Short Notes: Written by Manish Verma Written by Manish Verma

1
12TH Business Studies (319)

NIOS CLASS 1
Written by Manish Verma

Short Notes
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Learners Guideline Business Studies (319)
Chapter -1
NATURE AND SCOPE OF BUSINESS
Introduction
As we are all aware of human beings undertake various activities to satisfy their needs and
wants. These activities are known as Human Activities but why do they want to do any of such
activities? Obviously, it is mainly to earn their livelihood. In this lesson we shall learn about all
such activities, their categorization and some other related aspects like earning of adequate
profits, exploring new markets, growth and optimum utilization of available resources, all are the
Economic objectives of a business, Social objectives of a business include production of quality
goods, reasonable pricing, and upliftment of the society, fair dealings and good return to the
investors and human objectives include fair remuneration and incentives to the employees, better
working conditions, job satisfaction, and promotional opportunities etc. and at last Commerce is
the sum total of all activities involving removal of hindrances in the process of exchange of
goods and services and facilitates the availability for consumption.
Important points from text

1. The activities in which individuals engage themselves on a regular basis and earn their
livelihood are known as their ‘occupations’.
In fact everyone is engaged in one occupation or the other, and these can be broadly
categorized as –
(a) Profession;
(b) Employment; and
(c) Business.
2. Business objectives are something, which a business organization wants to achieve or

accomplish over a specified period of time. The objectives of business may be classified
as –
(a) Economic objectives
(b) Social objectives
(c) Human objectives
(d) National objectives
(e) Global objectives
4. The role of profit in business:
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5. Nature of Business Risk :

a) Uncertainty
b) Profit is the Reward for Risk
c) Difficult to Measure
d) Essential Element of Business
e) Variability
6. Causes of Business Risks

a) Natural Causes
b) Economic Causes
c) Political Causes
d) Human Causes
e) Physical and Technical Causes
7. Industry primarily refers to all such business activities concerned with

production/raising or processing of goods and services. It processes raw materials or
semi-finished goods into finished goods.
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Learn new words:

1. Auxiliaries to trade: - These are various activities that facilitate trade.
2. Business: - Activities involving regular production or purchase of goods and services for
sale, with an object of earning profit are known as Business.
3. Economic Activities:- Human activities that are undertaken with an objective to earn the
livelihood
4. Non Economic Activities: Activities undertaken to derive mere satisfaction
5. Profession: - All activities that require special knowledge and skill to be applied by an
individual to earn living.
6. Employment: - When people render their services regularly for others and get the return
in terms of wages/salary.
Evaluate yourself.
1. Mr.Varun wants to start a business and therefore help him to knowing business risk
and its causes.
2. Ms Radhika wants to earn profit from her business and really excited to know the role
of profits in business. Explain in detail.
3. Explain the purpose of economic and non economic activities with examples.
4. No business is risk free. Put light on this statement
Maximize your marks
 Learning new words and answer all the above questions.
Page 3 of 3
NIOS/Acad./2020/319/01/E
National Institute of Open Schooling
Senior Secondary Course – Business Studies
Lesson 1: Nature & Scope of Business
Worksheet-1
1. Explain Economic Activities. Classify and give examples from your surroundings.
2. Differentiate between Business, Profession and Employment on the basis of definition,

risk and capital.
3. Elaborate the importance of Business.
4. What objectives would you keep in mind while starting a Business?
5. ‘Is profit earning the sole objective of Business?’ Explain the role of profit in Business.
6. What is Business Risk? Why is it often said that more the risk more the profit? Discuss.
7. According to you what are the factors that cause Business Risks?
8. Elaborate the various classifications of business activities giving relevant examples.
9. What is industry? Give its various classifications.
Definition
On the basis of On the basis of On the basis of level On the basis of size of
nature of activity nature of goods of investment activity
produced
10. What is Trade? Explain various auxiliaries to Trade. How would these help you in doing
a Business?
Chapter -2
BUSINESS SUPPORT SERVICES
Introduction
Have you ever observed that to carry out any business activities successfully various support
services are required? Activities that facilitate smooth flow of goods from producers to
consumers and functioning of business are termed as business support services like arranging
funds, buying of goods from the main market, carrying those goods to the shop, stores those
systematically and sells them to the customers as per their demand. The owner or the
businessman needs various help or support from others. For example, he may take loan from
bank, hire machinery so let us have an idea about those services and their operations. In this
lesson we shall learn about the basic aspects like the meaning, importance and functioning of
these support services.
Important points from the text:

