Sample Paper of OCM with Solutions 12th Commerce (2022) | Maharashtra Board (Download Free Pdf)

Sample Paper of OCM with Solutions

12th Commerce OCM Textbook Solutions

Chapter Name	Solution Link
1) Principles of Management	Click Here
2) Functions of Management	Click Here
3) Entrepreneurship Development	Click Here
4) Business Services	Click Here
5) Emerging Modes of Business	Click Here
6) Social Responsibilities of Business	Click Here
7) Consumer Protection	Click Here
8) Marketing	Click Here

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• 12th OCM Question Paper 2021 with Solution – Click Here
• HSC SP Question Paper 2021 with Solution – Click Here

Sample Paper of OCM with Solutions

Q. 1. (A) Select the correct option and rewrite the sentences :                                       (5) {20}

1) …………….. warehouses provide facilities for perishable commodities.
a) Bonded
b) Cold storage
c) Government

2) For online transactions ……… is required.
a) registration
b) trading
c) business

3) Business organizations should protect health and provide safety measures to ………..
a) employees                         
b) owners                  
c) investors

4) The main objective of the consumer organization is to protect the interest of the ………..
a) Consumer
b) trader
c) producer

5) Perishable goods such as vegetables, fruits, milk products, etc. are sold in ……………… Market.
a) Very Short Period
b) Short Period
c) Long Period

(B) Find odd one :                                                                                                 (5)

1) Fatigue Study, Principle of Unity of Command, Work-Study, Motion Study.

2) Trekking, Wildlife study, Horseback riding, Indoor games.

3) Debit card, Credit card, Aadhar card, ATM card.

4) Timely payment of taxes, earning foreign exchange, creating goodwill, political stability.

5) District Commission, State Commission, NGO, National Commission.

(C) Answer in one sentence :                                                                                                              (5)

1) What is the standardization of tools and equipment?
2) What is outsourcing?
3) What organization should do to improve the quality of goods and to reduce the cost of production?                         
4) What information one should check before buying a product??
5) Define Market.

(D) Correct the underlined word and rewrite the following sentences :                              (5)

1) Esprit de corps means ‘division is strength’.
2) Directing is the function of comparing the actual performance with the pre-determined performance.
3) Insurance helps to maximize the risks in the business.
4) Registration is the Last step in online transactions.
5) MRP (Maximum Retail Price) should not be printed on every packet.

Q. 2. Explain the following terms/concepts : (Any FOUR)                                                      (12)

1) Marketing Mix
2) Lok Adalat.
3) Concept of Trusteeship
4) Outsourcing
5) Planning
6) Principle of Discipline.

Q. 3. Study the following case/situation and express your opinion : (Any TWO) (6)

1) Mr. Harshad is an entrepreneur and engaged in the production of eco-friendly utensils. Both male and female workers are working in his factory. All male employees are directly working on machines whereas female employees are working in Packaging Department. Mr. Sharath is working as Finance Manager while Mrs. Naina is working as HR Manager who is responsible for recruiting employees in the factory. On this basis:
i) Identify any one principle of management in the above case.
ii) What is the designation of Mrs. Naina in this organization.
iii) Who is responsible for the overall planning of the organization?

2) Mr. Ashok visited a shop to buy a pair of shoes of RS. 700. The salesman forced him to buy a pair of bigger size shoes of the ordinary company by claiming this size would be suitable for him. After reaching home, he discovered that the shoes are still too big for him. He complained about the shoes to the shopkeeper. It was denied by the shopkeeper to replace the shoes despite the availability of stock.
In the above case,
i) Which right has been violated?
ii) Comment on the right which has been violated.
iii) Where can Mr. Ashok file his complaint?

3) Mr. X purchases goods from the nearest shop. Mr. Y purchases mobiles from Tokyo. Mr. Z of Nandurbar purchases electronic goods from Delhi.
i) From which type of market does Mr.X purchase?
ii) Name the type of market from where Mr.Y deals?
iii) State the type of market from where Mr.Z purchases goods?

Q. 4. Distinguish between the following : (Any THREE)                                                      (12)

1. Planning and Staffing.
2. Life insurance and Marine insurance.
3. E-Business and Traditional Business
4. District Commission and National Commission

Q. 5. Answer in brief : (Any TWO)                                                                   (8)

1. Explain any five principles of management of Henry Fayol.
2. Explain any five points of importance of directing.
3. State four types of deposits.

