2nd PUC Business Studies Model Question Paper 5 with Answers

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Karnataka 2nd PUC Business Studies Model Question Paper 5 with Answers

Time: 3.15 Hours
Max Marks: 70

Instructions :

1. Write the serial number of questions properly as given in the question paper while answering.
2. Answer for a question should be continuous.

Section – A

I. Answer any ten of the following questions in a word or a sentence each. Each questions carries one mark. 10 x 1 = 10

Question 1.
The following is not an objective of management:
a. Earning of profits
b. growth of the organization
c. Providing employment
d. policy making
Answer:
c. Providing employment.

Question 2.
Who is known as the Father of General Management?
Answer:
Henry Fayol

Question 3.
Which of the following does not characterize the business environment?
a. Uncertainty
b. Employees
c. Relativity
d. Complexity
Answer:
b. Employees

Question 4.
Which function of management involves decision making?
Answer:
Planning

Question 5.
……………. cannot be delegated at all.
Answer:
Accountability

Question 6.
State the off-the-job training method given to plumbers, electricians or iron workers.
Answer:
Vestibule Training.

Question 7.
Which of the following is not an element of direction?
a. Motivation
b. Communication
c. Delegation
d. Supervision
Answer:
c. Delegation.

Question 8.
What is Ratio Analysis?
Answer:
Ratio Analysis refers to analysis of financial statements through computation of ratios.

Question 9.
What is Business Finance?
Answer:
Money required for carrying out business activities is called business finance.

Question 10.
What is meant by depository?
Answer:
A depository keeps securities in electronic form on behalf of the investor.

Question 11.
Give the meaning of product.
Answer:
A product is a bundle of utilities that can be used to satisfy human needs and wants.

Question 12.
Who is an entrepreneur?
Answer:
The person who set – up his business is called an entrepreneur.

Section – B

II. Answer any ten of the following questions in two or three sentences each. Each question carrier two marks: 10 x 2 = 20

Question 13.
Define Management.
Answer:
According to Harold Koontz, “Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims”.

Question 14.
What is Discipline according to Fayol?
Answer:
Discipline is the obedience to organisational rules and employment agreement which are necessary for the working of the organisation.

Question 15.
Give the meaning of planning premises
Answer:
Planing premises are the assumptions about the future conditions and events. Trends in population, legal regulations etc, are examples. Plans should be formulated by the management within the frame work of the planing premises.

Question 16.
State any two differences between Delegation and Decentralisation.
Answer:

Basis	Delegation	Decentralisation
1. Nature	Delegation is a compulsory act because no individual can perform all tasks on his own.	Decentralisation is an optional policy decision. It is done at the discretion of the top management.
2. Scope	It has a narrow scope as it is limited to superior and his immediate subordinate	It has a wide scope because it implies extension of delegation to the lowest level of management.

Question 17.
Why is staffing both a line as well as staff activity?
Answer:
Staffing is both a function of management as well as a distinct functional area of management. It is therefore referred to as both line as well as well as a staff activity. It is the essential function of the manager as well as an advisory role played by the Human Resource Department.

Question 18.
What is communication?
Answer:
According to George Terry, “Communication is an exchange of facts, ideas, opinions or emotions by two or more persons.”

Question 19.
What do you mean by Responsibility Accounting?
Answer:
Responsibility accounting is a system of accounting in which different sections, divisions and departments of an organization are set up as “Responsibility Centres”. The head of the centre is responsible for achieving the target set for his center.

Question 20.
State the twin objectives of Financial Planning.
Answer:

• To ensure availability of funds whenever required.
• To see that the firm does not raise resources unnecessarily.

Question 21.
What is Stock Exchange?
Answer:
According to Securities Contract (Regulation) Act 1956, Stock Exchange means any body of individuals, whether incorporated or not, constituted for the purpose of assisting, regulating or controlling the business of buying and selling or dealing in securities.

Question 22.
State any two features of marketing.
Answer:

• Needs and wants
• Creating a Market Offering
• Customer Value
• Exchange Mechanism

Question 23.
What is Consumer Protection?
Answer:
Consumer Protection refers to providing adequate protection to consumers against the unfair trade practices followed by the manufacturers and service providers. It includes educating consumers about their rights and responsibilities, helps them with judicial machinery for protecting the interests of consumers and also requires the consumers to form consumer associations for protection and promotion of their interests.

