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This a MCQ (Multiple Choice Question) based practice test of Chapter 1 - Nature and Significance of Business of Business Studies of Class XI (11) for the quick revision/preparation of School Board examinations
Q Which of the following does not characterise business activity?
- a)Sale or exchange of
- b)Production of goods
- c)Presence of risk and services
- d)Salary or wages goods and services
Correct answer is 'D'. Can you explain this answer?
Verified Answer
This a MCQ (Multiple Choice Question) based practice test of Chapter 1...
Salary or wages is not a characteristic of business. In a business activity, the entrepreneurs work for themselves, solely for the profit motive. A business involves production and exchange of goods and services. Risk is also involved in carrying on a business because of the unpredictable events associated with it.
Hence, the correct answer is option (d).
Hence, the correct answer is option (d).
This question is part of UPSC exam. View all Commerce courses
Most Upvoted Answer
This a MCQ (Multiple Choice Question) based practice test of Chapter 1...
Explanation:
Characteristics of Business Activity:
1. Sale or exchange of goods and services: One of the main characteristics of business activity is the sale or exchange of goods and services. Businesses engage in the production or procurement of goods and services and then sell them to customers in exchange for money.
2. Production of goods: Another characteristic of business activity is the production of goods. Businesses are involved in the manufacturing or production of goods that are then sold to consumers. This can include the production of physical goods such as cars, clothes, or electronics.
3. Presence of risk: Business activity also involves a certain amount of risk. Businesses face various risks such as market risk, competition risk, financial risk, etc. They need to take calculated risks in order to make profits and succeed in the market.
4. Provision of services: Along with the production of goods, businesses also provide services to customers. Service-based businesses include hotels, restaurants, healthcare providers, banks, etc. These businesses do not produce physical goods but provide intangible services to customers.
Explanation of the Correct Answer:
The correct answer is option 'D - Salary or wages goods and services'. This option does not characterise business activity.
Why is 'Salary or wages goods and services' not a characteristic of business activity?
- 'Salary or wages' refers to the payment made by employers to employees for their work or services rendered.
- While salary and wages are a part of business activity as businesses have to pay their employees for their services, it is not a characteristic that distinguishes business activity.
- Payment of salary or wages is a part of the internal functioning of a business and does not define the nature or significance of business activity itself.
- Business activity primarily involves the production or procurement of goods and services, their sale or exchange, and the presence of risk.
- Salary or wages are a component of the expenses incurred by a business in carrying out its operations but it does not define the essence of business activity.
Hence, 'Salary or wages goods and services' does not characterise business activity and is the correct answer.
Characteristics of Business Activity:
1. Sale or exchange of goods and services: One of the main characteristics of business activity is the sale or exchange of goods and services. Businesses engage in the production or procurement of goods and services and then sell them to customers in exchange for money.
2. Production of goods: Another characteristic of business activity is the production of goods. Businesses are involved in the manufacturing or production of goods that are then sold to consumers. This can include the production of physical goods such as cars, clothes, or electronics.
3. Presence of risk: Business activity also involves a certain amount of risk. Businesses face various risks such as market risk, competition risk, financial risk, etc. They need to take calculated risks in order to make profits and succeed in the market.
4. Provision of services: Along with the production of goods, businesses also provide services to customers. Service-based businesses include hotels, restaurants, healthcare providers, banks, etc. These businesses do not produce physical goods but provide intangible services to customers.
Explanation of the Correct Answer:
The correct answer is option 'D - Salary or wages goods and services'. This option does not characterise business activity.
Why is 'Salary or wages goods and services' not a characteristic of business activity?
- 'Salary or wages' refers to the payment made by employers to employees for their work or services rendered.
- While salary and wages are a part of business activity as businesses have to pay their employees for their services, it is not a characteristic that distinguishes business activity.
- Payment of salary or wages is a part of the internal functioning of a business and does not define the nature or significance of business activity itself.
- Business activity primarily involves the production or procurement of goods and services, their sale or exchange, and the presence of risk.
- Salary or wages are a component of the expenses incurred by a business in carrying out its operations but it does not define the essence of business activity.
Hence, 'Salary or wages goods and services' does not characterise business activity and is the correct answer.
Community Answer
This a MCQ (Multiple Choice Question) based practice test of Chapter 1...
correct answer is d because all the above activities are comes under business activities only the salary or wages goods and services are not considered as characterise business activity
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This a MCQ (Multiple Choice Question) based practice test of Chapter 1 - Nature and Significance of Business of Business Studies of Class XI (11) for the quick revision/preparation of School Board examinationsQ Which of the following does not characterise business activity?a)Sale or exchange ofb)Production of goodsc)Presence of risk and servicesd)Salary or wages goods and servicesCorrect answer is 'D'. Can you explain this answer?
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This a MCQ (Multiple Choice Question) based practice test of Chapter 1 - Nature and Significance of Business of Business Studies of Class XI (11) for the quick revision/preparation of School Board examinationsQ Which of the following does not characterise business activity?a)Sale or exchange ofb)Production of goodsc)Presence of risk and servicesd)Salary or wages goods and servicesCorrect answer is 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about This a MCQ (Multiple Choice Question) based practice test of Chapter 1 - Nature and Significance of Business of Business Studies of Class XI (11) for the quick revision/preparation of School Board examinationsQ Which of the following does not characterise business activity?a)Sale or exchange ofb)Production of goodsc)Presence of risk and servicesd)Salary or wages goods and servicesCorrect answer is 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for This a MCQ (Multiple Choice Question) based practice test of Chapter 1 - Nature and Significance of Business of Business Studies of Class XI (11) for the quick revision/preparation of School Board examinationsQ Which of the following does not characterise business activity?a)Sale or exchange ofb)Production of goodsc)Presence of risk and servicesd)Salary or wages goods and servicesCorrect answer is 'D'. Can you explain this answer?.
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