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2017 Commerce UGC NTA NET JRF Solved Previous Year Paper January-2017 Paper-II

Commerce UGC NTA NET JRF Solved Previous Year Paper January-2017 Paper-II

1. Assertion (A) : Corporate culture is generally considered as either closed and threatening or as open and participatory.
Reason (R) : Corporate culture and style of functioning of top managers is an important factor for determining the internal environment of a company.
Codes :
A. (A) is correct, but (R) is incorrect.
B. Both (A) and (R) are correct and (R) is the correct explanation of (A).
C. Both (A) and (R) are correct, but (R) is not the correct explanation of (A).
D. (R) is correct, but (A) is incorrect.
Ans : B

2. Statement-I : If the workers develop an attitude of non-cooperation with Management, a repressive economic system may be needed to set right this industrial disorder.
Statement-II : By fulfilling social responsibility towards shareholders, employees, consumers, government and community, a business achieves economic growth and increases public image.
Codes :
A. Statement I is correct, but II is incorrect.
B. Both the statements I and II are correct.
C. Statement II is correct but I is incorrect.
D. Both the statements are incorrect.
Ans : B

3. Match the items of List-I with List-II.
List–I List–II
(a) Planning Commission 1. 1993
(b) Competition Act 2. 2002
(c) Adrian Cadbury Committee 3. 1951
(d) Rangrajan Committee on Disinvestment in PSEs 4. 1991
Codes :
(a) (b) (c) (d)
A. 1 2 3 4
B. 3 1 4 2
C. 3 2 4 1
D. 3 2 1 4
Ans : C

4. From which Five Year Plan “Growth with Social Justice” has received emphasis?
A. 5th B. 6th
C. 7th D. 10th
Ans : A

5. Which of the following is not the objective of the Competition Act, 2002?
A. Prohibition of Restrictive Trade Practices.
B. Prohibition of Dominant Position
C. Prohibition of Anti-competitive Agreements
D. Regulation of Combinations
Ans : A

6. Consolidated financial statements are prepared on the principle
A. In form the companies are one entity, in substance they are separate.
B. In form companies are separate, in substance they are one.
C. In form and substance the companies are one entity.
D. In form and substance the companies are separate.

Ans : C

7. Match the items of List-I with those of List-
II and indicate the correct code :
List–I List–II
(a) Acid Test Ratio 1. Profitability analysis
(b) Debt Service Coverage Ratio2. Activity analysis
(c) Debt Equity Ratio3. Liquidity analysis
(d) Stock Turnover Ratio 4. Long-term solvency analysis
Codes :
(a) (b) (c) (d)
A. 2 1 3 4
B. 2 3 4 1
C. 3 4 1 2
D. 3 1 4 2
Ans : D

8. From the following two statements of Assertion
(A) and Reason (R), indicate the correct code :
Assertion (A) : From the marginal costing approach point of view, the marginal cost is compared with the purchase price.
Reason (R) : If the marginal cost is less than the purchase price it should be purchased rather than manufactured.
Codes :
A. Both (A) and (R) are correct.
B. (A) is correct, but (R) is not correct.
C. (A) is not correct, but (R) is correct.
D. Both (A) and (R) are incorrect.
Ans : B

9. Which one of the following statements is true about standard labour time?
A. Standard labour time indicates the time in hours needed for a specific process.
B. It is standardized on the basis of past experience.
C. In fixing standard time due allowance should not be given to fatigue and tool setting.
D. The Production Manager does not provide any input in setting the labour time standards.
Ans : A

10. Under the yield method of valuation of equity share capital, if for an equity share of Rs. 50, the normal rate of return is 10% and expected rate of return is 5%, then the value of an equity share will be
A. Rs. 25 B. Rs. 40
C. Rs. 50 D. Rs. 100
Ans : A