Question 24.
What is Entrepreneurship?
Answer:
Entrepreneurship is the process of setting up one’s own business as distinct from pursuing any other economic activity.

Section – C

III. Answer any seven of the following questions in 10 – 12 sentences. Each question carrier 4 Marks : 7 x 4 = 24

Question 25.
Explain briefly any four grounds to say management is important.
Answer:
Management is considered important due to the following reasons:

(a) Management helps in achieving group goals:
Management is required to give a common direction to the individual effort, in order to achieve the group goals of the organisation.

(b) Management increases efficiency:
The main aim of every manager is to increase efficiency i.e., to maximise output with minimum cost. This is achieved through better planning, organising. directing and controlling the activities of the organisation.

(c) Management creates a dynamic organisation:
All organisations have to function in an environment which is constantly changing. Resistance to change is often observed with individuals management helps people adapt to these changes, so that an organisation is able to maintain its competitive edge.

(d) Management helps for achieving personal objectives:
A manager motivates and leads his team in such a manner that individual members are able to achieve personal goals while contributing to the overall organ is national objective. Through motivation and leadership the management helps individuals to develop team spirit, cooperation and commitment to group success.

Question 26.
Explain the Principles of Management contributed by FW Taylor.
Answer:
Scientific management refers to the use of scientific and standardized tools, methods and trained workers in all organisational activities in order to increase the total production with minimum cost and wastage. Following are the principles of scientific management contributed by FW Taylor.

(i) Science not Rule of Thumb : Taylor was the first person to introduce the method of scientific inquiry into the domain of management practice. He believed that there was only one best method to maximise efficiency Le.. by scientific way. Scientific management includes scientific selection of workers, placement and training, work – study motion study fatigue study, time study. gradation of equipment and machinery, payment wages according to work done etc.

(ii) Harmony, Not discord : There should be harmonious relationship between management and workers. Both should realise that each one is important. This avoids class – conflict. To achieve this, Taylor introduced mental revolution. Both management and workers should transform their thoughts n order to achieve harmonious relationship amongst them.

(iii) Cooperation, Not individualism : There should be complete cooperation between the labour and the management instead of individualism. Competition should be replaced by cooperation. Both should realise that they need each other. To achieve this fact, the management should consult their employees while taking important decisions. There should be a two way communication between management and workers. According to Taylor, there should be almost equal division of work and responsibility between workers and management.

(iv) Development of each and every person to his or her greatest efficiency and prosperity: Industrial efficiency depends on personnel competencies. According to Taylor, efficiency could be achieved from the beginning i.e., from the time of selection of employees. Each person must be scientifically selected. Work should be assigned according to his mental and intellectual capabilities Proper training should be given to improve his/her skill. This will contribute to their greatest efficiency and prosperity for both organisation and workers.

Question 27.
Explain briefly any four features of planning.
Answer:
The planning function of the management has certain special features. These features are as follows:

a. Planning focuses on achieving objectives: Organisations are set up with a general purpose in view. Specific goals are set out in the plans along with the activities to be undertaken to achieve the goals. Thus, planning is purposeful. It contributes to the achievement of predetermined goals of an organization.

b. Planning is a primary function of management: Planning lays down the base for other functions of management. All other managerial functions are performed within the framework of the plans drawn. Thus, planning is referred to as the primary function of management.

c. Planning is pervasive: Planning is required at all levels of management. It is also required in all departments of the organization. Planning is not an exclusive function of top management. It is required at every level and in every department. Hence, planning is all pervasive in nature.

d. Planning is continuous: Plans are prepared for a specific period of time. At the end of that period there is a need for a new plan to be drawn on the basis of new requirements and future conditions. Hence, planning is a continuous process.

Question 28.
How does training and development of employees benefit the organisations?
Answer:
The benefits of training and development activity to the employees are as follows:

• Improved skills and knowledge due to training lead to better career of the individual.
• Increased performance by the individual helps him to earn more.
• Training makes the employee more efficient to handle machines. Thus, less prone to accidents.
• Training increases the satisfaction and morale of the employees.