Q. 6. Justify the following statement : (Any TWO)                                                                (8)

1. Right person at right job with right pay is the basic principle of staffing.
2. Entrepreneurship is the best source for self-employment.
3. Principle of subrogation is applicable to all contracts of indemnity.
4. Business organizations should avoid environmental pollution and ecological imbalance.

Q. 7. Attempt the following : (Any TWO)                                                                           (10)

1. What are the functions of warehouses?
2. State rights of the consumer.
3. Explain packaging and labelling.

Q. 8. Answer the following questions : (Any ONE)                                                                (8)

1. What is Insurance? Explain the principles of insurance.
2. Explain in detail 7Ps of Marketing Mix.

Solution of Sample Paper of OCM 12th

Q. 1. (A) Select the correct option and rewrite the sentences:    (5) {20}

1) Cold storage warehouses provide facilities for perishable commodities.
2) For online transactions registration is required.
3) Business organizations should protect health and provide safety measures to employees.
4) The main objective of the consumer organization is to protect the interest of the Consumer.
5) Perishable goods such as vegetables, fruits, milk products, etc. are sold in Very Short Period Market.

(B) Find odd one :                                                                                                

1) Fatigue Study, Principle of Unity of Command, Work-Study, Motion Study.
2) Trekking, Wildlife study, Horseback riding, Indoor games.
3) Debit card, Credit card, Aadhar card, ATM card.
4) Timely payment of taxes, earning foreign exchange, creating goodwill, political stability.
5) District Commission, State Commission, NGO, National Commission.

(C) Answer in one sentence :                                                                                                             

1) What is the standardization of tools and equipment?
Ans: Standardized working environment and methods of production help to reduce spoilage and wastage of material, cost of production, fatigue among the workers and it improves the quality of work.

2) What is outsourcing?
Ans: Outsourcing is the process of contracting some business functions to specialized agencies.

3) What organization should do to improve the quality of goods and to reduce the cost of production?
Ans: Research and development should be conducted to improve quality of goods and to reduce cost of production.                        

4) What information one should check before buying a product?
Answer: Before buying, the consumer should enquire about the quality, quantity, price, utility of goods and services, etc.

5) Define Market.
Answer: In simple words market is a place where two or more parties are involved in buying and selling. These two parties involved in the transactions are called buyers and sellers. The transaction of buying and selling takes place with exchange of money.

(D) Correct the underlined word and rewrite the following sentences :                              (5)

1) Esprit de corps means ‘Unity is strength’.
2) Controlling is the function of comparing the actual performance with the pre-determined performance.
3) Insurance helps to minimize the risks in the business.
4) Registration is the First step in online transactions.
5) MRP (Maximum Retail Price) should be printed on every packet.

Q. 2. Explain the following terms/concepts : (Any FOUR)       (12)

1) Marketing Mix
Answer: Marketing Mix is the combination of different marketing variables that the firm blends and controls to achieve the desired result from the target market.

In simple words the marketing mix is putting the right product, at the right time, at the right price in the right place. It is one of the important tools of marketing.

2) Lok Adalat.
Answer: Lok Adalat is an effective and economical system for quick redressal of public grievances. It can also be referred to as ‘People’s Court’. It is established by the government to settle disputes by compromise.

Resolution of disputes by Lok Adalat gets statutory recognition. e.g. MSEDCL, MSRTC, Railway authority, Insurance Companies, Banks, etc. organize regular Lok Adalat.

3) Concept of Trusteeship
Answer: Trusteeship is a socioeconomic philosophy that was propounded by Mahatma Gandhi. It provides a means by which the wealthy people would be the trustees of trusts that looked after the welfare of the people in general. Businessmen are considered to be trustees of the society.

4) Outsourcing
Answer: Outsourcing is the process of contracting a business function or any specific business activity to specialized agencies mostly the non-core areas such as sanitation, security, household pantry, etc. are outsourced by the company. The company makes a formal agreement with the agency.

5) Planning
Answer: Planning is the basic function of management. Every function of management is based on planning. It includes deciding the things to be done in advance. Planning is an intellectual process of logical thinking and rational decision-making. It focuses on the organization’s objectives and develops various courses of action.

James Stoner: “Planning is the process of establishing goals and a suitable course of action for achieving these goals.”

6) Principle of Discipline.
Answer: According to Fayol, discipline is the most essential thing in the organization. Employees must obey and respect the rules that govern the organization. Discipline helps to achieve the goals of the organization. Good discipline is the result of effective leadership. There must be a clear understanding between the management and workers regarding the organization’s rules. Basic discipline should be observed at all levels of management.