1. Banking refers to the provision of services by banks and there are different types of
Banks like acceptance of deposits, grant of loans and advances and other agency as well
as general utilities services.
2. Functions of commercial banks

(a) Primary functions:
(i) Accepting deposit (ii) Lending money
(b) Secondary functions :

(i) Agency services (ii) General utility services.
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3. Insurance: Based on the subject matter of insurance and nature

of risk covered, insurance can be broadly classified as
(a) Life insurance, (b) Fire insurance, (c) Marine insurance, and (d)
Other types of insurance.
4. Principles of insurance :-
5. The main services which help business in its effective communication are classified as
postal services and telecommunication services.
The various services provided by post offices are classified as (a) Mail services, (b)
Financial services, (c) Insurance services, and (d) Business development services.
6. The telecommunication which are helpful for business firms are fixed line phone, cellular
service, telegram, telex, fax, voice mail, e-mail, teleconferencing.
7. Warehousing refers to the activities involving storage of goods on a large scale in a
systematic and orderly manner and making them available conveniently when needed.
The different types of warehouses functioning in our country are – Private warehouses,
Public warehouse, Government warehouse, Bonded warehouse and Cooperative
warehouse.
8. The functions of warehouse are – storage of goods, protection of goods, bears the risk of
loss or damage to goods in storage, financing, processing, transportation. It also performs
various value added services like grading and branding, mixing, blending and packaging
of goods.
Learn new key words:
1. Bank draft is a cheque drawn by a bank branch on another branch outside the city.
2. A pay order is a cheque drawn by a bank branch and payable at same branch
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3. RTGS is a fund transfer system where there is no waiting period for the settlement of
transaction. Minimum transaction value is Rs. 50,000.
4. NEFT is a fund transfer system and transactions are settled in batches.
5. SMS alert is an e-banking facility where in the customer remains informed about every
deposit/withdrawal from his account.
6. Parcels and couriers are type of postal services
7. Saving services provided by post office include NSC, PPF, and MIS
8. A lumpsum amount is deposited for a specified time in fixed deposit account.
9. In RD accounts, the account holder is required to deposit a
specified sum of money every month. Saving account is opened
10. Current deposits accounts provide facility to business persons to
deposit or withdraw money
Evaluate yourself.
1) Explain the concept of business support services

2) What are the functions of commercial bank and what are the different types of bank
3) State the importance and types of insurance
4) What is the meaning , mode and importance of Transportation.
5) Explain the concept of communication and various means of communication.
6) Warehousing meaning, Importance and function.
Maximize your marks
 Learn the key words
 Get into the little details of the above mentioned important points.
 Answer all the question to evaluate yourself and to maximize your marks.
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NIOS/Acad./2020/319/02/E

Lesson 2: Business Support services
Worksheet- 2
1. Why do you think that banks are important to us?
2. Discuss with your friends the various types of banks you see in your city. How would
you classify them?
3. What are the primary and secondary functions of Commercial Banks?
4. Briefly explain different banking services. If you want to expand your business, how can
you avail the services of banks? Explore.
5. What is insurance and why do you think it is important?
6. Explain different types of insurance. Which life insurance policy would you opt for and
why?
7. What is transportation? Why it is important for any business?
8. Explain Communication and its types. Do you think communication is important for
business? Justify.
9. Explain the role of Warehouses in business. What services do you feel can be offered by
a warehouse? Elaborate.
Chapter- 3
BUSINESS ENVIRONMENT
Introduction
The term ‘business environment’ means external forces, factors and institutions that are beyond
the control of the business and they affect the functioning of business enterprises. The interaction
between the business and its environment helps in identifying the opportunities for and threats to
the business. Hence it is important to learn about the various components of the business
environment, which consists of the economic aspect, the socio-cultural aspects, the political
framework, the legal aspects and the technological aspects.
Important points:
 Business environment is multifaceted, complex, and dynamic in nature. The changes in
business environment are unpredictable. It differs from place to place, region to region
and country to country. Environmental analysis makes the task of managers easier in
dealing with business challenges. It helps the firms to analyze the competitors’ strategies
and formulate their own strategies accordingly keeping in mind its own strength and
weakness.
 Types of Business Environment
(a) Economic environment: (i) Economic Conditions; (ii) Economic Policies;
(iii) Economic System
(b) Non-economic environment : (i) Social Environment; (ii) Political Environment; (iii)
Legal Environment; (iv) Technological Environment; (v) Demographic Environment; (vi)
Natural Environment
 Recent development in Indian Economy
(a) Liberalisation: Liberalisation refers to the process of eliminating unnecessary

