Sept 2013 GSET Commerce Solved Paper, Paper – III, Subject Code: 17

Sept 2013 GSET Commerce Solved Paper

Paper – III (Commerce)

Subject Code: 17

Marks: 150

Time: 2.30 Hours

Note: This paper contains Seventy Five (75) multiple choice/assertion/reasoning/matching questions. Each question carrying TWO (2) marks. Attempt All the questions.

1. In the analysis of economic environment there are certain economies which are in the transition from centralized economic system to market economy. They are referred to as:

(A) Transitory economies.

(B) Transition economies.

(C) Developing economies.

(D) Open economies.

Ans: (B) Transition economies.

2. Who presides over the National Development Council?

(A) The Chairman of the Planning Commission.

(B) The Secretary of National Development Council.

(C) The Finance Minister of Central Government.

(D) The Prime Minister of India.

Ans: (D) The Prime Minister of India.

3. Which of the following statements is correct?

(A) A legal protection granted for an invention that is new, non-obvious and useful is called a trade mark.

(B) Trade and Merchandize Marks Act, 1958 was first implemented in Gujarat.

(C) Trademark Act was made in 1997.

(D) A part of Brand which can be recognized but is not utterable is called a Brand-mark.

Ans: (D) A part of Brand which can be recognized but is not utterable is called a Brand-mark.

4. Which one of the following is correct?

(A) The MRTP Act, 1969 was replaced by Competition Act, 2010.

(B) The MRTP Commission was replaced by Competition Commission.

(C) The New MRTP Act took the place of Competition Commission.

(D) Competition Policy and the EXIM Policy are almost same.

Ans: (B) The MRTP Commission was replaced by Competition Commission.

5. In globalization the _______ is a very common strategy of entering into foreign market.

(A) Licensing.

(B) Management Designs.

(C) Joint-ventures.

(D) Manufacturing.

Ans: (C) Joint-ventures.

6. Assets in the balance sheet of a company are arranged in the order of:

(A) Book value.

(B) Liquidity.

(C) Permanence.

(D) Market value.

Ans: (C) Permanence.

7. Profit and Loss a/c shows the:

(A) Financial results of the concern for a period.

(B) Financial position of the concern on a particular date.

(C) Financial position of the concern for a period.

(D) Financial results of a concern on a particular date.

Ans: (A) Financial results of the concern for a period.

8. After reissue of forfeited shares, the surplus in the Forfeited Shares A/c is transferred to:

(A) General Reserve A/c.

(B) Reserves and Surplus A/c.

(C) Profit and Loss A/c.

(D) Capital Reserve A/c.

Ans: (D) Capital Reserve A/c.

9. Match the following: In case of purchase method of amalgamation

(1) If fair value of net assets is more than the amount of purchase consideration.

(2) If purchase consideration is in excess of value of net assets.

(3) If statutory reserves are required to maintain their identity.

(a) The double entry is completed by opening the amalgamation adjustment Account.

(b) The difference is credited to capital reserve account.

 (c) The difference is debited to goodwill account.

 

 Codes:

(A) (1)-(b), (2)-(c), (3)-(a).

(B) (1)-(c), (2)-(b), (3)-(a).

(C) (1)-(a), (2)-(b), (3)-(c).

(D) (1)-(c), (2)-(a), (3)-(b).

Ans: (A) (1)-(b), (2)-(c), (3)-(a).

10. Who is interested in master budget?

(A) Lower-level management.

(B) Top management.

(C) Middle-level management.

(D) Functional heads.

Ans: (B) Top management.

11. Find the correct matching of the items of List I with the items of List II:

List I

List II

(a) Normal profit.

(b) Economic profit.

(c) Accounting profit.

(1) Excess of total revenue over total explicit cost.

(2) Total revenue equals total cost.

(3) Excess of total revenue over total of explicit and implicit costs and a normal rate of return.

 Codes:

(A) (1)-(c), (2)-(a), (3)-(b).

(B) (1)-(b), (2)-(a), (3)-(c).

(C) (1)-(a), (2)-(b), (3)-(c).

(D) (1)-(a), (2)-(c), (3)-(b).

Ans: (A) (1)-(c), (2)-(a), (3)-(b).