Q. 3. Study the following case/situation and express your opinion : (Any TWO) (6)

1) Mr. Harshad is an entrepreneur and engaged in the production of eco-friendly utensils. Both male and female workers are working in his factory. All male employees are directly working on machines whereas female employees are working in Packaging Department. Mr. Sharath is working as Finance Manager while Mrs. Naina is working as HR Manager who is responsible for recruiting employees in the factory. On this basis:
i) Identify any one principle of management in the above case.
ii) What is the designation of Mrs. Naina in this organization.
iii) Who is responsible for the overall planning of the organization?

Solution:
i) Principle of management in the above case is the Principle of Division of Work.
ii) The designation of Mrs. Naina in this organization is Human Resource Manager.
iii) Mr. Harshad is responsible for the overall planning of the organization.

2) Mr. Ashok visited a shop to buy a pair of shoes of RS. 700. The salesman forced him to buy a pair of bigger size shoes of the ordinary company by claiming this size would be suitable for him. After reaching home, he discovered that the shoes are still too big for him. He complained about the shoes to the shopkeeper. It was denied by the shopkeeper to replace the shoes despite the availability of stock.
In the above case,
i) Which right has been violated?
ii) Comment on the right which has been violated.
iii) Where can Mr. Ashok file his complaint?

Solution:
i) Right to Choose has been violated.
ii) In this case, The salesman forced him to buy a pair of bigger size shoes from an ordinary company by claiming this size would be suitable for him. According to Consumer Rights, Mr. Ashok has the right to select from a range of products and services, offering competitive prices with an assurance of satisfactory quality. Here, the right to choose had been violated.
iii) Mr. Ashok can file a complaint in District consumer forum.

3) Mr. X purchases goods from the nearest shop. Mr. Y purchases mobiles from Tokyo. Mr. Z of Nandurbar purchases electronic goods from Delhi.
i) From which type of market does Mr.X purchase?
ii) Name the type of market from where Mr.Y deals?
iii) State the type of market from where Mr.Z purchases goods?

Solution:
i) Mr. X purchases goods from the Local Market.
ii) Mr. Y deals from Tokyo i.e International Market.
iii) Mr. Z of Nandurbar purchases electronics goods from Delhi. i.e National Market.

Q. 4. Distinguish between the following : (Any THREE)   (12)

1) Planning and Staffing.

Points	Planning	Staffing
1) Meaning	Planning is deciding in advance what to do, how to do it, when to do it, and who is to do it.	The staffing function pertains to the recruitment, selection, development, training, and compensation of subordinate managers.
2) Objective	To set goals and choosing the means to achieve these goals.	To appoint right type of people at the right positions and the right time.
3) Area of function	It includes setting objectives by identifying the ways of attaining the goal and selecting the best plan.	It includes recruitment, selection, training, development, and compensation of human resources.
4) Factors	Internal and external factors are considered in the planning process.	Staffing is mostly concerned with internal factors.
5) Resources	Planning is done as per the  requirement and  availability of  resources.	It is the process relating to organization of human resources.
6) Level of management	Top management is concerned with planning the activities.	Middle-level management is related to recruitment, training and selection Top level is concerned with promotion and compensation.

2) Life insurance and Marine insurance.

Points	Life Insurance	Marine Insurance
1) Meaning	A contract whereby the insurance company undertakes to pay a certain sum of money either on death or maturity (whichever is earlier) for a consideration (premium)	A contract whereby the insurance company undertakes to pay  compensation to insured in case of loss to him due to dangers (perils) of the sea.
2) Policy taken by	It can be taken by an individual for his own life or for his family members.	It can be taken by exporters,  importers and shipping companies etc.
3) Subject matter	In life insurance, the life of the  insured is a subject matter	In Marine insurance, goods in the ship, cargo, and freight are the subject matter.
4) Tenure	The policy can be issued for any number of years, even until the death of the assured.	It is generally for a short period and may range from one month to a year. Normally it does not exceed one year.
5) Compensation	It is paid either on death or maturity whichever is earlier.	It is paid only if there is loss causing event during the term of the policy.
6) Principle of Indemnity	It is not applicable as human life cannot be valued in terms of money for calculating the actual loss.	It is applicable as insurance  company compensates for the  financial loss and the insured is brought back to the same financial condition that he was before the event.
7) Number of Policies	Insured can take any number of policies on the same life. Compensation is paid on all the policies.	Generally, only one policy can be taken. However, double insurance is possible. However, compensation does not exceed the actual loss.
8) Beneficiary	The beneficiary can be insured (if he survives the selected term) or else the nominee or the legal heir on the death of the assured.	The beneficiary is the insured  person or company.
9) Surrender of policy	The policy can be surrendered before the expiry of the term subject to certain conditions.	It cannot be surrendered.