11. Match the items of List-I with the items of List-II and denote the code of correct matching.
List–I List–II
(a) Hypothesis of Sales Revenue Maximization1. W.J. Baumol
(b) Hypothesis of Maximization of Firm’s Growth Rate2. Robin Marris
(c) Hypothesis of Maximization of Managerial Utility Function3. O.E. Williamson
(d) Hypothesis of Satisfying Behaviour 4. Cyert and March
Codes :
(a) (b) (c) (d)
A. 2 1 3 4
B. 2 3 1 4
C. 1 2 3 4
D. 1 4 2 3
Ans : C

12. Gopal was holding 100 shares of Rs. 10 each of a company on which he had paid Rs. 3 an application and Rs. 2 on allotment but could not pay Rs. 2 on first call. Directors forfeited the above share. Share capital will be debited by :
A. Rs. 1000 B. Rs. 700
C. Rs. 500 D. Rs. 800
Ans : B

13. The short-run production function for a firm is as follows :
Q = –L3 + 15L2 + 10L Where Q denotes total output in physical units and L denotes units of labour which are homogeneous, but are not perfectly divisible and change in labour does not tend to become zero.
Statement I : In this production function, the marginal product of 5th unit of labour is 85.
Statement II : Similarly, in this production function, the average product of the 5th unit of labour is 60.
Codes :
A. Both the Statements are true.
B. Both the Statements are false.
C. Statement I is true, while Statement II is false.
D. Statement I is false, but Statement II is true.
Ans : D

14. The Kinked demand curve model of oligopoly was developed by
A. Augustin Cournot B. Stackelberg
C. Edgeworth D. Sweezy
Ans : D

15. For the success of the penetration price policy, which one of the following is not desirable?
A. Short-run demand for the product to have elasticity greater than unity.
B. Availability of economies of large scale production.
C. Product to have very low cross-elasticity of demand.
D. Easy acceptance and adoption of the product by the consumers.
Ans : C

16. Statement I : The absolute value of the difference between an unbiased estimate and the corresponding population parameter is called sampling error.
Statement II : Multi-stage sampling is a restricted non-probability based sampling technique.
Indicate the correct code :
A. Both the Statements are correct.
B. Both the Statements are incorrect.
C. Statement I is correct, while Statement II is incorrect.
D. Statement I is incorrect, while Statement II is correct.
Ans : C

17. Match the following items of List-I and List-
II with regard to hypothesis-testing and indicate the code of correct matching.
List–I List–II
(a) The ability of test to reject the null hypothesis when it is false. 1. Level of significance
(b) The probability of accepting a false null hypothesis. 2. Type I error
(c) The probability of rejecting a true null hypothesis due to sampling error. 3. Type II error
(d) The probability of rejecting a true null hypothesis. 4. Power of a test
Codes :
(a) (b) (c) (d)
A. 4 2 1 3
B. 4 3 1 2
C. 1 2 3 4
D. 2 3 1 4
Ans : B

18. Which one of the following is a false statement?
A. The signs of the regression coefficients are always the same.
B. Correlation coefficient is the geometric mean of the two regression coefficients.
C. The co-variance between two variables divided by the product of their standard deviations produces the value of coefficient of correlation.
D. Coefficient of correlation is independent of origin but not of scale.
Ans : D

19. If the two regression coefficients are 0.8 and 0.2, then the value of coefficient of correlation is
A. – 0.16 B. + 0.50
C. + 0.40 D. – 0.40
Ans : C

20. Process of arranging data into a new order is called
A. Manipulation of data
B. Standardization of data
C. Sequencing of data
D. Standardized input
Ans : A

21. Developed by the Special Projects Office of the U.S. Navy; this technique was first formally applied to the planning and control of the Polaris Weapon System in 1958 and worked well in expediting the completion of that programme. The technique is known as
A. Gantt Chart
B. PERT
C. CRM
D. Milestone budgeting
Ans : B

