✅ Correct Answer: (a) Sampling error

📘 Explanation:

The sampling error refers to the difference between the point estimate (a statistic calculated from a sample) and the true population parameter. Since a sample is just a subset of the population, this error arises due to the natural variability between the sample and the population.

❌ Why the other options are incorrect:

• (b) Estimation error:
  This is a more general term, but sampling error specifically refers to the difference between a sample statistic and the true population parameter.

• (c) Probable error:
  This refers to the estimated value of an error in measurements, not directly related to the difference between a sample statistic and the population parameter.

• (d) Standard error:
  The standard error is a measure of the variability or dispersion of a sample statistic (like the mean) across multiple samples, not the difference between the sample estimate and the true population parameter.

✅ Final Answer: (a) Sampling error

✅ Correct Answer: (a) Observation, (b) Experimentation, (d) Survey method

📘 Explanation:

Primary data collection methods are those where the data is collected directly from the source. The following are the common primary data collection methods:

1. Observation:
   Directly observing the subject or phenomenon in its natural environment. This method is often used in behavioral research.

2. Experimentation:
   Conducting experiments where variables are controlled, and the effect on the dependent variable is measured. This method is typically used in scientific studies.

3. Survey method:
   Collecting data by asking respondents through questionnaires or interviews. This is a common method for gathering primary data in social science and market research.

❌ Why (c) Corporate database is incorrect:

• Corporate database refers to secondary data, not primary data. Secondary data is data that has already been collected by someone else for a different purpose, and corporate databases fall into this category.

✅ Final Answer: (a) Observation, (b) Experimentation, (d) Survey method

✅ Correct Answer: Strata

📘 Explanation:

In sampling, when we divide the population into homogeneous (or similar) subsets, these subsets are called strata. This is a key concept in stratified sampling, where the population is divided into strata based on certain characteristics, and samples are then drawn from each of these strata.

❌ Why the other options are incorrect:

• Clusters:
  In cluster sampling, the population is divided into groups (clusters), but the clusters themselves may not be homogeneous. Typically, clusters are formed by grouping together naturally occurring subgroups of the population, which may vary in characteristics.

• Samples:
  A sample refers to the actual subset of individuals selected from the population for the purpose of analysis. It is not a homogeneous group of subsets.

• Sample sizes:
  Sample size refers to the number of individuals or units chosen for the sample, not the subsets of the population.

✅ Final Answer: Strata

✅ Correct Answer: Delphi Technique

📘 Explanation:

The Delphi Technique is a structured method used for forecasting and decision-making based on the input of a panel of experts. It is characterized by:

• Anonymity of participants (they don’t know who the other participants are)

• Geographical dispersion (experts do not need to be physically present)

• Iterative rounds of questionnaires or surveys

• Controlled feedback provided by a facilitator

• Aim to reach a consensus over multiple rounds

❌ Why Other Options Are Incorrect:

• Brainstorming Technique:

  • Involves open, face-to-face group discussion with no anonymity; not suitable for dispersed participants.

• Heuristic Ideation Technique:

  • A creative method based on trial and error or rules of thumb (heuristics), not designed for dispersed or anonymous participation.

• Decision Tree Technique:

  • A visual/analytical tool for decision-making under uncertainty, not a group-based forecasting method.

✅ Final Answer: Delphi Technique

✅ Correct answer: Application blank, initial interview, employment tests, final interview, checking references, physical examination

✅ Explanation:

The selection process in Human Resource Management follows a systematic sequence to ensure the most suitable candidate is hired. Here’s the standard order:

1. Application Blank
   – The candidate submits basic details (education, experience, etc.) through an application form.

2. Initial Interview (Screening Interview)
   – A preliminary interview to shortlist candidates based on suitability.

3. Employment Tests
   – Aptitude, personality, or skill tests to assess the candidate’s competencies.

4. Final Interview
   – A detailed interaction with senior managers or HR to evaluate overall fit.

5. Checking References
   – Verification of candidate’s background, experience, and behavior.

6. Physical Examination
   – A medical check-up to ensure the candidate is physically fit for the job.

✅ Final Answer: Application blank, initial interview, employment tests, final interview, checking references, physical examination.

✅ Correct answer: Prospecting, Pre-approach, Approach, Presentation, Overcoming Objectives, Closing, Follow-up

✅ Explanation:

The 7 steps of personal selling (also called the personal selling process) are a structured approach followed by salespeople to convert prospects into customers. The correct and logical sequence is:

🔹 1. Prospecting

Identifying potential customers (leads) who may have a need for the product and the ability to buy.

🔹 2. Pre-approach

Researching and preparing to contact the prospect. This includes gathering information about the customer and planning the sales strategy.

🔹 3. Approach

The initial contact with the prospect — greeting, building rapport, and setting the tone for the presentation.

🔹 4. Presentation

Demonstrating how the product/service meets the prospect’s needs. This involves highlighting benefits and creating value.

🔹 5. Overcoming Objections

Addressing concerns, questions, or hesitations that the prospect may have regarding the purchase.

🔹 6. Closing

Asking for the order or making the sale. This step secures the commitment from the customer.

🔹 7. Follow-up

After-sales service, ensuring satisfaction, and building a long-term relationship. This can lead to repeat business or referrals.

❌ Why the other options are incorrect:

• Sequences like approach before pre-approach, or presentation before prospecting, violate the logical and professional flow of a sales interaction.

✅ Final Answer: Prospecting, Pre-approach, Approach, Presentation, Overcoming Objectives, Closing, Follow-up.

✅ Correct Answer: (a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)

📘 Explanation:

• Theory of Absolute Advantage was developed by Adam Smith (iv). It explains how countries benefit by specializing in producing goods they can make more efficiently than others.

• Factor Proportion Theory (also known as Heckscher-Ohlin theory) was proposed by Heckscher and Ohlin (iii). It states that countries export products that use their abundant factors of production intensively.

• Country Similarity Theory was put forward by Steffan Linder (ii). It suggests that countries with similar demand structures tend to trade more with each other.

• Product Life Cycle Theory was introduced by Raymond Vernon (i). It explains how a product’s production location shifts internationally through its life cycle stages.

