September 2018 GSET Commerce Solved Paper, Paper – II, Subject Code: 17

September 2018 GSET Commerce Solved Paper

Paper – II (Commerce)

Subject Code: 17

Marks: 100

Time: 120 Minutes (2 Hours)

Note: This paper contains ONE HUNDRED (100) multiple-choice questions. Each question carrying TWO (2) marks. Attempt all the questions.

1. A clean letter of credit guarantees the acceptance and payment of bills without:

(A) Approval.

(B) Bank.

(C) Condition.

(D) Loss.

Ans: (C) Condition.

2. The role of the organisation in career planning is to introduce and strengthen systems to ensure _______ of employees.

(A) Career progression.

(B) Self-development.

(C) Economic development.

(D) Skill enhancement.

Ans: (A) Career progression.

3. The Committee appointed by SEBI in the year 2003 for suggesting how best to future improve the Corporate Governance (CG) practices was:

(A) National Committee on Corporate Governance.

(B) The Kumarmangalam Birla Committee.

(C) The Ambani Committee.

(D) The Narayan Murthy Committee.

Ans: (D) The Narayan Murthy Committee.

4. Which one is not normally possible in case of monopoly?

(A) MC = MR.

(B) AC = AR.

(C) MR = AR.

(D) MR = P.

Ans: (C) MR = AR.

5. The training imparted to a new employee to induct him into new social setting of his work is called:

(A) Orientation training.

(B) Job training.

(C) Corrective training.

(D) Promotional training.

Ans: (A) Orientation training.

6. State Bank of India was established in the year:

(A) 1935.

(B) 1955.

(C) 1964.

(D) 1969.

Ans: (A) 1935.

7. GST rate for raw diamonds is passed at:

(A) 3%.

(B) 1%.

(C) 0.25%.

(D) 0.05%.

Ans: (C) 0.25%.

8. Identify the four pillars of brand equity, according to brand asset valuator model.

(A) Relevance, performance, bonding and advantage.

(B) Presence, performance, advantage and bonding.

(C) Energized differentiation, relevance, esteem and knowledge.

(D) Energized differentiation, esteem, brand feeling and brand salience.

Ans: (C) Energized differentiation, relevance, esteem and knowledge.

9. Max Weber is associated with:

(A) Theory of motivation.

(B) Principles of management.

(C) Theory of scientific management.

(D) Theory of bureaucracy.

Ans: (D) Theory of bureaucracy.

10. Which of the following countries is a member of ASEAN?

(A) Indonesia.

(B) Japan.

(C) United States.

(D) India.

Ans: (A) Indonesia.

11. Which of the following sectors is not open for 100% foreign direct investment?

(A) Coal.

(B) Oil refining.

(C) PowerPoint.

(D) Airport development.

Ans: (B) Oil refining.

12. Rationing of credit is an instrument of:

(A) Open market operations.

(B) Selective credit controls.

(C) Quantitative credit controls.

(D) Credit creation.

Ans: (B) Selective credit controls.

13. According to Young and Rubicam’s brand asset valuator, a brand’s _______ measures how well the brand is regarded and respected.

(A) Knowledge.

(B) Differentiation.

(C) Energy.

(D) Esteem.

Ans: (D) Esteem.

14. Planned introduction of an employee to its job and the organization is called:

(A) Training.

(B) Development.

(C) Induction.

(D) Promotion.

Ans: (C) Induction.

15. Trading on equity means:

(A) The use of long-term fixed interest bearing debt and preference share capital.

(B) The use of long-term fixed interest bearing debt and equity share capital.

(C) The use of long-term fixed interest bearing debt and preference share capital along with equity share capital.

(D) The use of long-term fund and short-term fund.

Ans: (C) The use of long-term fixed interest bearing debt and preference share capital along with equity share capital.

16. The fatigue and motion study was conducted by:

(A) Henry L. Gantt.

(B) F. W. Taylor.

(C) Frank B. and Lillian M. Gilbreth.

(D) Henry Fayol.