3) E-Business and Traditional Business

Points	Traditional business	E-Business.
1) Formation	Traditional business takes lengthy and complicated procedure to form.	E-Business is easy to form.
2) Setting up cost	It takes huge capital in order to setup.	It takes a very nominal cost.
3) Risk Involved	Less Risk involved as parties have personal interaction.	High risk involved as there is no direct contact between the parties.
4) Area covered	Traditional business is limited to particular area so scope is limited.	E-Business covers entire world and so scope is vast.
5) Customer interaction	Face-to-face interaction is possible.	In E-business, there is absence of face-to-face interaction.
6) Physical inspection	Goods can be inspected physically before purchase.	Goods cannot be inspected physically before purchase.
7) Resource focus	Traditional business resources focus on supply side.	E-business resources focus on demand side.
8) Delivery of goods	In traditional business delivery of goods is instant.	In E-business delivery of goods takes time.

4) District Commission and National Commission

Points	District Commission	National Commission
1) Meaning	A consumer dispute redressal forum at the district level established by the State Government is known as District Commission.	A consumer dispute redressal forum at the National level established by the Central Government by notification is known as National Commission.
2) President	A person who is sitting or retired or qualified to be District Judge.	A person who is or has been a judge of the Supreme Court shall be appointed by  the Central Government.
3) Member	Not less than two and not more than such number of  members as may be prescribed, in consultation with the Central Government	Not less than four and not more than such number of  members as may be prescribed.
4) Membership Tenure	The members can have the membership for a term of five years or up to the age of sixty-five years, whichever is earlier.	The members can have the membership for a term of five years or up to the age  of sixty-seven years and president up to seventy years, whichever is earlier.
5) Area covered	It covers a particular district.	It covers the entire country.
6) Monetary Jurisdiction	To entertain complaints where the value of the goods  or services paid as consideration do not exceed Rs. one crore.	To entertain complaints where the value of the goods or services paid as consideration exceeds Rs. ten crore
7) Appeal	An appeal against the District Commission can be made to the State Commission.	An appeal against the National Commission can be made to  the Supreme Court.

Q. 5. Answer in brief : (Any TWO)          (8)

1) Explain any five principles of management of Henry Fayol.

Answer:
Fayol suggested 14 principles of management. These statements serve as a guideline for decision-making and management actions.

1) Principle of Division of Work

According to this principle, the work is divided into different kinds such as technical, financial, commercial, security operations, accounting and managerial. It is assigned to employees as per their qualities and capabilities. It helps in improving efficiency and expertise of employees which ultimately turns into expected productivity level.

2) Principle of Authority and Responsibility

Authority is the right to take decisions. It is necessary to get things done appropriately by subordinates. Authority always comes with responsibility. If the manager is given the authority to complete a task within a given time, he should be held responsible if he does not complete the work in given time. Manager should have proper authority to take managerial decisions on his own with respect to the goal.

3) Principle of Discipline

According to Fayol, discipline is the most essential thing in the organization. Employees must obey and respect the rules that govern the organization. Discipline helps to achieve the goals of the organization. Good discipline is the result of effective leadership. There must be a clear understanding between the management and workers regarding the organization’s rules. Basic discipline should be observed at all levels of management.

4) Principle of Unity of Command

Each member of the organization should receive orders from only one superior. This principle helps in managing conflicts and solving disputes among people in organization. It also helps in avoiding confusion. If an employee receives commands from more than one authority, he will get confused and will not be able to take decisions about whose orders should be followed. This is wrong approach.

5) Principle of Unity of Direction

This principle states that ‘there should be one head and one plan’ in every organization. Each group in the organization should have the same objective and the group should be directed by one manager using single plan.

2) Explain any five points of importance of directing.

Answer:
Theo Haimann: “Direction consists of the process and techniques utilizing in issuing instructions and making certain that operations are carried out as planned.”

1) Initiates Action

Direction is the function that supports activating the plans with the help of employees. Every action is initiated through a timely direction. Proper instructions are given to subordinates while completing their assigned task. The managers direct the subordinates about what to do, how to do, when to do and also to see that their instructions are properly followed.

2) Integrates Efforts

Communication is one of the elements of direction. It helps in integrating the efforts of all the employees and departments which results in achievement of organizational goals. Integration of efforts is possible through persuasive leadership and effective communication towards the accomplishment of organizational goals.