✅ Final Answer: (a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)

✅ Correct Answer: Attitudes are beliefs, feelings, and action tendencies of individuals toward objects, ideas, and people

✅ Explanation:

Attitude refers to an individual’s predisposition to respond in a consistently favorable or unfavorable manner with respect to a given object, person, or idea. It is composed of three components, often called the ABC model:

1. Affective – How a person feels about something (emotions)

2. Behavioral – The action tendency or intention toward it

3. Cognitive – What a person believes or thinks about it

This definition captures the full structure of an attitude—making it the most comprehensive and correct description.

❌ Why the other options are incorrect:

• “Attitudes are learned”: ✔️ True, but it’s only part of the definition—not a full description.

• “Attitudes are organized and are core to an individual”: ✔️ Partially true, but too abstract and not precise.

• “Attitudes are major determinants of human behaviour”: ✔️ Correct insight, but this refers more to the function of attitudes rather than what they are.

✅ Final Answer: Attitudes are beliefs, feelings, and action tendencies of individuals toward objects, ideas, and people.

✅ Correct Answer: Forming, storming, norming, performing, adjourning

✅ Explanation:
This is the correct sequence of group development stages as proposed by Bruce Tuckman in 1965 (with the fifth stage, adjourning, added later in 1977). These stages describe the typical progression teams go through as they form, evolve, and eventually disband.

1. Forming – Team members come together and get to know one another. There is excitement, anxiety, and uncertainty about roles and expectations.

2. Storming – Conflicts and power struggles may arise as members assert their opinions. This stage tests the group’s ability to handle disagreements.

3. Norming – Members establish norms, roles, and stronger relationships. Cooperation increases and the group becomes more cohesive.

4. Performing – The group becomes fully functional and works efficiently toward achieving its goals.

5. Adjourning – The group disbands after achieving its objectives, often marked by reflection and recognition.

✅ Final Answer: Forming, storming, norming, performing, adjourning.

✅ Correct Answer: Going concern concept

✅ Explanation:
The going concern concept assumes that a business will continue its operations for the foreseeable future and will not be liquidated or forced to halt its operations. This concept is fundamental to financial accounting because it justifies the deferral of certain expenses and revenues over time, and the valuation of assets based on their ability to generate future income.

For example, under this concept, assets are not immediately valued at their liquidation value but at their ongoing use value, assuming the business will continue operating in the normal course.

❌ Why the other options are incorrect:

• Accounting period concept: This concept refers to the practice of dividing the life of a business into time periods (e.g., months, quarters, years) for reporting and analysis purposes, but it does not make assumptions about the continuity of the business.

• Realization concept: This concept is related to revenue recognition, which dictates that revenue should only be recognized when it is earned and realizable, not when cash is received.

• Separate entity concept: This concept states that the business is a separate entity from its owners or shareholders, meaning the business’s transactions are distinct from those of the owners.

✅ Final Answer: Going concern concept. This concept assumes that a business will continue its operations for the foreseeable future.

✅ Correct answer: Segment Invasion Plan

✅ Explanation:
In the context of Market Testing, especially during test marketing of a new product, SIP stands for Segment Invasion Plan.

It refers to the strategy of entering specific market segments gradually, testing how well the product performs in different customer groups or geographical areas before full-scale launch. The idea is to:

• Assess market response segment by segment

• Optimize marketing and distribution strategies

• Reduce risk by scaling in a controlled way

This allows companies to refine their positioning, product features, and marketing mix before national or global rollout.

❌ Why the other options are incorrect:

• Systematic Investment Planning – ❌ This relates to financial planning/investing, not market testing or marketing strategies.

• Short Input Processing – ❌ Not a recognized term in marketing or testing frameworks.

• Segment Investment Portfolio – ❌ Sounds financial and not related to test marketing strategy.

✅ Final Answer: Segment Invasion Plan.

✅ Correct Answer: Poisson Distribution

Explanation:

In Queuing Theory, the arrival pattern of customers over time is typically modeled using the Poisson distribution.

🔍 Why Poisson?

• The Poisson distribution describes the number of events (like customer arrivals) occurring in a fixed interval of time or space, assuming the events occur independently and at a constant average rate.

• It is ideal for modeling random arrivals, such as customers arriving at a service counter, calls to a call center, etc.

❌ Why the Other Options Are Incorrect:

1. Binomial Distribution

   • Used for a fixed number of trials with two outcomes (success/failure). Not suitable for modeling random arrivals over time.

2. Normal Distribution

   • Describes continuous data with a symmetric bell-shaped curve. Arrival patterns (discrete events per time unit) are not normally distributed.

3. Log-normal  Distribution

   • Often used for distribution of service times, not arrival patterns.

✅ Conclusion:

Customer arrivals in queuing theory typically follow a Poisson distribution.

✅ Correct Answer: Rs. 52,000 favourable

✅ Explanation:
Direct Material Price Variance (DMPV) measures the difference between the standard price and the actual price of materials, multiplied by the actual quantity of materials purchased.

Formula:

Direct Material Price Variance = (Standard Price − Actual Price) × Actual Quantity Purchased

Step-by-Step Calculation:

• Standard price = Rs. 5.00 per kg

• Actual price = Actual Cost of material purchased and consumed / Actual Quantity of material purchased and consumed = Rs. 4,68,000 / 1,04,000 kg = Rs. 4.50 per kg

• Actual quantity purchased and consumed = 1,04,000 kg

= (5.00 − 4.50) × 1,04,000 = 0.50 × 1,04,000 = Rs.52,000

Since the actual price is less than the standard price, the variance is favourable.

✅ Final Answer: Rs. 52,000 favourable.

✅ Correct answer: To evaluate the performance of the employees

✅ Explanation:
Human Resource Planning (HRP) is primarily concerned with ensuring the right number and type of people are available at the right time to fulfill organizational objectives. Its main objectives include:

• Preventing overstaffing or understaffing ✅

• Ensuring employee availability ✅

• Providing direction to all HR activities (like recruitment, training, and succession planning) ✅

However:

• Evaluating the performance of employees ❌
  This falls under Performance Appraisal, which is a separate HR function. It is not a primary objective of HRP, though HRP may use performance data for planning purposes.

✅ Final Answer: To evaluate the performance of the employees.

✅ Correct Answer: Source of funds

✅ Explanation:
The sale of a long-term investment is considered a source of funds. When a company sells a long-term investment (such as property, stocks, bonds, or other assets held for investment purposes), it receives cash or cash equivalents in return. This inflow of cash is classified as a source of funds because the company has gained liquidity by converting an asset into cash.