22. Consider the following statements relating to planning and find out which of the following is/are correct :
Statement I :The operating personnel should not be associated with the preparation of the budget.
Statement II :A programme indicates the principal operations to be carried out to accomplish a work.
Statement III :Under MBO technique, the Managers should be provided with a freehand to laydown the objectives.
Codes :
A. Only Statement I is correct.
B. Only Statement II is correct.
C. Only Statement III is correct.
D. Both Statements I and III are correct.
Ans : B

23. Assertion (A) : Sympathetic listening in upward communications often leads to resentment in communicator.
Reason (R) : Sympathetic listening and encouraging remarks often lead the communicator to believe that his proposal will receive action not contemplated by superior (communicatee).
Codes :
A. (A) is correct and (R) is the right explanation to it.
B. (A) is correct, but (R) is not the right explanation to it.
C. (A) is not correct while (R) is a correct statement.
D. Both (A) and (R) are incorrect.
Ans : A

24. Assertion (A) : Herzberg believes that today’s motivators are tomorrow’s hygiene factors.
Reason (R) : Some job conditions operate primarily to dissatisfy employees when they are absent, but their presence does not motivate them in strong way.
Codes :
A. Both (A) and (R) are correct and (R) is the right explanation of (A).
B. Both (A) and (R) are correct, but (R) is not the right explanation of (A).
C. (A) is not correct while (R) is correct.
D. Both (A) and (R) are incorrect.
Ans : B

25. Which of the following statements relating to Henry Fayol are correct?
Statement I : Authority and responsibility are related and former arises from latter.
Statement II : Espirit de Corps is an extension of the principle of unity of command.
Statement III : Unity of command means only one command at a time.
Statement IV : There are fourteen basic principles identified by Henry Fayol.
Codes :
A. Statements I, II and IV
B. Statements II and III
C. Statements I and IV
D. Statements II and IV
Ans : D

26. Match the following items of List-I (sources of competition) with List-II (examples for these sources of competition) and indicate the code of correct matching.
List–I List–II
(a) Directly similar products 1. OLA Taxi and Metro Rail
(b) Available substitutes 2. Mercedes and BMW
(c) Unrelated products 3. PVR and Amusement park
Codes :
(a) (b) (c)
A. 3 2 1
B. 1 3 2
C. 1 2 3
D. 2 1 3
Ans : D

27. The marketing task which finds ways to alter the time pattern of demand through flexible pricing, promotion and other incentives is called
A. Demarketing B. Synchromarketing
C. Fleximarketing D. Gorilla Marketing
Ans : B

28. Which of the following is not a reason for a firm to lose its market share to competitors?
A. A product/model is perceived by the target customer group as satisfying needs.
B. Customers not being covered by the company’s sales force and distribution outlets.
C. Customers may have been lost to competitors due to poor service by the firm or its sales personnel or product becoming obsolete or more expensive.
D. All the above are correct reasons for given condition.
Ans : A

29. Match the items of List-I with List-II and denote the code of correct matching.
List–I List–II
(a) Invest Strategy 1. No receiving of new resources.
(b) Protect Strategy 2. Well financed marketing efforts.
(c) Harvest Strategy 3. Selective resource allocation
(d) Divest Strategy 4. Not warranting substantial new resources.
Codes :
(a) (b) (c) (d)
A. 2 3 4 1
B. 1 3 2 4
C. 2 1 4 3
D. 4 3 2 1
Ans : A

30. An elaborated version of the idea expressed in meaningful consumer term is called
A. Product image B. Product idea
C. Product concept D. Prototype
Ans : C

31. Which one of the following combinations of rules stands true while preparing schedule of changes in working capital?
A. An increase in current assets increases working capital.
B. An increase in current assets decreases working capital.
C. An increase in current liabilities decreases working capital.
D. An increase in current liabilities increases working capital.
Codes :
A. A and D B. A and C
C. B and C D. C and D
Ans : B