3) Means of Motivation

While directing the subordinates, their opinions are also considered. A manager identifies the potential and abilities of its subordinates and helps them to give their best. He also motivates them by offering them financial and non-financial incentives to improve their performance. It boosts the morale of subordinates.

4) Provides Stability

Stability plays a significant role in the growth and survival of the organization. Effective leadership, communication, supervision, and motivation develop cooperation and commitment among the employees. It provides stability and creates balance among various departments and groups.

5) Coping up with the Changes

Factors of business environment are always changing. Adapting to environmental changes is necessary for the growth of the organization. With the help of motivation, proper communication, and leadership, the employees can clearly understand the nature of change and also the positive outcome of adapting to the change. For example, e-filing, use of Robots at workplace etc.

3) State four types of deposits.

Answer:
The different types of deposits are explained below.

1) Fixed Deposit

A fixed deposit account is an account where a fixed amount is kept for a fixed period of time bearing a fixed interest rate. The rate of interest is more as compared to a savings bank account and varies with the deposit period. Normally, withdrawal of the amount is not permitted before maturity date. However, depositors can withdraw amount before the maturity date for which bank will reduce the interest rate.

2) Recurring Deposit

It is operated by salaried persons and businessmen having a regular income. A certain fixed sum of money is deposited into the account every month. Withdrawal of accumulated amount along with interest is paid after the maturity date. The rate of interest is higher which is similar to a fixed deposit account. A separate passbook is provided to know the position of RD account.

3) Saving Account Deposit

It is generally operated by those who earn regular or fixed income such as salary or wages. The main aim of this deposit account is to encourage the habit of savings among people. These deposit accounts are meant for the purpose of maximum savings. There are restrictions on withdrawal limits from these accounts. These accounts carry low-interest rates.

4) Current Account Deposit

This account is operated by business firms and other commercial organizations such as hospitals, educational institutions, etc. who have regular banking transactions. In this account, there is no restriction on deposits and withdrawals of amounts. No interest is paid by
the bank on this account.

Q. 6. Justify the following statement : (Any TWO)    (8)

1) Right person at right job with right pay is the basic principle of staffing.

Answer:
a) The need of staffing arises since the initial period of organization.
b) Due to promotion, transfer, business expansion, retirement, resignation, accidents, death of employee, etc. vacancies are created in organization.
c) In this context, staffing function plays very important role in an organization.
d) Thus, Right person at right job with right pay is the basic principle of staffing.

2) Entrepreneurship is the best source for self-employment.

Answer:
1) Intellectual Capabilities
An entrepreneur is a creative thinker. He has reasonably good intelligence. He has ability to analyze business situations. This ability will help him to take proper decisions.

2) Future Vision
The entrepreneur has a good foresight about future market situation. He should also have knowledge about external business environment. This will help him to take proper decisions according to the situations and changes in the market. So, he can take timely action for the same.

3) Technical Knowledge
An entrepreneur has good technical knowledge about his business. The entrepreneur has the ability to update himself with the latest knowledge about the product, process and technology.

4) Risk bearing capacity
A successful entrepreneur takes calculated risks. He is ready to face challenges and always seeks new and more opportunities.
Thus, Entrepreneurship is the best source of self-employment.

3) Principle of subrogation is applicable to all contracts of indemnity.

Answer:
a) As per the principle of subrogation, after the insured is compensated for the loss due to damage of the property insured, then the right of ownership of such property passes on to the insurer.
b) This principle is applicable only when the damaged property has any value after the event causing the damage.

c) Indemnity means a guarantee or assurance to put the insured in the same financial position in which he was prior to the happening of the uncertain incident.
d) Principle of indemnity is applicable to fire, marine, and general insurance. It is not applicable to life insurance as loss of life can never be measured in monetary terms.
Thus, the principle of subrogation is applicable to all contracts of indemnity.

4) Business organizations should avoid environmental pollution and ecological imbalance.

Answer:
1) The functioning of business units and industrialization creates air, water, and sound pollution. The carbon particles, dust, harmful gases, chemicals, etc. create air pollution

2) Harmful chemicals, untreated sewage, industrial waste, fertilizers, pesticides, refuse, e waste, etc. when get mixed with water, creates water pollution. Airplanes, motor vehicles, construction machines, and industrial equipment create sound pollution.