The sale of long-term investments typically appears in the cash flow statement under the “Cash flows from investing activities” section.

❌ Why the other options are incorrect:

• Application of funds: This refers to the use of cash or resources, such as purchasing new assets or paying off liabilities. The sale of an asset is not an application but rather a source of funds.

• Change in current assets: The sale of a long-term investment affects non-current assets, not current assets. Current assets typically include items like cash, receivables, and inventory, which are expected to be used or converted within one year.

• Change in current liabilities: The sale of a long-term investment does not directly affect current liabilities, which include obligations like accounts payable, short-term debt, or accrued expenses due within the next year.

✅ Final Answer: Source of funds. The sale of a long-term investment results in an inflow of cash, thus acting as a source of funds.

✅ Correct Answer: (c), (a), (e), (b), and (d)

📘 Explanation:

When entering a foreign market like India, the risk level increases as the mode of entry shifts from indirect, low-control methods to direct, high-control investments. The correct order in terms of increasing risk is:

1. Portfolio Investment (c): Low risk—no direct control, just financial investment in securities.

2. Co-operative Joint Venture (a): Shared risk and control with a local partner.

3. Equity Joint Venture (e): Higher commitment and equity involvement—moderate risk.

4. Branch Office (b): Full legal presence in the host country, facing local regulations and liabilities.

5. Wholly Owned Subsidiary (d): Highest risk—full control and full exposure to political, legal, and economic environments.

✅ Final Answer: (c), (a), (e), (b), and (d)

✅ Correct answer: Kurt Lewin

✅ Explanation:
The Force-Field Theory of change was propounded by Kurt Lewin, a pioneer in social psychology and organizational change.

According to this theory:

• Any situation is held in balance by two opposing sets of forces:

  • Driving forces (which push for change), and

  • Restraining forces (which resist change).

Lewin suggested that successful change requires:

1. Unfreezing (breaking down the existing status quo),

2. Changing (moving to a new state),

3. Refreezing (establishing stability in the new state).

This model is foundational in Organizational Development (OD) and Change Management.

❌ Why the other options are incorrect:

• Peter Drucker:
  ❌ Known for contributions to management by objectives (MBO) and modern management theory, not force-field theory.

• Joseph A. Schumpeter:
  ❌ Famous for the concept of “creative destruction” in economics and entrepreneurship.

• David C. McClelland:
  ❌ Known for Need Theory of Motivation (achievement, affiliation, power), not change models.

✅ Final Answer: Kurt Lewin.

✅ Correct Answer: (a), (b), (c) and (d)

✅ Explanation:

As per RBI guidelines (2008) and the recommendations of the Working Group on Rehabilitation of Sick MSMEs, an MSME is considered to have reached the stage of incipient sickness when early warning signs or financial distress indicators emerge that can lead to sickness if not addressed in time.

All four conditions listed in the question are valid triggers for identifying incipient sickness:

• (a) Delay in commencement of commercial production by more than 6 months leading to cost overruns
  ✔️ Indicates failure in project implementation and rising financial pressure.

• (b) The enterprise incurs losses for 2 years or a cash loss for one year
  ✔️ A key financial indicator of distress and early sign of non-viability.

• (c) Capacity utilization is less than 50% of projected sales
  ✔️ Shows poor operational performance, weak demand, or production issues.

• (d) Erosion of net worth due to accumulated cash losses to the extent of 50%
  ✔️ Signals significant financial deterioration and reduced investor confidence.

These are early warning signs used by banks/financial institutions for initiating corrective actions, such as restructuring or rehabilitation support under RBI’s MSME framework.

✅ Final Answer: (a), (b), (c) and (d).

✅ Correct Answer: (a), (b), (c) and (d)

✅ Explanation:

A retailing firm needs to make several strategic decisions to successfully compete and grow in the market. The major strategic issues include:

🔹 (a) Location decisions

• Critical for customer accessibility and footfall.

• Affects convenience, visibility, and operational cost.

🔹 (b) Brand building decisions

• Helps in creating a strong identity and customer loyalty.

• Includes marketing, positioning, and communication strategy.

🔹 (c) Merchandise mix decisions

• Involves selecting the right combination of products to sell.

• Affects customer satisfaction and inventory management.

🔹 (d) Target market selection

• Helps identify the specific group of customers to focus on.

• All other strategies are aligned to meet the needs of this group.

All these decisions are interconnected and essential for the long-term strategic planning of a retail firm.

❌ Why the other options are incorrect:

• (a), (b), and (c) only – Ignores target market selection, which is a core strategic decision.

• (a) and (c) only – Misses out on brand strategy and customer targeting.

• (a), (c), and (d) only – Misses brand building, which is key for long-term retail success.

✅ Final Answer: (a), (b), (c) and (d).

✅ Correct answer: Decision Making

✅ Explanation:
Human Resource (HR) procedures are standardized methods and steps for handling HR-related tasks such as hiring, onboarding, promotions, grievances, and terminations. These procedures help ensure that:

• Actions are consistent across departments and managers,

• Decisions are fair and legally compliant,

• There is a reduction in bias and subjectivity,

• And all employees are treated equitably.

This consistency is critical in the managerial perspective of Decision Making, as it ensures decisions are made based on predefined rules and guidelines rather than personal judgment or inconsistency.

❌ Why the other options are incorrect:

• Direction:
  ❌ Refers to guiding and supervising employees, not directly related to consistency through procedures.

• Strategy:
  ❌ Strategy is about long-term goals and plans; procedures support implementation but are not the strategic layer itself.

• Recruitment:
  ❌ While HR procedures are involved in recruitment, consistency as a broad concept applies more to decision-making overall—not just this one function.

✅ Final Answer: Decision Making.

✅Correct answer: (a), (b) and (c) only

✅ Explanation:

To keep a brand live, contemporary, and relevant, marketers use several strategic tools:

1. Brand Extension – Using an existing brand name to launch new products in a different category (e.g., Dove launching shampoos after soaps). It leverages brand equity to expand market reach.

2. Brand Rejuvenation – Updating the brand image (logo, packaging, advertising, positioning) to appeal to changing customer preferences without changing the core identity (e.g., Maggi’s health-focused messaging).

