theory -> (iii) David Ricardo
(b) Opportunity Cost Theory -> (ii) Gottfried Haberler
(c) Factor Endowment Theory -> (iv) Heckscher and Ohlin
(d) Absolute Cost Theory -> (i) Adam Smith
(a) i, ii, iii, iv
(b) iii, ii, iv, i
(c) iv, iii, ii, i
(d) i, iv, iii, ii
Answer: (b)
70. Which is not a guiding principle of the World Bank regarding lending?
(a) Proper assessment of repayment prospects.
(b) Lending only for specific economically sound projects.
(c) Lending to meet foreign exchange content of project cost.
(d) The bank expects the borrower to spend the loan in a particular country.
Answer: (d)
71. Total return on a security is equal to:
(a) Periodic cash receipts + Capital gains / Purchase Price
(b) Periodic cash receipts + Capital gains / Current Market Price
(c) Periodic cash receipts / Current Market price
(d) Periodic cash receipts − Capital gains / Purchase Price
Answer: (a)
72. Risk of a portfolio can be minimised by:
(a) Combining securities with perfect positive correlation.
(b) Combining securities with perfect negative correlation.
(c) Combining securities with partially positive correlation.
(d) Combining securities with partially negative correlation.
Answer: (b)
73. The certificate evidencing an unsecured corporate short-term debt is:
(a) Certificate of Deposit
(b) Short-term loan certificate
(c) Treasury Bill
(d) Commercial paper
Answer: (d)
74. Which of the following statements are false?
(a) Grey market is for listed securities.
(b) OTCEI is for big investors.
(c) Insider Trading is legally permitted.
(d) Arbitrage is profit from price differences in two markets.
(a) (a), (b), (c)
(b) (a), (b), (d)
(c) (a), (b), (c), (d)
(d) (b), (c), (d)
Answer: (a)
75. Which of the following statements are false?
(a) First-time share capital is venture capital.
(b) All Venture Capital Funds are promoted by Government.
(c) Venture capitalists provide managerial support.
(d) Benefits are realised in the long run.
(a) (a), (b) and (d)
(b) (a) and (b)
(c) (b), (c) and (d)
(d) (c) and (d)
Answer: (b)
76. Match the Risks:
(a) Liquidity Risk -> (iii) Inability to pay dues on time.
(b) Business Risk -> (iv) Fluctuation in profits.
(c) Financial Risk -> (ii) Related to firm’s capital structure.
(d) Inflation Risk -> (i) Related to purchasing power of income.
(a) ii, iii, iv, i
(b) i, iv, iii, ii
(c) iii, ii, iv, i
(d) iii, iv, ii, i
Answer: (d)
77. Statements on channel strategies:
(I) Service distribution only selects ownership parties. (False)
(II) Ownership channel for services is long/complex. (False)
(III) Short channels mean more control for the seller. (True)
(a) (I) and (II) correct, (III) incorrect.
(b) (I) and (III) correct, (II) incorrect.
(c) (I) and (II) not correct, (III) correct.
(d) All are not correct.
Answer: (c)
78. Enormous collection of data from internal/external sources for firm use is:
(a) Data-base
(b) Data warehouse
(c) Data mining
(d) M.I.S.
Answer: (b)
79. Retail statements:
(I) Non-store retailing via advertising is Direct Selling. (False)
(II) Personal contact away from store is Direct Marketing. (False)
(a) (I) correct, (II) incorrect.
(b) (I) incorrect, (II) correct.
(c) Both correct.
(d) Both not correct.
Answer: (d)
80. Customers who accept innovation just before the average adopter are:
(a) Early Adopters
(b) Early Majority
(c) Late Majority
(d) Late Adopters
Answer: (b)
81. The G. E. Business Model is based on:
(a) Market Attractiveness and Business Position.
(b) Business Attractiveness and Market Position.
(c) Industry Growth rate and Market share.
(d) Company’s Growth rate and Industry’s Position.
Answer: (a)
82. Reduction from list price for marketing functions performed by buyers is:
(a) Trade Discount
(b) Functional Discount
(c) Cash Discount
(d) Both Trade and Functional Discount
Answer: (d)
83. Match Personnel Management (PM) vs HRM:
(a) Focus of PM -> (iv) Profit maximization by controlling people.
(b) Focus of HRM -> (i) Development attitude for best contribution.
(c) Philosophy of PM -> (ii) Functional area of management.
(d) Philosophy of HRM -> (iii) Humane management.
(a) ii, iii, iv, i
(b) iii, ii, i, iv
(c) iv, i, ii, iii
(d) i, iii, iv, ii
Answer: (c)
84. Strategic HRM statements:
(I) SHRM focuses on intentions; HR strategies on long-term only. (False)
(II) SHRM focuses on macro; HR strategy on specific issues. (True)
(III) HR strategy decisions are derived from strategic HRM. (True)
(a) I and II correct.