12. Who gave the behavioristic explanation of consumers’ demand:

(A) Alfred Marshall.

(B) J.R. Hicks.

(C) Paul Samuelson.

(D) Edgeworth.

Ans: (A) Alfred Marshall.

13. In a production it was found that production changes by 16% when all the inputs were changes by 3.6%. The output elasticity is:

(A) 4.2.

(B) 4.4.

(C) 4.6.

(D) 4.8.

Ans: (B) 4.4.

14. Internal economies accruing to a firm do not include:

(A) Financial economies.

(B) Managerial economies.

(C) Economies of superior technique.

(D) Economies of location.

Ans: (D) Economies of location.

15. During the short-run the optimum level of output corresponds to that level of output, where:

(A) Marginal cost is minimum.

(B) Average variable cost is minimum.

(C) Average cost is minimum.

(D) Average fixed cost stops declining.

Ans: (C) Average cost is minimum.

16. Which one of the following is not a method of collecting primary data?

(A) Schedules and Questionnaires.

(B) Direct Personal Investigations.

(C) Computerised database.

(D) Projective Techniques.

Ans: (C) Computerised database.

17. Which one of the following is non-probability sampling technique?

(A) Random sampling.

(B) Snow Ball sampling.

(C) Stratified sampling.

(D) Sequential sampling.

Ans: X

18. Match the following:

(1) Association between attributes.

(2) Large samples.

(3) Small samples.

(4) More than two sample means.

(a) F-test.

(b) t-test.

(d) z-test.

 Codes:

(A) (a)-(4), (b)-(3), (c)-(1), (d)-(2).

(B) (a)-(1), (b)-(2), (c)-(3), (d)-(4).

(C) (a)-(4), (b)-(3), (c)-(2), (d)-(1).

(D) (a)-(3), (b)-(1), (c)-(4), (d)-(2).

Ans: (A) (a)-(4), (b)-(3), (c)-(1), (d)-(2).

19. Karl Pearson’s coefficient of correlation between two variables X and Y can be calculated by:

(A) Co-variance between the variables divided by the product of their standard deviations and N.

(B) Co-variance between the variables multiplied by the product of their standard deviations.

(C) The product of the standard deviations of the variables divided by the product of total deviations of X-variable and total deviations of Y-variable taken from their respective averages.

(D) Co-variance between the variables divided by the product of their arithmetic averages.

Ans: (A) Co-variance between the variables divided by the product of their standard deviations and N.

20. Which one of the following is not a positive characteristic of a computer?

(A) Speed.

(B) Versatility.

(C) Accuracy.

(D) Vulnerability of stored data.

Ans: (D) Vulnerability of stored data.

21. Assertion (A): Management is a continuous process.

Reason (R): Managers first plan, then organise and finally perform the function of controlling.

Codes:

(A) Both (A) and (R) are correct and (R) is correct explanation of (A).

(B) Both (A) and (R) are correct, but (R) is not a correct explanation of (A).

(C) (A) is correct, but (R) is incorrect.

(D) (A) is incorrect, but (R) is correct.

Ans: (A) Both (A) and (R) are correct and (R) is correct explanation of (A).

22. _______ has developed the technique of ‘Management by Exception’.

(A) Peter F. Drucker.

(B) Henry Fayol.

(C) F.W. Taylor.

(D) L.F. Urwick.

Ans: (C) F.W. Taylor.

23. Which one of the following is called ‘Management by results’?

(A) Management by Objectives.

(B) Management by Exception.

(C) Management by Walking around.

(D) Manage scientifically.

Ans: (A) Management by Objectives.

24. “Leaders are born not made”, refers to:

(A) Great-man-approach of managing.

(B) Great-man-approach of leadership.

(C) Trait-approach of motivation.

(D) Autocratic-approach of leadership.

Ans: (B) Great-man-approach of leadership.

25. Ethics provide:

(A) Consumer Autonomy.

(B) Corporate Social Responsibility.

(C) Justice.

(D) All of the above.

Ans: (D) All of the above.

26. Functions of marketing management consists:

(A) Determination of the marketing objects.

(B) Marketing Planning.

(C) Marketing Organisation.

(D) All of the above.