3. Brand Relaunch – Reintroducing a brand with modifications in product features, packaging, or positioning, often after it has declined or disappeared from the market (e.g., relaunch of Cinthol with a younger appeal).

These three strategies directly aim at keeping the brand fresh, competitive, and appealing to the target market.

❌ Why the other option is incorrect:

• (d) Brand Proliferation – This refers to launching too many products or variations under a single brand or category, which may cause confusion or cannibalization in the market rather than enhancing relevance. It is not a deliberate or effective strategy to keep a brand contemporary.

✅ Final Answer: (a), (b) and (c) only.

✅ Correct Answer: Both the statements A and R are correct but R is not the right explanation of A

📘 Explanation:

• Assertion A: Foreign trade policy is an important instrument that incentivizes exporters. This is true because the policy provides benefits like subsidies, export incentives, and simplified procedures to encourage exports.

• Reason R: It is important for exporters to have knowledge of the foreign trade policy. This is also true because knowing the policy helps exporters comply with regulations and access various benefits.

However, Reason R does not explain why the foreign trade policy is an important instrument to incentivize exporters. Instead, it states a separate fact about exporters needing knowledge. If the Assertions and Reason was reversed, then R would be the correct explanation of A.

Thus, while both statements are correct individually, R is not the correct explanation for A.

✅ Final Answer: Both the statements A and R are correct but R is not the right explanation of A

✅ Correct Answer: (a)-(i), (b)-(iv), (c)-(ii), (d)-(iii)

✅ Explanation:

Let’s examine each match in detail:

✅ Final Answer: (a)-(i), (b)-(iv), (c)-(ii), (d)-(iii)

✅ Correct answer: CLV (1) = m × [ r / (1 + d) ]

✅ Explanation:

Customer Lifetime Value (CLV) estimates the net profit a company earns from a customer over the duration of their relationship.

In the first year, a simplified formula of CLV is:

CLV (1) = m × [ r / (1 + d) ]

Where:

• m = margin (profit per period)

• r = retention rate

• d = discount rate (reflects time value of money)

This formula discounts future earnings back to the present using 1 + d, which is standard in financial modeling and NPV calculations.

❌ Why the other options are incorrect:

• CLV (1) = m + [ r / (1 + d) ] → This incorrectly adds instead of multiplying the margin and retention.

• CLV (1) = m – [ r / (1 – d) ] → Incorrect sign and denominator; also misuses financial logic (1 − d leads to inflated values).

• CLV (1) = m × [ r / (1 − d) ] → Incorrect discounting method; (1 − d) would lead to overestimation.

✅ Final Answer: CLV (1) = m × [ r / (1 + d) ]

✅ Correct answer: Exporting, Licensing, Franchising, Partnering, Strategic Alliance

✅ Explanation:
This is the correct sequence of international market entry modes, arranged from lowest to highest level of investment, control, risk, and potential return.

1. Exporting – The simplest and least risky method, where products are manufactured domestically and sold in foreign markets. No need for local operations.

2. Licensing – A contractual arrangement where the company allows a foreign firm to use its intellectual property (brand, technology, etc.) in exchange for royalties. Low involvement.

3. Franchising – Similar to licensing but more structured. The franchisor offers its brand, operational model, and ongoing support to the franchisee. Moderate control and risk.

4. Partnering – Also referred to as joint ventures, involves working with a local partner. This helps with local market knowledge, regulations, and risk-sharing. Higher commitment and collaboration.

5. Strategic Alliance – The most complex and committed form of entry. Involves deep collaboration between firms for joint R&D, marketing, or innovation. Requires significant investment and trust.

✅ Final Answer: Exporting, Licensing, Franchising, Partnering, Strategic Alliance.

✅ Correct Answer: The process of identifying problems and opportunities and then resolving them

✅ Explanation:
Decision-making is best understood as a process, not just a one-time event. It involves:

1. Identifying a problem or opportunity

2. Gathering information

3. Evaluating alternatives

4. Choosing the best course of action

5. Implementing and reviewing the decision

This makes decision-making a systematic and dynamic process that requires judgment, analysis, and often collaboration — rather than a single act of choosing.

❌ Why the other options are incorrect:

• Decision on a particular course of action: This is just the end result of decision-making, not the process itself.

• Too self-evident requiring an answer: Some decisions may seem obvious, but that doesn’t define the nature of decision-making.

• Deciding on a choice after a series of brainstorming: Brainstorming is a technique used during the decision-making process, but it’s only one part of the whole.

✅ Final Answer: The process of identifying problems and opportunities and then resolving them.

✅ Correct Answer: Lower indifference curves indicate a higher level of satisfaction

✅ Explanation:

1. Indifference curves slope downward to the right:

   • This is correct. Indifference curves represent combinations of two goods that give the consumer the same level of satisfaction. As you move along an indifference curve, increasing the quantity of one good generally requires a decrease in the quantity of the other good to maintain the same level of satisfaction. Hence, indifference curves slope downward to the right.

2. Indifference curves of imperfect substitutes are convex to the origin:

   • This is correct. When goods are imperfect substitutes, the consumer is willing to give up more of one good to get an additional unit of the other good, but at a diminishing rate. This results in a convex (bowed-inward) shape of the indifference curve.

3. Indifference curves neither intersect nor are tangent to one another:

   • This is correct. Indifference curves do not intersect because each curve represents a different level of satisfaction. If they intersected, it would imply that the consumer is simultaneously indifferent between two different levels of satisfaction, which is logically inconsistent. Indifference curves also cannot be tangent to each other, as this would imply two different levels of satisfaction at a single point.

4. Lower indifference curves indicate a higher level of satisfaction:

   • This is incorrect. Higher indifference curves indicate a higher level of satisfaction, not lower ones. The farther away an indifference curve is from the origin, the higher the level of satisfaction it represents because it implies more of one or both goods.

Thus, the incorrect statement is “Lower indifference curves indicate a higher level of satisfaction.”

✅ Final Answer: Lower indifference curves indicate a higher level of satisfaction.

✅ Correct answer: Applying appropriate techniques to select a candidate

✅ Explanation:
Human Resource Selection is the process of choosing the most suitable candidate from a pool of applicants. It involves using systematic and appropriate techniques such as screening, interviews, tests, background checks, and medical examinations to evaluate candidates and select the best fit for the job and organization.

