COMMERCE STUDY MATERIAL

(2025 – 2026)

CLASS : 12

STUDENT NAME : ___________________

CLASS : ___________

Prepared by :

P.G.ASST IN COMMERCE,
THIRU KAMARAJ MUNICIPAL HIGHER SECONDARY SCHOOL,
VILLUPURAM.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 UNIT :1 MANAGEMENT PROCESS
CHAPTER 1: PRINCIPLES 0F MANAGEMENT.

I. Choose the Correct answers:

1. Management is what a _______ does?
a) Manager b) Subordinate
c) Supervisor d) Superior
2. Management is an ________
a) Art b) Science
c) Art and Science d) Art or Science
3. Scientific management is developed by
a) Fayol b) Taylor
c) Mayo d) Jacob
4. Dividing the work into small tasks is known as
a) Discipline b) Unity
c) Division of work d) Equity
5. With a wider span, there will be _______ hierarchical levels.
a) More b) Less
c) Multiple d) Additional
Answers:
1 a 2 c 3 b 4 c 5 b

II.VERY SHORT ANSWER QUESTIONS:

1.What is management ?
Management is goal oriented and it is an art of getting things done with and
through others.

2.List out the management tools .

➢ Accounting
➢ Business law,
➢ Psychology,
➢ Statistics,
➢ Econometrics,
➢ Data processing , etc

3.State the meaning of Authority.

Authority means the right of a superior to give the order to his
subordinates;

4.What do you mean by Span of management?

The number of subordinates who can be managed efficiently by a
superior is called span of management.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

III.SHORT ANSWER QUESTIONS
1.Define the term management.
Management is a multipurpose organ that manages a business and
manages manager, and manages worker and work — Peter F. Drucker
(OR)
To manage is to forecast, to plan, to organise, to command, to coordinate
and to control. —Henry Fayol.

2.Differentiate management from Administration.

BASIS FOR MANAGEMENT ADMINISTRATION

COMPARISON
Meaning Management is goal The process of administering
oriented and it is an art of an organization by a group of
getting things done with people .
and through others.
Authority Middle and Lower Level Top Level
Role Executive Decisive
Concerned with Policy Implementation Policy Formulation
Key person Manager Administrator
Area of It works under It has full control over the
operation administration activities of the
organizations.

3.What are the principles of Taylor?

➢ Principles of scientific management by Taylor are
➢ Science, Not Rule of Thumb
➢ Harmony, Not Discord
➢ Mental Revolution
➢ Cooperation, Not Individualism
➢ Development of each and every person to his or her greatest efficiency and
Prosperity.

4.What determines the span of management?

➢ The efficiency of the higher official
➢ Number of workers
➢ Nature of work
➢ Environment of the work
➢ The planning capacity of the Institution
➢ The communication level of the Institution.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

IV.Long Answer Questions:
1.Explain the concept of management. (any 5)
Body of Knowledge:
Management has now developed into a specialised body of management theory and
philosophy. Management literature is growing in all countries.
Management Tools:
Accounting, Business law, Psychology, Statistics, Econometrics, Data processing
Separate Discipline
Management studies in many universities and institutions of higher learning are
recognised as a separate discipline.
Specialisation:
Thus we have today an increasing tendency in favour of management by experts or
professionals.
Code of Conduct:
Enlightened businessmen have recognised that business management is a social
institution and it has social responsibilities to be fulfilled — towards customers,
employees, and the public or community.

2. Explain the principles of modern management.( Any 5)

(i)Equity:
Employees must be treated kindly, and justice.
Managers should be fair and impartial when dealing with employees, giving equal
attention towards all employees.
ii)Authority and Responsibility:
Authority means the right of a superior to give the order to his
Subordinates. Responsibility means obligation for performance.
iii)Discipline:
It is obedience, proper conduct in relation to others, respect of authority, etc.
It is essential for the smooth functioning of all organization.
iv)Unity of Command:
Each subordinate should receive orders and be accountable to one and only
one superior.
If an employee receives orders from more than one superior, it is likely to create
confusion and conflict.
v)Unity of Direction:
All related activities should be put under one group
There should be one plan of action for them,
They should be under the control of one manager.

CHAPTER – 2 FUNCTIONS OF MANAGEMENT

I. Choose the Correct Answers:
1. Which is the primary function of management?
(a) Innovating (b) Controlling
(c) Planning (d) Decision-making

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

2. Which of the following is not a main function?
(a) Decision-making (b) Planning
(c) Organising (d) Staffing
3. _________ is included in every managerial function.
(a) Co-ordinating (b) Controlling
(c) Staffing (d) Organising
4. Which of the following is verification function?
(a) Planning (b) Organising
(c) Staffing (d) Controlling
5. The goals are achieved with the help of ____
(a) Motivation (b) Controlling
(c) Planning (d) Staffing
Answers:
1 c 2 a 3 a 4 d 5 a

II.VERY SHORT ANSWER QUESTIONS:

1.Write a short note about Planning.
➢ Planning is the primary function of management.
➢ Nothing can be performed without planning.
➢ Planning refers to deciding in advance.
2What is meant by Motivation?
➢ Motivation includes increasing the speed of performance of a work
➢ Developing a willingness on the part of workers.
➢ The goals are achieved with the help of motivation.

3.List the subsidiary functions of management .

➢ Innovation
➢ Representation
➢ Decision making
➢ Communication
4.What is the Traditional proverb used in planning?
❖ Think Before you Act
❖ Look Before you Leap
III.Short answer questions:-
1.List out the main functions of management.
❖ Planning
❖ Organising
❖ Staffing
❖ Directing
❖ Controlling
❖ Motivation
❖ Co-ordination

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

2.State the importance of staffing.
❖ Staffing refers to placement of right persons in the right jobs.
❖ The success of any enterprise depends upon the successful performance
of staffing function.
❖ Staffing includes selection of right persons, promotion of best persons,
retirement of old persons,
3.How the employees are informed about important matters in a company?
Employees are kept informed of all necessary matters by: -
Circulars, Instructions manuals, Newsletters, Notice-boards,
Meeting, etc.,
IV.Long Answer Questions:
1.Explain the various functions of management.
I.Main Functions:
(i)Planning:
Planning is the primary function of management.
Nothing can be performed without planning.
Planning refers to deciding in advance.
(ii)Staffing:
Staffing refers to placement of right persons in the right jobs.
The success of any enterprise depends upon the successful performance of
staffing function.
(iii)Motivating:
Motivation includes increasing the speed of performance of a
work and developing a willingness on the part of workers.
(iv)Controlling:
Controlling helps to evaluate the performance of employees and
deciding increments and promotion decisions.
(v)Directing
Directing denotes motivating, leading, guiding and communicating with
Subordinates.
Employees are kept informed of all necessary matters by: -
Circulars, Newsletters, Meeting, etc.,
II.SUBSIDIARY FUNCTIONS:
❖ Innovation
❖ Representation
❖ Decision making
❖ Communication

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 Chapter -3. MANAGEMENT BY OBJECTIVES (MBO)
MANAGEMENT BY EXCEPTION (MBE)
I. Choose the Correct Answers:
1. ___________ System gives full Scope to the Individual Strength and Responsibility.
(a) MBO (b) MBE
(c) MBM (d) MBA
2. Which is the First step in Process of MBO?
(a) Fixing Key Result Area
(b) Appraisal of Activities
(c) Matching Resources with Activities
(d) Defining Organisational Objectives
3. __________ keeps Management Alert to Opportunities and Threats by Identifying
Critical Problems.
(a) MBA (b) MBE
(c) MBM (d) MBO
4. Delegation of Authority is Easily Done with the Help of __________ .
(a) MBM (b) MBE
(c) MBO (d) MBA
5. MBO is popularised in the USA by __________ .
(a) Prof. Reddin (b) George Odiorne
(c) Henry Fayol (d) F.W Taylor
Answers:
1 a 2 d 3 b 4 c 5 b

II.Very Short Answer Questions

1.What are the objectives of MBO?
❖ To measure and judge performance.
❖ To relate individual performance to organizational goals
❖ To stimulate the subordinates’ motivation.
❖ To enhance communications between superiors and subordinates

2.Bring out the meaning of MBE.

MBE is a style of business management that focuses on identifying and
handling cases that deviate from the norm.
3.Mention any two advantages of MBO?
❖ MBO process helps the managers to understand their role in the total
organization.
❖ MBO motivates the workers.
❖ MBO provides a foundation for participative management.
❖ Sub-ordinates are also involved in the goal setting.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
4.What is known as KRA?
❖ KRA stands for Key Result Areas.
❖ KRA indicates the strength of an organisation.
❖ Examples:-Profitability, Market standing, Innovation etc.,

III.Short Answer Questions

1.Write the features of MBO.

❖ MBO tries to combine the long run goals of organization with short run
goals.
❖ Management tries to relate the organization goals with society goals.
❖ Recognises the participation of employees in goal setting.
❖ Encourages a climate of trust, goodwill and a will to perform.
❖ A high degree of motivation and satisfaction is available to employees through MBO.
❖ MBO’s emphasis on effective performance.

2. What are the Process of MBE?

❖ It is necessary to set objectives or norms with predictable or estimated results.
❖ These performances are assessed and get equated to the actual performance.
❖ The deviation gets analysed. With an insignificant or no deviation, no action is
required and senior managers can concentrate on other matters.
❖ If actual performances deviates significantly, solve this “exception”
immediately.

3. List out any Three process of MBO.

❖ Defining Organizational Objectives
❖ Goals of each section
❖ Fixing Key Result Areas
❖ Setting Subordinate Objectives or Targets .
❖ Matching Resources with Objectives.
❖ Appraisal of Activities

IV.Long Answer Questions:

1.What are the major advantages of MBO?
❖ MBO helps to take corrective action.
❖ MBO process helps the managers to understand their role in the total
organisation.
❖ MBO provides a foundation for participative management.
❖ Sub-ordinates are also involved in goal setting.
❖ A department does not work at cross purpose with another department.
❖ Systematic evaluation of performance is made with the help of MBO.
❖ The responsibility of a worker is fixed through MBO.
❖ Decision is taken by the management very quickly.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
2.What are the advantages of MBE?
❖ It saves the time of managers
❖ It focuses managerial attention on major problems.
❖ It is a technique of separating important information from
unimportant one.
❖ It can avoid uninformed and impulsive action.
❖ MBE provides better yardsticks for judging results .
3.Discuss the disadvantages of MBE
❖ Only managers have the power over really important
decisions.
❖ It can be demotivating for employees at a lower level.
❖ It takes time to pass the issues to managers .
❖ It takes time to managing employees who deviate from the
normal procedures.

UNIT-2 FINANCIAL MARKETS – I

CHAPTER -4. INTRODUCTION TO FINANCIAL MARKETS
I. Choose the Correct Answers:
1. Financial market facilitates business firms
a) To rise funds c) To make more sales
b) To recruit workers d) To minimize fund requirement
2. Capital market is a market for
a) Short Term Finance b) Medium Term Finance
c) Long Term Finance d) Both Short Term and Medium Term Finance
3. Primary market is also called as
a) Secondary market b) Money market
c) New Issue Market d) Indirect Market
4. Spot Market is a market where the delivery of the financial instrument and
payment of cash occurs
a) Immediately b) In the future
c) Uncertain d) After one month
5. How many times a security can be sold in a secondary market?
a) Only one time b) Two time
c) Three times d) Multiple times
Answers:
1 a 2 c 3 c 4 a 5 d
II.Very Short Answer Questions:
1.What are the components of organized sectors?
❖ Regulators # Financial Markets
❖ Financial Institutions # Financial Services
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
2.What is spot market?
Cash /Spot Market is a market where the delivery of the financial
instrument and payment of cash occurs immediately . (i.e.) settlement is
completed immediately.
3.What is debt market?
It is the financial market for trading in Debt Instruments, such as
Government Bonds or Securities, Corporate Debentures or Bonds.
4.How is price decided in a secondary market?
❖ The price decided is done through the interaction of buyers and sellers.
❖ It’s price is determined based on the demand and supply of the
securities.
III.Short Answer Questions:
1.Give the meaning of financial market.
A market wherein financial instruments are traded is known as a
financial market, such as financial claims, assets and securities.
2.Write a note on Secondary Market.
❖ It is the market for old securities.
❖ It is the market for securities that are already issued.
❖ Ex : Stock Exchange.
3.Bring out the scope of financial market in India.
❖ The financial market provides financial assistance to all sectors
(individuals, agricultural sectors, industrial sectors, service sectors,
banks, insurance sectors, provident funds.)
❖ Through the financial market all sectors can get their required funds in
time.
❖ Through the financial market all sectors get their short term and long
term financial assistance.
❖ It leads to the overall economic development.
IV.Long Answer Questions:
1.Distinguish between new issue market and secondary market.

BASIS FOR NEW ISSUE SECONDARY MARKET

COMPARISON MARKET
1.Meaning It is the market It is the market for old
for new share . securities.
2.Buying Direct Indirect
3. How can Only once Multiple times
securities be sold?
4.Intermediary Underwriters Brokers
5.Price Fixed price Fluctuates, depends on the
demand and supply force

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 6.Gained person Company Investors

7.Buying and selling Company and Investors

between Investors

2.Enumerate the different types of Financial Markets. (any 5)

(i)Spot market:
Cash /Spot Market is a market where the delivery of the financial
instrument and payment of cash occurs immediately . (i.e.) settlement is
completed immediately.
(ii)Debt market:
It is the financial market for trading in Debt Instruments, such as
Government Bonds or Securities, Corporate Debentures or Bonds.
(iii)Secondary Market:
It is the market for old securities.
It is the market for securities that are already issued.
(iv)Money Market:
It is the market for short term financial claim (usually one year or less)
E.g. Treasury Bills, Commercial Paper, Certificates of Deposit
(v) Capital Market:
Capital market is a market for borrowing and lending of long -term capital
funds .E.g. Shares, Debentures

3.Discuss the role of financial market.