32. Assertion (A) : The primary motive of a company in using financial leverage is to magnify shareholders’ return under favourable economic conditions.
Reason (R) : To magnify shareholders’ return fixed charges funds can be obtained at a cost higher than the firm’s rate of return on net assets.
Codes :
A. (A) is correct and (R) is the correct explanation of (A).
B. (A) is correct, but (R) is wrong.
C. (R) is correct, but (A) is wrong.
D. Both (A) and (R) are wrong.
Ans : B

33. Debt financing is a cheaper source of finance because of
A. Time value of money
B. Rate of interest
C. Tax deductibility of interest
D. Dividends are not payable to lenders
Ans : C

34. Which of the following is not true with reference to capital budgeting?
A. Capital budgeting is related to asset replacement decisions.
B. Cost of capital is equal to minimum required rate of return.
C. Timing of cash flows is relevant.
D. Existing investment in a project is not treated as sunk cost.
Ans : D

35. Which of the following statements is not correct?
A. The cost of capital is required rate of return to ascertain the value of the firm.
B. Different sources of funds have a specific cost of capital related to that source only.
C. Cost of capital does not comprise any risk premium.
D. Cost of capital is basic data for NPV technique.
Ans : C

36. Which of the following is not the quality of human resources in any organization?
A. Their behaviour to stimuli is often inconsistent and unpredictable.
B. They depreciate with passage of time in terms of skills.
C. They are heterogeneous.
D. Retaining qualified human resources is a challenge for managers.
Ans : B

37. Human Resource Planning benefits to an organization are reflected in which of the following combinations?
(a) Balance between demand and supply of human resources.
(b) Non-compulsion on management to assess critically and continuously the employees and personnel policies.
(c) Duplication of efforts and conflicts are avoided.
(d) Minimizing the future returns on investment in human resources.
Codes :
A. (a) and (b) B. (a) and (c)
C. (a), (b) and (c) D. (a), (c) and (d)
Ans : B

38. A statement containing items such as job title, location, summary, duties, materials used, working conditions, etc., is called
A. Job specification B. Job evaluation
C. Job description D. Job analysis
Ans : C

39. Match List-I with List-II relating to theory of wages.
List–I List–II
(Wage Theory) (Propounder)
(a) Wage Fund Theory 1. John Davidson
(b) Subsistence Theory 2. David Recardo
(c) Residual Claimant 3 Theory. Adam Smith
(d) Bargaining Theory of Wages 4. Francis Walker
Codes :
(a) (b) (c) (d)
A. 2 4 1 3
B. 3 2 4 1
C. 4 1 3 2
D. 2 3 4 1
Ans : B

40. Which organizational analysis method is used, among the following, to develop various efficiency indices relating to contribution of human capital in meeting the organizational goals?
A. Objectives analysis
B. Resource utilization analysis
C. Task analysis
D. Organizational climate analysis
Ans : B

41. Match the items of List-I with the items of List-II regarding evaluation of project application and suggest the correct code.
List–I List–II
(a) Managerial Appraisal 1. Analysis of working results.
(b) Economic Appraisal 2. Disposal of factory effluents.
(c) Financial Appraisal 3. Analysis about traits of an entrepreneur
(d) Technical Appraisal 4. Analysis on employment potential
Codes :
(a) (b) (c) (d)
A. 1 2 4 3
B. 2 1 3 4
C. 3 4 1 2
D. 4 3 2 1
Ans : C

42. Match the items of Column-I with the items of Column-II and suggest the correct code.
Column–I Column–II
(a) Relationship Banking 1. Dealing in hundis and acceptance of deposits.
(b) Merchant Banking 2. Widening the entrepreneurial base and assist in a rapid rate of industrial growth.
(c) Indigenous Banking 3. Engaged in the business of Issue Management.
(d) Development Banking 4. Creating, maintaining and enhancing strong relationship with customers.
Codes :
(a) (b) (c) (d)
A. 4 2 1 3
B. 2 4 3 1
C. 4 3 1 2
D. 2 1 4 3
Ans : C