The focus of selection is on:

• Evaluating candidate qualifications

• Matching job requirements

• Using objective tools and procedures

• Reducing hiring risks

So, “applying appropriate techniques to select a candidate” directly captures the essence of the HR selection process.

❌ Why the other options are incorrect:

• The activity to select a suitable pool of candidates:
  ❌ This describes recruitment, not selection. Recruitment is about attracting a pool; selection is about choosing from that pool.

• Always being stimulated by the departure of an employee:
  ❌ Selection may occur due to various reasons—expansion, new projects, promotions—not only due to departures.

• Always ascertaining a candidate’s personality to ensure a suitability fit:
  ❌ Personality fit may be one factor, but selection is broader—it includes skills, experience, qualifications, etc. Also, not all jobs require deep personality evaluation.

✅ Final Answer: Applying appropriate techniques to select a candidate.

✅Correct answer: Management of reputation of the company

✅ Explanation:

Public Relations (PR) in marketing refers primarily to the strategic communication process that builds mutually beneficial relationships between an organization and its publics. At its core, PR is about managing the company’s reputation — ensuring that the public, stakeholders, and media have a positive perception of the brand or organization.

PR activities include handling media relations, crafting press releases, responding to crises, managing social responsibility campaigns, and maintaining goodwill — all of which center around reputation management.

❌ Why the other options are incorrect:

• Promoting products/brands of the company – This is primarily a function of advertising and sales promotion, not PR. While PR can support product promotion, its main goal is broader: protecting and enhancing reputation.

• Managing an event of the company – This falls under event management or experiential marketing. PR may support it, but event management is a separate function.

• Conducting publicity campaigns around relevant issues – This is a tactic within PR, but not the full scope or definition. It’s one part of PR, not its central purpose.

✅ Final Answer: Management of reputation of the company.

🛑This decision is considered at a plant level. If we consider at a broader level like Aggregate Planning, Demand and Supply Planning; the sequence differs.

✅ Correct Answer: What to produce, how to produce, how much to produce, how to determine price of the product

✅ Explanation: This sequence reflects the typical order in which internal decisions are made within a business firm in microeconomics. First, the firm decides what to produce based on market demand and strategic goals. Second, it figures out how to produce, choosing the most efficient production methods and resource combinations. Third, it determines how much to produce, balancing production capacity with demand forecasts. Finally, the firm sets the price of the product, considering costs, competition, and consumer willingness to pay.

❌ Why the other options are incorrect:

• What to produce, how much to produce, how to produce, how to determine price of the product: Misplaces the production method decision, which logically follows the product decision before determining quantity.

• How much to produce, what to produce, how to produce, how to determine price of the product: Illogical sequence; a firm cannot decide how much to produce before knowing what to produce.

• What to produce, how much to produce, how to determine price of the product, how to produce: Puts pricing before deciding on production methods, which can lead to inaccurate cost estimations and inefficiencies.

✅ Final Answer: What to produce, how to produce, how much to produce, how to determine price of the product.

✅ Correct Answer: (a) Statistically significant

📘 Explanation:

When conducting a hypothesis test, we compare the test statistic to a critical value or rejection region:

• If the test statistic falls into the rejection region, we reject the null hypothesis.

• This outcome means the result is unlikely to have occurred by random chance alone, given the null hypothesis is true.

🔍 This leads to the conclusion that the result is:

→ Statistically significant

This is exactly what option (a) states.

❌ Why other options are incorrect:

• (b) Statistically insignificant:
  This would mean we fail to reject the null — opposite of what the question describes.

• (c) Statistically critical:
  Not a standard term in hypothesis testing.

• (d) Confidence interval:
  Refers to the range of values within which a parameter is expected to fall — not related directly to the rejection region.

✅ Final Answer: (a) Statistically significant

✅Correct answer: Japan

✅ Explanation:
The Shanghai Cooperation Organization (SCO) is a political, economic, and security alliance founded in 2001. It primarily includes countries from Central Asia and neighboring regions. As of now, China, India, and Pakistan are all member states of the SCO.

• Founding Members (2001): China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan

• Joined later: India and Pakistan (2017), Iran (2023)

Japan, however, has never been a member of the SCO. It is geopolitically more aligned with Western alliances like the G7 and QUAD (Quadrilateral Security Dialogue), and maintains strategic distance from SCO due to its strong ties with the U.S. and concerns over China and Russia’s influence.

❌ Why the other options are incorrect:

• China – Founding member of the SCO in 2001.

• Pakistan – Joined SCO as a full member in 2017.

• India – Also joined as a full member in 2017.

✅ Final Answer: Japan

✅ Correct answer: (a)-(ii), (b)-(i), (c)-(iii), (d)-(iv)

✅ Explanation:

Let’s match each branding strategy with its correct meaning:

🔹 (a) Line Extension → (ii) Existing product category and existing brand name

• A line extension involves introducing new variants (flavors, colors, sizes, forms) of a product within the same product category under the same brand name.

• Example: Coca-Cola launching Diet Coke or Coke Zero.

🔹 (b) Brand Extension → (i) New product category and existing brand name

• A brand extension uses an existing brand name to enter a new product category.

• Example: Amul (dairy) launching Amul Chocolates.

🔹 (c) Multi Brands → (iii) Existing product category and new brand name

• A company introduces multiple brands in the same product category, often to capture different segments.

• Example: HUL selling Dove, Lux, and Pears – all soaps, but different brands.

🔹 (d) Co-branding → (iv) Putting two established brand names of different companies on the same product

• Co-branding combines two well-known brands from different firms on one product.

• Example: Intel Inside Dell laptops or Nike + Apple Fitness collaboration.

✅ Final Answer: (a)-(ii), (b)-(i), (c)-(iii), (d)-(iv).

✅ Correct Answer: (a) and (c)

✅ Explanation:
In the given scenario, Pearl Ltd. purchased a van for Rs. 12,000, making a down payment of Rs. 5,000 and signing a Rs. 7,000 note payable in 60 days. Let’s analyze the effects:

1. Total Assets:
   The van is acquired for Rs. 12,000, increasing the total assets of the company by that amount. The cash payment of Rs. 5,000 reduces cash, but the net effect on total assets is an increase of Rs. 12,000 due to the addition of the van.

2. Total Liabilities:
   The note payable of Rs. 7,000 creates an obligation, which increases total liabilities by Rs. 7,000. The cash payment does not create a liability; it just reduces cash, so the total liabilities increase by Rs. 7,000, not Rs. 12,000.