(i)Savings Mobilization:
Financial Market helps in obtaining funds from ‘surplus’ units .
(ii)National Growth
Financial markets helps in nation’s growth by providing financial
assistance to all sectors.
It leads to overall economic growth.
(iii)Investment
It plays a key role in arranging the investment of funds , thus
collected, in those units which are in need of the same.
(iv)Entrepreneurship Growth
This market provides necessary financial resources to the
entrepreneurial class.
(v)Industrial Development:
This market helps an accelerated growth of Industrial Development of
a country.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 CHAPTER – 5 CAPITAL MARKET
I. Choose the Correct Answers:
1. Capital market do not provide
a) Short term Funds b) Debenture Funds
c) Equity Funds d) Long term Funds
2. When the NSEI was established
a) 1990 b) 1992
c) 1998 d) 1997
3. Primary market is a Market where securities are traded in the
a) First Time b) Second Time
c) Three Time d) Several Times
4. Participants in the Capital Market includes
a) Individuals b) Corporate
c) Financial Institutions d) All of the above
5. The _______ was set up by a premier financial institution to allow the trading of
securities across the electronic counters throughout the country.
a) OTCEI b) Factoring
c) Mutual Funds d) Venture Funds Institutions
Answers:
1 a 2 b 3 a 4 d 5 a

II.Very Short Answer Questions:

1.What is Capital Market?
Capital market is a market for borrowing and lending of long-term capital
funds.

2.Write a note on OTCEI.

➢ The OTCEI was set up by a premier financial institution.
➢ It allows the trading of securities across the electronic counters
throughout the country.

3.Who are the participants in a Capital Market?

➢ Individuals,
➢ Corporate sectors,
➢ Govt.,
➢ Banks and Other financial institutions.

4.How is price determined in a Capital Market?

It’s price is determined based on the demand and supply
prevailing in the capital market for securities.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

III.Short Answer Questions:
1.What are the various kinds of Capital Market? Explain.
Primary Market:
Primary market is a market for new issues or new financial claims.
Hence, it is also called New Issue Market.
This market helps in Capital formations.
Secondary Market:
It is the market for old securities.
It is the market for securities that are already issued.
Ex : Stock Exchange.
2.Explain any two functions of Capital Market.
(i)Savings and Capital Formation:
Capital market help to mobilize savings from various sectors of
population .
This accelerates the capital formation in the country.
(ii)Permanent Capital:
The capital market enables companies to raise permanent capital.
(iii)Industrial Growth:
It stimulates industrial growth by mobilizing funds.
3.Explain about Factoring and Venture Capital Institutions.
Factoring Institutions:
The factoring institutions collect the book debts for and on behalf of its
clients.
Venture Fund Institutions:
It is designed especially for funding new and innovative project
ideas.
Venture capital funds bring into force the hi-technology projects, which are
converted into commercial production.
IV.Long Answer Questions:
1.Discuss the characters of a Capital Market.
(i)Securities Market:
The dealings in a capital market are done through the securities like
shares, debentures, etc.
(ii)Price:
It’s price is determined based on the demand and supply of the
securities.
(iii)Participants:
Individuals, Corporate sectors, Govt., Banks and Other financial institutions.
(iv)Location :
Capital market is not confined to certain specific locations.
(v)Market for Financial Assets:
Capital market helps in buying and selling of long term financial assets.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

2.Briefly explain the functions of capital market.
(i)Savings and Capital Formation:
Capital market help to mobilize savings from various sectors of
population. This accelerates the capital formation in the country.
(ii)Permanent Capital:
The existence of a capital market enables companies to raise permanent
capital.
(iii)Industrial Growth:
It stimulates industrial growth by mobilizing funds
(iv)Easy Liquidity:
Investors can sell off their holdings and convert them into liquid cash
easily.
(v)Development of Backward Areas:
It provides funds for projects in backward areas. This leads
to Development of Backward Areas
(vi)Ready and Continuous Market:
The stock exchange provides a central convenient place where
buyers and sellers can easily purchase and sell securities.
(vii)Foreign Capital:
Capital markets makes possible to generate foreign capital.
This is important for economic development of the country.

3.Explain the various types of New Financial Institutions.

(i)Venture Fund Institutions:
It is designed especially for funding new and innovative project
ideas.
(ii)Mutual Funds:
Financial institutions that help in channelising savings of small
investors into avenues of productive investments are called
‘Mutual Funds’.
(iii)Factoring Institutions:
The factoring institutions collect the book debts for and on behalf of its
clients.
(iv)Over the Counter Exchange of India (OTCEI):
It allows the trading of securities across the electronic counters throughout
the country.
(v)National Stock Exchange of India Limited (NSEI):
The Exchange provides nationwide electronic screen based “scripless”
and “floorless” trading system in securities.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 LESSON-6 : MONEY MARKET
I. Choose the Correct Answers:
1.The money invested in the call money market provides high liquidity with
_________________.
a) Low Profitability b) High Profitability
c) Limited Profitability d) Medium Profitability
2. A major player in the money market is the _________________.
a) Commercial Bank b) Reserve Bank of India
c) State Bank of India d) Central Bank.
3. Debt Instruments are issued by Corporate Houses are raising short-term financial
resources from the money market are called __________.
a) Treasury Bills b) Commercial Paper
c) Certificate of Deposit d) Government Securities
4. The market for buying and selling of Commercial Bills of Exchange is known as a
__________.
a) Commercial Paper Market b) Treasury Bill Market
c) Commercial Bill Market d) Capital Market
5. A marketable document of title to a time deposit for a specified period may be
referred to as a __________.
a) Treasury Bill b) Certificate of Deposit
c) Commercial Bill d) Government. Securities
Answers:
1 a 2 a 3 b 4 c 5 b

II.VERY SHORT ANSWER QUESTION:-

1.What is a CD market?
A market whereby the Certificate of Deposits can be bought and sold is
called CD Market.
2.What is Government Securities Market?
A market whereby the Government or guilt-edged securities can be
bought and sold is called Government Securities Market.
3.What do you mean by Auctioning?
A method of trading which help us to sell the securities to the highest
price is known as auctioning.
4.What do you meant by Switching?
The purchase of one security against the sale of another security carried
out by the RBI in the secondary market is described as Switching.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

III.Short Answer Questions:-
1.What are the features of Treasury Bills?
➢ Issuer
➢ Finance Bills
➢ Liquidity
➢ Vital Source
➢ Monetary Management
2. Who are the participants of Money market?
➢ Private Banks
➢ Public Banks
➢ Mutual Funds Institutions
➢ RBI
➢ State Governments
➢ Central Banks of different countries
➢ Non-Banking Financial Institution
3.Explain the types of Treasury Bills?
❖ 91 days Treasury Bills.
❖ 182 days Treasury Bills.
❖ 364 days Treasury Bills.
4.What are the types of Commercial Bills?
❖ Demand Bills,
❖ Clean bills and documentary bills,
❖ Inland bills and Foreign Bills,
❖ Indigeneous Bills,
❖ Accommodation Bills.
IV. Long Answer Questions:-
1.Differenciate between the Money Market and Capital Market.

S FEATURES MONEY MARKET CAPITAL MARKET

NO
1 Duration of It is a market for short- It is a market for long-term
Funds term loanable funds. funds.
2 Supply of This market supplies This market supplies funds for
Funds funds for short period long term requirements .
requirements .
3. Liquidity High liquidity in Money Low liquidity in Capital
Market Market
4. Risk Low credit and High credit and market risk
market risk.

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5. Underwriting Underwriting is not a It is a primary function.
primary function.
6 Regulator Central Bank is the Besides Central Bank, Special
Regulator of Money regulatory authority like
Market. SEBI, etc.

2.Explain the characteristics of Money Market? (any 5)

Short-term Funds
It is a market purely for short-term funds or financial assets called near money.
Maturity Period
It deals with financial assets having a maturity period upto one year only.
Conversion of Cash
It deals with only those assets which can be converted into cash readily without loss
and with minimum transaction cost.
No Formal Place
Generally, transactions take place through phone, i.e., oral communication.
Sub-markets
It is not a single homogeneous market. It comprises of several sub-markets each
specialising in a particular type of financing. E.g., Call Money Market, Acceptance Market,
Bill Market.

3.What are the characteristics of Government Securities? (any 5)

Agencies
Government securities are issued by agencies such as Central Government, State
Governments, semi-government authorities like local Government authorities, e.g.
municipalities, autonomous institution such as metropolitan authorities, port trusts
etc.,
RBI Special Role
RBI takes a special and an active role in the purchase and sale of these securities as
part of its monetary management exercise.
Issue opening
A notification for the issue of the securities is made a few days before the public
subscription is open.
Switching
The purchase of one security against the sale of another security carried
out by the RBI in the secondary market is described as Switching.
Auctioning
A method of trading which help us to sell the securities to the highest
price is known as auctioning.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 UNIT - III FINANCIAL MARKETS - II
CHAPTER-7 STOCK EXCHANGE
I. Choose the Correct Answers:
1. ____ is the oldest stock exchange in the world.
a) London Stock Exchange b) Bombay Stock Exchange
c) National Stock Exchange d) Amsterdam Stock Exchange
2. There are _____ stock exchange in the country.
a) 21 b) 24
c) 20 d) 25
3. Jobbers transact in a stock exchange
a) For their Clients b) For their Own Transactions
c) For other Brokers d) For other Members
4. A pessimistic speculator is
a) Stag b) Bear
c) Bull d) Lame Duck
5. An optimistic speculator is
a) Bull b) Bear
c) Stag d) Lame duck

Answers:
1 d 2 b 3 b 4 b 5 a

II.VERY SHORT ANSWERS QUESTIONS:-

1.What is meant Stock Exchange?
Stock Exchange is an organized market for the purchase and sale of
industrial and financial security. (OR)
Stock exchange is an organized market for buying and selling corporate and other
securities.
2.Write any 5 Stock Exchanges in India.
❖ The Bombay Stock Exchange
❖ Bangalore Stock Exchange Ltd.
❖ The Delhi Stock Exchange Association Ltd.
❖ The Madras Stock Exchange Ltd
❖ The National Stock Exchange of India (NSE) Ltd.
3.What is meant by Remisier?
❖ Remisers acts as an agent of a member of a stock exchange.
❖ He obtains business for his principal
❖ He gets a commission for that service.
4.Who is called a Broker?
❖ Brokers act as intermediaries between buyers and sellers of securities.
❖ They do not purchase or sell securities on their behalf.
❖ Brokers charge a commission

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

5.What are the types of Speculators?
❖ Bull (or) Tejiwala
❖ Bear (or) Mandiwala
❖ Stag (or) Premium hunter
❖ Lame Duck.
II.Short Answer Questions:-
1.What are the limitations of Stock exchange
❖ Lack of uniformity.
❖ Lack of control of stock exchanges.
❖ Absence of restriction on the membership of stock exchanges.
❖ Failure to control unhealthy speculation.
❖ Allowing more than one charge in the place.
❖ No proper regulation of listing of securities on the stock exchange.
2.Explain Bull and Bear :-
Bul:-l
A Bull or Tejiwala is an operator who expects a rise in prices of securities in
the future.
He is an optimistic speculator.
Bear:-
A bear or Mandiwala speculator expects prices to fall in future.
A bear is a pessimistic speculator.
3.Explain Stag and Lame Duck :-
Stag
A stag is a cautious speculator in the stock exchange.
He sells the shares before being called to pay the allotment money.
He is also called a premium hunter.
Lame Duck:-
When a bear finds it difficult to fulfill his commitment, he is said to be
struggling like a lame duck.

IV. LONG ANSWER QUESTIONS :-

1.Explain the functions of Stock Exchange. (Any 5)
Ready and Continuous Market: An Investor can convert his shares into cash and
with the same ease he can convert his cash into securities.
Correct Evaluation of Securities
The prices at which securities are bought and sold are recorded and made public.
These prices are called “market quotations”.
Protection to Investors
All dealings in a stock exchange are in accordance with well-defined rules and
regulations.

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 Proper Chanalisation of Capital
People like to invest in the shares of such companies which yield good profits.
Aid to Capital Formation
Stock exchanges thus ensure a steady flow of capital into industry and assists industrial
development
2.Explain the Features of Stock Exchange.
(i). Market for Securities
Stock exchange is a market, where securities of all sectors are bought and sold.
(ii)Deals in Second Hand Securities
It deals with existing or second hand securities and hence it is called secondary market.
(iii)Regulates Trade in Securities
It provides the necessary facilities to its members and brokers who trade in securities.
It regulates the trade activities so as to ensure free and fair trade.
(iv)Transactions Effected only through Members
All the transactions in securities at the stock exchange are effected only through its
authorised brokers and members.
Investors have to buy or sell the securities at the stock exchange through the
authorised brokers only.
(v)Recognition from Central Government
Stock exchange is an organised market.
It requires recognition from the Central Government.
(vi) Financial Barometers
Stock exchanges are the financial barometers and development indicators of national
economy of the country.

3. Distinguish between Stock Exchange and Commodity Exchange (any 5).

Sl.No Feature Stock Exchange Commodity Exchange

1. Meaning Stock Exchange is an organized A commodity exchange is an
market for the purchase and exchange where
sale of industrial and financial commodities are traded.
security.