controls and restrictions on the smooth functioning of business enterprises.
(b) Privatisation : Privatisation refers to reducing the role of public sector by involving
the private sectors in most activities.
(c) Globalisation : Globalisation means ‘integrating’ the economy of a country with the
world economy. This implies free flow of goods and services, capital, technology and
labour across national boundaries.
 Social Responsibility of Business: Social responsibility of business refers to the

obligation of business enterprises to adopt policies and plans of actions that are desirable
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in terms of the expectation, values and interest of the society. It ensures that the interests
of different groups of the public are not adversely affected by the decisions and policies
of the business.
 Business Ethics: Business ethics are the moral principles, which guide the behavior of
businessmen or business activities in relation to the society. It provides certain code of
conduct to carry on the business in a morally justified manner. Business ethics means
moral behavior on the part of businessmen. Elements of business ethics include –
discipline, honesty, fair and reasonable treatment, perfection in the conduct of life and
desirable business practices.
 Business and Environmental pollution: - The health of plants and animals depend on
the quality of environment in which they live. Rapid industrialization, evolvement of fast
food centers and traffic have caused much damage to the environment.
Need for Pollution Control:-

1. To reduce safety hazards and to ensure safety of life.
2. To reduce risk of liability to pay compensation to people.
3. To protect public health.
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4. To reduce inconveniences like water pollution (which will affect fishes and other water
plants), human health hazards such as breathing difficulty, irritation in eyes etc.
5. To save cost of cleaning the land and machines.
Learn new key words:
 Economic Environment- The survival and success of each and every business
enterprise depend fully on its economic environment. The economic environment
includes economic conditions, economic policies and economic system of the country
 Non Economic Environment-Non-economic environment comprises social,

political, legal, technological, demographic and natural environment. All these have a
bearing on the strategies adopted by the firms and any change in these areas is likely to
have a far-reaching impact on their operations
Evaluate yourself
1. The recent developments in Indian economy that have greatly influenced the working of
business units in India, Therefore explain the importance and types of business
environment?
2. What do you understand by social responsibility and how it is towards different
interest groups?
3. Explain the concept of Business ethics and what are its elements that help business to
grow?
4. Briefly explain the impact of government policy changes on Business and Industry?
Maximize your marks
 Learn the key words
 Answer all the question to evaluate yourself and to maximize your marks.
Page 3 of 3
NIOS/Acad./2020/319/03/E
Lesson 3: Business Environment
Worksheet- 3
1. What do you mean by ‘Business Environment’? Explain its features.
2. Elaborate the importance of Business Environment and explain how does it impact a
business.
3. Discuss the various Economic and Non-economic Business Environment.
4. Briefly explain Liberalisation, Privatization and Globalisation reforms in India.
5. How Government policy changes have impacted business and industry?
6. Explain the concept of Social Responsibility in business.
7. What are various responsibilities of business towards their interest groups.
8. How does business contribute in environmental pollution?
9. What do you understand by business activities? Also explain Business Ethics in detail.
Lesson-4
MODERN MODES OF BUSINESS
Introduction
Now-a-days the Internet is a worldwide system of computer network through which the users at
any computer can access the information from any other computer. It helps the users to browse
information on any topic, exchange messages using e-mail, chatting, and purchase items on-line
and so on. You know that normally E-Commerce is the process of conducting business with the
help of electronic devices using the computer and interconnected telecommunication network. E-
business requires a website, technically qualified workforce, computer and effective
telecommunication system. However, India took no time to adapt the changing technology and
emerged as a successful player in the world market. This has been made possible through
introduction of information technology. In this lesson we shall learn in details about all these
modern modes of business.

