Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

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TN State Board 12th Commerce Model Question Paper 5 English Medium


  1. The question paper comprises of four parts.
  2. You are to attempt all the parts. An internal choice of questions is provided wherever applicable.
  3. All questions of Part I, II. III and IV are to be attempted separately.
  4. Question numbers 1 to 20 in Part I are Multiple Choice Questions of one mark each. These are to be answered by choosing the most suitable answer from the given four alternatives and writing the option code and the corresponding answer.
  5. Question numbers 21 to 30 in Part II are two-mark questions. These are to be answered in about 50 words.
  6. Question numbers 31 to 40 in Part III are three-mark questions. These are to be answered in about 150 words.
  7. Question numbers 41 to 47 in Part IV are five-mark questions. These are to be answered in about 250 words. Draw diagrams wherever necessary.

Time: 3 Hours
Max Marks: 90

Part – I

Choose the correct answer. Answer all the questions: [20 x 1 = 20]

Question 1.
Management is an …………….
(a) Art
(b) Science
(c) Art and Science
(d) Art or Science
(c) Art and Science

Question 2.
Which of the following is verification function ……………?
(a) Planning
(b) Organising
(c) Staffing
(d) Controlling
(d) Controlling

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 3.
Capital market is a market for …………..
(a) Short Term Finance
(b) Medium Term Finance
(c) Long Term Finance
(d) All of these
(c) Long Term Finance

Question 4.
Government Securities are issued by agencies such as ………….
(a) Central Government
(b) State Governments
(c) Semi-government Authorities
(d) All of the above
(d) All of the above

Question 5.
Stock exchanges deal in …………….
(a) Goods
(b) Services
(c) Financial Securities
(d) Country’s Currency
(c) Financial Securities

Question 6.
The headquarters of SEBI is ……………
(a) Kolkata
(b) Mumbai
(c) Chennai
(d) Delhi
(b) Mumbai

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 7.
Human resource is an asset…………..
(a) Tangible
(b) Intangible
(c) Fixed
(d) Current
(b) Intangible

Question 8.
Advertisement is a …………….. source of recruitment.
(a) internal
(b) external
(c) agent
(d) outsourcing
(b) external

Question 9.
In the following variables which one is not the variable of marketing mix?
(a) Place Variable
(b) Product Variable
(c) Program Variable
(d) Price Variable
(c) Program Variable

Question 10.
Selling goods/services through internet is ……………..
(a) Green marketing
(b) E-business
(c) Social marketing
(d) Niche marketing
(b) E-business

Question 11.
Who is the father of Consumer Movement?
(a) Mahatma Gandhi
(b) John F. Kennedy
(c) Ralph Nader
(d) Jawaharlal Nehru
(c) Ralph Nader

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 12.
The District Forum can entertain complaints where the value of goods or services and the compensation if any claimed is less than ……………..
(a) ₹ 10,00,000
(b) ₹ 20,00,000
(c) ₹ 40,00,000
(d) ₹ 50,00,000
(b) ₹ 20,00,000

Question 13.
New Economic Policy was introduced in the year
(a) 1980
(b) 1991
(c) 2013
(d) 2015
(b) 1991

Question 14.
Sale of Goods Act was passed in the year
(a) 1940
(b) 1997
(c) 1930
(d) 1960
(c) 1930

Question 15.
A cheque will become stale after months of its date.
(a) 3
(b) 4
(c) 5
(d) 1
(a) 3

Question 16.
Which of the below is not a characteristic of a Fabian Entrepreneur?
(a) Conservative
(b) Risk averse
(c) Sceptical
(d) Adaptive
(d) Adaptive

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 17.
Which of the following types of shares are issued by a company to raise capital from the existing shareholders?
(a) Equity Shares
(b) Rights Shares
(c) Preference Shares
(d) Bonus Shares
(b) Rights Shares

Question 18.
A person shall hold office as a director in companies as per the Companies Act, 2013.
(a) 5
(b) 10
(c) 20
(d) 15
(c) 20

Question 19.
Board meetings to be conducted minimum times in a year.
(a) 2
(b) 3
(c) 4
(d) 5
(c) 4

Question 20.
A special resolution is required to ………………
(a) redeem the debentures
(b) declare dividend
(c) appoint directors
(d) appoint auditor
(d) appoint auditor

Part – II

Answer any seven questions. Question No. 30 is compulsory. [7 x 2 = 14]

Question 21.
Bring out the meaning of Management By Exception.
Management By Exception is an important principle of managerial control suggested by the classical writers on management. It is based on the belief that an attempt to control everything results in controlling nothing. Management by exception is a style of business management that focuses on identifying and handling cases that deviate from the norm.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 22.
Write any two instruments of money market.