Question 29.
Explain any four semantic barriers to communication
Answer:
Semantic barriers are concerned with problems and obstructions in the process of encoding and decoding of message into words or impressions. Some Semantic barriers are as follows:

• Badly expressed massage: Badly expressed massages may be on account of inadequate vocabulary, usage of wrong words, omission of needed words etc.
• Symbols with different meanings: A word may have several meanings. Receiver has to perceive the right meaning of the word used by communicator. Wrong perception leads to communication problems.
• Faulty translations: Sometimes, the communications originally drafted In one language need to be translated to the language understandable by the receivers. If the translator is not proficient with both the languages, mistakes may creep in causing different meanings to the communication.
• Unclarified assumptions: Some communication may have certain assumptions which are subject to different interpretations. These assumptions may lead to wrong understanding between the speakers.

Question 30.
Explain the limitations of Controlling.
Answer:
Controlling suffers from the following limitations:

• Difficulty in setting quantitative standards: Control system loses some of its effectiveness when standards cannot be defined in quantitative terms. This makes measurement of performance and their comparison with standards a difficult task. Employee morale, job satisfaction and human behavior are such areas where this problem might arise.
• Little control on external factors: Generally an enterprise cannot control external factors such as government policies, technological changes, competition etc.
• Resistance from employees: Control is often resisted by employees. They see it as a restriction on their freedom.
• Costly affair: Control is a costly affair as it involves a lot of expenditure, time and effort. A small enterprise cannot afford to install an expensive control system.

Question 31.
Explain any four factors affecting financing decisions.
Answer:
Financing Decision: This decision is about the quantum of finance to be raised from various long-term sources. It involves identification of various available sources. It has to make a judicious combination of these sources namely debt, equity, preference share capital and retained earnings.
The financing decisions are affected by various factors which are as follows:

• Cost: The cost of raising funds through different sources is different. A good financial manager would normally opt for a source which is the cheapest.
• Risk: The risk associated with each of the sources is different.
• Flotation Costs: Higher the flotation cost, less attractive is the source.
• Cash Flow position of the company: A stronger cash flow position may make debt financing more viable than funding through equity.

Question 32.
Distinguish between primary market and secondary market.
Answer:

Primary Market	Secondary Market
There is a sale of securities by new companies or new issues of securities by existing companies directly to the investors.	There is trading of existing shares only.
Securities are sold by the company to the investor directly.	Ownership of existing securities is exchanged between the investors. The company is not involved at all.
The flow of funds is from savers to investors. Thus, it helps in capital formation.	It only promotes liquidity among the share-holders.
It is also known as new-issue market.	It is also known as stock exchange.
There is no fixed geographical location.	These are located at specified places.
Only’ buying of securities takes place, securities cannot be sold in a primary market.	Both the buying and the selling of securities can take place on the stock exchange.

Question 33.
Explain any four characteristics of industrial products.
Answer:
Industrial Products are those products, which are used as inputs in producing other products. The following are its important characteristic features:

• Number of Buyers: As compared to the consumer products, the numbers of buyers of industrial products are limited.
• Channel Levels: Because of limited number of buyers, the sale of industrial products is
  generally made with the help of shorter channels of distribution, i.e., direct selling or one level channel.
• Geographic Concentration: Because of location of industries at certain points or regions, industrial markets are highly concentrated geographically
• Derived Demand: The demand for industrial products is derived from the demand for consumer goods. For example, the demand for leather will be derived from demand for shoes and other leather products in the market.

Question 34.
State any four directions which can be issued by the consumer court to the opposite party.
Answer:
If the consumer court is satisfied about the genuineness of the complaint, it can issue the following directions to the opposite party:

• To remove the defect in goods or deficiency in service.
• To replace the defective product with a new one, free from any defect.
• To refund the price paid for the product, or the charges paid for the service.
• To pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to the negligence of the opposite party.

Section – D

IV. Answer any four of the following questions in 20 – 25 sentences each. Each question
carrier 8 marks: 4 x 8 = 32

Question 35.
Management is a series of continuous interrelated functions. – Comment.
Answer:
Management is described as the process of planning, organising, directing and controlling the efforts of organisational members and of using the resources of the organisation to achieve specific goals.
Luther Gulick has given a keyword PODSCORB’.