3. Owner’s Equity:
   This transaction involves acquiring an asset (the van) financed by both cash and a liability. Since no immediate profit or loss is recorded, owner’s equity remains unaffected by this transaction.

4. Liquidity from a Short-Term Creditor’s Perspective:
   The company now has a short-term liability of Rs. 7,000, which may actually reduce liquidity, not increase it. The business must repay the note payable in 60 days, which could reduce the company’s ability to meet other short-term obligations.

✅ Final Answer: (a) and (c).

• Total assets will increase by Rs. 12,000.

• This transaction will not have an immediate effect on owner’s equity in the business.

✅ Correct Answer: Rs. 3,202 unfavourable

✅ Explanation: Overhead Spending Variance compares the actual overhead incurred (both fixed and variable) to the applied overhead based on standard rates for actual production. It reflects whether the company spent more or less on overheads than expected for the actual output.

📌 Formula:

Overhead Spending Variance = Actual Overhead − Applied Overhead

🧾 Step-by-step:

• Actual Overhead = Fixed (Rs. 12,850) + Variable (Rs. 2,352) = Rs. 15,202

• Applied Overhead = 1,000 units × Rs. 12 (standard total overhead rate) = Rs. 12,000

Overhead Spending Variance = 15,202 − 12,000 = Rs.3,202

Since actual spending exceeded the expected overhead, it is unfavourable.

✅ Final Answer: Rs. 3,202 unfavourable.

✅ Correct answer: New Product Development

✅ Explanation:
Concept testing, product testing, and test marketing are all key stages within the New Product Development (NPD) process, which involves taking a product idea from concept to market launch.

These steps help reduce risk and ensure that the product aligns with customer needs before full-scale commercialization:

1. Concept Testing – Evaluating customer response to a new product idea before creating a prototype.

2. Product Testing – Assessing the actual product performance, quality, and user satisfaction.

3. Test Marketing – Launching the product in a limited market to evaluate customer response and make final adjustments.

These are sequential steps typically used after idea screening and before commercialization.

❌ Why the other options are incorrect:

• Innovation-Diffusion process – ❌ Focuses on how innovations spread through a population, not on the development steps of a product.

• Product Life Cycle – ❌ Refers to the stages a product goes through after launch (Introduction, Growth, Maturity, Decline), not before launch.

• Market Development – ❌ A growth strategy involving selling existing products in new markets — unrelated to product testing stages.

✅ Final Answer: New Product Development.

✅ Correct answer: (a), (d), (c), and (b)

✅ Explanation:

In practical marketing strategy formulation, especially for MSMEs (Micro, Small, and Medium Enterprises), the sequence can logically be:

• (a) Product – First, decide what you are offering.

• (d) Price – Then determine how much to charge based on cost, value, and competition.

• (c) Place – Decide where and how the product will be delivered to the customer.

• (b) Promotion – Lastly, plan how to inform and persuade the customer.

This order — Product → Price → Place → Promotion — reflects a strategic flow that builds from product creation to customer communication.

✅ Final Answer: (a), (d), (c), and (b).

✅ Correct Answer: (a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)

✅ Explanation:

Here is the correct matching of product categories with their respective quality certification marks in India:

• (a) Gold and silver jewellery → (iii) BIS Hallmark
  ✔️ BIS Hallmark certifies the purity and quality of gold and silver jewellery as per the standards set by the Bureau of Indian Standards (BIS).

• (b) Agricultural products → (iv) AGMARK
  ✔️ AGMARK is a certification mark under the Agricultural Produce (Grading and Marking) Act, ensuring quality in agricultural commodities like grains, pulses, oilseeds, etc.

• (c) Industrial products → (i) ISI Mark
  ✔️ The ISI mark is issued by BIS for industrial and consumer goods to signify that they conform to the Indian standards (e.g., electrical appliances, cement, etc.).

• (d) Processed food products → (ii) FPO Mark
  ✔️ FPO (Fruit Products Order) mark ensures the quality and hygienic processing of processed food products, particularly fruit and vegetable-based products.

✅ Final Answer: (a)-(iii), (b)-(iv), (c)-(i), (d)-(ii).

✅ Correct Answer: I’m not Ok, You are Ok

✅ Explanation:

The question relates to Transactional Analysis (TA) — a theory of personality and communication developed by Eric Berne. It identifies four possible life positions that individuals may take in their interactions with others, based on self-perception and perception of others.

🔹 Life Positions in TA:

🔹 Dinesh’s Situation:

• He is emotionally and professionally depressed

• His morale and self-confidence are low

• He faced rejection, family stress, office gossip, and peer disapproval

• He seems to see others (management/staff) as capable or critical, while seeing himself as ineffective

➡️ These signs point toward the “I’m not OK, You are OK” position, which is common when a person experiences failure, rejection, or trauma and feels inferior to others.

✅ Final Answer: I’m not OK, You are OK ✅

✅ Correct Answer: New Product – New Market

📘 Explanation:
In Ansoff’s 2×2 Matrix, mergers and acquisitions are most closely associated with the Diversification strategy when the acquiring firm enters both a new market and introduces a new product. This is especially true when a company acquires another in a different industry or market segment to broaden its scope, capabilities, and customer base. The goal is to reduce dependency on current markets or products and achieve growth through strategic expansion.

For example, a tech firm acquiring a health food company is diversifying into an entirely different product and market.

❌ Why the other options are incorrect:

• Present Product – Present Market (Market Penetration): This strategy focuses on increasing market share in existing markets using current products—typically through promotions, pricing, or improved service, not M&A.

• Present Product – New Market (Market Development): While M&A can support this strategy, it only applies when the acquired company helps sell existing products to new markets—not when new products are also involved.

• New Product – Present Market (Product Development): This applies when a company introduces new products to its current market—not when it enters new markets as well.

✅ Final Answer: New Product – New Market

✅ Correct Answer: Both the statements A and R are correct and R is the right explanation of A

📘 Explanation:

• Assertion A: Correct. Strategic decision-making involves choosing among various possible courses of action, and this responsibility primarily lies with the senior management. Their role is to set direction and define priorities that shape the future of the organization.

• Reason R: Also correct. Strategic management revolves around fundamental questions like:

  • What is our business?

  • What will it be?