Ans: (C) Frank B. and Lillian M. Gilbreth.

17. The result of positioning is the successful creation of _______ which provides a cogent reasons why the target market should buy the product.

(A) An award winning promotional campaign.

(B) A customer-focused value proposition.

(C) A demand channel.

(D) Everyday low pricing.

Ans: (B) A customer-focused value proposition.

18. Many U.S. firms prefer to sell in Canada, England and Australia rather than in larger markets such as Germany and Frances – because they feel more comfortable with the languages, laws and culture, which reflect the _______ between these countries and the United States.

(A) Self-serving bias.

(B) Coincident development.

(C) Psychic proximity.

(D) Cognitive dissonance.

Ans: (C) Psychic proximity.

19. CSR is:

(A) Corporate Security Ratio.

(B) Corporate Statutory Records.

(C) Corporate Social Responsibility.

(D) Corporate Statutory Responsibility.

Ans: (C) Corporate Social Responsibility.

20. The _______ factor would be relatively low if supply of labour is higher than demand.

(A) Production.

(B) Labour Cost.

(C) Wage.

(D) Salary.

Ans: (C) Wage.

21. EPSS stands for:

(A) Electronic Performance Services System.

(B) Electronic Performance Support System.

(C) Electronic Process Support System.

(D) Electronic Profit Support System.

Ans: (B) Electronic Performance Support System.

22. _______ is main promoter of CRISIL.

(A) RBI.



(D) SBI.

Ans: (C) ICICI.

23. Reinforcement theory of motivation is contributed by:

(A) A. H. Maslow.

(B) Sigmund Freud.

(C) B. F. Skinner.

(D) David Nadler and Edward Lawler.

Ans: (C) B. F. Skinner.

 24. In a sprinkler approach to international expansion, _______.

(A) Many countries are entered simultaneously.

(B) Countries are entered when competition is limited.

(C) Countries are gradually entered sequentially.

(D) Countries in which the supply of raw material is greatest are entered first.

Ans: (A) Many countries are entered simultaneously.

25. An interview in which a group of interviewers questions the applicant is:

(A) Mass interview.

(B) Panel interview.

(C) Situational interview.

(D) Computerized interview.

Ans: (B) Panel interview.

26. Capital budgeting is the process of making investment decisions on:

(A) Total expenditure.

(B) Revenue expenditure.

(C) Capital expenditure.

(D) Preliminary expenditure.

Ans: (C) Capital expenditure.

27. Customer profitability analysis (CPA) is best conducted with the tools of an accounting technique called:

(A) Input-output analysis.

(B) Factor analysis.

(C) Revenue based costing.

(D) Activity based costing.

Ans: (D) Activity based costing.

28. The total income for a resident super senior citizen (80 years or more) at any time during the previous year is not taxable upto:

(A) Rs. 2,50,000 p.a.

(B) Rs. 3,00,000 p.a.

(C) Rs. 5,00,000 p.a.

(D) Rs. 4,00,000 p.a.

Ans: (C) Rs. 5,00,000 p.a.

29. The call money market refers to the market for:

(A) Term loans.

(B) Extremely short-term period loans.

(C) Long-term period loans.

(D) Short-term period loans.

Ans: (B) Extremely short-term period loans.

30. Debenture is called a:

(A) Senior Security.

(B) Junior Security.

(C) Hybrid Security.

(D) Government Security.

Ans: (A) Senior Security.

31. Which of the following is one of Hofstede’s four cultural dimensions that differentiate countries?

(A) Customer relationship management versus power distance.

(B) Strategic management versus marketing management.

(C) Weak versus strong uncertainty avoidance.

(D) Total quality management versus just in time technique.

Ans: (C) Weak versus strong uncertainty avoidance.

32. Regional economic integration is defined as the creation of trading agreements between _______.

(A) Firms targeting the same market.

(B) Individual firms in an industry.

(C) Related industries.

(D) Blocks of countries.

Ans: (D) Blocks of countries.