 

P → Planning
O → Organising
S → Staffing
D → Directing
Co → Coordination
R → Reporting and
B → Budgeting

The most widely accepted classification of management functions is given by Koontz and O’ Donnell which includes planning, organizing, staffing, Directing and Controlling.

1. Planning; Planning is the basic and first [unction of management. It is the function of determining in advance what is to be done and who is to do it. A plan is a future course of action. Planning implies setting goals in advance and developing a way of achieving them efficiently and effectively. Planning is necessary to ensure proper utilisation of human and non-human resources.

2. Organisaing: It is the process of bringing together, physical, financial and human resources. ¡t develops productive relationship amongst them for achievement of organisational goals. Organising is the management function of assigning duties, grouping tasks, establishing authority and allocating resources required to carry out a specific plan.
Organising as a process involves,

• Identification of activities
• Classification of activities
• Assignment of duties
• Delegation of authority and creation of responsibility
• Coordinating authority and responsibility relationships.

3. Stalling:
It includes finding the right people for the right job. This is also known as the human resource function and has assumed greater importance in the recent years
staffing involves.

• Man – power planning
• Recruitment, selection and placement
• Training and Development
• Remuneration
• Performance appraisal
• Promotions and Transfer

4. Directing : Directing function involves leading, influencing and motivating employees to perform the tasks assigned to them. It is that part of managerial function that actuates the organisational methods to work efficiently for achievement of organisational objectives
Directing has the following elements:

• Supervision
• Motivation
• Leadership
• Communication
• Delegation
• Coordination

5. Controlling : It is the management function of monitoring organisational performance towards the attainment of organisational goals. It implies the measurement of actual performance against the set standards and connecting the deviations if any so as to ensure the achievement of organisations goals.
Controlling has the following steps:

• Establishment of standards
• Measurement of actual performance
• Comparison of actual performance with the set standards and finding out deviations if any
• Taking corrective action.

Conclusion : Theoretically, the management functions can be separated but practically these functions are overlapping in nature. Hence they are inseparable. Each function blends into the other and each function affects the performance of other functions.

Question 36.
Explain the various types of plans.
Answer:
In order to accomplish the targets, the management of a business organization chalks out different types of plans. The important types of plans are explained below:

Types of plans
1. Single-use plans: A single-use plan is developed for a one-time event or project. The examples are

• Budgets
• Programmes
• Projects

2. Standing Plans: A standing plan is used for activities that occur regularly over a period of time. The examples are

• Policies
• Procedures
• Methods
• Rules

3. The other plans Include strategies and objectives.

Brief explanation of the various types of plans are as follows:

1. Objectives:

• Objectives are the end points towards which the activities of an organization are directed. They are said to be the desired future position that the management would like to reach.
• Objectives are very basic to the organization which the organization wants to achieve by its operations.
• Objectives are set by the top management. They lay down guidelines for the activities and serves as a bench mark for measuring the performance of an organization.
• Objectives need to be expressed in specific terms. They should he expressed in quantitative and measurable terms. They are also to he put in the form of written statements and they represent the desired results to be achieved in a given period.

2. Strategies:

• A strategy provides the broad contours of an organization’s business.
• Strategies are the specific programmed of action [or achieving the objectives o the organization by employing the organizations resources efficiently and effectively.
• A strategy is a comprehensive plan which acts as a guideline to handle specific problems. Major
• strategic decisions will include decisions like whether the organization will continue to be in the same line of business, or combine new lines of activity with the existing business or seek to acquire a dominant position in the same market.

3. Policy:

• Policies are general statements that guide thinking.
• Policies provide a basis for interpreting strategy.
• Policy is a guide to managerial action and decision in the implementation of strategy

Strategies are formulated by the top management. Formulation of strategy involves the following aspects:

• Determination of the long term objectives
• Adopting a course of action to achieve the objectives and
• Allocating resources necessary to achieve the objectives.

4. Procedure: Procedures are routine steps on how to carry out activities. They detail the exact manner in which any work is to be performed. Procedures are the guidelines to action and they are usually intended to the works which are repetitive in nature. Examples of procedure include procedure for execution of the customer’s order for supply of goods and procedure for recruitment of employees in an organisation.

