Business Administration CSS Paper 2001

NOTE: Attempt FIVE questions in all, including question No. 7 which is COMPULSORY. Select at least ONE QUESTION from each of the PARTS I, II AND III. All questions carry EQUAL marks.

PART – I (Management)

  1. Explain the SELECTION PROCESS used in modern organizations. What techniques can be used to improve the interviewing process used as a selection technique?

  2. If you were a manager, would you decentralize authority? State several reasons for your answer. How would you make that you did decentralize too much?

Part II (Principles of Management)

  1. Explain how the following macro-environmental forces affect the marketing programmes of business organizations: (5+15)
    (a) Technology
    (b) Economic Conditions
    (c) Political and Legal Forces

  2. Once a company decides to target a particular country, it has to determine the best mode of entry”. List the alternative available and explain the natures, advantages and limitations of any TWO involving more commitment, risk, control and profit potential.

PART – III (Financial Management)

  1. Explain the following concepts/terms with examples:
    (a) Debt-to-Enquiry Ratio
    (b) Return on Equity (ROE
    (c) The Economic Order Quantity (EOQ)
    (d) Cash Budget
    (e) Classification of Working Capital on the basis of Time

  2. Selected financial ratios for XYZ Co. are as follows..
    _________________________19 x 1 ______ 19 x 2 _____19 x 3
    Current ration ______________ 4.2 ________ 2.6 _______ 1.7
    Acid test ration _____________ 2.1 ________ 1.0 ______ .6
    Debt-to-total assets _________ 23% _______ 33% ______ 47%
    Inventory Turnover __________ 8.7x _______ 5.4x ______ 3.5x
    Average collective period _____33 days _____ 36 days ___ 49 days
    Total asset turnover _________ 3.2x _______ 2.6x ______ 1.9%
    Net profit margin ___________ 3.8% _______ 2.5% ______ 1.4%
    Return on investment (ROI) ___ 12.1% ______ 6.5% ______ 2.8%
    Return on Equity (ROE) _______ 15.7%______ 9.7% ______ 5.4%

(a) Why did return on investment decline?
(b) Was the increase in debt a result of greater current liabilities or of greater long-term? Explain.


  1. Write only correct answer in the Answer Book. Do not reproduce the questions.

(1)Most preferred stock pays a fixed dividend at regular intervals.
(a) True (b) False

(2) Any increase in an asset item is a source of funds.
(a) True (b) False

(3) Depreciation is a book-keeping entry that allocates the cost of assets against income but does not involve any movement of capital.
(a) True (b) False

(4) The maturity of a security relates to the owner’s ability to convert it into cash on short notice:
(a) True (b) False

(5) The credit period represents the period of time during which a cash discount can be taken on short notice.
(a) True (b) False

(6) Which ratio is computed with the help of the following?
Cost of goods sold
(a) Receivable turnover (b) Times interest earned (c) Inventory Turnover (d) None of these

(7) ________ is the right that is delegated to an individual or a department to control specific processes, practices, policies and other matters relating to activities undertaken by person in other departments.
(a) Line authority (b) Functional Authority (c) Line and Staff Authority (d) None of these

(8) Decentralization is the tendency to disperse decision making in an organized structure:
(a) True (b) False

(9) Programmes are plans which are general statements or understandings that guide or channel thinking in decision making:
(a) True (b) False

(10) _______ is that part of managing that involves establishing an international structure of roles for people to fill in an organization:
(a) Leading (b) Controlling (c) Planning (d) None of these

(11) Henri Fayol applied the principle of ‘Division of Work’ to all kinds of work, managerial as well as technical.
(a) True (b) False

(12) ________ spell out specific required actions or non-actions, allowing no discretion:
(a) Procedures (b) Budgets (c) Rules (d) None of these

(13) Business buyers are as geographically dispersed as final consumers.
(a) True (b) False

(14) The distribution between a consumer good and an industrial good is based on the purpose for which product is purchased:
(a) True (b) False

(15) Intensive distribution occurs when the product is stocked in as many outlets as possible.
(a) True (b) False

(16) Merchant wholesalers are independently owned business that do not own (take title to) the goods they sell:
(a) True (b) False.

(17) Which of the following elements in a compensation package provides the greatest amount of incentive for salespersons?
(a) Salary (b) Fringe Benefits (c) Commissions (d) Use of Company Vehicle

(18) The process whereby the seller distinguishes between market segments, selects one or more of these segments, and develops products and marketing-mixes tailored to each segment is called _______ marketing.
(a) Mass (b) Target (c) Product Variety (d) Service

(19) Goods that the consumer, in the process of selection and purchase, characteristically compares on such bases as suitability, quality, price and style are called _______ goods.
(a) Shopping (b) Specialty (c) Unsought (d) Convenience

(20) Product ______ is a period of rapid market acceptance and increasing profits.
(a) Development (b) Introduction (c) Growth (d) Maturity