1. E-Commerce takes place between companies i.e., business to business (B2B), between
companies and their customers (B2C), and customer to customer (C2C).
2. E-Business covers not only the interaction with its customers and suppliers but also
interactions and dealings among various departments and persons within the firm. E-
Business includes not only B2B, B2C, and C2C but also Intra-B Commerce i.e.,
interaction and dealings among various departments and persons within the firm.
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3. Benefits of e-Commerce/e-Business:
(a) Wider Accessibility (b) Improved Customers Service (c) Shortened Transaction Time
(d) Cost Saving and Low Prices (e) Enlarge Business and Profits (f) Convenience to
Customers
4. Limitations of e-Commerce/e-Business:
(a) It lacks personal touch with customers

(b) The customer cannot actually see, feel or try on the goods he/she is buying. (c) The
physical delivery of goods often takes long time.
(d) Return of faulty goods bought on-line may often be more problematic and a time
consuming exercise.
(e) Shopping through Internet is not the same experience as a shopping expedition with
family or friends.
(f) Online transactions are prone to a number of risks that can result into financial,
reputational or psychological losses to the parties involved in a transaction.
5. The Transaction Process

(Precautions for Security)
(a) Protected by Passwords

(b) Off-line Authentication
(c) Encryption, which refers to the conversion of data into a code so that it cannot be read
by other users.
(d) Use of digital signatures to authenticate the sender of the message
(e) Copy of the transaction may be forwarded to a trusted third party.
• Applications of e-Commerce
e-Banking (b) e-ticketing (c) e-Advertising (d) e-Trading (e) e-Post
6. Outsourcing is a management strategy by which an organisation contracts out its major

non-core functions to specialised service providers with a view to benefit from their
expertise, efficiency and cost effectiveness, and allow managers to concentrate on their
core activities.
Page 2 of 3
Learn new points:

1. E-business requires a website, technically qualified workforce, computer and effective
telecommunication system.
2. Before performing online buying, customer must find the seller, select the product and
place an order.
3. Payment in online shopping can be through COD, Cheque, Net banking transfer,
Credit/debit card, Digital Cash etc.
4. Scope for BPO are productivity improvement, cost reduction, focus on core business
technology up gradation and stimulation of entrepreneurship.
5. KPO means outsourcing services that require expertise of a higher order
6. E-Banking - is an electronic medium through which our registered users can access
various services
7. E-Ticketing- allows you to send ticketing information directly to an airline
8. E-Advertising - is advertising that uses the Internet and other forms of digital media to
help a business promote and sell goods and services.
9. E-Post - sends messages as a soft copy through internet and at the destination it will be
delivered to the addressee in the form of hard copy
Evaluate yourself
1. Explain the facility of Internet and its uses which are used in various mode of
business.
2. What do you think E-commerce is better or E-business? Explain its advantages
and limitation
3. Identify the stages involved in the trading process in on-line transactions and what
are the precautions to be taken to ensure security in on-line transactions
4. Explain the concept of outsourcing of services, its merits and limitations.
Maximize your marks

 Read the chapter carefully and attempt all the above questions.
 Go through the learning key point
Page 3 of 3
NIOS/Acad./2020/319/04/E

Senior Secondary Course: Business Studies
Lesson 4: Modern Modes of Business
Worksheet-4
1. The Internet is the global system of interconnected computer networks to communicate

between networks and devices. Comment and enlist 10 most important uses of the
Internet.
2. Make a list of various modes of the business transactions depending upon the activities
you observe in the shops in your locality.
3. Reema wants to start a garment retailing business. She is confused whether she should go
for e-business or not. Explain the various benefits and limitations of e-business.
4. Your brother wants to buy a Rakhi gift online for you. Describe the various stages
involved in making online transactions.
5. Your father feels that online transactions are not secure. Explain the steps that can be
taken to ensure security in online transactions.
6. Rajan wants to expand his business to online platform. Describe the various e-resources
required for successful e-business implementation.
7. Select a company of your choice and find out the various services being outsourced by
the company. Why do you think is outsourcing needed?
8. Roshan manages an IT firm. He wants to outsource services like payroll processing or

cheque processing. Explain the merits and demerits of outsourcing of services.
9. KPO is mainly done to improve the efficiency and quality and reduce the cost of doing
business. In light of this statement write a short note on KPO. Also differentiate between
a BPO and KPO.
10. Risks involved in business transactions may be financial, reputational or physiological.

