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Nature and Purpose of Business

Nature and Purpose of Business

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Questions

Question 1 Multiple Choice (Single Answer)

Which of the following is not a characteristic of business activities?

  1. Production and procurement of goods and services
  2. Dealing in goods and services on a regular basis
  3. Banking and finance for business activities
  4. Profit earning
  5. Element of risk
Question 2 Multiple Choice (Single Answer)

Which of the following industries is a part of the primary sector?

  1. Fish hatcheries
  2. Processing of raw iron
  3. Oil refineries
  4. Car industry
  5. Warehousing
Question 3 Multiple Choice (Single Answer)

The term _________ is used for activities in which mechanical appliances and technical skills are involved.

  1. commerce
  2. profession
  3. occupation
  4. business
  5. industry
Question 4 Multiple Choice (Single Answer)

Which of the following functions of a business enterprise facilitates the exchange of goods and services from producers to people who want them, at the place they want, at the time they require and at the price they are prepared to pay?

  1. Financing
  2. Advertising
  3. Marketing
  4. Human resource management
  5. All of the above
Question 5 Multiple Choice (Single Answer)

Which of the following statements is/are correct?
A. There is an uncertainty of return in business activities.
B. Commerce involves all activities that provide auxiliaries to trade.
C. Industry refers to all economic activities.

  1. Only A
  2. Only B
  3. Only C
  4. Only A and B
  5. All of these
Question 6 Multiple Choice (Single Answer)

Manufacturing industries can be divided into separate categories on the basis of method of operation for production. Which of the following is/are the correct categories of manufacturing industries?
A. Analytical industries
B. Synthetical industries
C. Processing industries
D. Assembling industries

  1. Only A and B
  2. Only A, B and C
  3. Only C and D
  4. Only B, C and D
  5. All of these
Question 7 Multiple Choice (Single Answer)

Match the column I (Occupation) with column II (Mode of establishment
Column I 
        </strong>|<strong>Column II</strong>|

|A. Business|1. Service agreement|
|B. Profession|2. Necessary legal formalities|
|C. Employment|3. Membership of a professional body|

  1. A-1, B-2, C-3
  2. A-2, B-3, C-1
  3. A-3, B-2, C-1
  4. A-1, B-3, C-2
  5. A-3, B-1, C-2
Question 8 Multiple Choice (Single Answer)

Which of the following is/are correct regarding risks in a business?
a. Business risks arise due to uncertainties.
b. Nature and size of business affect the degree of risk in a business.
c. Risk is essential in business.
d. Profit is the reward for risk taking.

  1. Only a and b
  2. Only c and d
  3. Only a and c
  4. Only a, c and d
  5. All of these
Question 9 Multiple Choice (Single Answer)

Which of the following refers to the position of an enterprise in relation to its competitors?

  1. Profit earning
  2. Productivity
  3. Social responsibility
  4. Market standing
  5. Innovation
Question 10 Multiple Choice (Single Answer)

All activities involving the hindrances in the process of exchange are included in commerce. Match the hindrances with the activities
Hindrances to business 
        </strong>|<strong>Activities to remove the hindrances</strong>|

|A. Person|1. Trade|
|B. Place|2. Transport|
|C. Risk|3. Insurance|

  1. A-1, B-2, C-3
  2. A-2, B-3, C-1
  3. A-3, B-1, C-2
  4. A-2, B-1, C-3
  5. A-1, B-3, C-2
Question 11 Multiple Choice (Single Answer)

Which of the following activities are auxiliaries to trade?
a. Transport and communication
b. Banking and finance
c. Insurance
d. Warehousing
e. Advertising

  1. Only a, b and c
  2. Only b, c, d and e
  3. Only a, b, c and e
  4. Only a, c, d and e
  5. All of these
Question 12 Multiple Choice (Single Answer)

Match the column I (industry) with column II (category of industry
Industry 
        </strong>|<strong>Category of industry</strong>|

|A. Lumbering|1. Synthetical industry|
|B Cattle breeding|2. Extractive industry|
|C. Oil refinery|3. Genetic industry|
|D. Cement|4. Analytical industry|

  1. A-1, B-2, C-3, D-4
  2. A-2, B-3, C-4, D-1
  3. A-3, B-1, C-2, D-4
  4. A-4, B-1, C-3, D-2
  5. A-1, B-4, C-2, D-3
Question 13 Multiple Choice (Single Answer)

Which of the following are correct regarding methods of dealing with a risky transaction for a business entity?
a. It may take preventive measures to deal with risks.
b. It may transfer its own risk to another entity.
c. It may decide against entering risky transactions.
d. It may assume risks in advance.
e. It may share risks.

  1. Only a, b and c
  2. Only d and e
  3. Only a, c, and d
  4. Only c, d and e
  5. All of these
Question 14 Multiple Choice (Single Answer)

Which of the following cannot be a cause due to which a business enterprise may face risk of losses?

  1. Natural
  2. Human
  3. Economic
  4. Technological
  5. Size of business
Question 15 Multiple Choice (Single Answer)

Which of the following statements is/are incorrect?
a. Profits can be taken as society’s approval to the utility of business.
b. Profit maximisation indicates the efficient working of a business.
c. There are hardly any sizeable business enterprises, whose only objective is profit maximisation.

  1. Only a
  2. Only b
  3. Only c
  4. All of the above
  5. None of the above
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