33. The Accounting Rate of Return is also known as:

(A) Return on preference share.

(B) Return on capital employed.

(C) Return on debt.

(D) Return on equity share.

Ans: (B) Return on capital employed.

34. A _______ is the set of all products and items a particular seller offers for sale.

(A) Product line.

(B) Product mix.

(C) Product extension.

(D) Product class.

Ans: (B) Product mix.

35. ECS denotes:

(A) Electronic Clearance System.

(B) Electronic Credit System.

(C) Electronic Channel System.

(D) Electronic Clearance Service.

Ans: (D) Electronic Clearance Service.

36. Stock market represents:

(A) Primary market.

(B) Secondary market.

(C) Bullion market.

(D) Real estate market.

Ans: (B) Secondary market.

37. Deferred shares are known as:

(A) Sweet shares.

(B) Founders’ shares.

(C) Preference shares.

(D) Equity shares.

Ans: (B) Founders’ shares.

38. Domestic-based export agents perform a valuable service for companies seeking to enter foreign markets. The primary function of these agents is to _______.

(A) Carry on exporting activities on behalf of several producers.

(B) Buy the manufacturer’s products and then sell them abroad.

(C) Buy foreign products and sell them in the domestic country.

(D) Seek and negotiate foreign purchase for a commission.

Ans: (D) Seek and negotiate foreign purchase for a commission.

39. The number of subordinates a superior can effectively handle is called:

(A) Organising people.

(B) Co-ordination.

(C) Span of control.

(D) Directing.

Ans: (C) Span of control.

40. Out of the following one of it is not associated with Cloud Computing:

(A) Infrastructure – as – Service (IaaS).

(B) Platform – as – Service (PaaS).

(C) Software – as – Service (SaaS)

(D) Computing – as – Service (Caas).

Ans: (D) Computing – as – Service (Caas).

41. In whose model, the equilibrium is unstable and indeterminate?

(A) Edgeworth Model.

(B) Cournot Model.

(C) Sweezy Model.

(D) Pareto Model.

Ans: (A) Edgeworth Model.

42. IMPS denotes:

(A) International Money Payment System.

(B) Immediate Payment Service.

(C) Intermediate Payment System.

(D) Indian Money Payment System.

Ans: (B) Immediate Payment Service.

43. The value of rent free accommodation where the population exceeds 25 lakhs and accommodation is owned by employer:

(A) 10% of salary.

(B) 7.5% of salary.

(C) 15% of salary.

(D) 5% of salary.

Ans: (C) 15% of salary.

44. SEBI is:

(A) A Bank.

(B) An Insurance company.

(C) A Regulatory agency.

(D) A Rating agency.

Ans: (C) A Regulatory agency.

45. Which of the following types of FDI includes creation of new assets and production facilities in the host country?

(A) Strategic Alliance.

(B) Brownfield Investment.

(C) Merger and Acquisition.

(D) Greenfield Investment.

Ans: (D) Greenfield Investment.

46. The Age Discrimination in Employment Act of _______made it unlawful to discriminate against employees or applicants who are between 40 and 65 years of age.

(A) 1958.

(B) 1967.

(C) 1965.

(D) 1963.

Ans: (B) 1967.

47. One of the following is not associated with Securities Contracts (Regulation) Act 1956:

(A) Prevent undesirable transactions in securities.

(B) Regulate payment of taxes.

(C) Regulate dealings in securities.

(D) Regulation of stock exchanges.

Ans: (B) Regulate payment of taxes.

48. GATT stands for:

(A) Government Aided Tariff Treaty.

(B) General Agreement on Trade and Tariff.

(C) Generally Accepted Trade Tariff.

(D) Government Agreed Tariff on Trade.

Ans: (B) General Agreement on Trade and Tariff.

49. Human relations approach of management is associated with:

(A) Abraham Maslow.

(B) Peter F. Drucker.

(C) Elton Mayo.

(D) Herzberg.

Ans: (C) Elton Mayo.