Describe the various types of e-business risks.
Lesson-5
FORMS OF BUSINESS ORGANISATION
Introduction
In this lesson, you will learn about the various forms of business organization their
characteristics, merits and limitations, suitability and the steps involved in their formation. In
business activities, whether it is a single individual who may own the business or a number of
individuals may come together to own the business jointly. So, based on ownership, we have
different forms of business organization like a proprietary concern, a partnership firm or a
company. You will realize that whatever business activity one may take up, he has to bring
together various resources like men, money, materials, machines, technology, etc. to carry out
that activity successfully. Not only that these resources are to be put into action in a systematic
manner to achieve the objectives of business.
1. On the basis of ownership and management there are different forms of business
organization.
2. Sole proprietorship – refers as sole trader

 Ownership and, usually, operation of an organization by one person. He/she takes the
profits and bears the losses. This form of business organization include, easy to form
and wind up, quick decision and prompt action, direct motivation, flexibility in
operation.
3. Partnership – Business operated by two or more persons as co –owners. It pools

resources from the partners, makes their optimum utilization by taking better decisions. It
Page 1 of 3
protects the interest of each and every partner and gets benefit out of the specialized knowledge
and skills of individual partner.
4. Joint Hindu Family - It is governed by Hindu Law. The members of the Hindu undivided
family jointly own the business and the eldest member called Karta manages the business in
the best possible manner. Every member called co-parcener gets an assured share in profit
irrespective of their participation.
1. Cooperative society is a voluntary association of persons who work together to

promote their economic interest. It works on the principle of self-help and
mutual help.
6. Suitability: Sole proprietorship is suitable for simple business involving less capital and
low risk. Partnership form of business is suitable for construction business, providing legal
services, medical services etc. Joint Hindu Family form of business organisation is suitable
where the family inherits a running business and the members want to continue the business
jointly. Cooperative Society form of business organisation is generally started to solve the
common economic problems or to meet the common requirements of the weaker sections of
the community.
Learn new points:
Page 2 of 3
 Partnership Deed: - an agreement between the partners of a firm that outlines the
terms and conditions of partnership among the partners.
 Partner by estoppels- The phrase refers to a person who is not technically a

partner, but can still be held liable as one for any debts or damages incurred by a
business or owed to a third party.
 Coparcener’ - a person who shares equally with others in the inheritance of an

undivided estate or in the rights to it..
Evaluate yourself
1. Mr. X and Mr. Y were thinking for quite a long time to convert their partnership firm into
Pvt. Ltd. Co. but they are not sure, whether it would be possible or not, and now it is
going to be different from partnership. Guide them in this situation
2. Since Karta has absolute power to manage the business as per his own will, he may
misuse the authority for his personal gain. What do you think?
3. If you got an opportunity to start a business in the present scenario which form of
business organization will you choose & why?
Maximize your marks

 Read the chapter carefully and attempt all the above questions.
Page 3 of 3
NIOS/Acad./2020/319/05/E

Lesson 5: Forms of Business Organisation
Worksheet-5
1. The market in your vicinity is limited, localised and customers give importance to
personal attention. Your friend wants to start a grocery shop there. Which form of
business organisation would you suggest him and why? Explain its merits and
limitations.
2. Pradhan wants to expand his factory but arranging funds is challenging for him. He fears
taking loan from bank. So he is planning to join hands with someone so that resources
and work can be shared. This involves going into a partnership. Explain the nature, merits
and limitations of partnership before he makes a decision.
3. Cooperative society is a voluntary association of persons who work together to promote

their economic interest. If the students of your society join together for forming a
cooperative society, what would it be and how would it benefit the society?
4. A cooperative society is different from other forms of business organisations. Describe its
characteristics that make them different from other forms of business organisations.
5. Cooperative societies can be classified on the basis of nature of services rendered by

them. Write a short note on main types of cooperative societies giving one example each.
6. Your friends in the society want to form a cooperative society. What advantages and
limitations would you tell them before they start? Explain in detail.
7. It is always advisable for partners to have a written agreement before they get into a
partnership. Describe its contents.
8. You as a Joint Hindu Family are engaged in a trading business. Your younger brother is
inquisitive to know more about the family business. Explain the characteristics of HUF.
9. Partners can be classified into various categories based on liability, nature of

participation, sharing of profits and conduct exhibited. Elaborate.
10. Select a business that you would like to undertake and choose the form of business
organisation for performing the business. Justify your answer.
Lesson-6
COMPANY FORM OF BUSINESS ORGANISATION
Introduction
You must have heard the names of State Bank of India (SBI), National Thermal Power
Corporation (NTPC), Reliance Industries Limited (RIL) and Tata Steel Limited. Do you know
who owns these steel plants? These are all big business units and organized in the form of Joint
Stock Companies. Now we shall learn in detail about the Joint Stock Company; its merits and
limitations; and also discuss the factors that influence the choice of form of business
organization. We will also learn about the factors influencing the choice of an appropriate form
of business organization