Ans: (D) All of the above.

27. Which of the following is not true about publicity?

(A) It is done through mass media.

(B) It is one way of communication.

(C) It is paid form of propaganda.

(D) It is non-personal in nature.

Ans: (C) It is paid form of propaganda.

28. Which of the following is not a base for segmenting consumer markets?

(A) Occupation.

(B) Education.

(C) Quality.

(D) Social class.

Ans: (C) Quality.

29. Which of the following does not belong to marketing concept?

(A) Product concept.

(B) Production concept.

(C) Services concept.

(D) Social marketing concept.

Ans: (C) Services concept.

30. It is a set of procedures and sources that managers use to obtain everyday information about developments in the marketing environment. It is called as:

(A) A Marketing Information System.

(B) A Marketing Research System.

(C) A Marketing Intelligence System.

(D) An Internal Record System.

Ans: (C) A Marketing Intelligence System.

31. According to MM Proposition, in the presence of corporate tax, the optimal capital structure would be 100% _______.

(A) Equity.

(B) Debt.

(C) Bonds.

(D) Debentures.

Ans: (B) Debt.

33. If the Net Present Value for a project is negative, then:

(A) IRR = Cost of capital.

(B) IRR < Cost of capital.

(C) IRR > Cost of capital.

(D) BCR = 1.

Ans: (B) IRR < Cost of capital.

34. Baumol’s Cash Management Model attempts to minimize:

(A) Holding costs.

(B) Transaction costs.

(C) Cash balances.

(D) Total costs.

Ans: (D) Total costs.

35. Who developed one of the earliest models linking the value of the firm to its dividend policy?

(A) Walter.

(B) Gorden.

(C) Miller.

(D) Modigliani.

Ans: (B) Gorden.

36. Recruitment means:

(A) Conducting interview.

(B) Selecting fresh candidate.

(C) Attracting candidates for job.

(D) Appointing a new person.

Ans: X

37. The appraisal process is designed by the:

(A) Sales Department.

(B) Finance Department.

(C) Personnel Department.

(D) Marketing Department.

Ans: (C) Personnel Department.

38. Which one of the following roles of HRM is really strategic in nature?

(A) Policy maker.

(B) Change agent.

(C) Administrative expert.

(D) Fire fighter.

Ans: (D) Fire fighter.

39. Which model of HRM highlights the interest of all the stakeholders?

(A) Harvard model.

(B) Warwick model.

(C) Storey model.

(D) Legge’s model.

Ans: (A) Harvard model.

40. Which of the following Acts does not provide social security to the worker?

(A) Minimum Wages Act.

(B) The Payment of Gratuity Act.

(C) The Workers’ Compensation Act.

(D) The Employee’s State Insurance Act.

Ans: (B) The Payment of Gratuity Act.

41. Schedule-3 of the Banking Act is related to:

(A) Borrowings.

(B) Capital.

(C) Deposits.

(D) All of the above.

Ans: (C) Deposits.

42. The First Narasimham Committee brought about:

(A) De-regulation of interest rates.

(B) De-regulation of borrowing.

(C) De-regulation of management of banks.

(D) De-regulation of bank customers.

Ans: (A) De-regulation of interest rates.

43. Electronic Banking requires:

(A) Firewalls and operating systems.

(B) Codes and confidence.

(C) Electrons and passwords.

(D) Networks only.

Ans: (A) Firewalls and operating systems.

44. The Reserve Bank of India has evolved the following model for rating of Indian Banks:

(A) GAAP.

(B) XBRL.

(C) CAMELS.

(D) BANCASSURANCE.

Ans: (C) CAMELS.

45. IDBI Bank was constituted through a:

(A) Merger.

(B) Reserve merger.

(C) Take-over.

(D) Acquisition.

Ans: (B) Reserve merger.

46. Ethnocentric firms are those whose orientation is:

(A) Compatible with host country marketing.

(B) Compatible with home country marketing.

(C) Compatible with no specific country.

(D) Compatible with a region.

Ans: (B) Compatible with home country marketing.

47. Domestic currency depreciates when:

(A) There is an inflation.

(B) There is deflation.

(C) When domestic inflation is higher than foreign inflation.