5. Methods: Methods provide the prescribed ways in which a task has to be performed considering the objective. It deals with a task comprising one step of a procedure and specifies how this step is to be performed. Method has a limited scope compared to the procedure. Examples of methods include training the employees under off the job training method. remunerating the sales men under bonus and commission method etc.

6. Rules: Rules are specific statements that inform what is to be done. Every organization likes to operate in an orderly way. For this purpose it is necessary for the business organization to lay down certain rules.

Rules are the specific statements which prescribe the code of behavior to the people of an organization. Rules are rigid. Their violation attracts penalty and disciplinary action. An example of a rule is ‘wear identity cards compulsorily at the work placet

7. Programmes : Programmes are detailed statements about a project which outlines the objectives, policies, procedures, rules, tasks, human and physical resources required. A program is a precise plan which lays down the operations to be carried out to accomplish a given task within a specified period of time. Programmes are framed for the works which are non – repetitive in nature. An example for a programme includes sale of 5000 cars in the month of March, 2019.

8. Budget: Budget is a statement of expected results expressed in numerical terms.
Budget is a plan which expresses the future facts and figures in quantitative terms for a specified period.
Budget is considered a control device. An example for a budget is a sales budget which forecasts the sales of different products in each area for a particular period.

Conclusion: The success of the business depends to a large extent on the effective planning. Thus, the logical and scientific planning must go through the above steps.

Question 37.
What is Decentralization? Explain its importance.
Answer:
Decentralization of authority means dispersal of authority to take decisions to the lower levels of organization. The importance of decentralization is as follows:

a. Quick decision making: Managers are free to make their own decisions within the specific area of task assigned to them. The enterprise enjoys benefit of quick decision-making.

b. Democratic system: Decentralisation shares authority and responsibility between managers. It avoids concentration of power which is a democratic approach towards management.

c. Relief to top management: The authority is delegated to the lower levels. The top management is relieved of taking operational decisions. They can concentrate on corporate planning, control and co-ordination of the activities of different departments.

d. Incentive to workers: It boosts the morale of employees. It provides them job satisfaction by providing them independence, status and participation in the activities of the enterprise.

e. Facilitates growth: It enables the managers at the lower level heads to perform to their full potential and also develops a sense of competition among the departments. Such positive spirit contributes towards growth of enterprise.

f. Development of executives: The subordinates get an opportunity to take decision and develop themselves for getting promotion that allows them to become future executives.

g. Reduces workload : Decentralisation is the technique of distributing authority, responsibility and duty among managers. So, the work load of the manager is reduced and restricted to the job assigned to them.

Conclusion: Thus, decentralization implies reservation of some authority regarding planning, organizing, directing ad controlling is retained at the top level management and other functions are delegated at lower levels. Decentralisation transfers authorities to subordinates and thus the authority being centralized in few hands is spread over to a number of employees.

Question 38.
What are barriers to communication? Suggest the suitable measures to improve communication effectiveness.
Answer:
Perfect and complete communication does not take place many a times due to certain obstacles which are known as barriers to communication. Following are the barriers to effective communication:

1. Physical barriers: Internal structure of the organization and layout of office machines and equipments creates physical barriers in communication, Physical barriers include:

• Distance
• Noise
• Physical arrangement

2. Semantic barriers: The use of difficult and multiple uses of languages, words. figures. and symbols create semantic barriers. Some semantic barriers are:

• Language
• Jargons.

3. Organisational barriers: These arise from the organizational goals, regulations. structure and culture. Organisational barriers include:

• Poor planning
• Structure complexities
• Status differences
• Organisational distance
• Information overload
• Timing

4. Psychological barriers: These are the barriers to effective communication created due to lack of interest In the people for whom the communication is meant. People do not pay attention to the communication in which they are not interested.  Examples for psychological barriers are:

• Perception
• Filtering
• Distrust
• Emotions
• Viewpoint

Following are the ways to overcome barriers to effective communication:

1. Clarity of Ideas: The problem to be communicated to subordinates should be clear in all aspects. The entire problem should be studied in depth, analysed and stated in such a manner that is clearly conveyed to subordinates.

2. Communicate according to the needs of receiver: The Level of understanding of receiver should be crystal clear to the communicator. Manager should adjust his communication according to the education and understanding levels of subordinates.