  • Treasury Bills in the Treasury Market
  • Money at Call and Short Notice in the Call Loan Market

Question 23.
Define Stock Exchange.
According to Husband and Dockerary, “Stock exchanges are privately organized markets which are used to facilitate trading in securities.”

Question 24.
Mention features of campus recruitment.
Campus recruitment is one of the external sources of recruitment. Its features are:

  • The organisations visit the educational institutions to identify and recruit suitable candidates.
  • They have to conduct the test and other interview methods to find out the suitable persons.

Question 25.
Who is called Promoters?
Promotion stage begins when the idea to form a company comes in the mind of a person. The person who envisage the idea is called a.‘promoter’.

Question 26.
Give two examples of adulteration.

  • Powdered rice/wheat is adulterated with starch.
  • Coffee powder is adulterated with tamarind seed.

Question 27.
Define Business environment.
According to Bayard O ‘Wheeler, Business environment is “the total of all things external to firms and industries which affect their organisation and operations”.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 28.
List down any two essential elements of the contract of sale.
Following essential elements are necessary for a contract of sale:

  • Two Parties: A contract of sale involves two parties – the seller and the buyer.
  • Transfer of Property: To constitute sale, the seller must transfer or agree to transfer the ownership in the good to the buyer.
S.No. Wholesale Market Retail Market
1. Goods are supplied in bulk quantity. Goods are sold to customers in small quantities.
2. Goods are supplied to dealers and retailers. Goods are sold to the public.

Part – III

Answer any seven questions. Question No. 40 is compulsory. [7 x 3 = 21]

Question 31.
Differentiate Management and Administration.

Basis for Comparison Management Administration
Meaning An organised way of managing people and things of a business organisation is called the management. The process of administrating an organisation by a group of people is known as the administration.
Authority Middle and lower level. Top level
Role Executive Decisive
Concerned with Policy Implementation. Policy formulation.
Area of operation It works under administration. It has full control over the activities of the organisation.
Applicable for Profit-making organisations; i.e. business organisations. Government offices,    military clubs, business enterprises, hospitals, religious and educational organisations.

Question 32.
What are the features and types of Treasury Bills?
Treasury Bills are issued to the public and other financial institutions for meeting the short- term financial requirements of the Central Government.
Features of Treasury Bills:

  • Issuer
  • Finance Bills
  • Liquidity
  • Vital Source
  • Monetary Management

Types of Treasury Bills:

  • 91 days Treasury Bills
  • 182 days Treasury Bills and
  • 364 days Treasury Bills

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 33.
Explain Bull and Bear Speculators?
Speculators in a stock market are of different types based on animals behaviour. They are:

  • Bull: A Bull or Tejiwala is an operator who expects a rise in prices of securities in the future. He purchases the securities expecting price of rise in future.
  • Bear: A bear or Mandiwala speculator expects prices to fall in future and sells securities at present with a view to purchase them at lower price.

Question 34.
What are the features of Human Resources? (Any 3)

  • Human resource exhibits innovation and creativity.
  • Human resource alone can think, act, analyse and interpret.
  • Human resources are emotional beings.

Question 35.
Explain the types of market on the basis of time.

  • Very Short Period Market: Markets which deal in perishable goods like, fruits, milk, vegetables, etc., are called as very short period market. There is no change in the supply of goods.
  • Short Period Market: In certain goods, supply is adjusted to meet the demand. The demand is greater than supply. Such markets are known as Short Period Market.
  • Long Period Market: This type of market deals in durable goods, where the goods and services are dealt for longer period usages.

Question 36.
Give any three cases in which an ordinary resolution need to be passed.
An ordinary resolution is one which can be passed by a simple majority; i.e. if the members of votes cast by members, entitled to vote in favour of the resolution is more than the votes cast against the resolution.

Ordinary Resolution is required for the following matters:

  • To change or rectify the name of the company
  • To alter the share capital of the company
  • To redeem the debentures

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 37.
Explain the meaning of Agreement to sell.
The property (ownership or title) in the goods has to pass at a future time or after the fulfilment of certain conditions specified in the contract. Where the goods under the agreement to sell are destroyed, the loss falls squarely on the seller as the ownership is still vested with the seller even though the possession of the goods is with the buyer.

Question 38.
Discuss the two different types of crossing.
Crossing may be General crossing and Special crossing.
1. General crossing- The lines should be drawn across the face of a cheque and not on the reverse thereof. Further, they must by parallel and transverse. Cross marks such as ‘X’ does not constitute crossing.

2. Special crossing- may be of not negotiable crossing and Account payee crossing. But the A name of banker to whom the payment should be made is to be necessarily written on the face of the cheque.

Question 39.
Distinguish between shares and stocks.