50. IDBI was established in the year:

(A) 1955.

(B) 1964.

(C) 1969.

(D) 1980.

Ans: (B) 1964.

51. “Management is the art of getting things done through people.” Who said this?

(A) Mary Parker Follet.

(B) F.W. Taylor.

(C) Henry Fayol.

(D) Elton Mayo.

Ans: (A) Mary Parker Follet.

52. Direct costs are also known as:

(A) Common costs.

(B) Overhead costs.

(C) Traceable costs.

(D) Fixed costs.

Ans: (C) Traceable costs.

53. NAFTA is a free trade zone comprising of which of the following countries?

(A) Canada, Mexico and South America.

(B) Canada, Mexico and Peru.

(C) Mexico, South America and the United States.

(D) Canada, Mexico and the United States.

Ans: (D) Canada, Mexico and the United States.

54. The appropriate objective of an enterprise is:

(A) Maximisation of profit.

(B) Maximisation of sales.

(C) Maximisation of owner’s wealth.

(D) Maximisation of assets.

Ans: (C) Maximisation of owner’s wealth.

55. A measure of the responsiveness of quantity demanded to changes in the price of a related goods is known as:

(A) Cross elasticity of demand.

(B) Substitution elasticity of demand.

(C) Complementary elasticity of demand.

(D) Price elasticity of demand.

Ans: (A) Cross elasticity of demand.

56. Which is the first step to be performed by a marketer in developing effective marketing communications?

(A) Identifying a target audience.

(B) Determining the objectives.

(C) Establishing the budget.

(D) Deciding on the media mix.

Ans: (A) Identifying a target audience.

57. Rates of tax deducted at source for winnings from horse races without surcharge, health and education cess for the AY 2019-20 is:

(A) 10%.

(B) 15%.

(C) 20%.

(D) 30%.

Ans: (D) 30%.

58. Operating leverage increases, when:

(A) Variable cost increases.

(B) Fixed cost increases.

(C) Variable cost decreases.

(D) Fixed cost decreases.

Ans: (B) Fixed cost increases.

59. The amount is given by the chief cashier to the petty cashier as advance is known as:

(A) Advanced Money.

(B) Petty Money.

(C) Imprest Money.

(D) Supply Money.

Ans: (C) Imprest Money.

60. Cashew Corporation is a subsidiary wholly owned by:


(B) RBI.

(C) STC.

(D) EXIM Bank.

Ans: (C) STC.

61. Process of Environmental Analysis includes:

(A) Scanning, Measuring, Forecasting and Assessment.

(B) Scanning, Measuring, Forecasting and Approachment.

(C) Scanning, Monitoring, Forecasting and Assessment.

(D) Scanning, Monitoring, Fourth-coming and Assessment.

Ans: (C) Scanning, Monitoring, Forecasting and Assessment.

62. The Chairman of the NITI Ayog is:

(A) Dr. Montek Singh Ahluwalia.

(B) Sh. Arun Jaitely.

(C) Sh. N. D. Modi.

(D) Sh. Rajnath Singh.

Ans: (C) Sh. N. D. Modi.

63. Gordon’s model is related with:

(A) Market Policy.

(B) Capital Policy.

(C) Dividend Policy.

(D) Reserve Policy.

Ans: (C) Dividend Policy.

64. The Seven-S model for successful strategy implementation was proposed by:

(A) Boston consultancy group.

(B) Mc. Kinsey & Co.

(C) Arthur Andersen & Co.

(D) Du Pont Co.

Ans: (B) Mc. Kinsey & Co.

65. Which of the following is most closely related with the organic growth of an organization?

(A) Developing new products from within.

(B) Acquiring a product or service brand.

(C) Entering new market places.

(D) Increasing productivity of employees.

Ans: (A) Developing new products from within.

66. As a business practice, broadening involves:

(A) Acquiring or merging with firms in the same or complementary industries to gain economies of scale and scope.

(B) Factoring the interests of customers, employees, shareholders and other stakeholders into the activities of the enterprise.

