APSET Paper 2 Mock Test - 3 (Management) Free Online Test 2026

Ethical challenges provides information and activities to help individuals or groups think through basic ethical concepts and considerations. Ethical challenges will not provide specific answers for the specific dilemmas that people face but will help readers bring to conscious awareness some understandings that help in thinking through ethical issues.
Ethical challenges may arise on account of:
(a) Failure of personal character, conflict of personal value and organisational goals and conflict of organisational goals and social values
(b) Hazardous but popular products

Line organisation is the oldest and simplest form of organisation. According to this type of organisation, the authority flows from top to bottom in a concern. The line of command is carried out from top to bottom.

Badli worker is one who is appointed for the time being to do some work of regular nature when the person who has been doing that work goes on leave or is absent due to any reason. The job will cease to exist when the regular employee for whose absence he is appointed resumes duty.

A holistic marketing approach states that business is considered as a whole wherein all the departments viz. R&D, Marketing, Finance, HR, etc. are integrated and work collectively towards the marketing and sale of a product. There are four components that can very well characterise the holistic marketing approach:
Internal marketing means hiring, training, motivating and inculcating business values in able employees who can serve customers well. Internal marketing deals with the market department to know the understanding level of the product among the employees and thereby imparting the necessary training to meet the expected results.
Performance marketing focuses on the returns to the business from the marketing activities undertaken as well as the effects of the same on the society as a whole. The marketer has to give answers to the top authority for the amount spent on marketing activities along with its effects on business. Brand and customer equity is the major focus area of this marketing.
Integrated marketing means how well the 4 P's of the marketing mix (product, price, place, promotion) are synced to deliver the efficient message to the prospective customers.Integrated marketing, an important character of holistic marketing must ensure that each communication tool must give a real and authentic information to the customer.
Relationship marketing focuses on building a strong and long-lasting relationship with all who can directly or indirectly add to the success of an organization.This is the most essential character of holistic marketing that results in a marketing network that shows how well all the stakeholders have created mutually profitable business relationships.

The operating cycle refers to the time it takes for a company to convert its inventory into cash through the sale of goods or services. It includes the time it takes to purchase raw materials, manufacture or produce the goods, sell them, and collect cash from customers.

The operating cycle consists of two main components: the inventory conversion period and the accounts receivable collection period. The inventory conversion period is the time it takes for a company to convert its raw materials into finished goods and then sell them. The accounts receivable collection period is the time it takes for the company to collect cash from its customers after the sale.

Therefore, the operating cycle represents the time that elapses between the purchase of raw materials and the collection of cash for sales.

Definition: “Extrinsic motivation refers to our tendency to perform activities for known external rewards, whether they be tangible (e. g. , money) or psychological (e. g. , praise) in nature. “- Brown
Extrinsic motivation is concerned with external motivators these are associated with financial rewards. such as -pay promotion, fringe benefits, retirement plans, health insurance schemes, margin profit, holidays, vacations, etc.
So, Pension, life insurance and margin profit are the part of extrinsic motivation.

Economists need 'Statistics' in Economics because

• It helps us understand and analyze economic theories and denote correlations between variables such as demand, supply, price, output etc.
• It helps economists with the collection, processing, and analysis of specific economic data.
• It helps us with planning economically and it makes economic laws become more efficient.

Michael Porter developed three generic strategies that a company could use to gain competitive advantage, back in 1980. These three are: cost leadership, differentiation and Niche Strategy.

(a) Job-evaluation is used to determine compensation: This statement is true. Job evaluation is a process used to determine the relative worth of jobs within an organization, which helps in establishing a fair and equitable compensation structure.

(c) Job-enrichment is referred to as vertical job loading: This statement is also true. Job enrichment involves increasing the depth and complexity of a job by adding tasks that require more skill, responsibility, and autonomy. It is often referred to as vertical job loading because it involves enhancing the job vertically by giving employees more control and decision-making authority.

A buffer stock is a system or scheme which buys and stores stocks at times of good harvests to prevent prices falling below a target range (or price level), and releases stocks during bad harvests to prevent prices rising above a target range (or price level).

So, Buffer stock’ is the level of stock at times of good harvests to prevent prices falling below a target range (or price level).

P and nP charts are control charts for attributes. They can use limit gauges and are easy to understand. P and nP charts cannot recognize different degrees of defectiveness in units.