Basis for Difference Shares Stocks
1. Meaning The term ’share’ means a fraction or unit of the total capital of the company which have equal denomination. Stock is created from fully paid shares by passing resolution in the general meeting. The Articles of Association of the company must permit this conversion.
2.Denomination All the shares are of equal denomination. The denomination of stocks may differ.
3. Paid up value Shares can be partly or fully paid up. Stock can only be fully paid up.

Question 40.
Write any three factors of political and legal environment.
The framework for running a business is given by the political and legal environment.

  • Political stability is reflected by the following parameters like the election system, the law and order situation.
  • The image of the leader and the country in the international arena.
  • The constitution of the nation.

Part – IV

Answer all the questions. [7 x 5 = 35]

Question 41(a).
Explain the modern Principles of Management. (Any 5)
The Father of Modem Management is Mr. Henry Fayol, and according to him there are 14 major principles of management which every manager has to practice for the success of the organization.

  • Division of Work: According to this principle the whole work is divided into small tasks. This leads to specialization which increases the efficiency of labour.
  • Authority and Responsibility: This is the issue of commands followed by responsibility for their consequences.
  • Discipline: It is obedience, proper conduct in relation to others, respect of authority, etc. It is essential for the smooth functioning of all organizations.
  • Unity of Command: This principle states that each subordinate should receive orders and be accountable to one and only one superior.
  • Unity of Direction: All related activities should be put under one group, there should be one plan of action for them, and they should be under the control of one manager.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium


(b) Distinguish between new issue market and secondary market. (Any 5)

Basis For Comparison New Issue Market Secondary Market
Meaning The market place for new shares is called primary market.(Initial Issues Market) The place where formerly issued securities are traded is known as Secondary Market. (Resale Market)
Buying Direct Indirect
Financing It supplies funds to budding enterprises and also to existing companies for expansion and diversification. It does not provide funding to companies.
How can securities be sold? Only once Multiple times
Buying and Selling between Company and Investors Investors

Question 42(a) Explain the features of Stock Exchange. (Any 5)
There are various features of a stock exchange. They are given below:

  • Market for Securities: Stock exchange is a market, where securities of corporate bodies, government companies are bought and sold.
  • Deals in Second Hand Securities: It deals with shares, debentures bonds and securities already issued by the companies.
  • Regulates Trade in Securities: Stock exchange does not buy or sell any securities on its own account. It regulates the trade activities so as to ensure free and fair trade.
  • Allows Dealings only in Listed Securities: In the stock exchange only listed securities are purchased and sold. Unlisted securities cannot be traded in the stock exchange.
  • Association of Persons: A stock exchange is an association of persons or body of individuals which may be registered or unregistered.

(b) Explain the principles of placement.
The following are the principles of placement:

  • Job First, Man Next: Man should be placed on the job according to the requirements of the job.
  • Job Offer: The job should be offered to the man based on his qualification.
  • Terms and conditions: The employee should be informed about the terms and conditions of the organisation.
  • Aware about the Penalties: The employee should also be made aware of the penalties if he / she commits a mistake.
  • Loyalty and Co-operation: When placing a person in a new job, an effort should be made to develop a sense of loyalty and co-operation in him.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 43(a).
What are the differences between on the job training and off the job training?

Basis for comparison On the Job Training Off the Job Training
1. Meaning The employee learns the job in the actual work environment. The training of employees is done outside the actual work place.
2. Cost It is cheapest to carry out. It is costly due to the expenses like separate training room, specialist, etc.
3. Suitable for Suitable for manufacturing related jobs. It is suitable for managerial jobs.
4. Approach Practical approach Theoretical approach
5. Carried out Provided by the experienced employee Provided by the experts
6. Methods Coaching, mentoring, apprenticeship, job rotation Seminar, lectures, vestibule, field trip, e-leaming

(b) Narrate the elements of marketing mix.
Marketing mix means a marketing programme that is offered by a firm for the satisfaction of human wants. There are four Elements of Marketing mix:

  • Product: A Product is the main element of marketing. Without a product, there can be no marketing.
  • Price: Price is the value of a product expressed in monetary terms. It is the amount charged for the product.
  • Place (Physical Distribution): An excellent quality product, with a good price, will be waste, if it is not transferred from the production place to consumption place.
  • Promotion: An excellent product with competitive price cannot achieve a desired success and acceptance in market, with special features are conveyed to the consumers.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Question 44(a).
How consumers are exploited? (Any 5)
Consumer is one who consumes the goods manufactured or created. Consumers are exploited in many ways in the business. They are as follows:

  • Selling at Higher Price: The price charged by the seller for a product or service may not be higher compared to the quality.
  • Adulteration: It refers to mixing or substituting undesirable material in food. This leads to heavy loss to the consumer, (e.g. ) Mixing of stones with grains.
  • Duplicate or Spurious goods: Duplicate products of popular products are illegally produced and sold.
  • Artificial Scarcity: There are certain situations where the shop-keepers put up the board ‘No Stock” in front of their shops, even though there is plenty of stock in the store.
  • Sub-standard: On opening a packet or sealed container one may find the content to be of poor quality.