(C) Buying more goods and services from outside domestic or foreign vendors.

(D) Appointing teams to manage customer-value building process and break down walls between departments.

Ans: (B) Factoring the interests of customers, employees, shareholders and other stakeholders into the activities of the enterprise.

67. Multiple Regression Analysis, Factor Analysis, Multivariate Analysis of Variance, etc. are examples of:

(A) Inferential analysis.

(B) Descriptive analysis.

(C) Discrepancy analysis.

(D) Directive analysis.

Ans: (B) Descriptive analysis.

68. The quota that restricted on world trade in textile was known as:


(B) MFA.



Ans: (B) MFA.

69. The tendency to perceive another person as belonging to a single class or category is known as:

(A) Stereotyping.

(B) Halo effect.

(C) Attribution.

(D) Assimilation.

Ans: (A) Stereotyping.

70. Under the Industrial Disputes (Amendment) Act, 2010, the total number of members of the Grievance Redressal Committee shall not exceed:

(A) Four.

(B) Six.

(C) Ten.

(D) Twelve.

Ans: (B) Six.

71. Capital structure refers to:

(A) Equity financing of a firm.

(B) Debt financing of a firm.

(C) Permanent financing of a firm.

(D) Working capital financing of a firm.

Ans: (C) Permanent financing of a firm.

72. A _______ is a set of procedures and sources, managers use to obtain everyday information about developments in the marketing environment.

(A) Data warehousing system.

(B) Viral marketing campaign.

(C) Product management system.

(D) Marketing intelligence system.

Ans: (D) Marketing intelligence system.

73. Capital Adequacy Ratio for Banks as per Basel III norms:

(A) 8%.

(B) 4%.

(C) 2%.

(D) 5%.

Ans: (A) 8%.

74. Tax evasion means:

(A) Availing deductions under Section 10A of the Income Tax Act.

(B) Making suitable arrangement for TDS.

(C) Illegally understate the income.

(D) Avail deductions available under Sections 80C to 80U.

Ans: (C) Illegally understate the income.

75. _______ theory is the study of people making interdependent choices.

(A) Game theory.

(B) Chaos theory.

(C) Motivation theory.

(D) Leadership theory.

Ans: (A) Game theory.

76. Which of the following is a Non-parametric Test?

(A) F-test.

(B) Chi-square test.

(C) Z-test.

(D) t-test.

Ans: (B) Chi-square test.

77. Which of the following is true about direct investment as a mode of international expansion?

(A) It allows a firm to retain full control over its investment.

(B) It yields the lower returns than joint ventures.

(C) It involves the least amount of risk.

(D) It involves the least cost.

Ans: (A) It allows a firm to retain full control over its investment.

78. Minimum Wages Act was enacted in India in:

(A) 1947.

(B) 1948.

(C) 1949.

(D) 1950.

Ans: (B) 1948.

79. In a narrow sense, the term fund mean:

(A) Working capital.

(B) Cash.

(C) Finance.

(D) Total financial resources.

Ans: (B) Cash.

80. When a consumer expresses thoughts, feelings, images, experiences and beliefs associated with the brand, the consumer is expressing:

(A) Brand knowledge.

(B) Ethnocentric bias.

(C) Self-serving bias.

(D) Brand identity.

Ans: (A) Brand knowledge.

81. Consider the following problem relating to a let out house property.

Municipal Value

Fair Rent

Standard Rent (Under the Rent Control Act)

Annual Rent Received


Rs. 78,000

Rs. 72,000

Rs. 75,000

The gross annual value of the property will be:

(A) Rs. 78,000.

(B) Rs. 72,000.

(C) Rs. 75,000.

(D) Rs. 70,000.

Ans: (C) Rs. 75,000.

82. The Ledger is called:

(A) Book of original entry.

(B) Petty cash book.

(C) Day book.

(D) Book of principal entry.

Ans: (D) Book of principal entry.

83. Which of the following is not a measure of Central Tendency?

(A) Mode.