3. Consult others before communicating: Before actually communicating the message. it is better to involve others in developing a plan for communication. Participation and involvement of subordinates may help to gain ready acceptance and willing cooperation of subordinates.

4. Be aware of languages tone and content of message: The contents of the message,tone, and language used, manner in which the message is to be communicated are the important aspects of effective communication. The language used should be understandable to the receiver and should not offend the sentiments of listeners.”

5. Convey things of help and value to listeners: While conveying message to others, it is better to know the Interests and needs of the people with whom you are communicating. If the message relates directly or indirectly to such interests and needs it certainly evokes response from communicate.

6. Ensure proper feedback: The communicator may ensure the success of communication by asking questions regarding the message conveyed. The receiver of communication may also be encouraged to respond to communication, The communication processmly he improved by the feedback received to make it more responsive.

7. Communicate for present as well as future: Generally, communication is needed to meet the existing commitments to maintain consistency; the communication should aim at future goals of the enterprise also.

8. Follow up communications: There should be regular follow up and review on the instructions given to subordinates. Such follow up measures help in removing hurdles if any in implementing the instructions.

9. Be a good listener: Manager should be a good listener. Patient and attentive listening solves half of the problems. Managers should also give indications of their interest in listening to their subordinates.

Question 39.
What is Stock Exchange? Explain the functions of stock exchange.
Answer:
Stock Exchange means any body of individuals, whether incorporated or not, constituted for the purpose of assisting,regulating or controlling the business of buying and selling or dealing in securities. The following are the important functions of stock exchange:

i. Providing liquidity and marketability to existing securities: The basic function of a stock exchange is the creation of a continuous market where securities are bought and sold. It gives investors the chance to disinvest and reinvest. This provides both liquidity and easy marketability to already existing securities in the market.

ii. Pricing of Securities: share prices on a stock exchange are determined by the forces of demand and supply. A stock exchange is a mechanism of constant valuation through which the prices of securities are determined. Such a valuation provides important instant information to both buyers and sellers in the market.

iii. Safety of Transaction: The membership of a stock exchange is well regulated and its dealings are well delined according to the existing legal framework. This ensures that the investing public gets a safe and fair deal on the market.

iv. Contributes to Economic Growth: A stock exchange is a market in which existing securities are resold or traded. Through this process of disinvestment and reinvestment, savings get channelized into their most productive investment avenues, This leads to capital formation and economic growth.

v. Spreading of Equity Cult: The stock exchange can play a vital role in ensuring diver share ownership by regulating new issues, better trading practices and taking effective steps in educating the public about investments.

vi. Providing scope for speculation: The stock exchange provides sufficient scope within the provisions of law for speculative activity in a restricted and controlled manner . It is generally accepted that a certain degree of healthy speculation is necessary to ensure liquidity and price continuity in the stock market.

vii. Regulates company management: Listed companies have to comply with rules and regulations of concerned stock exchange authorities. Thus, stock exchanges put the burden on the company to have healthy practices.

viii. Price Stability: There are many operators who buy from a stock exchange where securities are cheaper and sell in other stock exchanges where the prices for the same securities are higher. This process is known as arbitrage. These operators bring about stability in the prices of securities among various stock markets.

ix. Capital Mobility: The trading of various securities enables an investor to move his funds from one sector to another or from one industry to another. Investors can divert their investments from less profitable enterprises to more profitable enterprises.

x. Serves as economic barometer: A Stock Exchange is not only an indicator of the state of health of individual companies but also of the overall situation and economy as a whole. Even a small change in the internal environment of any company or in the political, economic and social environment of the country gets reflected in the prices of securities on the stock exchange.