(D) When domestic money supply is less.

Ans: (C) When domestic inflation is higher than foreign inflation.

48. The Andean Pact belongs to which level of regional economic integration?

(A) Free Trade Area.

(B) Customs Union.

(C) Common Market.

(D) Economic Union.

Ans: (B) Customs Union.  

49. Capital Account convertibility will affect:

(A) Repatriation of profits by MNC.

(B) Value of India’s exports.

(C) Value of India’s imports.

(D) India’s current account balance.

Ans: (A) Repatriation of profits by MNC.

50. Match the following:

Part A(WTO Ministerial Conferences)

Part B (Held in)

(w) First.

(x) Second.

(y) Third.

(z) Fourth.

(1) Geneva.

(2) Singapore.

(3) Doha, Qatar.

(4) Seattle, USA.

 Codes:

(A) (w)-(1), (x)-(2), (y)-(3), (z)-(4).

(B) (w)-(2), (x)-(1), (y)-(4), (z)-(3).

(C) (w)-(4), (x)-(2), (y)-(3), (z)-(1).

(D) (w)-(1), (x)-(2), (y)-(4), (z)-(3).

Ans: (B) (w)-(2), (x)-(1), (y)-(4), (z)-(3).

51. In an inflationary period, additional depreciation is required to be charged to cover the backing of depreciation of the gross current replacement cost of the assets that increase every year when accounts are prepared as per:

(A) Cash system.

(B) Current Cost Accounting Method.

(C) Current Purchasing Power method.

(D) Mercantile system.

Ans: (B) Current Cost Accounting Method.

52. Which of the following is the oldest form of a derivative contract?

(A) Futures.

(B) Forwards.

(C) Options.

(D) Swaps.

Ans: (B) Forwards.

53. _______ was set-up by RBI to deepen and activate Indian Money Market.

(A) State Trading Corporation of India.

(B) Discount and Finance House of India.

(C) Both of the above.

(D) None of the above.

Ans: (B) Discount and Finance House of India.

54. Paying an excessive price for the acquisition is called:

(A) Hubris spirit.

(B) Megalomania.

(C) Winner’s curse.

(D) Green mail.

Ans: (D) Green mail.

55. Which of the following is not accounting software?

(A) TALLY.

(B) WINCA.

(C) EX.

(D) BANCO.

Ans: (D) BANCO.

56. In which of the following concepts the marketers identify the hierarchy of attributes which guides the consumer decision-making in order to understand different competitive forces and its formation?

(A) Market Myopia.

(B) Market Portioning.

(C) Marketing Myopia.

(D) Meta Markets.

Ans: (B) Market Portioning.

57. The practice of tailoring products and marketing programmes to the needs and wants of specific individuals and local customer groups is called as:

(A) Market Targeting.

(B) Target Marketing.

(C) Integrated Marketing.

(D) Micro Marketing.

Ans: (D) Micro Marketing.

58. Companies using call centers for receiving calls from customers is described by the following:

(A) In-bound Tele-marketing.

(B) Out-bound Tele-marketing.

(C) Advertising.

(D) In-bound and out-bounding tele-marketing.

Ans: (B) Out-bound Tele-marketing.

59. Which of the following is not the stage of product cycle?

(A) Introduction.

(B) Growth.

(C) Market segmentation.

(D) Decline.

Ans: (C) Market segmentation.

60. Marketing is a human activity directed at satisfying need and wants through exchange process, is the statement of:

(A) Cundiff and Still.

(B) Kenneth Andrew.

(C) Philip Kotler.

(D) Kishwar S. Kan.

Ans: (C) Philip Kotler.

61. Audits of non-managers is called:

(A) H.R. Audit.

(B) Management Inventories.

(C) Skill Inventories.

(D) Human Resource Inventories.

Ans: (C) Skill Inventories.

62. The best way of recruiting is always:

(A) Walk-in.

(B) Referrals.

(C) Advertisement.

(D) Variables.

Ans: (D) Variables.

63. Identify from the following, the type of change that occurs after external forces have already affected the performance:

(A) Proactive change.

(B) Reacting change.

(C) Responsive change.

(D) Freezing change.

Ans: (B) Reacting change.