2. Function Providing easy marketability Offering liquidity to

securities.
3. Object Object is facilitating capital Object is facilitating goods
formation flow through risk reduction

4. Participants Investors and Speculators Producers, dealers, traders

and a body of speculators.
5. Cornering cornering is easy Cornering is difficult

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 LESSON-8 SECURITIES EXCHANGE BOARD OF INDIA (SEBI)
I. Choose the Correct Answers:
1. Securities Exchange Board of India was first established in the year ____
a) 1988 b) 1992
c) 1995 d) 1998
2. The headquarters of SEBI is _______
a) Calcutta b) Bombay
c) Chennai d) Delhi
3. Registering and controlling the functioning of collective investment schemes as
_______
a) Mutual Funds b) Listing
c) Rematerialisation d) Dematerialization
4. SEBI is empowered by the Finance ministry to nominate ______ members on the
Governing body of every stock exchange.
a) 5 b) 3
c) 6 d) 7
5. Trading is dematerialized shares commenced on the NSE is ________
a) January 1996 b) June 1998
c) December 1996 d) December 1998
Answers:
1 a 2 b 3 a 4 d 5 c
II.VERY SHORT ANSWER QUESTIONS:-
1.Write a short notes on SEBI.
❖ Securities and exchange board of India( SEBI) is an apex body that
maintains and regulates our capital market.
❖ It was established in 1988 by Indian government.
❖ SEBI has its headquarters at the business district of BandraKurla
Complex in Mumbai
2.Write any two objectives of SEBI.
❖ Regulation of Stock Exchange.
❖ Protection to the Investors.
❖ Checking the Insider Trading.
❖ Control over Brokers.
3.Mention the headquarters of SEBI.
SEBI has its headquarters at the business district of BandraKurla Complex
in Mumbai,
4.What are the various ID proofs?
➢ PAN CARD
➢ VOTER’S CARD
➢ DRIVING LICENSE
➢ BANK PASS BOOK

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III.SHORT ANSWER QUESTIONS:-
1.What is meant by Dematerialization?
❖ Dematerialization is the process by which physical share certificates of
an investor are taken back by the company and destroyed.
❖ Then an equivalent number of securities in the electronic form are
credited to the investors account with his Depository Participant.
❖ Dematerialization is done at the request of the investor.
2.What are the documents required for Demat account ?
I.Proof of Identity
❖ PAN card,
❖ Voter's ID,
❖ Passport
❖ Driving license,
❖ Bank attestation,
❖ IT returns,
❖ Electricity bill,
❖ Telephone bill,etc.,
II.Proof of Address
➢ Ration card,
➢ Passport,
➢ Voter ID card,
➢ Driving license,
➢ Bank passbook
IV.LONG ANSWER QUESTIONS:-
1.What are the functions of SEBI?
(i)Safeguarding the interests of investors by means of adequate education
and guidance
(ii)SEBI makes rules and regulation that must be followed by the financial
intermediaries .
(iii)Regulating and controlling the business on stock markets.
(iv)Barring insider trading in securities.
(v)SEBI regulates mergers and acquisitions as a way to protect the
interest of investors.
(vi)It conducts research and publishes information beneficial to all market players .
(vii)Provide appropriate training to financial intermediaries.
(viii)Levying fee or any other type of charges to carry out the purpose of
the Act.
(ix)Performing functions that may be assigned to it by the Central
Government of India.
(X)SEBI issues Guidelines and Instructions to businesses concerning capital issues.

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2. Explain the powers of SEBI. (any 5)
a)Powers Relating to Stock Exchanges & Intermediaries
It can ask information from the stock exchanges and intermediaries regarding their
business transactions for inspection or scrutiny and other purpose.
(b)Power to Impose Monetary Penalties
SEBI has been empowered to impose monetary penalties on capital market
intermediaries and other participants for a range of violations.
(c)Power to Regulate Insider Trading
SEBI has power to regulate insider trading or can regulate the functions of merchant
bankers.
(d)Powers Under Securities Contracts Act
SEBI is also empowered by the Finance Ministry to nominate three members on the
Governing Body of every stock exchange.
(e)Power to Regulate Business of Stock Exchanges
SEBI is also empowered to regulate the business of stock exchanges

UNIT – IV - HUMAN RESOURCE MANAGEMENT

LESSON-9 FUNDAMENTALS OF HUMAN RESOURCE MANAGEMENT
I. Choose the Correct Answers:
1. Human resource is a _________ asset.
a) Tangible b) Intangible
c) Fixed d) Current
2. Human Resource management is both _________ and _________ .
a) Science and art b) Theory and practice
c) History and Geography d) None of the above
3. Planning is a _________ function.
a) selective b) pervasive
c) both a and b d) none of the above
4. Human resource management determines the _________ relationship.
a) internal, external b) employer, employee
c) Owner, Servant d) Principle, Agent
5. Labour turnover is the rate at which employees _________ the organisation
a) enter b) leave
c) Salary d) None of the above
Answers:
1 b 2 a 3 b 4 b 5 b

II.VERY SHORT ANSWER QUESTIONS:-

1.What is Human Resource Management?

The branch of management that deals with managing human resource is
known as Human Resource Management.
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2.State two features of HRM.
➢ Universally relavant.
➢ Goal oriented.
➢ It is a continuous process.
➢ It is a dynamic activity.
3.Mention two characteristics of Human Resources.
➢ Human resource is the only factor of production that lives.
➢ Human resource created all other resources.
➢ Human resources are emotional beings.
➢ Human resources are movable.
➢ Human resource can work as a team.
4.What are the managerial functions of HRM?
Managerial function –
❖ Planning,
❖ Organising,
❖ Directing,
❖ Controlling.
III.SHORT ANSWER QUESTIONS:-
1.Define the term Human Resource Management.
HRM as that part of management process which is primarily concerned with
the human constituents of an organisation.
2.What are the characteristics of Human resources?
❖ Human resource is the only factor of production that lives.
❖ Human resource created all other resources.
❖ Human resources are movable.
❖ Human resource can work as a team.
❖ Human resources are emotional beings.
❖ The behaviour of human resources are unpredictable.
❖ Human resource exhibits innovation and creativity.
❖ Human resource alone can think, act, analyse and interpret.

3.What is the significance of Human resource?

❖ It is only through human resource all other resources are effectively
used
❖ The sustainable growth of an organization depends on the important
resource human resource
❖ Industrial relations depend on human resource
❖ Human resource can be utilized at all levels of management.
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 ❖ Human resources are well protected by legislative frameworks.
❖ Human relations is possible only through human resource
❖ Human resource manages all other factors of production
❖ The skill sets of the Human resources can be improved through training
and development programmes
IV.LONG ANSWER QUESTIONS:-
1.Explain the characteristics of Human Resource.
❖ Human resource is the only factor of production that lives
❖ Human resource created all other resources
❖ It is only the labour of employees that is hired and not the employee
himself
❖ Human resource exhibits innovation and creativity
❖ Human resource alone can think, act, analyse and interpret
❖ Human resources are emotional beings
❖ Human resources can be motivated either financially or non financially
❖ The behaviour of human resources are unpredictable
❖ Over years human resources gains value and appreciates .
❖ Human resources are movable
❖ Human resource can work as a team.

2.Describe the significance of Human Resource Management (any 5).

To identify manpower needs :
The number of men required are to be identified accurately to optimise the cost.
To ensure the correct requirement of manpower:
At any time the organisation should not suffer from shortage or surplus manpower
which is made possible through human resource management.
To select right man for right job:
Human resource management ensures the right talent available for the right job,
To appraise the performance of employees:
Human resource management activities boosts up good performers and motivates
slow performers.
To determine employee commitment:
Human resource management determines the level of commitment of employees to
their work either through interview or questionnaire.

3.Discuss the Operative functions HRM.

i.Procurement –
Acquisition deals with job analysis, human resource planning, recruitment, selection,
placement, transfer and promotion
ii.Development –
Development includes performance appraisal, training, executive development, career
planning and development, organisational development

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 iii.Compensation –
It deals with job evaluation, wage and salary administration, incentives, bonus, fringe
benefits and social security schemes
iv. Retention –
This is made possible through health and safety, welfare, social security, job
satisfaction and quality of work life
v. Integration –
It is concerned with the those activities that aim to bring about reconciliation between
personal interest and organisational interest

LESSON-10 RECRUITMENT METHODS

I. Choose the Correct Answers:
1. Recruitment is the process of identifying ___.
a) right man for right job b) good performer
c) Right job d) All of the above
2. Recruitment bridges gap between _____ and ________ .
a) job seeker and job provider b) job seeker and agent
c) job provider and owner d) owner and servant
3. Advertisement is a ________ source of recruitment
a) internal b) external
c) agent d) outsourcing
4. Transfer is an ________ source of recruitment.
a) internal b) external
c) outsourcing d) None of the above
5. E-recruitment is possible only through ________ facility.
a) Computer b) internet
c) Broadband d) 4G
Answers:
1 a 2 a 3 b 4 a 5 b

II.VERY SHORT QUESTION ANSWERS:-

1.Give the meaning of Recruitment.
❖ Recruitment is the process of finding suitable candidates for the various
posts in an organisation.
❖ It acts as a link between job provider and job seeker.
2.What is Promotion?
Promotion means, based on seniority and merits of the employees, they
are given opportunity to move up in the organisational hierarchy .
3.Write any two internal source of recruitment?
❖ Transfer # Upgrading
❖ Promotion # Demotion
❖ Retention # Previous applicants
❖ Retired employees
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4.What is meant by Poaching ?
❖ Organisations hire employees of other competitive companies by
paying them more both financial and non financial benefits.
❖ It is also called raiding.
III.SHORT ANSWERS:-
1.What is meant by Unsolicited applications?
The applications of job seekers who voluntarily apply for the vacancies
not yet notified by the organisations are called Unsolicited applications.
2.What is meant by Job portals?
Organisations can screen for the prospective candidates and fill up
their vacancies by using job portals.
3.State the steps in Recruitment process outsourcing
➢ Requirement Understanding
➢ Advertise & Source
➢ Screening
➢ Validation
➢ Profile submission
➢ Interview Process & Feedback
➢ Selection & Follow up
IV. Long Answer Questions:
1.Explain the Internal sources of Recruitment (any 5).
i.Transfer –
The simplest way by which an employee requirement can be filled is through
transfer of employee from one department with surplus staff to that of another with
deficit staff.
ii.Upgrading –
Performance appraisal helps in the process of moving employees from a lower
position to a higher position
iii. Promotion –
Based on seniority and merits of the employees they are given opportunity to move
up in the organisational hierarchy
iv.Retention –
The retiring employees can be used to meet the requirement after superannuation as
per management discretion
v. Dependants –
The legal heir or the dependent employee may be given a chance to replace the
deceased.
2. Explain the External sources of Recruitment (any 5).
A. Direct
i.Walkins– Walk-in applicants with suitable qualification and requirement can be
another source of requirement.

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 ii.Campus Recruitment –
The organisations visit the educational institutions to identify and recruit suitable
candidates.
iiiRecruitment at Factory gate –
Usually casual or temporary unskilled employees are recruited by this way. They are
recruited at factory gate and paid on hourly or daily basis.
B. Indirect
i.Employee referral –
The existing employees of the organisation may recommend some of their relatives
or known people who will be suitable for the existing vacancies. Based on the
credibility of the employee the referrals will be considered.
ii.Job Portals –
Using internet job portals organisations can screen for the prospective candidates
and fill up their vacancies.
3. What is the Recent trends in Recruitment?
Outsourcing : –
There are outsourcing firms that help in the process of recruiting through screening of
applications and finding the right person for the job for which job they are paid service
charges.
Poaching :-
Organisations hire employees of other competitive companies by paying
them more both financial and non financial benefits.
LESSON -11 EMPLOYEE SELECTION PROCESS:-
I. Choose the Correct Answers:
1. The recruitment and Selection Process aimed at right kind of people.
a) At right people b) At right time
c) To do right things d) All of the above
2. Selection is usually considered as a ___________ process
a) Positive b) Negative
c) Natural d) None of these
3. Which of the following test is used to measure the various characteristics of the
candidate?
a) physical Test b) Psychological Test
c) attitude Test d) Proficiency tests
4. The process of eliminating unsuitable candidate is called
a) Selection b) Recruitment
c) Interview d) Induction
5. Job first man next is one of the principles of ___________.
a) Test b) Interview c) Training d) placement
Answers:
1 d 2 b 3 b 4 a 5 a

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

II.VERY SHORT ANSWERS:-
1.What is selection?
Selection is the process of choosing the most suitable person for the vacant
position in the organization.
2.What is an Interview?
Interview represents a face to face interaction between the interviewer
and interviewee.
3.What is meant by Intelligence test?
➢ Intelligence tests are one of the psychological tests.
➢ Intelligence tests are designed to measure a variety of mental ability,
individual capacity of a candidate.
4.What do mean by Placement?
The process of placing the right man on the right job is called ‘Placement’

III.SHORT ANSWERS:-

1.What is Stress interview?

❖ This type of interview is conducted to test the emotional balance of the
candidate interviewed.
❖ They assess the suitability of the candidate by observing the reaction
and response of the candidate to the stressful situation .
❖ Mostly this type of interview is conducted for recruiting sales
representatives, staff for defence and law enforcement agencies.

2.What is Structured interview?

❖ A series of question are pre-prepared by the interviewer.
❖ Only these questions are asked in the interview.
❖ Ultimately interviewees are ranked on the basis of score
earned by the candidate in the interview.
3.Name the types of selection test?
I.ABILITY TESTS
➢ APTITUDE
➢ ACHIEVEMENT
➢ INTELLIGENCE
➢ JUDGEMENT
II.PERSONALITY TESTS
➢ INTEREST
➢ PERSONALITY
➢ PROJECTIVE
➢ ATTITUDE

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4.What do you mean by Achievement test?
➢ This test measures a candidate’s capacity to achieve in a particular field.
➢ This test measures a candidate’s level of skill in certain areas .
➢ It is also called proficiency test.
➢ This test is conducted before, during or after a learning experience.