1. A joint stock company is an artificial person, having a separate legal entity, with a
perpetual succession.
2. The Characteristic of a Joint stock companies are :
3. Types of company
Private Government
Public company
company company
Statutory Chartered Foreign

company company company
Multinational
Holding Subsidiary
corporation
company company
(company)
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4. Merits of Joint stock company

 A joint stock company can arrange large resources.
 Its members enjoy the benefits of limited liability.
 The benefits of large scale business operation can only be derived from this form
of organization. Its shares are easily transferable.
 It derives the benefit of professional management in its operation
5. Demerits of Joint stock company

 The formation of a joint stock company involves compliance with a number of
legal formalities.
 It suffers from the limitations of excessive government control. It is very difficult
to maintain secrecy in the business.
 All important decisions require the approval of Board of Directors or General
body of the shareholders.
 It takes more time in taking certain decisions. The joint stock companies are
practically managed by a specific group of people.
6. Multinational corporation: A business unit that is registered as a company in one

country but carries on its business in a number of other countries by setting up factories,
branches and subsidiary units is called a multinational corporation.
7. Merits of Multinational corporation:
a) Investment of foreign capital

(b) Generation of employment
(c) Use of advanced technology
(d) Growth of ancillary units
(e) Increase in exports and inflow of foreign exchange
(f) Healthy competition with domestic companies
8. Demerits of Multinational corporation:
a) Least concern for priorities of host countries

(b) Adverse effect on domestic enterprises
(c) Change in culture of the people.
9. A joint venture is an enterprise set up jointly by two or more business concerns. It helps
in pooling the funds, technical knowhow and managerial skills
10. A PPP is a partnership between a private sector enterprise and a public sector
enterprise. Active government involvement, pooling of funds, expertise and experience,
sharing of risk and responsibility etc. are the features of PPP form of enterprise.Faster
implementation, high quality services, sharing of risk, accountability of the government
are the merits of PPP.
Page 2 of 3
Learn new points:

 Liability- A liability is something a person or company owes, usually a sum of money. .
 Finance – It is a broad term that describes activities associated with banking, leverage or
debt, credit, capital markets, funds, and investments
 Liquidity - The transferability of shares acts as an added incentive to investors as the

shares of a public company can be traded easily in the stock exchange.
Maximize your marks

 Read the chapter carefully
Page 3 of 3
NIOS/Acad./2020/319/06/E
Lesson 6: Company Form of Business Organisation
Worksheet-6
1. Do a Google search and find out when the Companies Act 1956 was revised. Mention
any three highlights of the revised Act.
2. Discuss with your friend and find out the various types of companies. From the
information gathered write a short note on each type identified.
3. Rekha is confused between a Private Company and a Public Company. Write a short note
on each to explain and also differentiate between the two in tabular form.
4. Analyse the characteristics of a Partnership and Company form of business organisations.

Bring out atleast five differences between them in tabular form.
5. The Multinational Companies enjoy several advantages due to large scale production and
distribution activities across national borders. Describe the advantages and limitations of
Multinational Companies.
6. Your mother wants to invest in a Government company. Explain what all you would like
her to know about a Government company. Also mention its characteristics and give
atleast four examples of a government company.
7. Find out about Joint Stock Company and Cooperative societies from your neighbourhood
and the literature available. Differentiate between them on the basis of membership,
formation, purpose, management and liability.
8. Joint Venture facilitates pooling funds, technical know-how and managerial skills where
rewards and risks are shared by concerns in joint venture. In addition to this describe
other features of a Joint Venture.
9. Public Private Partnership involves partnership between public and private sector in
financing, designing and developing infrastructural facilities. In light of the statement
describe the features, merits and limitations of a PPP.
10. Choosing right form of a business organisation is very important. Explain the factors that
you would keep in mind while selecting the right form of BO.
Lesson-7
PUBLIC SECTOR ENTERPRISES
Introduction
It was observed that private sector did not take interest in areas where the gestation period was
long, investment was heavy and the profit margin was low; such as machine building,
infrastructure, oil exploration, etc. Not only that, industries were also concentrated in some
regions that had certain natural advantages like availability of raw materials, skilled labour,
nearness to market. This led to regional imbalances. Hence, the government while regulating the
business activities of private enterprises went in for direct participation in business and set up
public enterprises in areas like coal industry, oil industry, machine building etc. We will learn
about the nature and characteristics of public enterprises and the forms of their organization.