64. Performance appraisal is a part of the following:

(A) Career Development.

(B) Career Training.

(C) Career Up gradation.

(D) Career Welding.

Ans: (A) Career Development.

65. Which is the simulation of the administrative tasks of a manager job?

(A) Role play.

(B) In-basket.

(C) Discussion group.

(D) Interview.

Ans: (B) In-basket.

66. EXIM banks extend line of credit to the following except:

(A) Foreign Government.

(B) Foreign Government Agencies.

(C) Foreign Financial Institution.

(D) Foreign Companies.

Ans: (D) Foreign Companies.

67. To be eligible as MNC a firm should have over its foreign affiliates:

(A) ownership only.

(B) control only.

(C) either ownership or control.

(D) neither ownership nor control is needed.

Ans: (C) either ownership or control.

68. The aim of foreign exchange risk management is to:

(A) Maximize profits.

(B) Earn a minimum level of profit.

(C) Minimize losses.

(D) Know with certainty the future cash flows.

Ans: (C) Minimize losses.

69. A speculator is bullish about index nifty which stands at Rs. 1,150. He decides to buy one three month nifty call option contract (having a market lot of 200) with strike price of Rs. 1,210 at a premium of Rs. 15 per call. Three months later the index closes at Rs. 1,245. His profit (or loss) on the position is:

(A) Loss of Rs. 9,000.

(B) Profit of Rs. 9,000.

(C) Profit of Rs. 3,000.

(D) Profit of Rs. 4,000.

Ans: (D) Profit of Rs. 4,000.

70. Under the Bretton Woods system the only currency that remained convertible into Gold was:

(A) The British Pound.

(B) US Dollar.

(C) Japanese Yes.

(D) Chinese Yuan.

Ans: (B) US Dollar.

71. To be resident of India, the individual coming from abroad during previous year for the first time has to remain present in India for minimum:

(A) 182 days.

(B) 60 days.

(C) 90 days.

(D) 180 days.

Ans: (A) 182 days.

72. Expenses incurred by the existing concern after commencement of business on raising long-term loan is:

(A) Preliminary expenses under Section 35D.

(B) Interest and financial charges under Section 36 (1) (iii).

(C) General expenses under Section 37(1).

(D) None of the above.

Ans: (C) General expenses under Section 37(1).

73. Where a partner transfers any capital asset into the business of firm, the sale consideration of such asset to the partner shall be:

(A) Market value of such asset on the date of such transfer.

(B) Value at which it was recorded in the books of the firm.

(C) Cost at which the asset was originally acquired by the partner.

(D) Cost at which the asset was originally acquired by the partner with adjustment of cost inflation index.

Ans: (B) Value at which it was recorded in the books of the firm.

74. Ojas Ltd. established in Himachal Pradesh, commence its operations on 1-1-2012 and produces the article prescribed in the Fourteenth schedule. The undertaking will be entitled for the deduction of:

(A) 100% of profits for a period of 10 years commencing from initial assessment year.

(B) 100% of profits for a period of 5 years commencing from initial assessment year and 30% of profits for next 5 years.

(C) 30% of profits for a period of 10 years commencing from initial assessment year.

(D) 25% of profits for a period of 10 years commencing from initial assessment year.

Ans: (B) 100% of profits for a period of 5 years commencing from initial assessment year and 30% of profits for next 5 years.

75. Match the following:

(1) Retain or Replace.

(2) Make or buy.

(3) Lease or buy.

(4) Invest or disinvest.

(a) Lease rentals, cost incurred and deductibility.

(b) Disposal value, Purchase price and rate of depreciation.

(c) Inflows (Capital and Revenue) and deductibility or chargeability of inflows or outflows (Actual or Notional).

(d) Cost incurred (capital or revenue) and deductibility.  

 Codes:

(A) (1)-(a), (2)-(b), (3)-(c), (4)-(d).

(B) (1)-(b), (2)-(d), (3)-(a), (4)-(c).

(C) (1)-(c), (2)-(a), (3)-(d), (4)-(b).

(D) (1)-(c), (2)-(d), (3)-(a), (4)-(b).

Ans: (B) (1)-(b), (2)-(d), (3)-(a), (4)-(c). 

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