  • What should it be?
    These questions drive the decision-making process and help in determining the long-term direction of the organization.

✅ Since the reason (R) correctly explains why strategic decisions are a senior management function (as they focus on answering these fundamental strategic questions), the correct answer is:

✅ Final Answer: Both the statements A and R are correct and R is the right explanation of A

✅ Correct Answer: (a) and (c)

✅ Explanation:

Whistle-blowing is generally seen as an ethical act when done in good faith to expose wrongdoing that affects the public interest. However, it becomes unjustified under the following circumstances:

• (a) Ulterior motive, Breach of trust:
  If the whistle-blower acts out of personal revenge, political gain, or to harm colleagues or the organization, the action loses its ethical grounding. Similarly, breaching confidentiality without valid cause undermines trust and is generally unjustifiable.

• (c) Insufficient evidence:
  Accusations made without credible or sufficient evidence can lead to false allegations, damage to reputations, and legal repercussions. Whistle-blowing requires a reasonable belief backed by facts, not assumptions or hearsay.

❌ Why the other options are incorrect:

• (b) To protect public interest:
  This is the primary justification for ethical whistle-blowing, especially when serious harm or legal violations are involved.

• (d) To inspire other employees:
  While not the main reason, if the whistle-blowing is genuine, this can be a positive side-effect rather than an unjustified motive.

✅ Final Answer: (a) and (c).

✅ Correct answer: International joint ventures are staffed by high quality managers

✅ Explanation:
When it comes to Human Resource Management (HRM) in the context of cross-border alliances and international joint ventures (IJVs), one of the most critical success factors is ensuring that high-quality managers are placed in key roles. These managers need to:

• Navigate complex cultural differences

• Handle strategic and operational coordination between partner firms

• Possess international experience, adaptability, and leadership skills

• Ensure effective communication and alignment of goals across borders

HRM contributes to this by developing international staffing policies, identifying and training global leadership talent, and ensuring proper selection and development processes are in place.

Hence, staffing international joint ventures with high-quality managers is a key HRM contribution to the success of cross-border partnerships.

❌ Why the other options are less correct:

• Organization spends 20 percent of their HR budgets on cross border alliances:
  ❌ This is arbitrary and not a recognized HRM strategy or success factor.

• A strategy is in place before embarking on a cross border alliance:
  ✅ This is important, but it’s more of a general organizational consideration. The direct role of HRM is more aligned with staffing and talent management.

• Organizations that export their ideas to other societies and cultures:
  ❌ This is more about globalization and knowledge transfer, not specifically about HRM’s role in cross-border alliances.

✅ Final Answer: International joint ventures are staffed by high quality managers.

✅ Correct answer: Merchandise offered and size of the store area

✅ Explanation:

Modern organized retail business formats are classified based on multiple criteria, primarily:

1. Merchandise offered – Different formats specialize in various product categories such as food, apparel, electronics, furniture, etc.

2. Size of the store area – Retail formats differ significantly in scale. For example:

   • Convenience stores are small,

   • Supermarkets are medium-sized,

   • Hypermarkets and warehouse clubs are large-scale.

Retail formats are thus not determined by a single factor like merchandise, store size, or customer group alone—but by a combination of factors, especially merchandise and store area.

❌ Why the other options are incorrect:

• Merchandise offered only – Incomplete; ignores store size which influences classification.

• Size of store area only – Incomplete; doesn’t consider the range or type of merchandise.

• Customer groups only – Customer targeting influences marketing, but it’s not the primary basis for classifying retail formats.

✅ Final Answer: Merchandise offered and size of the store area

✅ Correct Answer: Policy Documents

✅ Explanation:

In the process of identifying opportunities, entrepreneurs typically rely on various sources that provide valuable insights into market trends, customer needs, and potential innovations. Let’s analyze each option:

(a) Employees and ex-employees:
✅ Employees, as well as former employees, often have a deep understanding of a company’s operations, challenges, and opportunities. Their feedback can help identify areas for improvement or potential market gaps that the company could explore.

(b) Dealers and Distributors:
✅ Dealers and distributors have direct interaction with customers and often have a clear view of market trends, customer demands, and emerging needs. Their insights are valuable for identifying opportunities to expand or enhance product offerings.

(c) Friends and Relatives:
✅ Friends and relatives can offer ideas based on their observations or experiences, providing different perspectives that can highlight new business opportunities. Their familiarity with the entrepreneur can also make them more willing to share helpful advice.

(d) Policy Documents:
❌ Policy Documents are primarily focused on regulations, guidelines, and strategic direction, but they are not typically a direct source for identifying new market opportunities. While they may guide decisions and business practices, they don’t usually uncover specific market gaps or innovative ideas.

Final Answer: Policy Documents

✅ Correct answer: (a) and (b)

✅ Explanation:
Off-the-job training refers to training that takes place away from the actual work environment, allowing employees to focus solely on learning without the pressures of their job responsibilities.

Typical methods of off-the-job training include:

• (a) Lectures, simulations, and laboratory training:
  ✅ These are classic off-the-job techniques. Lectures provide theoretical knowledge, simulations mimic real scenarios in a controlled setting, and lab training offers hands-on practice away from the workplace.

• (b) Role playing, vestibule training, and video presentation:
  ✅ Also off-the-job methods. Role playing enhances interpersonal skills, vestibule training is conducted in a simulated environment resembling the workplace, and videos are used for knowledge transfer or demonstration.

❌ Why the other options are incorrect:

• (c) Job rotation and coaching:
  ❌ These are on-the-job training methods. They occur within the work environment and involve learning by doing.

• (d) Job instruction training:
  ❌ Also an on-the-job method, where supervisors or trainers guide employees through tasks directly at the workplace.

✅ Final Answer: (a) and (b).

✅ Correct Answer: Rs. 20,000 unfavourable

✅ Explanation:
Material Quantity Variance (MQV) is the difference between the standard quantity allowed for actual production and the actual quantity used, multiplied by the standard price per kg. It shows whether more or less material was used than expected for the actual output.

Formula:

MQV = (Standard Quantity Allowed − Actual Quantity Used) × Standard Price

Step-by-step Calculation:

• Standard quantity allowed = Standard material allowed per unit × Actual output in units = 100 kg/unit × 1,000 units = 100,000 kg

• Actual quantity used = 104,000 kg

• Standard price = Rs. 5 per kg

MQV = (100,000 − 104,000) × 5 = (−4,000) × 5 = Rs. 20,000

This is unfavourable because more material was used than the standard allowed for the actual production level.