IV. Long answer questions:

1.Briefly explain the various types of tests. (any 5)
Intelligence test:-
Intelligence tests are one of the psychological tests.
Intelligence tests are designed to measure a variety of mental ability,
individual capacity of a candidate.
Achievement test:-
This test measures a candidate’s capacity to achieve in a particular field.
This test is conducted before, during or after a learning experience.
Attitude Test
This test measures candidate’s tendencies towards the people, situation, action and
related things.
Judgment Test
This test is conducted to test the presence of mind and reasoning capacity of the
candidates
Aptitude test
Aptitude test is a test to measure suitability of the candidates for the post/role.
2. Explain the important methods of interview (any 5).
i.Screening / Telephone Interview
Telephone interview is conducted by some organization to eliminate unfit and
unsuitable candidate at the preliminary stage itself
ii.Preliminary Interview
This interview is conducted to know the general suitability of the candidates who
have applied for the job.
iii.Stress Interview
This type of interview is conducted to test the temperament and emotional balance
of the candidate interviewed.
iv.Structure/Guided/Planned Interview
Under this method, a series of question to be asked by the interviewer are pre-
prepared by the interviewer and only these questions are asked in the interview.
v.Unstructured Interview
There is no pre-prepared questions. Interviewers determine the suitability of the
candidate based on their response to the random questions raised in the interview.

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3.Differentiate Recruitment and Selection. (any 5)

S. No. Basis of Recruitment Selection

Comparison
1 Meaning Recruitment is an activity of Selection is the process
searching candidates and of choosing the most
encouraging them to apply for it. suitable person for the
vacant position in the
organization
2 Approach Approach under recruitment is Approach under selection
positive one. is negative one.
3 Sequence First Second
4 Method It is an economical method It is an expensive method
5 Process Recruitment process is very Selection process is very
simple complex and complicated
6 Time Less time is required More time is required

LESSON-12 EMPLOYEE TRAINING METHOD

I. Choose the Correct Answers:
1. Off the Job training is given
a) In the class room b) On off days
c) Outside the factory d) In the playground
2. Improves Skill Levels of employees to ensure better job performance
a) Training b) Selection
c) Recruitment d) Performance appraisal
3. When trainees are trained by supervisor or by superior at the job is called
a) Vestibule training b) Refresher training
c) Role play d) Apprenticeship training
4. ________ is useful to prevent skill obsolescence of employees
a) Training b) Job analysis
c) Selection d) Recruitment
5. Training methods can be classified into ________ and ________ training.
a) Job rotation and Job enrichment b) On the Job and Off the Job
c) Job analysis and Job design d) Physical and mental
Answers:
1 c 2 a 3 d 4 a 5 b

II.VERY SHORT ANSWERS:-

1.What is meant by Training?
Training is the act of increasing the knowledge and skills of an employee for
doing particular jobs.
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2.What is Mentoring training method?
➢ Mentoring is the process of sharing knowledge and experience of an
employee.
➢ It is mostly used for managerial employees.
3.What is Role-play?
➢ Under this method trainees are explained the situation and assigned
roles.
➢ They have to act out the roles assigned to them without any rehearsal.
4.State e-learning method?
E- learning is also often referred to us online learning or web based
training.
Under this type of web based training is anywhere and any time
information can pass over the internet.
III.SHORT ANSWERS:-
1.What is Vestibule training?
Vestibule training is training of employees in an environment similar to
actual work environment artificially created for training purpose.
This type of training is given to avoid any damage or loss to machinery .
It is given to Drivers, Pilots, Space Scientists etc.,
2.What do you mean by On the Job training?
On the job training, the employee learns the job in the actual work
environment.
It is based on the principle of “Learning by Doing and Learning While
Earning”.
Coaching method, Mentoring method, Job rotation method,etc., are the
on the job training methods.
3.Write down various steps in a training programme.
Whom to Train?
Who is the Trainee?
Who are trainers?
What method will be used for Training?
What should be level the Training?
Where to conduct the Training Programme?
4.Write short note on Trainer and Trainee.
TRAINER:-
Trainer is a person who teaches skills to employee and prepare them for a
job activity.
TRAINEE:-
A person who is learning and practising the skills of particular job is called
trainee.
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IV.LONG ANSWERS:-
1.Discuss various types of training.
(i)Mentoring training method.
Mentoring is the process of sharing knowledge and experience of an
employee.
It is mostly used for managerial employees.
(ii)Role-play.Under this method trainees are explained the situation and
assigned roles.
They have to act out the roles assigned to them without any rehearsal.
(iii)E-learning method.
E- learning is also often referred to us online learning or web based
training.
Under this type of web based training is anywhere and any time
information can pass over the internet.
(iv)Vestibule training.
Vestibule training is training of employees in an environment similar to
actual work environment artificially created for training purpose.
This type of training is given to avoid any damage or loss to machinery .
It is given to Drivers, Pilots, Space Scientists etc.,
(v)On the Job training.
On the job training, the employee learns the job in the actual
work environment.
It is based on the principle of “Learning by Doing and Learning While
Earning”.
Coaching method, Mentoring method, Job rotation method ,etc., are the
on the job training methods.
2. What are the difference between on the job training and off the job
training?
Basis for On the Job Training Off the Job Training
comparison
Meaning The employee learns the job The employee learns the job
in the actual work in out side the actual work
environment environment
Cost It is cheapest It is expensive
Location At the work place Away from the work place
Principle Learning by performing Learning by acquiring
knowledge
Approach Practical approach Theoretical approach
Carried out It is carried out by the It is carried out by the
experienced employee experts

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3.Explain the benefits of training.
It reduces wastages of materials and idle time
It exposes employees to latest trends.
It minimizes the time for supervision.
It improves the employees productivity
It enhances the morale of the employee.
Customers get better quality of product/ service
Customers get innovative products
Customers get value added products.
UNIT – V- ELEMENTS OF MARKETING
LESSON-13 CONCEPT OF MARKET AND MARKETER
I. Choose the Correct Answers:
1. One who promotes (or) Exchange of goods or services for money is called as .
a) Seller b) Marketer
c) Customer d) Manager
2. The marketer initially wants to know in the marketing is .
a) Qualification of the customer b) Quality of the product
c) Background of the customers d) Needs of the customers
3. The Spot market is classified on the basis of .
a) Commodity b) Transaction
c) Regulation d) Time
4. Which one of the market deals in the purchase and sale of shares and debentures?
a) Stock Exchange Market b) Manufactured Goods Market
c) Local Market d) Family Market
5. Stock Exchange Market is also called _____________
a) Spot Market b) Local Market
c) Security Market d)National Market
Answers:
1 b 2 d 3 b 4 a 5 c

II.VERY SHORT ANSWERS:-

1.What is Market?
The meeting place of buyers and sellers in an area is called Market.
Market means a place where goods are bought or sold.
2.Define Marketer.
“A person whose duties include the identification of the goods and
services desired by a set of consumers, as well as the marketing of those
goods and services on behalf of a company”. - Business Dictionary
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3.What is meant by Regulated Market?
Regulated Markets are organised, controlled and regulated by statutory
measures. Example: Stock Exchanges of Chennai.
4.What is meant by Spot Market?
Spot Market is a Market where goods are exchanged and the physical
delivery of goods takes place immediately.
5.What is meant by commodity Market?
A commodity market is a place where produced goods or consumption
goods are bought and sold.
III.SHORT ANSWERS:-
1.What can be marketed in the Market?
Goods: Vegetables
Services: banking
Experiences: Theme Park
Events: shows,T20
Persons: Cinema Stars, Sports Stars
Places: Amusement
Properties: Land, Plot
2.Mention any three Role of marketer?
Instigator
Innovator
Integrator
Implementer
3.Explain the types of market on the basis of time.
(i)Very Short Period Market:
Markets which deal in perishable goods like, fruits, milk, vegetables etc.,
are called as very short period market.
(ii)Short Period Market:
In certain goods, supply is adjusted to meet the demand. Such markets are
known as Short Period Market.
(iii)Long Period Market
This type of market deals in durable goods, where the goods and services
are dealt for longer period usages.

IV.LONG ANSWER QUESTIONS:

1.How the market can be classified?

i. ON THE BASIS OF GEOGRAPHICAL AREA- Family market, Local market.
ii.ON THE BASIS OF GOODS – Commodity Market, Capital market.
iii.ON THE BASIS OF ECONOMICS – Perfect Market, Imperfect Market.
iv. ON THE BASIS OF TRANSACTION – Spot market, Future market.
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v.ON THE BASIS OF TIME – Very Short Period Market, Short Period Market,
Long Period Market.

(FOR THIS QUESTION WRITE ANY FIVE TYPES OF MARKET WITH

EXPLANATION.
EX: SPOT MARKET, commodity Market, Very Short Period Market, Short Period
Market, Long Period Market )

2.How the market can be classified on the basis of Economics?

I. Perfect Market:
Perfect market satisfies the following conditions:
i.Large number of sellers and buyers are there.
ii. Prices should be uniform throughout the market.
iii.The goods are identical or homogenous.
II.IMPERFECT MARKET:
Imperfect market satisfies the following conditions:
i.Prices are not uniform.
ii.There is lack of communication.
iii.Products are similar but not identical.

LESSON -14 MARKETING AND MARKETING MIX

I. Choose the Correct Answers:

1. The initial stage of Marketing system is____________
a) Monopoly system b) Exchange to Money
c) Barter system d) Self producing
2. Who is supreme in the Market?
a) Customer b) Seller
c) Wholesaler d) Retailer
3. In the following variables which one is not the variable of marketing mix?
a) Place Variable b) Product Variable
c) Program Variable d) Price Variable
4. Marketing mix means a marketing program that is offered by a firm to its target
______________ to earn profits through satisfaction of their wants.
a) Wholesaler b) Retailer
c) Consumer d) Seller
5. Which one is the example of Intangible product?
a) Education b) Mobiles
c) Garments d) Vehicles
Answers:
1 c 2 a 3 c 4 c 5 a

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

II.VERY SHORT ANSWERS:-
1.What is Marketing?
Marketing is the performance of buying activities that facilitate to more flow of goods
and services from producer to ultimate user.
2.Define marketing Mix.
Marketing mix is a pack of four sets of variables namely product variable,
price variable, promotion variable, and place variable .
3.What is meant by Grading?
Grading means classification of standardized products in to certain well
defined classes.

III.SHORT ANSWER QUESTIONS:-

1.What are the objectives of marketing?
❖ To develop the marketing field.
❖ To develop guiding policies
❖ To suggest solutions by studying the problems relating to marketing.
❖ To find sources for further information concerning the market problems.
❖ To revive existing marketing function.
❖ To take appropriate actions in the course of action.
2What are the concept of marketing?
❖ Make what you can sell
❖ First create customer, Then create products.
❖ Love your customers and not the products.
❖ Customer is supreme of king.
❖ Customers preferences shape your decisions.

3.What do you mean by marketing mix? Write ant two elements.

Marketing mix is a pack of four sets of variables namely product variable,
price variable, promotion variable, and place variable.
i.Product:
Product is the main element of marketing. Without a product , there
can be no marketing.
ii.Price:
It is the amount charged for the product.
IV. Long Answer Questions:
1.Discuss about the Evolution of marketing. (any 5)
i.Barter System: The goods are exchanged against goods, without any other medium
of exchange, like money.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 ii.Production Orientation: This was a stage where producers concentrated on the
mass production of goods for the purpose of profit. They cared very little about the
customers.
iii.Marketing Orientation: Customers’ importance was realised but only as a means
of disposing of goods produced.
ivConsumer Orientation: Under this stage only such products are brought forward
to the markets which are capable of satisfying the tastes, preferences and
expectations of the consumers-consumer satisfaction.
v.Management Orientation: The marketing function assumes a managerial role to co-
ordinate all interactions of business activities with the objective of planning,
promoting and distributing want-satisfying products and services to the present and
potential customers.
2. Narrate the Elements of Marketing mix.
These are 4 elements of marketing mix
i. Product
Product is the main element of marketing. Without a product, there can be no
marketing.
ii. Price
Price is the value of a product expressed in monetary terms. It is the amount charged
for the product.
iii. Place (Physical Distribution)
Place or physical distribution facilitates the movement of products from the place of
manufacture to the place of consumption at the right time.
iv. Promotion
An excellent product with competitive price cannot achieve a desired success and
acceptance in market, unless and until its special features and benefits are conveyed
effectively to the potential consumers.