43. In which year, IFCI Act was amended in order to make it possible to provide assistance, inter alia, for medical, health or other allied services?
A. 1960 B. 1970
C. 1973 D. 1986
Ans : D

44. SIDBI was set up as a subsidiary of IDBI to
A. Take over the functions of small business financing of IDBI.
B. Take over the venture capital operations of ICICI.
C. Reconstruct and rehabilitate the sick and closed industrial units financed by IDBI.
D. Facilitate, finance and promote India’s Foreign trade.
Ans : A

45. Letters of credit, Guarantees, Forward Contracts, etc., come under which one of the following?
A. Liabilities of a bank
B. Assets of a bank
C. Foreign exchange items of a bank
D. Off-balance sheet items of a bank
Ans : D

46. Consider the following statements with regard for the “Theory of Absolute Cost Advantage” :
(i) Productive efficiency differed among different countries because of diversity in natural and acquired resources possessed by them.
(ii) The difference in natural advantage manifests in varying climate, quality of land, availability of minerals, water and other resources.
(iii) The difference in acquired resources manifests in different levels of technology and skills available.
Identify the correct code from the following :
A. Statement (i) is correct, but (ii) and (iii) are incorrect.
B. Statements (i) and (ii) are correct, but (iii) is incorrect.
C. All the statements (i), (ii) and (iii) are correct.
D. None of the statements is correct.
Ans : C

47. Match the items of List-I with List-II and indicate the correct code.
List–I List–II
(a) Absolute Cost Advantage Theory 1. The empirical evidence based on US export of labour intensive goods challenging the factor endowment theory.
(b) Comparative Cost Advantage Theory 2. A country having a direct cost advantage in the production of a product on account of greater efficiency.
(c) Factor Endowment Theory 3. A country should produce and export a commodity that primarily involves a factor of production abundantly available within the country.
(d) Leontief Paradox 4. A country should specialize in the production and export of a commodity in which it possesses greatest relative advantage.
Codes :
(a) (b) (c) (d)
A. 2 4 3 1
B. 2 4 1 3
C. 2 1 3 4
D. 1 4 3 2
Ans : A

48. Match the items of List-I with List-II and indicate the code of correct matching :
List–I List–II
(a) Accommodating capital flow 1. Creation of international reserve assets by the IMF and their allocation among member countries in order to improve international liquidity.
(b) Autonomous capital flow 2. Estimate of foreign exchange flow on account of either variations in the collection of related figures or unrecorded illegal transactions of foreign exchange.
(c) SDR Allocation 3. Inflow of foreign exchange to meet the balance of payments deficit, normally from the IMF.
(d) Statistical discrepancy 4. Flow of loans/investments in normal course of business.
Codes :
(a) (b) (c) (d)
A. 1 2 4 3
B. 3 4 1 2
C. 3 4 2 1
D. 3 1 2 4
Ans : B

49. Statement I : TRIMs agreement refers to conditions or restrictions imposed on foreign investors.
Statement II : TRIMs agreement specifically forbids imposing restrictions on operations of an enterprise which result in protecting domestic products and making imports disadvantageous.
Codes :
A. Statement I is correct, but II is incorrect.
B. Statement II is correct, but I is incorrect.
C. Both the statements I and II are correct.
D. Both the statements I and II are incorrect.
Ans : C

50. Assertion (A) : Revenue from indirect taxes was the major source of tax revenue till tax reforms were taken during nineties.
Reason (R) : Traditionally India’s tax regime relied heavily on indirect taxes including customs and excise.
Codes :
A. Both (A) and (R) are correct, but (R) is not the correct explanation of (A).
B. (A) is correct, but (R) is not correct.
C. Both (A) and (R) are correct and (R) is the correct explanation of (A).
D. Both (A) and (R) are incorrect.

Note :
This paper contains seventy five (75) objective type questions of two (2) marks each. All questions are compulsory.
Ans : C

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