P charts:

• P charts are used for evaluating fraction defectives when subgroup size is not constant.
• Control charts for defectives are used to identify samples which are out of acceptable limits. These charts provide information to the management to initiate corrective actions.

nP chart:

• It is the simplified version of P chart.
• This chart is used when number of items in a sample is constant.

So, only 3rd statement is correct.

Factoring: 

• Factoring is a financial service provided by specialized agents to help manufacturers and traders etc. manage their receivables.
• It is a process of selling receivables to a third party at a discount.
• The supplier (exporter) assigns his accounts receivables in favor of the factor and gives notice of assignment to the debtor.
• The factors undertake collection/accounting and management of debts of their clients.
• A factor may either lend against accounts receivables or by purchasing invoices. He will take responsibility for collecting the debt.
• A factoring agency is a service provider to a firm that extends the services of Sales ledger administration and credit management.
• The factoring service may be offered with or without recourse.
• Factoring with recourse refers to the right of the factor to claim bad debts from his client, whereas, without recourse factoring, the risk of bad debt will be borne by the factoring agent himself.

The area under any conditional CDF is 1

The area under conditional cumulative density function is the probability that a random variable on a value given that the variable satisfies certain conditions

If X is a random variable and A is an event the conditional CDF of X given A is defined as 

F(x|A) = P(X <= x | A)

• The area under conditional CDF from infinity to particular value x is the probability that X is less than or equal to x, given that A has occurred

P(X <= x | A) = F(x|A)

• The area under the conditional cumulative density function is 1

​Hence the correct answer is 1

Income and expenditure account:

• The income and expenditure account is prepared by non-trading concerns at the end of the accounting period matching revenue receipts with revenue expenses to determine surplus or deficit.
• It is a nominal account that states that all the expenses are debited, and all the incomes are credited.
• It follows the accrual basis of accounting, meaning all the revenue transactions of this year are recorded regardless of whether they are received or not.

Key Points

Features of Income and expenditure account:

• Non-trading concerns prepare income and expenditure accounts, and it is similar to the profit and loss account made by the trading concerns.
• It is usually prepared at the end of the period.
• It is prepared on the accrual basis of accounting.
• It records non-cash items as well.
• Only items of only revenue nature are included, and capital items are excluded.
• The surplus or deficit balance at the end of it is then transferred to the capital fund account.
• It is based on the double-entry system of accounting

In 1938, Henry Murray developed a system of needs as part of his theory of personality, which he named 20+ needs. Murray's system of needs has influenced the creation of personality testing, including both objective and subjective measures.

Raymond Cattell generated sixteen dimensions of human personality traits, known as the 16 traits.

Three traits concept of personality was given by Eysenck. Eysenck's theory of personality is based on three dimensions: introversion vs. extroversion, neuroticism vs. stability, and psychoticism vs. socialisation.

Ernest Tupes and Raymond Christal proposed 5 traits of personality. The Big Five personality traits are: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Hence, only (A) represents the correct combination.

Money market instruments are securities that provide businesses, banks, and the government with large amounts of low-cost capital for a short time. The period is overnight, a few days, weeks, or even months, but always less than a year.
Commercial Paper is an important money market instrument. Commercial Paper is a money-market security issued (sold) by large corporations to obtain funds to meet short-term debt obligations (for example, payroll) and is backed only by an issuing bank or company promise to pay the face amount on the maturity date specified on the note.

In highly competitive environment, an organisation to achieve sustained success should be resilient. Resilience relates more to how an organisation can access and utilise resources when it needs them. Resilience exists when the person uses "mental processes and behaviours in promoting personal assets and protecting self from the potential negative effects of stressors".

A fixed position layout is where the product stays stationary while workers come to the product site to build it. Fixed position layouts are ideal for products that are large, heavy, or too fragile to move. Ship building and construction of dams and bridges are typical examples of fixed position layout.

Encoding is a process by which a sender translates his thoughts into a series of symbols that he feels, will communicate the message to the intended receiver. (c) A channel is anything that links the sender with the receiver. (d) Decoding is the interpretation and translation of a message into meaningful information. (e) A feedback is a message that is generated by the receiver in response to the sender’s original message. (a) Modeling is not relevant in this context.

Debt ratio measures the percentage of total assets financed by debt (including current liabilities). So, it tests how leveraged an organisation is.Hence, option (c) is correct.