LESSON-15 RECENT TRENDS IN MARKETING

I. Choose the Correct Answers:
1. Selling goods/ services through internet is
a. Green marketing b. E- business
c. Social marketing d. Meta marketing
2. Which is gateway to internet?
a. Portal b. CPU
c. Modem d. Webnaire
3. Social marketing deals with:
a. Society b. Social Class
c. Social change d. Social evil
4. Effective use of Social media marketing increase conversion rates of ___________.
a. Customer to buyers b. Retailer to customers
c. One buyer to another buyer’s d. Direct contact of marketer
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
5. Pure play retailers are called
a. Market creators b. Transaction brokers
c. Merchants d. Agents
Answers:
1 b 2 c 3 b 4 a 5 b

II.VERY SHORT ANSWERS:-

1.What is service marketing?
Service marketing denotes the processing of selling service goods like
telecommunication, banking, insurance, car rentals, healthcare, tourism,
professional services, repairs etc.,
2.What is green marketing?
❖ Green marketing involves developing and promoting products and
services without causing a detrimental impact on the environment.
❖ Green marketing is also known as environmental marketing,
ecological marketing, eco-friendly marketing
3. What is Ambush marketing?
❖ Ambush marketing technique is a new technique whereby a
particular advertiser seeks to connect his product to the event in
the mind of potential customer without paying sponsoring
expenses to the event.
❖ In other words it is a method of building brands in covert ways.
4.What is Social marketing?
❖ Social marketing helps to eradicate social evils .
❖ The primary aim of this marketing is “Social good”.
❖ For example, this may include asking people not to smoke in public areas.
III.SHORT ANSWERS:-
1.What are the advantages of E-Marketing?
❖ E - Marketing provides 24 hours and 7 days service to its users
❖ Customer can buy whatever they want/ need just by browsing the
various sites.
❖ Product bought through E-Marketing is cheaper than other
marketing.
2.Discuss the objectives of E-Marketing.
❖ Expansion of market share
❖ Reduction of distribution and promotional expenses.
❖ Achieving higher brand awareness.
❖ Strengthening database

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

3.Explain in detail about Niche marketing.
❖ Actually there is no market in niche market.
❖ A niche market involves specific target audience with a specialized
offering.
❖ The sports channels like STAR Sports, ESPN, STAR Cricket and Fox Sports
target the niche market of sports enthusiasts.
IV.LONG ANSWERS:-

1.Explain in detail how traditional marketing differ from E-marketing.

E-Marketing Traditional Marketing

It is very economical and faster way to It is very expensive and takes more time
promote the products. to promote product.
It is faster way to promote the products. It takes more time to promote product.
It is quiet easier for promoting product It is very expensive and time consuming
globally in the short time. to promote product/ service .
It needs minimum manpower. It needs more man power.
In this marketing product can be sold or That is not possible in traditional
bought 24 x 7, round the year with marketing.
minimum manpower

2.Discuss any two new methods of marketing.

E-Tailing:-
E-tailing or electronic retailing refers to selling of goods and services
through a shopping website (internet)
E-tailing is also called online retailing.
Social marketing:-
Social marketing helps to eradicate social evils .
The primary aim of this marketing is “Social good”.
For example, this may include asking people not to smoke in public areas.
Niche marketing.
Actually there is no market in niche market.
A niche market involves specific target audience with a specialized
offering.
Service marketing
Service marketing denotes the processing of selling service goods like
telecommunication, banking, insurance, car rentals, healthcare, tourism,
professional services, repairs etc.,
Green marketing
Green marketing involves developing and promoting products and services
without causing a detrimental impact on the environment.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
 UNIT – VI – CONSUMER PROTECTION
LESSON - 16 CONSUMERISM
I. Choose the Correct Answers:
1. The term ‘consumerism’ came into existence in the year __________.
a) 1960 b) 1957
c) 1954 d) 1958
2. Who is the father of Consumer Movement?
a) Mahatma Gandhi b) Mr. Jhon F. Kennedy
c) Ralph Nader d) Jawaharlal Nehru
3. Sale of Goods Act was passed in the year?
a) 1962 b) 1972
c) 1930 d) 1985
4. The Consumer Protection Act came into force with effect from
a) 1.1.1986 b) 1.4.1986
c) 15.4.1987 d) 15.4.1990
5. _____ of every year is declared as a Consumer Protection Day to educate the public
about their rights and responsibilities.
a) August 15 b) April 15
c) March 15 d) September 15

Answers:
1 a 2 c 3 c 4 c 5 c

II.VERY SHORT ANSWER QUESTIONS:-

1.Who is a consumer?
A consumer is an individual who consumes goods and services,
manufactured and sold by others or created by nature and so ld by
others.
2.Give two examples of adulteration.
➢ Mixing of stones with grains.
➢ Mixing of coconut oil with palmolein.
➢ Mixing of tamarind seed with Coffee powder.
➢ Papayas seeds is added to black pepper.
3.What is Caveat Emptor?
➢ Caveat emptor is a Latin term that means let the buyer beware .
➢ The principle of caveat emptor serves as a warning to the buyers that
they have no recourse with the seller if the product does not meet
their expectations.
4.What is Caveat Venditor ?
Caveat Venditor , means let the seller beware by which goods are
covered by an implied warranty of merchantability.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
5.Write a short notes on Consumer Protection Act,1986.
➢ The Central Government enacted a comprehensive law called the
Consumer Protection Act in 1986 and it came into force with effect from
15.04.1987.
➢ The Act seeks to protect and promote the interests of consumers.
➢ This act provides safeguards to consumers.
III.SHORT ANSWERS:-
1.What are the important legislations related to consumerism in India?(any 3)
The Indian Contract Act, 1872 :
To bind the people on the promise made in the contract.
The Trade Mark Act, 1999 :
To prevents the use of fraudulent marks on the product.
The competition Act, 2002 :
To protect the consumers against unhealthy competition.
2.What is meant by artificial scarcity?
➢ There are certain situations where the shop-keepers put up the board
‘No Stock” in front of their shops, even though there is plenty of stock in
the store.
➢ For e.g., in Cinema houses, board may hang in the main entrance ‘House
Full’ while cinema tickets will be freely available at a higher price in the
black market.
3.Write the importance of consumerism.
➢ Awakening and uniting consumers.
➢ Discouraging unfair trade practices.
➢ Protecting against exploitation.
➢ Awakening the government.
➢ Effective implementation of consumer protection laws.
➢ Providing complete and latest information.
➢ Discouraging anti-social activities.
IV.LONG ANSWERS:-
1.How consumers are exploited?
(i)Selling at Higher Price:-
Consumers are forced to buy the short supply of goods at higher prices in
the black market.
(ii)Adulteration:-
It refers to mixing or substituting undesirable material in food.
Example:-
Mixing of stones with grains, Papayas seed is added to black pepper

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (iii)Duplicate or Spurious goods:-
Duplicates are available in plenty in the market for every original, like
automobile spare parts, medicines, jewellery, etc.,
(iv)Artificial scarcity:-
There are certain situations where the shop-keepers put up the board ‘No
Stock” in front of their shops, even though there is plenty of stock in the
store.
(v)False Advertisements:-
Many times, advertisement makes false representation about the quality,
price, grade, etc.,
2.Explain the role of business in consumer protection. (any 5)
i.Avoidance of Price Hike
Business enterprises should desist from hiking the price in the context of acute
shortage of goods /articles.
ii.Avoidance of Hoarding
Business enterprises should allow the business to flow normally. It should not
indulge in hoarding and black marketing
iii.Guarantees for Good Quality
Business enterprises should not give false warranty for the products. It should ensure
supply of good quality.
iv. Product Information
Business enterprises should disclose correct, complete and accurate information about
the product
v.Truth in advertising
Business enterprises should not convey false, untrue, bogus information relating to the
product through the advertisements in media and thus mislead the consumers.

3.What are the objectives of Consumer Protection Act , 1986?

➢ Protecting consumers from unfair trade practices of traders.
➢ Empowering consumers to seek redressal against exploitation.
➢ Educating the consumers of their rights and duties.
➢ Ensuring better standard of living for consumers
➢ To provide quality products at their fair price.

LESSON-17 RIGHTS, DUTIES & RESPONSIBILITIES OF CONSUMERS

I. Choose the Correct Answers:
1. The final aim of modern marketing is _______
a. Maximum profit b. Minimum profit
c. Consumer satisfaction d. Service to the society
2. _______ is the king of modern marketing.
a. Consumer b. Wholesaler
c. Producer d. Reatailer

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

3. As the consumer is having the rights, they are also having ________.
a. Measures b. Promotion
c. Responsibilities d. Duties
4. Which of the following is not a consumer right summed up by John F. Kennedy
a. Right to safety b. Right to choose
c. Right to consume d. Right to be informed
5. It is the responsibility of a consumer that he must obtai______ as a proof for the
purchase of goods.
a. Cash receipt b. Warranty card
c. Invoice d. All of these
Answers:
1 c 2 a 3 c 4 c 5 a
II.VERY SHORT ANSWERS:-
1.Write short notes on:” Right to be informed”.
Consumers should be given all the relevant facts about the product so
that they can take intelligent decisions on purchasing the product.

The package should contain the full details about the name of the
product, composition, dosage, date of manufacturing, date of
expiry, batch number, warnings, antidote etc.
2.What are the rights of consumer according to John F.
Kennedy?
The Right of Safety
The Right to be informed
The Right to choose and
The Right to be heard.
3.Which is the supreme objective of business?
The consumer is the pivotal point around which the entire business
moves.
Satisfaction of consumers wants and needs is the prime and supreme
objective of a business.
III.SHORT ANSWERS:-
1.What do you understand about Right to Protection of Health and Safety?
There may be few products that are more likely to cause physical danger
to consumers’ health, lives and property.
The consumers have the right to protect them from this dangers .
In case of food items and drugs both life saving and life sustaining safety
is to be guaranteed.
2. What do you understand by “Right to redressal”.
✓ There should be prompt settlement of complaints and claims lodged by the
aggrieved customers.
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 ✓ This will boost consumer confidence and help render justice to buyers.
✓ There should be fair and just settlement of deserving claims in a definite
timeframe.

IV.LONG ANSWERS:-
1.Explain the Duties of Consumers.
(i)Buying Quality Products at Reasonable Price: -
The consumer should enquire about the price from certain shops and
government shops.
(ii)Reading the Label Carefully:-
It is the duty of the consumer to thoroughly read the label of the product.
(iii)Beware of False and Attractive Advertisements:-
The prime duty of consumer not to get misled by such fraudulent
advertisements.
(iv)Buying Standardized Products:-
It is the duty of the consumer to buy products with standardization marks
(v)Follow the Instruction of the Manufacturer :-
It is the duty of the consumer to use the product as per its instructions.
(vi)Knowledge of Consumer Rights:-
It is the duty of the consumer to be aware of his rights.
2.What are the Responsibilities of consumers?
He/she has to take delivery of the goods in time.
The consumer must seek to collect complete information about the
quality, quantity, price etc, of the product before purchasing it.
The consumer must get cash receipt as a proof of goods purchased
from the seller.
The buyer must obtain the warranty card mentioning the date of
purchase and period of warranty.
The consumer should never compromise on the quality of goods.
The consumers must watch for ISI, Agmark, FPO, the standard
quality certification marks and the like in the label.

LESSON-18 GRIEVANCE REDRESSAL MECHANISM

I. Choose the Correct Answers:
1. The Chairman of the National Consumer Disputes Redressal Council is ______
a) Serving or Retired Judge of the Supreme Court of India. b) Prime Minister
c) President of India d) None of the above
2. The Chairman of the State Consumer Protection Council is _____
a) Judge of a High Court b) Chief Minister
c) Finance Minister d) None of the above

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3. The Chairman of the District Forum is ________
a) District Judge b) High Court Judge
c) Supreme Court Judge d) None of the above
4. The State Commission can entertain complaints where the value of the goods or
services and the compensation, if any claimed exceed
a)Rs2 lakhs but does not exceed Rs 5 lakhs b)Rs 20 lakhs but does not exceed Rs 1 crore
c)Rs 3 lakhs but does not exceed Rs 5 lakhs d) Rs 4 lakhs but does not exceed Rs 20 lakhs
5. The International Organisation of Consumers Unions (IOCU)was first established
in
a) 1960 b) 1965
c) 1967 d) 1987
Answers:
1 a 2 a 3 a 4 b 5 a
II.VERY SHORT ANSWERS:-
1.What do you mean by Redressal Mechanism?
✓ A large majority of consumers are exploited by the sellers in many ways.
✓ Grievance redressal mechanism helps to take necessary steps to save
the consumers.
2.What do you know about National Commission.
✓ It was set up in 1988 under the Consumer Protection Act of 1986.
✓ Its head office is in New Delhi.
✓ The Commission is headed by a serving or retired judge of the Supreme
Court of India.
3. State the meaning of the term State Commission.
✓ The State Consumer Protection Council is also called State Commission.
✓ The State Commission is to be appointed by the State Government in
consultation with the Centre.
✓ The State Commission aims to protect the interest of aggrieved
consumers in that State.
4. What is an term District Forum?
➢ As per the Consumer Protection Act of 1986 and Section 9 there of the
establishment of a District Forum by the State Government in each
district.
➢ District Forum aims to protect the interest of aggrieved consumers in
that district.
III. SHORT ANSWER QUESTIONS.
1.Who are the members of the National Commission?
➢ The National Commission should have five members.
➢ One should be from judiciary.
➢ Four other members who shall be persons of ability, knowledge and
experience from any other fields.
➢ It should include a woman.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
2. Who are the members of the State Commission?
➢ Each State Commission shall consist of the following members.
➢ One should be from judiciary.
➢ Two other members who shall be persons of ability, knowledge and
experience from any other fields.
➢ One shall be a woman
3.Write a note on the Voluntary Consumer Organisation.
➢ Voluntary consumer organisations refer to the organisation formed
voluntarily by the consumers to protect their rights and interests.
➢ The primary objective of the Voluntary Consumer Organisation is to
strengthen the Consumer Advocacy Movement in India.

IV. Long Answer Questions:

1. Explain the overall performance of National Commission.

The National Consumer Disputes Redressal Commission (NCDRC) is also called as

National Commission.
Members
❖ The National Commission should have five members.
❖ One should be from judiciary.
❖ Four other members of ability, knowledge and experience from any other fields.
❖ It should include a woman.
Jurisdiction
❖ To entertain a complaint valued more than1 Crore.
❖ Revised the orders of State Commissions.
Powers
Adoption of uniform procedure in the hearing of the matters is followed in the
National Commission
Appellate Forum
Section 23 of Consumer Protection Act, 1986, provides that any person aggrieved by
an order of National Commission may prefer an Appeal against such order to
Supreme Court of India within a period of 30 days.