(B) Mean.

(C) Range.

(D) Median.

Ans: (C) Range.

84. Marketers often cut the cost of advertising dramatically by using consumers as their creative team. This strategy is known as:

(A) Crowd sourcing.

(B) Public relations.

(C) Vertical integration.

(D) Disintermediation.

Ans: (A) Crowd sourcing.

85. Companies can run the same marketing communications programs as used in the home market or change them for each local market, a process called _______.

(A) Product communications.

(B) Communication adaptation.

(C) Marked development.

(D) Dual adaptation.

Ans: (B) Communication adaptation.

86. Successful career planning and development requires action from:

(A) The organisation, his employees’ immediate manager and the employee.

(B) The employee and his/her immediate manager.

(C) A variety of sources both internal and external to the organisation.

(D) The employee with some assistance/guidance from his or her immediate manager.

Ans: (A) The organisation, his employees’ immediate manager and the employee.

87. Gearing Ratio indicates:

(A) The relationship between short-term funds and long-term funds.

(B) The relationship between preference share and equity share.

(C) The relationship between loan funds and net worth.

(D) The relationship between debenture and loan.

Ans: (C) The relationship between loan funds and net worth.

88. A cluster of complementary goods and services across diverse set of industries is called as:

(A) Market place.

(B) Meta market.

(C) Market space.

(D) Resource market.

Ans: (B) Meta market.

89. NABARD stands for:

(A) National Board for Agriculture and Rural Development.

(B) National Bank for Agriculture and Resource Development.

(C) National Bank for Agriculture and Rural Development.

(D) National Board for Agriculture and Remote Area Development.

Ans: (C) National Bank for Agriculture and Rural Development.

90. Who authored the book called ‘Gospel of Wealth’?

(A) Jhonson and Jhonson.

(B) Milton Friedman.

(C) Andrew Carnegie.

(D) Keith Davis.

Ans: (C) Andrew Carnegie.

91. When consumers share a strong need that cannot be satisfied by an existing product, it is called:

(A) Negative demand.

(B) Latent demand.

(C) Declining demand.

(D) Non-existent demand.

Ans: (B) Latent demand.

92. The SD Scale was developed by Charles F. Osgood. The SD Scale is:

(A) Standard Deviation Scale.

(B) Semantic Differential Scale.

(C) Self Description Scale.

(D) Simple Definition Scale.

Ans: (B) Semantic Differential Scale.

93. UNCTAD was established in:

(A) New York in 1964.

(B) Geneva in 1964.

(C) Washington DC in 1947.

(D) Geneva in 1958.

Ans: (B) Geneva in 1964.

94. Apprenticeship Training Act was passed in the year _______.

(A) 1941.

(B) 1951.

(C) 1961.

(D) 1971.

Ans: (C) 1961.

95. The cost of capital of a firm is:

(A) The maximum rate of return from investments.

(B) The minimum rate of return from investments.

(C) The maximum rate of return on equity.

(D) The minimum rate of return on equity.

Ans: (B) The minimum rate of return from investments.

96. When the company follows one product one segment principle, it is:

(A) Undifferentiated marketing.

(B) Differentiated marketing.

(C) Concentrated marketing.

(D) Segment marketing.

Ans: (D) Segment marketing.

97. Long term capital asset means:

(A) Capital Assets held for more than 12 months.

(B) Capital Assets held for less than 12 months.

(C) Capital Assets held for more than 36 months.

(D) Capital Assets held for less than 36 months.

Ans: (C) Capital Assets held for more than 36 months.

98. A public company is:

(A) Registered with minimum five members.

(B) It has unlimited liability.

(C) There is no cap (ceiling) on the maximum number of members.

(D) It is not required to hold statutory meeting.

Ans: (C) There is no cap (ceiling) on the maximum number of members.

99. Which of the following is not a sampling methodology?

(A) Validity sampling.

(B) Stratified random sampling.

(C) Simple random sampling.

(D) Quota sampling.

Ans: (A) Validity sampling.

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