Out of a total 68% of majority, 34% are the early majority and rest 34% are the late majority. The early majority are the person who are average in social and economic factors and are just before the average adopter in the social system.

As such early majority also is a bit over sales promotional efforts the right answer to this question is option two.

IMF and World Bank are Bretton Woods twins. These institutions promote international economic cooperation, but the basic difference in the nature of these institutions are: The World Bank provides long-term loans for promoting balanced economic development while IMF provides short-term loans to member countries for eliminating the balance of payment disequilibrium.

Concessionary bargaining.

• It is a kind of collective bargaining in which the trade unions surrender or give back previously gained improvements in pay and conditions in exchange for some form of job security.
• For example, trade unions may agree to lower wages in return for job security or, the employees may agree to surrender improvements in wages or benefits in exchange for protection against layoffs.
• This may come during an economic decline whereby job security is more important to the unions than higher wages.
• Overall, this may actually benefit the company as they won’t have to pay for so many redundancies and can keep workers on.
• The main aim of concessionary bargaining is to strengthen the business in order to ensure its survival alongside its employees.
• So unions give back previous benefits in order to secure the businesses’ long-term future and therefore its members.

The terms "bull market" and "bear market" describe upward and downward market trends, respectively.

It can be used to describe either the market as whole or specific sectors and securities.

Marketing management is the organisational discipline which focuses on the practical application of marketing orientation, techniques and methods inside enterprises and organisations and on the management of a firm's marketing resources and activities. Marketing management has the responsibility to perform many functions in the field of marketing such as planning, collecting marketing information, directing, motivating, coordinating and controlling. All these functions aim to achieve the marketing goals.

A warehouse is a commercial building for storage of goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses etc.
They are usually large plain buildings in industrial areas of cities, towns and villages.
The primary purpose of a storage warehouse is storage. Storage is the physical containment of merchandise while it is awaiting a demand.
The form of storage will depend on the size and quantity of the items in inventory and the handling characteristics of the product or its container.
So, storage are meant to store products for moderate to long period of time.

Price Consumption Curve is a graphic representation which shows the ability of consumer to purchase quantity of goods/ products when the price of that commodity changes.

Hence, the correct answer is a- iv, b-ii, c-iii, d-i.

Queuing theory is a branch of operation research that studies the movement of people, objects, or information through a line.

Important Points

• The analytical modeling of a queue would involve providing an input specification describing the queue
• The arrival describes the way the customer enter the system 
• Poisson distribution is a discrete probability distribution that expresses the probability of the given number of an event occurring in fixed intervals.
• The arrival pattern can be expressed  as
  P ( X ) = λ x e − λ X ! μ
• The inter-arrival follows the exponential distribution

Hence the correct answer is In Queuing Theory, the statistical pattern by which customers arrive over a period of time follows Poisson distribution.

Franchise:

• A franchise is a kind of licence that enables a franchisee to use the franchisor's brand name to sell goods and services by having access to the franchisor's secret business techniques, procedures, and trademarks.
• The franchisee can market and sell these goods and services by acting as a parent company branch. It might even employ franchising rights to offer these goods through its own company.
• McDonald's, Levi's, dominos etc use same model for expansion

Important Points Advantages of franchising:

• Franchising lowers the danger of a company failing. Your company is built on a tested concept. Before investing, you might research previous franchises' track records of success.
• Products and services will already have a market share established. Therefore, market research won't be necessary.
• You may employ a well-known brand name or trademark. Any marketing efforts made by the franchise's owner, or "franchisor," are to your advantage.

Disadvantages of franchising:

• Costs can exceed your expectations. You may be required to agree to acquire products from the franchisor in addition to paying ongoing management service fees when you purchase a franchise.
• Typically, there are limitations on how you may operate the firm in the franchise agreement. It's possible that you won't be able to adjust for your regional market.
• You may find that after some time, ongoing franchisor monitoring becomes intrusive.

Hence, an exclusive right granted to a businessperson to sell a company's products (such as McDonald's Levi's) is Franchise.

Calculation:
The formula 3 median = mode + 2 mean is an empirical relationship that may hold true for approximately symmetric distributions.
Substituting the value in the formula we get,
3 ∗ (39) = Mode + 2 ∗ (37)
Mode = 13
Mode is the value that occurs most frequently.
Median is the middle value when the dataset is arranged in order.
Mean is the sum of all values divided by the number of values.