2. Explain the overall performance of State Commission.

The State Consumer Protection Council is also called State Commission.

Members
❖ A person who is or has been a Judge of a High Court appointed by the State
Government as its President.
❖ Two other members who shall be persons of ability, integrity and standing and
have adequate knowledge or experience of or have shown capacity in dealing with
problems relating to economics, law, commerce, industry, public affairs or
administration of them, one shall be a woman.
Jurisdiction
❖ The State Commission can entertain complaints within the territory of entire state.
❖ To entertain a complaint valued exceed Rs. 20 lakhs and below Rupees One Crore.
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 Powers
The State Commission also has the power to call for the records and pass appropriate
orders in any consumer dispute which is pending before or has been decided by any
District Forum within the State.
Appellate Forum
Any person aggrieved by an order of the State Commission may prefer an appeal to
the National Commission within 30 days from the date of such order.

UNIT – VII : BUSINESS ENVIRONMENT

LESSON-19 ENVIRONMENTAL FACTORS
I. Choose the Correct Answers:
1. VUCA stands for ___, ____,_____,______.
(a) Volatility, Uncertainty, Complexity and Ambiguity
(b) Value, Unavoidable, Company and Authority
(c) Volatility, Uncontrollable, Company and Auction
(d) All of the above
2. GST stands for ______,______,______.
(a) Goods and Social Tax (b) Goods and Service Tax
(c) Goods and Sales Tax (d) Goods and Salary Tax
3. Factors within an organisation constitutes _________ environment.
(a) Internal Thinker (b) External Thinker
(c) Fellow human beings (d) All of the above
4. Macro Environment of business is an _________ factor.
(a) Uncontrollable (b) Controllable
(c) Manageable (d) Immanageable
5. The two major types of business environment are _______ and ___________.
(a) Positive and Negative (b) Internal and External
(c) Good and Bad (d) Allowable and Unallowable
Answers:
1 a 2 b 3 a 4 a 5 b

II.VERY SHORT ANSWERS:-

1.What is internal environment?
➢ Internal environment refers to those factors within an organization.
➢ E.g Policies and programmes, organisational structure, employees,
2.Give the meaning of Corporate Governance.
➢ Corporate governance is a set of rules and policies which governs a
company.
➢ It is based on the four fundamental pillars of fairness, transparency,
accountability and responsibility.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

3.What is GST?
➢ GST is the indirect tax levied on goods and services across the country.
➢ There are 3 taxes applicable under this system:- CGST, SGST,and IGST.
4.Expand VUCA.
VUCA – volatility, uncertainty, complexity and ambiguity.

III. Short Answer Questions:

1.What are the political environment factors? (any 3)

The major elements of the legal and political environment are

❖ The image of the leader and the country in the inter-national arena.
❖ Legal framework of business and their degree of flexibility.
❖ The constitution of the nation.
❖ The Foreign policy of the country with special reference to tariffs and free trade.

2.Write about any three internal environmental factors of business.

Values system:
The values of the founder/owner of the business , percolates down to the entire
organisation and has a profound effect on the organisation
Vision and objectives:
The vision and objectives of a business guides its operations and strategic decisions.
Human resources:
The success of an enterprise is solely dependent on its manpower.

3.What do you know about Technological environment?

❖ The development in the IT and telecommunications has created a global market.

❖ Technology is widely used in conducting market research for understanding the
special needs of the customer.
❖ Digital and social media are used as a platform for advertising and promoting the
products/services.
❖ Data-mining and data analytics are used to know the customer better.
IV.Long Answer Questions:
1.Discuss the role of macro environment of business. (any 5)
Economic environment:
The business is an integral part of the economic system prevalent in a nation.
Socio-Cultural environment:
Business is a part of the society .Social environment refers to the sum total of factors
of the society in which the business is located. Social and cultural environment of
society affects the business.
Political and Legal environment :
The major elements of the legal and political environment are
The image of the leader and the country in the inter-national arena.
Legal framework of business and their degree of flexibility.
The constitution of the nation.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
 Technological environment :
The development in the IT and telecommunications has created a global market.
Technology is widely used in conducting market research for understanding the
special needs of the customer.
Global environment :
With the rapid growth of technology the physical boundaries are fast disappearing
and the new global market is emerging.

2.Explain the micro environmental factors of business. (any 5)

i)Financiers:
The financiers of a business which includes the debenture holders and financial
institutions play a significant part in the running of a business.
ii) Suppliers:
In any organisation the suppliers of raw materials and other inputs play a very vital
role. Timely procurement of materials from suppliers enables continuity in
production and reduces the cost of maintaining stock/inventory.
iii) Public:
This refers to any group like media group, citizen action group and local public which
has an impact on the business.
iv) Customers:
The aim of any business is to satisfy the needs of its customers. The customer is the
king and the fulcrum around which the business revolves. Hence it is essential for any
business to understand the needs of its varied customers
v) Competitors:
All organisations face competition at all levels local, national and global. It is
important for a business to understand its competitors and modify their business
strategies in the face of competition.

UNIT – VII – BUSINESS ENVIRONMENT

Chapter -20. LIBERALIZATION , PRIVATIZATION AND GLOBALIZATION
I. Choose the Correct Answers:
1. __________ is the result of New Industrial Policy which abolished the ‘License System’.
(a) Globalisation (b) Privatisation
(c) Liberalisation (d) None of these
2. ___________ means permitting the private sector to setup industries which were
previously reserved for public sector.
(a) Liberalisation (b) Privatisation
(c) Globalisation (d) Public Enterprise
3. ____________ ownership makes bold management decisions due to their strong
foundation in the international level.
(a) Private (b) Public
(c) Corporate (d) MNC’s
4. __________ results from the removal of barriers between national economies to
encourage the flow of goods, services, capital and labour.
(a) Privatisation (b) Liberalisation
(c) Globalisation (d) Foreign Trade
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5. New Economic Policy was introduced in the year _______.
(a) 1980 (b) 1991
(c) 2013 (d) 2015
Answers:
1 c 2 b 3 a 4 c 5 b

II.Very Short Answer Questions:

1.State the branches of New Economic Policy.
Liberalization , Privatization , Globalization
2.What is Privatization?
Privatization is the process of transferring ownership (of a business
enterprise, agency or public service) from the government to the private
sector.
3.Mention any two disadvantages of Liberalization.
❖ Increase in unemployment
❖ Loss to domestic units
❖ Unbalanced development.
❖ Increased dependence on foreign nations
4.Give any two advantages of Globalization.
❖ Increase in foreign collaboration
❖ Expansion of market
❖ Technological development
❖ Reduction in brain drain
III. Short Answer Questions:
1.What do you mean by liberalization?
❖ Liberalization refers to laws or rules being liberalized, or relaxed, by a
government.
❖ Liberalization means relaxation of various government restrictions .
❖ It includes removal of tariff, subsidies and other restrictions
2.State any three impacts on Globalisation.
❖ Globalisation has led to a boom in consumer products market.
❖ Multinational corporations (MNCs) can manufacture, buy and sell goods
worldwide.
❖ It helps to improve the production techniques and quality based
encashment.

3.Write a short note on New Economic Policy.

❖ India committed itself to New Economic Policy in 1991.
❖ The three dimensions of New Economic Policy are Liberalisation,
Privatisation and Globalisation .
❖ It is commonly known as the LPG.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
IV.LONG ANSWER QUESTIONS:
1.Explain the advantages and disadvantages of liberalisation. (any 5)
Advantages
(a)Increase the foreign exchange reserve:
Relaxation in the regulations covering foreign investment and foreign exchange has
paved way for easy access to foreign capital.
(b)Increase in consumption:
Liberalization increases the number of goods available for consumption within a
country due to increase in production.
(c)Control over price:
The removal of tariff barriers can lead to lower prices for consumers. This would be
particularly a benefit for countries who are importers.
Disadvantages
(a)Increase in unemployment:
Some industries grow, some decline. Therefore, there may often be structural
unemployment from certain industries closing.
(b)Loss to domestic units:
It has been possible for many entrants to make inroads into the country, which
poses a threat and competition to the existing domestic units.

2.What are the highlights of the LPG policy?

(a) Introduction of new Foreign Trade Agreements
(b) Foreign Investment (FDI & FII)
(c) MRTP Act, 1969 (Amended)
(d) Deregulation
(e) Opportunities for overseas trade
(f) Steps to regulate inflation
(g) Tax reforms
(h) Abolition of License

UNIT – VIII : THE SALE OF GOODS ACT 1930 AND THE NEGOTIABLE
INSTRUMENTS ACT 1881
CHAPTER 21 THE SALE OF GOODS ACT 1930
I. Choose the Correct Answers:
1. Sale of Goods Act was passed in the year
a) 1940 b) 1997
c) 1930 d) 1960
2. Which of the below constitutes the essential element of contract of sale?
a) Two parties b) Transfer of property
c) Price d) All of the above
3. Which of the below is not a good?
a) Stocks b) Dividend due
c) Crops d) Water
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
4. In case of the sale, the ____ has the right to sell
a) Buyer b) Seller
c)Hirer d) Consignee
5. The property in the goods means the
a) Possession of goods b) Custody of goods
c) Ownership of goods d) Both (a) and (b)
Answers:
1 c 2 d 3 b 4 b 5 c
II.VERY SHORT ANSWERS:-
1. What is a contract of sale of goods?
Contract of sale of goods is a contract whereby the seller transfers or
agrees to transfer the property (ownership) of the goods to the buyer for
a price.
2.List down the essential elements of a contract of sale:
❖ Two parties,
❖ Transfer of property,
❖ Goods,
❖ Price,
❖ Both sale and agreement to sell.
3.What is meant by goods?
The term goods includes every kind of movable property, stocks and
shares, growing crops, goodwill, trademarks, copy rights etc,.
4. What is a Contingent Goods?
❖ Contingent goods are the goods, the acquisition of which by the seller
depends upon a contingency.
❖ Contingent goods are a part of future goods.
III.Short Answer Questions:
1.Discuss in detail about existing goods.
Existing goods are those owned or possessed by the seller at the time of
contract of sale.
Existing goods may be either
(i) Specific Goods
(ii) Ascertained Goods
(iii) Generic or Unascertained Goods

2.Discuss the implied conditions and warranties in sale of goods contract.

In every contract of sale, there are certain expressed and implied conditions and
warranties. The term implied conditions means conditions which can be inferred
from or guessed from the context of the contract.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 i)Implied Conditions
Conditions as to Title
Conditions as to Description
Sale by Sample
Conditions as to Quality or Fitness
ii)Implied Warranties
Quiet Possession
Free from Any Encumbrances
Warranty in the case of Dangerous Goods

IV.LONG ANSWERS:-
1.Explain in detail the elements of contract of sale.
(i)Two Parties:
A contract of sale involves two parties- the seller and the buyer.
(ii)Transfer of Property:
The seller must transfer the ownership in the good to the buyer.
(iii)Goods:
The subject matter of contract of sale must be goods.
(iv)Price:
The monetary consideration for the goods sold is called price.
(v)Includes both ‘Sale’ and ‘Agreement to Sell’
If the property in goods is transferred immediately to the buyer it is
called a sale. If the transfer of property takes place at a future date or on
fulfilment of certain conditions, it is called ‘an agreement to sell’.

2.Distinguish between Conditions and Warranty.

Sl. Basic of Condition Warranty

No Difference
1. Meaning It is a stipulation which is It is a stipulation which is
essential to the main purpose of collateral to the main purpose of
the contract of sale. contract.
2. Significance Condition is so essential to the It is of subsidiary or inferior
contract that the breaking of character. The violation of
which cancels out the contract. warranty will not revoke the
contract.
3. Transfer of Ownership on goods cannot be Ownership on goods can be
Ownership transferred without fulfilling the transferred on the buyer without
conditions. fulfilling the warranty.
4. Treatment Breach of condition may be Breach of warranty cannot be
treated as breach of warranty treated as breach of condition.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 CHAPTER 22 -THE NEGOTIABLE INSTRUMENTS ACT 1930
I. Choose the Correct Answers:
1. Negotiable Instrument Act was passed in the year ______.
a. 1981 b. 1881
c. 1994 d. 1818
2. Number of parties in a bill of exchange are
a. 2 b. 6
c. 3 d. 4
3. Section 6 of Negotiable Instruments Act 1881 deals with
a. Promissory Note b. Bills of exchange
c. Cheque d. None of the above
4. _______ cannot be a bearer instrument.
a. Cheque b. Promissory Note
c. Bills of exchange d. None of the above
5. A cheque will become stale after _____ months of its date:
a. 3 b. 4
c. 5 d. 1
Answers:
1 b 2 c 3 c 4 b 5 a

II.Very Short Answer :

1.What is meant by Negotiable Instrument?
A negotiable instrument is a document which is transferable from one
person to another by mere delivery or by endorsement and delivery .
(OR)
A negotiable instrument means a promissory note, bill of exchange or cheque
payable either to order or to bearer
2.List three characteristics of a Promissory Note.
✓ A promissory note must be in writing.
✓ It must contain a promise or undertaking to pay.
✓ The promise to pay must be unconditional.
✓ It must be signed by the maker.
3.What is meant by cheque?
A bill of exchange drawn on a specified banker and not expressed to be
payable otherwise than on demand.
III.Short Answer Questions:
1.Distinguish between Negotiability and Assignability. (any 3)
Sl. Basic of Negotiability Assignability
No. Difference
1. Notice Notice is not necessary for the In case of actionable claim,
holder of negotiable instrument notice of the assignment by
to claim the payment from the the transferee regarding the
debtor. transfer of debt to the debtor
is necessary.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
 2. Nature of title Holder of negotiable The transferee’s title to the
instrument in due course gets a instrument is subject to the
better title than even the defects of the transferor’s
transferor. title.
3. Consideration Consideration is presumed The assignee has to prove the
consideration for the transfer.
2.What are the Characteristics of a Bill of Exchange?
✓ A bill of exchange is a document in writing.
✓ The document must contain an order to pay.
✓ The order must be unconditional.
✓ The instrument must be signed by the person who draws it.
✓ The amount that is required to be paid must also be specified in the bill.
✓ The bill may be payable on demand or after a specified period.
IV.Long Answer Questions:
1.Distinguish a cheque and a bill of exchange. (any 5)
Sl. Basic of Bill of Exchange Cheque
No Difference
1. Drawn A bill of exchange can be A cheque can be drawn only on
drawn on any person a particular banker.
including a banker

2. Payability It is payable on demand or It is payable on demand only.

on the expiry of a certain
period
3. Discounting A bill can be discounted A cheque cannot be discounted.
with a bank.