(b) Explain the advantages of liberalization. (Any 5)
Liberalization means relaxation of various government restrictions in the areas of social and economic policies of the country.

Advantages of Liberalization:

  • Increase in foreign investment: If a country liberalizes its trade, it will make the country more attractive for inward investment.
  • Increase the foreign exchange reserve: Relaxation in the regulations covering foreign investment and foreign exchange has paved way for easy access to foreign capital.
  • Increase in consumption: Liberalization increases the number of goods available for consumption within a country.

Question 45(a).
Distinguish between Condition and Warranty.

Basis for Difference Condition Warranty
1. Meaning It is a stipulation which is essential to the main purpose of the contract of sale. It is a stipulation which is collateral to the main purpose of contract.
2.Significance Condition is necessary to the contract that the breaking of which cancels out the contract. The violation of warranty will not revoke the contract.
3. Transfer of Ownership Ownership on goods cannot be transferred without fulfilling the conditions. Ownership on goods can be transferred on the buyer without fulfilling the warranty.
4. Remedy In case of breach of contract, the affected party can cancel the contract and claim damages. In the case of breach of warranty, the affected party cannot cancel the contract but can claim damages only.
5. Treatment Breach of condition may be treated as breach of warranty. Breach of warranty cannot be treated as breach of condition.

Question 46(a)
Discuss the problems faced by Women Entrepreneurs.
There is a tremendous growth in the women entrepreneurship in India. But there are certain problems met by women entrepreneurs. They are as follows:-
(1) Problem of Finance: The external sources of funds for the women is limited because they do not generally own properties in their own name. They are depending on their own savings and loan from friends and relatives.

(2) Lack of Education: Illiterate and semi-literate women entrepreneurs face difficulties in respect of accounts, money matters, marketing and day-to-day operations.

(3) Lack of Network Support: The success of business depends on the support of family members, friends and relatives. But it is reported that the women entrepreneurs get very limited support in times of crisis.

(4) Stiff Competition: They have to face acute competition for their goods from organised sector and from their male counterparts.

(5) Lack of Information: The lack of knowledge or limited knowledge about subsidies, concessions and incentives given by Government will affect the business.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium


(b) Write the difference between Shares and Debentures. (Any 5)

S.No. Shares Debentures
1. Shares are part of the capital of a company. Debentures mean a loan.
2. Shareholders gets dividends with a varying rate. Debenture holder gets fixed rate of Interest.
3. Shares do not carry any such charge. Debentures generally have a charge on the assets of the company.
4. Shares cannot be issued at a discount. Debentures can be issued at a discount.
5. Shareholders enjoy voting right. Debenture holders do not have any voting right.

Question 47(a).
What are the collective duties of directors?
Directors act as agents of the shareholders and act as a trustees of shareholders. The following are the duties of directors: Collective Duties of Directors: Directors as a part of Board perform certain duties collectively. The duties are as follows:

  • Approval of annual accounts and authentication of annual accounts
  • Appointment of First Auditors
  • Passing of resolutions at board meetings
  • Directors report to shareholders highlighting the performance of the company.

(b) Elaborate the functions of the Company Secretary.
The functions of the Company Secretary may be divided into two types. They are:

  • Statutory functions
  • Non-Statutory functions

Statutory Functions: As the principal officer of the company, the secretary must observe all the legal formalities in respect of the provisions of the Companies Act and other laws, for the activities of the company.

According to Companies Act 2013:

  • To sign document and proceedings requiring authentication by the company
  • To maintain share registers and register of directors and of contracts.
  • To give notice to register for increase in the share capital
  • To send notice of general meeting to every member of the company
  • To prepare minutes of every general meeting and board meeting within 30 days

Non-Statutory Functions: The secretary has to discharge non-statutory functions in relation to directors, shareholders and office and staff.

Tamil Nadu 12th Commerce Model Question Paper 5 English Medium

Functions in Relation to Directors:
A company secretary acts under the full control of the board of directors and carry out the instructions of the directors. The secretary will arrange board meetings issuing notice, and preparing agenda of meetings, recording the attendance and minutes of meetings.

Functions in Relation to Shareholders:
The company secretary must serve in the best interests of the shareholders.
He has to arrange the issue of allotment letters, call letters, letters of regret, share certificates, and share warrants to Shareholders.

Functions in Relation to Office and Staff:
The secretary is responsible for smooth functioning of the office work. He exercises an overall supervision, control and co-ordination of all clerical activities in the office.

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