Question 40.
Explain any eight functions of marketing.
Answer:
Marketing is concerned with exchange of goods and services from producers to consumers in such a way that maximises the satisfaction of customers’ needs. The various functions of marketing include

i. Gathering and Analysing marketing information:
One at the Important functions of a marker is to gather and analyse market information.This is necessary to identify the needs of the customers and take various decisions for the successful marketing of the product and services.

ii. Marketing planning :
Another important area of work of a marketers is to develop appropriate marketing plans so that the marketing objectives of the organisation can be achieved A complete marketing plan covering aspects like plan for increasing production, promotion of the products etc. and action programmes to achieve these objectives are to be developed.

iii. Product Designing and Development:
The design of the product contributes to making the product attractive to the target customers: A good design can improve performance of a product and also give it a competitive advantage in the market.

iv. Standardisation and Grading: Standardisation refers to producing goods of Pre determined specifications, which helps in achieving uniformity and consistency in the output. Standardisation ensures the buyers that goods confirm to the predetermined standards of quality, price and packaging. Grading is the process of classification of products into different groups, on the basis of some of the important characteristics such as quality, size etc, Grading ensures that goods belong to a particular quality and helps in realising higher prices for high quality output.

v. Packaging and Labeling: Packaging refers to designing and developing the package for the products. Labeling refers to designing and developing the label to be put on the package. Packaging and labeling have become so important in marketing that these are considered as the pillars of marketing. Packaging protects the products and also acts as an elective promotion tool.

vi. Branding: brand name helps in creating product differentiation. It provides basis for distinguishing the product of a firm with that of the competitor. Branding also helps in building customer’s loyalty and promotes sales of a product.

vii. Customer support services: These include after sales services, handing customer complaints, procuring credit services, maintenance services, technical services and consumer Information. All these services aim at providing maximum satisfaction to the customers,. Which is the key to marketing success in modern days.

viii. Pricing of product: Price of product refers to the amount of money customers have to pay to obtain a product the marketers have to properly analyse the factors determining the price of a product and then take several other decision such as setting the pricing objectives, determining the pricing strategies. determining the price and changing the prices etc.

ix Promotion: It involves informing the customers about the firms product, its feature etc, and persuading them to buy these products. The four important methods of promotion include advertising, personal selling., publicity and sales promotion. Deciding the budget for promotion. promotional tools to be used etc, are important decisions to be taken by a marketer in this area.

x. Physical Distribution: The two major areas under this function include

• Decision regarding channels of distribution
• Physical movement of the product from the place of its production to the ultimate
  consumer’s place. Managing Inventory, storage and warehousing, transportation etc, are key areas under this physical distribution function.

Conclusion: The modern functions of marketing emphasises more on customer satisfaction. Customer satisfaction itself leads to survival and growth of an organisations. From the view point of management function, the above activities are referred to as the functions of marketing.

Section – E

V. Answer any two of the following questions. Each question carrier five marks: 2 x 5 = 10

Question 41.
Draw the neat diagram of different levels of management to specify that authority- responsibility relationships create different levels of management.
Answer:

Question 42.
As a financial consultant, give the list of any ten factors which affect the choice of Capital Structure.
Answer:
List of factors that affects the choice of Capital Structure

• Cash flow position
• Interest Coverage Ratio
• Debt Service Coverage Ratio
• Return on Investment
• Cost of debt
• Tax rate
• Cost of Equity
• Flotation Costs
• Risk Considerations
• Flexibility

Question 43.
As an aggrieved consumer; write a complaint to district forum seeking redressal.
Answer:
Bangalore
1st March, 2019
From
xxxx
No. 74,1 cross,
M.L. Layout Bangalore – 560 086

To
The Registrar
Karnataka State Consumer Dispute Redressal Commission
Cunningham Road
Bangalore
Dear Sir,
Sub: Complaint regarding service of two wheeler-Regarding
On 1st February, 2019, I had bought a kinetic Honda Two wheeler [Model No.] I made this purchase at Mahalakshmi lay out Raveesh showroom on 1st February, 2019 by paying an amount of Rupees
[Bill Enclosed]

Unfortunately, the two – wheeler is not working properly and the Pick-up is not proper. The brake – systems are also not up to the mark.

To resolve the problem, I approached the show – room authorities who in turn guided me to the authorized service centre. But, the service centre authorities are not ready to do the needful free – of – cost though the warranty period is still on for the vehicle I look forward to your reply and a resolution to my problem. 1 am enclosing herewith the receipts, warranty card details, model details of the vehicle bill and other details of the vehicle] Please lodge a complaint against the seller and kindly ensure that timely action is taken in this regard.
Thanking you
Yours faithfully xxxx

Enclosures:

• Bill
• Warranty card
• Model details