4. Stamping Bills are to be sufficiently Cheques need not be stamped

stamped
5. Currency A bill can be drawn and A cheque is payable only in
payable in any currency. home currency.
6. Crossing A bill cannot be crossed A cheque can be crossed

2.Discuss in detail the features of a cheque.

(i)Instrument in Writings .
A cheque or a bill or a promissory note must be an instrument in writing.
(ii)Unconditional Orders
The instrument must contain an order to pay money.
The order must be unconditional.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (iii)Drawn on a Specified Banker Only
The cheque is always drawn on a specified banker.
The customer of a banker can draw the cheque only on the particular branch of the
bank where he has an account.
(iv)A Certain Sum of Money Only
The order must be for payment of only money.
The sum of money must be certain.
(v)Signed by the Drawer
The cheque is to be signed by the drawer.
It should tally with specimen signature furnished to the bank at the time of opening
the account.
(vi)Payable Always on Demand
A cheque is always payable on demand.
3. What are the requisites for a valid endorsement? (any 5)
• Endorsement is to be made on the face of the instrument or on its back.
• Endorsement for only a part of the amount of the instrument is invalid. It
can be made only for the entire amount.
• Endorsement is complete only when delivery of the instrument is made.
• Signing in block letters does not constitute regular endorsement.
• The prefixes or suffixes added to the names of the payees or endorsees
must be omitted in the endorsement.
• Endorsement must be in ink.
• If the payee is an illiterate person, he can endorse it by affixing his thumb
impression on the instrument.
• When there is no space for making further endorsements a piece of paper
can be attached to the negotiable instrument for this purpose. This piece
of paper is called ‘Allonge’.

UNIT – IX : ENTREPRENEURSHIP DEVELOPMENT

Chapter - 23 Elements of Entrepreneurship
I. Choose the Correct Answers:
1. Which of the below is a factor of production?
(a) Land (b) Labour
(c) Entrepreneurship (d) All of the above
2. Entrepreneur is not classified as
(a) Risk Bearer (b) Innovator
(c) Employee (d) Organizer
3. What are the characteristics of an entrepreneur?
(a) Spirit of enterprise (b) Flexibility
(c) Self Confidence (d) All of the above

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

4. Which of the below is not classified into managerial functions?
(a) Planning (b) Marketing
(c) Organizing (d) Controlling
5. Which of the below is a commercial function?
(a) Accounting (b) Coordination
(c) Discovery of idea (d) Planning
Answers:
1 d 2 c 3 d 4 b 5 a

II.Very Short Answer Questions:

1.Mention any two characteristics of entrepreneurs .
• Spirit of Enterprise # Self-Confidence
• Flexibility # Innovation
• Hard work # Leadership
2.List down the managerial functions of entrepreneurs.
#Planning #Organizing # Directing
# Controlling # Co-ordination
3.List down the promotional functions of entrepreneurs.
# Discovery of Idea # Determining the business perspectives
# Detailed Investigation # Choice of form of enterprise.
# Fulfillment of the formalities. #Preparation of business plan
# Mobilization of funds . #Procurement.
4.List the challenges faced by the women entrepreneurs
#Problem of Finance # Limited Mobility
# Lack of Education # Lack of Network Support
# Lack of information # Dependent culture Sensitivity
III.Short Answer Questions:
1.Distinguish between entrepreneur and Manager. (any 3)
Basis of Entrepreneur Manager
difference
Status Entrepreneur is owner of Manager is a salaried
the entity employee in the entity .
Risk Bearing Entrepreneur bears the Manager doesn’t bear any
eventual risk in operating risk
the enterprise
Rewards Entrepreneur is rewarded Manager’s reward salary,
by profit for the risk bonus.
bearing exercise..
Skills An entrepreneur requires Manager requires
creative talent, intuition conceptual skills and
and urge for innovation. human relations skills.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

2.List down the commercial functions of Entrepreneur and explain them shortly.
(any 3)
(a)Production or Manufacturing
The efficient and effective performance of production function depends on the proper
production planning and control to a major extent.
(b)Marketing
Entrepreneur has to carry out following functions pertaining to marketing aspect
namely consumer research, product planning and development, promotion etc
(c)Accounting
Entrepreneur has to arrange to prepare trading and profit and loss account in order
to know the profit or loss of business at a particular day.
(d)Finance
In the sphere of financial function, an entrepreneur has to take decisions like
choosing the right type of financing
(e)Human Resource Management
Entrepreneur has to estimate the manpower needs of the enterprise and accordingly
decide the size of manpower required for various slots of organisational structure.
3.Explain the promotional functions of entrepreneur. (any 3)
(i)Choice of form of enterprise
Entrepreneur has to choose the appropriate form of organisation suited to
implement the venture.
(ii)Determining the business objectives.
Entrepreneur has to develop business objectives in the backdrop of nature of
business and type of business activity
(iii)Preparation of Business Plan
Entrepreneur has to prepare a business plan or project report of the venture
that he is proposing to take up.
(iv)Procurement of Machines and materials.
Entrepreneur has to collect details from the various sources of supply and
screen them for selecting the best source of supply.
IV.LONG ANSWER QUESTIONS:
1.What are the characteristics of an entrepreneur?
(i)Self Confidence
Entrepreneur should have a self confidence in order to achieve high goals in
the business.
(ii)Resource Mobilisation
Entrepreneur should have the capability to mobilise both tangible inputs like
manpower, money materials, technology, market, method etc.,
(iii)Innovation
Entrepreneur should contribute something new or something unique to meet
the changing requirements of customers.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (iv)Flexibility
Entrepreneur should change the decisions made already in the light of ever-
changing business environment.
(v)Decision Making
Entrepreneur has to take timely and correct decision with regard to nature and
type of product to be produced
2.Distinguish between an Entrepreneur and an Intrapreneur?
Basis Entrepreneur Intrapreneur
Thinking Entrepreneur is a free Intrapreneur is forced
thinker to think independently
Dependency Entrepreneur is an Intrapreneur is
independent dependent on the
person entrepreneur.
Fund Entrepreneur has to Intrapreneur does not
Mobilizstion mobilize engage in fund
funds to finance the mobilization.
venture.
Reward Entrepreneur is rewarded Intrapreneur does not
by profit share in profits of
venture

Operation Entrepreneur operates Intrapreneur operates

mostly outside the within the enterprise
enterprise
Risk bearing Bears the risk involved in Does not bear any risk
the
venture
Status Entrepreneur is owner Intrapreneur is a salaried
person

3.Discuss the challenges faced by Women Entrepreneurs. (any 5)

(i)Problem of Finance
The access of women to external sources of funds is limited as they do not generally
own properties in their own name.
(ii)Limited Mobility
Indian women cannot afford to shed their household responsibilities towards their
family even after they plunge into the venture started by them.
(iii)Lack of Education
Illiterate and semi-literate women entrepreneurs encounter a lot of challenges in
their entrepreneurial journey with respect to maintaining accounts, understanding
money matters

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (iv)Sensitivity
Women are more prone to a variety of emotions. This trait does not allow women
entrepreneurs to take objective decisions in many contexts during the course of
running the entrepreneurial venture.
(v)Dependent culture
In India, women however educated and talented are groomed to be dependent on
their parents, life partners and children during the various phases of their life cycle.
They could not take decisions on their own in many contexts due to this
dependency factor.

Chapter - 24 Types of Entrepreneurs

I. Choose the Correct Answers:
1. Which of the following is the Activity of a Business Entrepreneur?
a. Production b. Marketing
c. Operation d. All of the above
2. Find the odd one out in context of Trading Entrepreneur.
a. Selling b.. Commission
c. Buying d. Manufacturing
3. Corporate Entrepreneur is also called as _____
a. Intrapreneur b. Promoter
c. Manager d. Shareholder
4. Which of these is based on Technology?
a. Modern b. Professional
c. Corporate d. Industrial
5. Which of the below is not a Characteristic of a Fabian Entrepreneur?
a. Conservative b. Risk averse
c. Sceptical d. Adaptive
Answers:
1 d 2 d 3 b 4 b 5 d
II.Very Short Answer Questions:
1.What is the other name for business entrepreneur?
Business entrepreneur is called solo entrepreneur.
2.What is the other name for corporate entrepreneur?
Corporate entrepreneur is called promoter.
3.Who are agricultural entrepreneur?
who raise farm products and market them are called Agricultural
entrepreneurs. (OR)
Who pursue their venture in agriculture and allied sector are called Agricultural
entrepreneurs.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

4.Give some examples of pure entrepreneurs?
# Dhirubai Ambani, # Jamshadji Tata # Aziz premji,
# T.V. Sundaram Iyengar, # Seshadriji,
# Birla, # Narayanamurthi, and so on.

III.Short Answer Questions:

1.Who is a private entrepreneur?
Ventures started by individual either singly or collectively at their own
risk after mobilizing various resources in order to earn profit are called
Private entrepreneurship.
2.Explain about the imitative entrepreneur?
❖ Imitative entrepreneur is one who simply imitates existing technology
already in place in advanced countries.
❖ They simply redesign the products developed in advanced countries and
produce a version suited to their local conditions.
3.Write about Fabian Entrepreneur?.
❖ They are of risk-averse type.
❖ They do not simply change to changes happening in the environment.
❖ But they adapt themselves to the changes only as a last resort.
❖ E.g- Nursus coffee.
III.Long Answer Questions:
1.Explain in detail on classification according to the type of business?
(i)Business Entrepreneur:
He/she may establish small or large enterprise to commercially exploit
his/her idea.
(ii)Trading Entrepreneur:
Trading entrepreneurs are those who restrict themselves to buying and
selling finished goods.

(iii)Agricultural Entrepreneur:
who raise farm products and market them are called Agricultural
entrepreneurs.
(iv)Service Entrepreneurs:
Service entrepreneurs enter into the venture of supplying service products
to end consumers.
E.g. airlines, banking, insurance etc.,
2.Discuss the nature of functional entrepreneurs.
(a)Innovating Entrepreneur
Innovative entrepreneur is one who is always focussed on introducing a new project
or introducing something new in the venture already started.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (B)Imitative Entrepreneur
Imitative entrepreneur is one who simply imitates existing skill, knowledge or
technology already in place in advanced countries.
(c)Fabian Entrepreneur
These entrepreneurs are said to be conservatives and sceptical about plasticising any
change in their organisation. They are of risk-averse type. They do not simply change
to the changes happening in the environment.
(d)Drone Entrepreneur
Drone entrepreneurs are those who are totally opposed to changes unfolding in the
environment. They used to operate in the niche market.
Chapter – 25 Government Schemes for Entrepreneurial Development
I. Choose the Correct Answers:
1. The ___________ initiative was launched to modernize the Indian economy to make all
governments services available electronically.
a) Standup India b) Startup India
c) Digital India d) Make in India
2. ________ is designed to transform India to a global design and manufacturing hub.
a) Digital India b) Make in India
c) Startup India d) Design India.
3. ___________ is the Government of India’s endeavour to promote culture of innovation
and entrepreneurship.
a) AIM b) STEP c) SEED d) AIC
4. ___________ should cover aspects like sources of finance, technical know-how, source
of labour and raw material, market potential and profitability.
a) Technical Report b) Finance Report
c) Project Report d) Progress Report
5. ____________has to include the mechanism for managing venture in the project report.
a) Banker b) Government
c) Lending Institutions d) Entrepreneur
Answers: 1 c 2 b 3 a 4 c 5 d

II.Very Short Answer Questions

1.Name any two Governmental Entrepreneurial schemes?
# Startup India # Make in India
# Atal Innovation Mission(AIM) # Digital India
# Jan Dhan-Aadhaar – Mobile # Stand-Up India:
2.Give a note on ‘Digital India’.
❖ The Digital India Initiative has been launched to modernize the Indian
economy
❖ The Digital India aims to make all government services available
electronically.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