3) Business organizations are expected to take all possible measures to prevent air, water, and sound pollution and to maintain the ecological balance. For the well-being of society, every organization should assist the concerned organizations engaged in pollution control programs such as the plantation of trees, preservation of wildlife, and natural resources.

4) Protecting the environment and maintaining the ecological balance in the following manner:
(i) Business organizations save costs and money by minimizing waste.
(ii) Business organizations that follow green practices (plantation of more and more trees) get support from customers.
(iii) Business organizations that take precautions to protect the environment create awareness among employees.
(iv) Protection of the environment process cut carbon emissions and create conditions for green growth which is beneficial to society.
(v) Business organizations showing awareness of environment protection get support and encouragement from the government. Thus, business organizations should avoid environmental pollution and ecological imbalance.

Q. 7. Attempt the following : (Any TWO)              (10)

1) What are the functions of warehouses?

Answer:
Following are the functions of warehouses:

1) Storage

This is the basic function of warehousing. Surplus commodities which are not needed immediately can be stored in warehouses. They can be supplied as and when needed by the customers.

2) Price Stabilization

Warehouses play an important role in the process of price stabilization. It is achieved by the creation of time utility by warehousing. In warehouses, usually large stock of goods is kept. Whenever there is a shortage in the market, goods can be immediately supplied through warehouses, which helps in price stabilization to avoid rise in price due to demand and supply differences.

3) Risk bearing

When the goods are stored in warehouses they are exposed to many risks in the form of theft, deterioration, fire, etc. Warehouses are constructed in such a way that they minimize these risks. A warehouse keeper has to take reasonable care of the goods and safeguard them against various risks. For any loss or damage sustained by goods, warehouse keeper shall be liable to the owner of the goods.

4) Financing

Loans can be raised from the warehouse keeper or from financial institutions against the goods stored by the owner. Goods act as security for the warehouse keeper or for financial institutions. In this manner, warehousing acts as a source of finance for the businessmen for meeting business operations.

5) Grading and Packing

Warehouses nowadays provide the facilities of packing, processing, and grading of goods. Goods can be packed in convenient sizes as per the instructions of the owner.

6) Transportation

Warehouses can provide transportation facilities to bulk depositors. It collects goods from the place of production and also sends goods to the place of delivery at the request of the owner.

7) Time and Place Utility

Warehouses create time utility by preserving the goods till they are demanded. It also creates place utility by providing the goods at the place, where they are required.

8) Processing

Certain commodities are not consumed in the form they are produced. Processing is required to make them consumable. e.g. Paddy is polished, fruits are ripened, etc. Sometimes warehouses undertake such activities on behalf of the owners.

2) State rights of the consumer.

Answer:
Following are the rights of the consumer.

1) Right to Safety

This right protects consumers against products, production processes, and services that are hazardous to health or life. According to this right, a consumer must get full safety and protection to his life and health. This safety should be in relation to medicines, electrical appliances, food, etc. The GOI has given safety standards in the form of AGMARK, lSI, BIS, Hallmark, etc.

2) Right to Information

According to this right, consumers should be provided with adequate information about all aspects of goods and services like price, name of the manufacturer, contents used, batch number if any, date of manufacture and expiry date, user manual and safety instruction, etc. It is applicable to food products, medicines, spare parts, or any other consumer products or services.

3) Right to Choose

The choices available to Indian consumers across the basket of goods and services have multiplied like telecommunications, travel and tourism, banking, electronics, fast-moving consumer goods(FMCG), etc. According to this right, a consumer should be given full freedom to select an article as per his requirement, liking, and purchasing capacity. As per this right, the seller cannot compel consumers to buy a particular product and hence monopoly is prevented.

4) Right to be heard

Every business organization should listen to and solve the complaints of consumers. According to this right, consumers have the opportunity to voice their complaints to the consumer forum. Consumers also give suggestions to manufacturers or traders on certain matters such as quality, quantity, price, packaging, etc. Nowadays, consumers can file online complaints through portals or mobile applications.

5) Right to Consumer Education

This right creates consumer awareness. An aware consumer can make a rational choice of goods and services and protect his rights and interests from the exploitation of unscrupulous businessmen. Thus, consumer education becomes a priority concern. It is necessary to give education and training regarding prevailing acts and legal processes. The government, media, and NGOs play vital roles in this regard. E.g. ‘Jago Grahak Jago’ campaign.

6) Right to Represent

The act provides an opportunity to individuals and consumer groups to represent consumers’ interests in consumer forums. The act allows the consumer to be represented by a person who is not a professional advocate. This provision is in recognition of the consumer’s right to represent.