✅ Final Answer: Rs. 20,000 unfavourable.

✅ Correct Answer: Rs. 4,800 unfavourable

✅ Explanation:
Labour Efficiency Variance (LEV) measures the difference between the standard hours allowed for actual production and the actual hours worked, multiplied by the standard labour rate. It indicates how efficiently labour time was used in production.

📌 Formula:

Labour Efficiency Variance = (Standard Hours Allowed − Actual Hours Worked) × Standard Labour Rate

🧾 Step-by-Step Calculation:

• Standard hours allowed per unit = 2 hours

• Actual output = 1,000 units

Standard hours allowed = 1,000 × 2 = 2,000 hours

• Actual hours worked = 2,240 hours

• Standard labour rate = Rs. 20/hour

LEV = (2,000 − 2,240) × 20 = (−240) × 20 = Rs.4,800

Because more hours were worked than allowed by the standard, the variance is unfavourable.

✅ Final Answer: Rs. 4,800 unfavourable.

✅ Correct Answer: Two Country, Two Commodity and One Factor Theory

📘 Explanation:

David Ricardo’s Theory of Comparative Advantage (1817) is a foundational concept in international trade. It explains how and why countries benefit from trade even when one country is more efficient in producing all goods.

Key Assumptions of Ricardo’s Model:

• Two Countries (e.g., England and Portugal)

• Two Commodities (e.g., wine and cloth)

• One Factor of Production – Labor (only labor is considered for production, ignoring capital and land)

The theory argues that:

• A country should specialize in producing and exporting goods in which it has a comparative advantage (i.e., lower opportunity cost), not necessarily an absolute advantage.

• This specialization leads to more efficient global production and mutual gains from trade.

✅ Final Answer: Two Country, Two Commodity and One Factor Theory

✅ Correct Answer: Enterprise Resource Planning (ERP)

📘 Explanation:

Enterprise Resource Planning (ERP) is an integrated system that enables organizations to plan, control, and manage their operations effectively. It connects various business functions—such as finance, HR, supply chain, procurement, and customer service—into a single unified system.

ERP systems also offer:

• Sophisticated planning and control features

• Real-time data sharing across departments

• Connectivity with suppliers, partners, and customers, improving collaboration and decision-making

❌ Why the other options are incorrect:

• Customer Relationship Management (CRM): Focuses specifically on managing a company’s interactions with current and potential customers, not overall planning and control across all departments.

• Manufacturing Resource Planning (MRP): Primarily focuses on production planning, inventory control, and scheduling—limited to manufacturing functions, not enterprise-wide.

• Economic Order Quantity (EOQ): A formula-based inventory management technique used to determine the ideal order quantity that minimizes total inventory costs—not a system, and doesn’t provide broad connectivity or control functionalities.

✅ Final Answer: Enterprise Resource Planning (ERP)

✅ Correct answer: There are no taxes and cost of debt is less than the cost of equity and the use of debt does not change the risk perception of investors.

✅ Explanation:

The Net Income (NI) Approach to capital structure theory (proposed by David Durand) suggests that:

Capital structure is relevant, and an increase in the proportion of debt (which is cheaper than equity) leads to:

• A decrease in the overall cost of capital, and

• An increase in the value of the firm.

The NI approach is based on the following key assumptions:

1. ✅ There are no taxes – So, there’s no tax shield benefit considered from using debt.

2. ✅ Cost of debt is less than cost of equity – Debt is considered cheaper, which justifies increasing leverage.

3. ✅ The use of debt does not affect the risk perception of investors – Even if debt increases, investors do not demand a higher return on equity (i.e., cost of equity remains constant).

These assumptions make it possible for the firm to minimize WACC and maximize its value simply by increasing debt in its capital structure.

❌ Why the other options are incorrect:

• “There are taxes…” — NI approach assumes no taxes.

• “Use of debt changes risk perception…” — NI approach assumes risk perception and cost of equity are unchanged.

✅ Final Answer: There are no taxes and cost of debt is less than the cost of equity and the use of debt does not change the risk perception of investors.

✅ Correct Answer: (a) and (c)

✅ Explanation:

Psychological barriers in communication occur due to mental or emotional factors that distort the effective exchange of information. The correct reasons for psychological barriers are:

• Premature evaluation: This happens when individuals judge or evaluate a message before fully understanding or listening to it, causing misunderstandings.

• Lack of attention: If the receiver is distracted, uninterested, or not paying attention, it leads to poor communication, which is a psychological barrier.

• Poor retention: If the receiver cannot retain or remember the information conveyed, communication breaks down.

• Lack of reliance: If there is a lack of trust or confidence between the sender and receiver, it creates barriers to effective communication.

❌ Why the other options are incorrect:

• (b) Organizational facilities, status relationships: These are typically structural or environmental barriers, not psychological barriers. They relate to physical factors like space or hierarchical barriers in an organization, but do not directly affect the psychological reception of communication.

• (d) Hierarchy, Organization policies: These are related to organizational barriers rather than psychological ones. They involve formal structures and policies that affect communication flow but do not directly involve psychological factors like attention or perception.

✅ Final Answer: (a) and (c)

✅ Correct Answer: (a), (b), (c), and (d)

✅ Explanation:

Entrepreneurs are influenced and motivated to start a business enterprise by a combination of personal, external, and situational factors. These include:

• (a) Ambitious factors:
  ✅ These are internal desires such as the urge for independence, achievement, self-fulfillment, and recognition. Many entrepreneurs are highly driven by personal ambition.

• (b) Compelling factors:
  ✅ These are push factors like job dissatisfaction, unemployment, economic necessity, or lack of career growth that force individuals into entrepreneurship as an alternative.

• (c) Facilitating factors:
  ✅ These are supportive conditions that make entrepreneurship easier, such as availability of capital, favorable government policies, market opportunities, and supportive infrastructure.

• (d) Family factors:
  ✅ Family background, such as coming from a business family, support from family members, and expectations to carry on family traditions, can be a strong motivator in pursuing entrepreneurship.

All four categories play a significant role in shaping entrepreneurial motivation, and often, a combination of these factors leads an individual to start a business.

Final Answer: (a), (b), (c), and (d)