3.List down the two types of finance for Entrepreneur.
❖ Long term finance
❖ Short term finance
III.Short Answer Questions
1.What is ‘Startup India’?
✓ Through the Startup India , Government of India promotes
entrepreneurship by mentoring, nurturing and facilitating startups
throughout their life cycle.
✓ Since its launch in January 2016
✓ A ‘Fund of Funds’ has been created to help startups gain access to
funding.
2.Expand the following : STEP, JAM, SEED
STEP - Support to Training and Employment Programme for Women
JAM – Jan Dhan-Aadhaar - Mobile
SEED - Science for Equity Empowerment and Development
IV.Long Answer Questions:
1.Explain any five Government Entrepreneurial Schemes?
(i)Start up India:-
Through the Startup India , Government of India promotes
entrepreneurship by mentoring, nurturing and facilitating startups
throughout their life cycle.
Since its launch in January 2016,
(ii)Make in India:
This scheme is designed to transform India into a global design and
manufacturing hub.
(iii)Digital India:
The Digital India Initiative has been launched to modernize the Indian
economy
To make all government services available electronically.
(iv)Jan Dhan-Aadhaar - Mobile
JAM that enables direct transfer of subsidies to intended beneficiaries.
(v)Stand-Up India:
It aims at enabling economic participation of, women entrepreneurs,
Scheduled Castes and Scheduled Tribes and share the benefit of Indian
growth with the above mentioned categories.
2.Describe the steps promoting Entrepreneurial venture
(i)Selection of the product
An entrepreneur may select a product according to his aspiration, capacity and
motivation after a thorough scrunity of micro and macro environment of business

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (ii)Selection of form of ownership
Entrepreneur has to choose the form of organisation suitable and appropriate for his
venture namely family ownership, partnership and private limited company.
(iii)Selection of Site
Entrepreneur has to choose suitable plot for accommodating his venture.
Following things may be considered in choosing the site namely:
Nearness to Native Place
Incentives provided by the Govt.
Nearness to Market
Availability of Labour and Raw Materials in a particular area.
Infrastructure Facilities
(iv)Designing Capital Structure
Entrepreneur has to determine the source of financé for funding the venture. He/she
may mobilise funds from his own savings, loans from friends and relatives, term loans
from banks and financial institutions.
(v)Acquisition of Manufacturing know-how
Entrepreneur can acquire manufacturing know-how from Government research
laboratories and individual consultants.
UNIT – X : COMPANY LAW AND SECRETARIAL PRACTICE
Chapter - 26 COMPANIES ACT 2013 .
I. Choose the Correct Answers:
1. The Company will have to issue the notice of situation of Registered Office to the
Registrar of Companies within _____ days from the date of incorporation.
(a) 14 days (b) 21 days
(c) 30 Days (d) 60 Days
2. How does a person who envisages the idea to form a company called?
(a) Director (b) Company Secretary
(c) Registrar (d) Promoter
3. Which of the following types of shares are issued by a company to raise capital
from the existing shareholders?
(a) Equity Shares (b) Rights Shares
(c) Preference Shares (d) Bonus Shares
4. The shares which are offered to the existing shareholder at free of cost is known
as ___________.
(a) Bonus Share (b) Equity Share
(c) Right Share (d) Preference Share
5. The shares which are offered first to the existing shareholder at reduced price is
known as _____________.
(a) Bonus Share (b) Equity Share
(c) Right Share (d) Preference Share

1 c 2 d 3 b 4 a 5 c
Answers:

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

II.Very Short Answer Questions:
1.What are the four stages of formation of a company?
# Promotion # Registration
# Capital subscription and # Commencement of Business.
2.What is Bonus Shares?
To utilize the company’s reserves and surpluses, issue of shares to
existing shareholders without taking any consideration .
3.What is Right shares?
❖ Right shares are issued by the company, with the aim of increasing the
subscribed share capital of the company by further issue.
❖ The right shares are primarily issued to the existing equity
shareholders
4.What is Debentures?
❖ When a company needs fund without increasing its share capital, it can
borrow from general public by issuing certificate for a fixed period of
time and at a fixed rate of interest.
❖ Such a loan certificate is called a Debenture.
III.Short Answer Questions:
1.What do you understand by Issue of Securities at Premium?
➢ When shares are issued at a price above the face or nominal value, they
are said to be issued at a premium.
➢ For example, a share having the face value of Rs.10 is issued at Rs.12.
Here, Rs.2 is the premium.
➢ The amount of share premium has be transferred to an account called
the ‘Securities Premium Account’.

2.Explain different kinds of Preference shares. (any 3)

(i)Cumulative Preference shares:
As the word indicates, all dividends are carried forward until specified, and paid out
only at the end of the specified period.
(ii)Redeemable Preference shares:
Such preference shares can be claimed after a fixed period or after giving due notice.
(iii)Non-Redeemable Preference shares:
Such shares cannot be redeemed during the lifetime of the company, but can only be
obtained at the time of winding up (liquidation) of assets.
(iv)Convertible Preference shares:
The shares can be converted into equity shares after a time period or as per the
conditions laid down in the terms.
(v)Non-convertible Preference shares:
Non-convertible preference shares cannot be, at any time, converted into equity shares.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
IV.Long Answer Questions:
1.Write the difference between Debentures and Shares?

S.no Debentures Shares

1. Debentures constitute a loan Shares are part of the
capital of a company
2. Debentures holder gets fixed rate Shareholders gets dividends
of Interest with a varying rate.

3. Debentures generally have a Shares do not carry any

charge on the assets of the such charge
company
4. Debentures can be issued at a Shares cannot be issued at a
discount without restrictions. discount
5. Debentures holders do not have Shareholders enjoy voting
any voting right.
Right
6 The rate of interest is fixed The dividend varies from
year to year.

2.What are the various kinds of Debentures? (any 5)

(i)Non Convertible Debentures (NCD):
These instruments retain the debt character and cannot be converted into equity
shares.
(ii)Partly Convertible Debentures (PCD):
A part of these instruments are converted into Equity shares in the future at notice
of the issuer. The issuer decides the ratio for conversion.
(iii)Fully convertible Debentures (FCD):
These are fully convertible into Equity shares at the issuer's notice. The ratio of
conversion is decided by the issuer.
(iv)Secured Debentures:
These instruments are secured by a charge on the fixed assets of the issuer company.
So if the issuer fails on payment of either the principal or interest amount, such fixed
assets can be sold to repay the liability to the investors.
(v)Unsecured Debentures:
These instrument are unsecured in the sense that if the issuer defaults on payment
of the interest or principal amount, the investor has to be included
as unsecured creditors of the company.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 Chapter - 27 Company Management
I. Choose the Correct Answer:
1. A person Shall hold office as a director in ________ companies as per the Companies
Act, 2013.
(a) 5 companies (b) 10 companies
(c) 20 companies (d) 15 companies
2. A Private Company shall have a minimum of ________.
(a) Seven directors (b) Five directors
(c) Three directors (d) Two directors

3. A Public Company having a paid up Share Capital of Rs. ___________ or more may
have a Director, elected by such small shareholders.

(a) One crore (b) Three crores

(c) Five crores (d) Seven crores
4. What is the statue of Directors who regulate money of the company.
(a) Banker (b) Holder
(c) Agent (d) Trustees
5. According to Companies Act, the Directors must be appointed by the.
(a) Central Government (b) Company Law Tribunal
(c) Company in General Meeting (d) Board of Directors.
Answers:
1 c 2 d 3 c 4 d 5 c

II.Very Short Answer Questions:

1.Name the companies required to appoint KMP.
❖ Every listed company
❖ Every public company (Having paid up share capital of Rs. 10 crore or
more)
2.Who is whole time Director?
❖ A Whole Time Director is one who devotes whole of his time of working
hours to the company .
❖ He has a significant personal interest in the company as the source of
his income.
3.Who is called as Managing Director?
A Managing Director is one who is employed by the company and has
substantial powers of management of the company and control of the
board.
4.Who can be Executive Director?
An executive director is a Chief Executive Officer (CEO) of company, or
corporation, who is responsible for making decisions to complete the
mission and for the success of the organization.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

II.Short Answer Questions:
1.When are alternative directors appointed?
❖ Alternate director is appointed by the Board of Directors, as a substitute
to a director who may be absent from India, for a period which is not
less than three months.
❖ The appointment must be authorized either by the Articles of
association of the company or by a passing a resolution in the general
Meeting.
❖ The alternative director is not a representative or agent of Original
Director.
2.Who is a shadow director?
A person who is not the member of Board but has some power to run it
can be appointed as the directors but according to his/her wish.
3.State the minimum number of directors for a Private company.
(i)In case of One Person Company: The requirement of directors is one.
(ii)Other Private Companies:The minimum requirement of Directors is two
IV.Long Answer Questions:
1.Who are the KMP?
❖ The Chief Executive Officer
❖ The Managing Director or the Manager
❖ The Company Secretary
❖ The Whole-time Director
❖ The Chief financial Officer
2.Brief different types of Directors.
(i)Residential Director:
Every company should appoint a director who has stayed in India for a
total period of not less than 182 days in the previous calendar year.
(ii)Small shareholders directors:
Small Shareholders can appoint a single director in a listed company.
(iii)Women Director:
There should be at least one woman as a director on the board.
(iv)Additional directors:
Any individual can be appointed as Additional directors by a company.
(v)Alternate Directors:
Alternate director is appointed by the Board of Directors, as a substitute
to a director who may be absent from India, for a period which is not less
than three months
(vi)Shadow Director:
A person who is not the member of Board but has some power to run it can
be appointed as the director but according to his/her wish.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.
3.State the qualifications of Directors.
❖ A director must be a person of sound mind.
❖ A director must hold share qualification, if the article of association
provides such.
❖ A director must be an individual.
❖ A director should be a solvent person.
❖ A director should not be convicted by the Court for any offence, etc.
CHAPTER- 28 COMPANY SECRETARY
I. Choose the Correct Answer:
1. Mention the status of a Company Secretary in a company.
a) A member b) A director
c) An independent d) An employee contractor
2. Who can become a secretary for a company?
a) Individual person b) Partnership firm
c) Co-operative societies d) Trade unions
3. Which meeting will be held only once in the life time of the company?
a) Statutory b) Annual General
c) Extra - ordinary d) Class General
4. Who is not entitled to speak at the annual general meeting of the company.
a) Auditor b) Shareholder
c) Proxy d) Directors

5. From the date of its incorporation the First Annual General Meeting is to be
conducted within __________ months.
(a) Twelve (b) Fifteen
(c) Eighteen (d) Twenty one
Answers:
1 d 2 a 3 a 4 c 5 c

II.Very Short Answer Questions:

1.Who is a secretary?
The person who is responsible for the general performance of an
organization is called company secretary.

2.What is meant by meeting?

A meeting is a gathering of two or more people that has been convened
for the purpose of achieving a common goal through sharing information

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

3.Write short note on ‘proxy’?
❖ Proxy means a person being the representative of a shareholder at the
meeting of the company .
❖ Proxy can be present at the meeting and he cannot vote.
4.What is voting?
❖ The word ‘Vote’ indicating one’s wishes or desire.
❖ By casting his vote one formally declaring his opinion or wish in favour
of or against a proposal or a candidate to be elected for an office.
III.Short Answer Questions:
1.What is Special Reesolution?
❖ A special resolution is the one which is passed by a not less than 75% of
majority.
❖ The number of votes, cast in favour of the resolution should be three
times the number of votes cast against it.
2.What do you mean by statutory meeting?
❖ The first general meeting of the public company is called statutory
meeting.
❖ This meeting is conducted only once in the lifetime of the company.
❖ The company gives the circular to shareholder before 21days of the
meeting.
❖ A private company or a public company having no share capital need
not conduct a statutory meeting.
❖
3.Give any three cases in which ordinary Resolution need to be passed?
❖ To change or rectify the name of the company.
❖ To alter the share capital of the company.
❖ To redeem the debentures.
❖ To declare the dividends.
❖ To appoint the directors.

IV. Long Answer Questions:

1.Briefly state different types of company meetings.
(i)Statutory Meeting
The first general meeting of the public company is called statutory
meeting.This meeting is conducted only once in the lifetime of the
company.
(ii)Annual General Meeting [AGM]
Every year a meeting is held to transact the ordinary business of the company. Such
meeting is called Annual General Meeting of the company (AGM). Company is bound
to invite the first general meeting within eighteen months from the date of its
registration. Then the general meeting will be held once in every year.

P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.

 (iii)Extra-Ordinary General Meeting
All other general meetings other than statutory and annual general meetings are called
extraordinary general meetings. If any meeting conducted in between two annual general
meeting to deal with some urgent or special or extraordinary nature of business is called
as extra-ordinary general meetings.
(iv)Board Meetings
Meetings of directors are called Board Meetings. Meetings of the directors provide a
platform to discuss the business and take formal decisions.
(v)Class Meeting (Meetings of Particular Share or Debenture Holders)
Meetings, which are held by a particular class of share or debenture holders
e.g. preference shareholders or debenture holders is known as class meeting.

2. Explain different types of open and secret types of voting

I. Open Procedure
(a) By Voice:
Voice voting is a popular type of voting in which the chairman allows the members to
raise their voice in favour or against an issue ‘Yes’ for approval and ‘No’ for rejection.
Chairman announces the result of voice voting on the basis of strength of words
shouted. It is an unscienfic method. It cannot be employed for deciding complex issue.
(b) By Show of Hands:
Under this method the chairman, requests the members to raise their
hands of those who are in favour of the proposal or candidate and then
requests those are against. Then the chairman counts the number of hands
raised for Yes and No respectively can announce the result on the basis of
hands counted.
II. Secret Procedure
a) By Ballot
Under this system, ballot paper bearing serial number is given to the members to
record their opinion by marking with the symbol or Shareholders have to cast their
vote in a secret chamber and put the ballot paper into the ballot box
b) Postal Ballot
Big companies or big associations having members scattered all over the
country follow this method of voting. Under this method serially
numbered ballot papers are sent by post in sealed covers to the
members,who, living at a distant place, are unable to attend the meeting
physically.

WISH YOU ALL THE BEST

P.G. ASST IN CO M M E RCE,
THIRU K AMARAJ M UNICIPAL H IG H ER SECO NDARY SCH OO L,
VILLUPURAM.
P.PRABHU, P.G.(COMMERCE) T.K.M.H.S.S.,VILLUPURAM.