7) Right to Redress

Along with the right to represent, the right of redressal is also given. Only filing of complaints is not enough to give justice to consumers, so this right implies a fair settlement of claims. This right enables the consumer to demand repair or replacement or compensation for defective products and for poor services. According to the consumer protection Act, three-tier quasi-judicial consumer dispute redressal machinery is established for the settlement of claims such as the District Commission, State Commission, and National Commission.

8) Right to Healthy Environment

All consumers have a right to a healthy and clean environment. According to this right, consumers can demand action against the pollution causing business organizations. All consumers have the right to a healthy and clean environment in the present and future.

9) Right to Protect from unfair business practices

As per this right, all consumers are protected against unfair business practices such as black marketing, profiteering, faulty weights and measures, exorbitant prices, adulteration, etc.

10) Right against spurious goods

This right is against the marketing of goods that are hazardous to health, spurious, and pose a danger to life itself.

Note: Write any 6-7 points for 5 marks question.

3) Explain packaging and labelling.

Answer:
Packaging

Package and Label create the first impression on the consumer about the product. An attractive package and label can help to make the product successful. Packaging means designing the package for the product. It helps to avoid breakage, damage, and destruction of the product. Packing material includes bottles, containers, plastic bags, tin, wooden boxes, jute bags, bubble bags, packing foam, etc.

Labelling

The label is a slip that is found on the product and provides all the information regarding the product and its producer. The slip on which all this information is provided is called a label and its process is called as labeling. Packaging and labelling not only provide protection to the product but also act as an effective tool of marketing.

Q. 8. Answer the following questions : (Any ONE)    (8)

1) What is insurance? Explain principles of insurance.

Answer:
Insurance is a means of protection from financial loss. It is a form of risk management, primarily used to hedge against the risk of a contingent or uncertain loss. Insurance is a contract between the insurer and the insured, whereby the insurer agrees to compensate the insured against loss. The insured has to pay a certain fixed sum of money on timely basis to the insurer.

Principles of Insurance:

1) Principle of Utmost good faith

In all types of insurance contracts both the parties must have utmost good faith towards each other. The insurer and insured must disclose all material facts clearly, completely and correctly. The insured must provide complete, clear and correct information of the subject matter of insurance to the insurer. Similarly, the insurer must provide relevant information regarding terms and conditions of the contract. Failure to provide complete, correct and clear information may lead to non-settlement of claim. 

For example, Mr. Shantanu has not provided information regarding his heart surgery at the time of taking policy. After his death, insurance company comes to know about this fact. As Mr. Shatanu has not provided correct and complete information at the time of taking policy, insurance company can refuse to give compensation to his family members.

2) Principle of Insurable interest

Insurable interest means some financial interest in the subject matter. The insured must have an insurable interest in the subject matter of insurance. Insurable interest is applicable to all insurance contracts. It is said to have an insurable interest in subject matter, when the existence of that subject matter puts the insured in financial benefit. Whereas nonexistence of subject matter put him into financial loss.

For example,
i) a person has an insurable interest in his own life and property.
ii) a businessman has an insurable interest in the goods he deals and in the property of business.

3) Principle of Indemnity

Indemnity means a guarantee or assurance to put the insured in the same financial position in which he was immediately prior to the happening of the uncertain event. This principle is applicable to fire, marine, and general insurance. It is not applicable to life insurance as loss of life can never be measured in monetary terms. In case of death of the insured, the actual sum assured is paid to the nominee of the insured. Under this principle, the insurer agrees to compensate the insured for the actual loss suffered.

For example, If a property is insured for Rs. two lacs and if the loss by fire is Rs.one lac, then the insured can claim compensation of Rs.one lac only.

4) Principle of Subrogation

This principle is applicable to all contracts of indemnity. As per this principle, after the insured is compensated for the loss due to damage of the property insured, then the right of ownership of such property passes on to the insurer. This principle is applicable only when the damaged property has any value after the event causing the damage.

For example, Mr. A owns a two-wheeler. The vehicle was stolen and subsequently, Mr.A filed a complaint in local police station. Upon receiving report from police,. the insurance company compensated fully Mr.A for the loss of the vehicle. Later on the stolen vehicle was recovered by police. In this situation, the owner of the vehicle does not have any claim over the vehicle as he has already subrogated i.e. transferred the ownership rights of the vehicle to the insurer. The insurer gets every right to sell or to scrap the said vehicle.

