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Test: Nature & Significance Of Management - 1


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10 Questions MCQ Test Business Studies (BST) Class 11 | Test: Nature & Significance Of Management - 1

Test: Nature & Significance Of Management - 1 for Commerce 2022 is part of Business Studies (BST) Class 11 preparation. The Test: Nature & Significance Of Management - 1 questions and answers have been prepared according to the Commerce exam syllabus.The Test: Nature & Significance Of Management - 1 MCQs are made for Commerce 2022 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Nature & Significance Of Management - 1 below.
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Test: Nature & Significance Of Management - 1 - Question 1

Which one of the following is NOT an Auxiliary to trade? 

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 1

Auxiliary to trade helps in smooth flow of trade. Insurance, warehouses and transport helps in smooth flow of trade but mining does not helps in smooth flow of trade.

Test: Nature & Significance Of Management - 1 - Question 2

Name the activity of commerce that removes the hindrance of time.

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 2

Warehousing activities remove hindrance of time by facilitating holding of stocks of goods to be sold when required.

Test: Nature & Significance Of Management - 1 - Question 3

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

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 3

Business activity is an activity which is an engaged in primary purpose of making a profit, salary and wages are expenses to a business. Hence it is not a primary business activity. 

Test: Nature & Significance Of Management - 1 - Question 4

Which one of the following is NOT the objective of the business?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 4

Investment is a monetary asset purchased with the motive of earning profit in future. 
The business objectives helps guide processes and overarching guidelines for the business for productivity, innovation, profit planning etc.

Test: Nature & Significance Of Management - 1 - Question 5

What reward does an entrepreneur get for risk bearing in business?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 5

Profit is an exclusive reward for the entrepreneur, for making business decisions under unpredictable and uncertain economic conditions. In short, Knight theory implies that uninsurable risks are uncertainty of a business and profit is the reward for uncertainty bearing.

Test: Nature & Significance Of Management - 1 - Question 6

Which one of the following is an economic activity in which specialized knowledge is required?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 6

Profession requires specialized knowledge as an economic activity. Examples can be teacher, doctor, advocate and many more.

Test: Nature & Significance Of Management - 1 - Question 7

Why should a business earn profit?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 7

Profit is a requirement for business because it helps in the development of the company positions in the market. Given that most firms and entrepreneurs invest in order to make a return, the profit earned by a business can be used to measure the success of that investment.

Test: Nature & Significance Of Management - 1 - Question 8

Which one of the following economic activity is directed towards producing or acquiring wealth through buying and selling of goods?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 8

Profession is concerned with rendering services Employment is concerned with working for others and getting rewarded with salary or wages. Management is concerned with achieving the described goals.

Test: Nature & Significance Of Management - 1 - Question 9

Bad debts due to non-payment of debt by debtor are an example of which type of business risk?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 9

Debtors are humans and when they convert into bad debts i.e they are not in position to pay back to the business entrepeneurs, it causes loss to the firm.

Test: Nature & Significance Of Management - 1 - Question 10

The latest generation of mobile phones has many features like faster internet browsing, Bluetooth etc. This is an example of which objective of business?

Detailed Solution for Test: Nature & Significance Of Management - 1 - Question 10

Innovative business can gain much profit easily . And new generation likes to purchase new and latest technology product. So innovation is usually considered the objective of a business that wants to earn profit.

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