(b) II and III correct.
(c) I and III correct.
(d) All correct.
Answer: (b)
85. What does “BARS” stand for?
(a) Business Appraisal and Rating Systems.
(b) Balanced Assessment Reviewing Scorecard.
(c) Behaviourally Anchored Rating Scale.
(d) Benchmarking Appraisal Reviewing Strategy.
Answer: (c)
86. Match Training terms:
(a) Andragogy -> (iv) Training the adults.
(b) Pedagogy -> (i) Styles of instructions (child-focused).
(c) Terminal behaviour -> (ii) Knowledge level after training.
(d) Training impediments -> (iii) Lack of commitment/resources.
(a) i, iv, iii, ii
(b) ii, iii, i, iv
(c) iv, i, ii, iii
(d) iii, ii, iv, i
Answer: (c)
87. Which is NOT a principle of compensation administration?
(a) Clear-cut plan for differential pay.
(b) People and jobs should never be mingled.
(c) System should be designed with subjectivity based on skill sets.
(d) Establish wage grievance procedures.
Answer: (c)
88. Match Industrial Relations terms:
(a) Healthy labour relations -> (iv) Voluntary arbitration and trade unions.
(b) Industrial Peace Law -> (i) Industrial Disputes Act.
(c) Industrial Democracy -> (iii) Workers’ participation in management.
(d) NCL, 1969 -> (ii) Grievance procedure principles.
(a) iv, i, iii, ii
(b) ii, iii, iv, i
(c) iii, i, iv, ii
(d) ii, iv, i, iii
Answer: (a)
89. Largest source of foreign investment in India in recent years:
(a) Australia
(b) Japan
(c) China
(d) Mauritius
Answer: (d)
90. Assertion (A) : Govt. is opening domestic market to foreign players in baby steps.
Reasoning (R) : Free play in retail has always been a political hot potato.
(a) (A) and (R) are correct; (R) explains (A).
(b) (A) and (R) are correct; (R) does not explain (A).
(c) Both are incorrect.
(d) (A) is correct; (R) is incorrect.
Answer: (b)
91. Depositary Receipt statements:
(I) GDR is bank certificate issued in >1 country.
(II) GDR is similar to ADR.
(III) GDRs are called EDRs for Euro markets.
(a) All are correct.
(b) I and II correct.
(c) I and III correct.
(d) II and III correct.
Answer: (1)
92. Treaty for common currency (Euro) in Dec 1999:
(a) Treaty of Rome
(b) Treaty of Maastricht
(c) Treaty of Lisbon
(d) Treaty of London
Answer: NIL (Note: Maastricht was 1992)
93. Statement (I) : ‘Law of one price’ states identical products must sell for same price.
Statement (II) : ‘Efficient market’ has no impediments to free flow of goods.
(a) (I) correct, (II) incorrect.
(b) (II) correct, (I) incorrect.
(c) Both correct.
(d) Both incorrect.
Answer: (c)
94. Which is NOT correct regarding patents?
(a) Protection for new, non-obvious, useful inventions.
(b) Grants exclusive right to make/sell.
(c) Exclusive purpose is to benefit the patent holder.
(d) Indian Patent Act effective from Jan 1, 2005.
Answer: (c)
95. Which is agricultural income under IT Act, 1961?
(a) Interest on arrears of rent.
(b) Interest received by money-lender in produce.
(c) Income from sale of spontaneous forest trees.
(d) Interest on capital received by a partner from an agricultural firm.
Answer: (4)
96. “Block of assets” for depreciation means:
(a) Value of all assets after depreciation.
(b) Value of all tangible assets.
(c) Assets to which one rate of depreciation applies.
(d) Gross value less accumulated depreciation.
Answer: (c)
97. Max exemption for voluntary retirement compensation U/S 10(10C):
(a) Rs. 1,00,000
(b) Rs. 2,50,000
(c) Rs. 5,00,000
(d) Rs. 10,00,000
Answer: (c)
98. Which is not correct for assessment of firms?
(a) All partnership firms are assessed as firms under the Act.
(b) Firm income is taxable at flat 30%.
(c) Partner’s share is not taxable in their hands.
(d) Remuneration is allowed as deduction subject to limits.
Answer: (a)
99. Due date of first installment of advance tax (non-companies):
(a) 15th April
(b) 15th June
(c) 15th September
(d) 15th December
Answer: (b)
100. Which is NOT allowed as a business deduction?
(a) Lawyer fees for drafting partnership deed.
(b) Loss due to embezzlement.
(c) Legal expenses to protect building.
(d) Cost of installing a new telephone.
Answer: (a)
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