5) Principle of Contribution

This principle is applicable to all contracts of indemnity where the insured has taken out more than one policy for the same risk or subject matter. Under this principle, the insured can claim the compensation only to the extent of actual loss either from one insurer or all the insurers. If the one insurer pays full compensation then that insurer can claim a proportionate amount from other insurers from whom insured has taken policy.

For example, Ms. Sayali insures her property of Rs. Two Lac Fifty Thousand with two insurers, with T Insurance Co. for Rs.One Lac(2/5th of the property value) and R Insurance Co. for Rs.One Lac Fifty Thousand (3/5th of the property value). If Ms. Sayali ‘s property is destroyed and the loss is worth Rs. One Lac Twenty Thousand, then both insurance companies will contribute towards actual loss i.e.Rs.One Lac Twenty Thousand. Thus company T will pay RS.48000/- (2/5th of the loss) and company R will pay Rs. 72000/-(3/5th of the loss).

6) Principle of Mitigation of loss

Insured must always try to minimize the loss of the property, in case of uncertain events. The insured must take all possible measures and necessary steps to control and reduce losses. Hence, it is the responsibility of the insured to protect the property and avoid loss.

For example, A house of Mr. Jayant is on fire due to an electric short circuit. In this case, Mr. Jayant cannot remain passive and must try his best to save his house from fire. Mr. Jayant must be active and cannot watch his house burn, just because house is insured.

7) Principle of Causa-Proxima

The principle of causa Proxima means, when a loss is caused by more than one causes, then the proximate cause of loss should be taken into consideration to decide the liability of the insurer. The property is insured against some causes and not against all causes, in such a case, the proximate cause of loss is to be found. If the proximate cause is the one which is insured against, the insurance company is bound to pay compensation and vice versa.

For example, a house was insured against the risk of theft. There was a theft in the house and before leaving, the house was set on fire by thieves. Now, there are two causes of loss, theft and fire, and the nearest cause of loss was fire. As the house was insured against theft and not by fire, the insured will not get any compensation from insurance company for loss by fire. But, he will get compensation for the property lost by theft.

2) Explain in detail 7Ps of Marketing Mix.

Answer:
1) Product

Product refers to the goods or services that are offered to the customers for sale and are capable of satisfying the need of the customer. The product can be intangible or tangible, as it can be in the form of services or goods. The business need to decide the right type of product through extensive market research. The success of the business depends on the impact of the product in the minds of the customer.

2) Price

The price of the product is basically the amount that a customer pays for the product. Price
plays an important role in creating demand for the product. The business needs to take utmost care to decide the price of the product. Cost of the product and willingness of the customer to pay for the product play an important role in pricing the product. Too high price may affect the demand for the product and pricing too low may affect the profitability of the business. While deciding the prices, the value and utility of the product to its customers are to be considered.

3) Place

Place is also known as a distribution channel. Placement or distribution is a very important part of marketing. Making the right product at the right price is not enough. A businessman needs to make the product available to the potential customers at the right place too. Business needs to distribute the product in a place that is accessible to potential buyers. It covers location, distribution, and ways of delivering the product to the customer. Better the chain of distribution higher the coverage of the product in the market.

4) Promotion

Promotion is an important element of marketing as it creates brand recognition and sales. Promotion is a tool of marketing communication that helps to publicize the product to the customer. It helps to convey product features to the potential buyer and induce them to buy it. The promotion mix includes tools such as advertising, direct marketing, sales promotion, personal selling, etc. The combination of promotional strategies depends on budget, the message business wants to communicate, and the target market.

5) People

People inside and outside the business directly or indirectly influence the business. People comprise all the human beings that play an active role in offering the product or service to the customer. The people include employees who help to deliver services to the customer. Right people at right place add value to the business. For the success of the business, it is necessary to recruit right people, train them, develop their skills and retain them.

6) Process

Process refers to the steps involved in delivering products and services to the customer. Processes are important to deliver a quality service. A good process helps to ensure the same standard of service to the customer as well as save time and money by increasing efficiency. The advancement of technology helps businesses in effective monitoring of the process of the business and take corrective action wherever necessary.

7) Physical Environment

Physical Environment refers to the marketing environment wherein the interaction between
customer and firm takes place. Since services are intangible in nature service providers try to
incorporate certain tangible elements into their offering to enhance customer experience. In
the service market, physical evidence is important to ensure that the service is successfully delivered. Through physical evidence, customers know the brand leaders in the market. Physical evidence affects the customer’s satisfaction. It includes location, layout, interior design, packaging, branding, dress of the staff and how they act, waiting area etc.

12th OCM Sample Question Paper

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