1. Business units owned, managed and controlled by the central, state or local government
are termed as public sector enterprises or public enterprises. These are also known as
public sector undertakings
2. Characteristic of Public sector enterprises
3. There are three different forms of organization used for the public sector enterprises
Departmental Undertaking
Statutory (or Public) Corporation
Government Company.
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4. The Statutory Corporations are the organisations, which are incorporated under the
special Acts of the Parliament/State Legislative Assemblies. These are autonomous
bodies and are free from government control in respect of their internal management.
5. It is true that the greatest advantage of statutory corporation is its independence and
flexibility, but it is found only on paper. In reality, there is excessive government
interference in most of the matters.
6. A company in which 51% or more of its capital is held by central and/or state
government is regarded as a Government Company. These companies are registered
under Companies Act 1956 and follow all those rules and regulations as are applicable to
any other registered company.
7. Importance of Public sector enterprises:
 Balanced regional development

 Boost the basic industries of an economy
 Concentrate on public welfare activities
 Promote export
 Price control of essential goods
 Limit the influence of private monopoly
 Ensure security of the country
 Minimise economic inequalities.
Learn new points:

Current Scenario: The government is taking every step to revive and restructure the public sector
enterprises to improve their performance, productivity and profitability. Major emphasis has
been given on the sick and chronically loss making enterprises, which are capable of being
revived. On 24 July 1991 the Government of India announced its Industrial policy to improve the
performance and portfolio of public sector enterprises. The new economic policies also
emphasized on liberalization,privatisation and globalisation. The role of public sector was
redefined. To grant autonomy and delegation of financial power to some of the profit making
public sector enterprises Government has given them the status of Navaratnas and Miniratnas.
Maximize your marks

 Read the chapter carefully
 Go through the learning point
Page 2 of 2
NIOS/Acad./2020/319/07/E
National Institute of Open School

Lesson 7: Public Sector Enterprises
Worksheet -7
1. A public sector enterprise is owned by the government in order to maximize social

welfare and uphold the public interest. In reference to this, explain your understanding
about the public enterprises. Also, explain the various characteristics of it.
2. Your friend is a bit confused between the public sector and private sector enterprises.
Explain to him the difference between the two.
3. Business organizations come in different types and forms in India. In this context, explain
the different forms of organization of public sector enterprises.
4. Explain the role of departmental undertaking in India. Also, elaborate the merits and
demerits of the same.
5. Give some examples of statutory corporations in India. Also, explain what purpose it
serves.
6. Public enterprises help in balanced regional development by promoting industries in

every part of the country. Justify this statement in the current scenario in India with the
help of suitable example by highlighting the importance of public enterprises.
7. Do you think, In India, can we replace the public sector with the private sector? Give
suitable arguments.
8. What do you understand by Government Company? Give some examples of Government

Company from your surroundings. Also discuss its advantages and limitations.
9. How does departmental undertaking differ from the public corporations?
10. Discuss the important features of statutory corporations.

Lesson-8
SELF EMPLOYMENT
Introduction
Let us learn more about the career option of self-employment in business. At this stage you have to decide
whether to take up a job in an organization or to start your own business. When you accept an
employment in any organization, you have to perform various jobs as per the requirements of your
employer and you may get a fixed amount of income as salary. But, instead of seeking a job, you can also
opt to do something on your own to earn your livelihood. You may run a small retail shop, tailoring shop,
restaurant, bakery and confectionery, beauty salon, etc. in your locality. In other words, you may get
engaged in trading or manufacturing on a small scale or providing some service for a price. Such
economic activities are known as self-employment.

1. Any economic activity which one may perform on his own as a gainful occupation is
termed as self-employment. Such an activity may consist of producing and selling goods,
buying and selling goods, or rendering services for a price.
2. Importance of Self-Employment:
3. A business which is small in size, requires less capital investment, employs less number
of workers, volume or value of output is less, may be called as Small Business.
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4. Characteristic of Small Business:
5. On the basis of fixed capital investment in plant and machinery, small businesses in India
are classified as (a) Small-scale industries; (b) Tiny industries; (c) Ancillary small
industry; (d) Village industries; (e) Cottage industries; (f) Micro business enterprises; (g)
Small- scale service and business (industry related) enterprises; and (h) Trading units
6. The Government of India provides several assistance and support to small business
enterprises. These include: liberalised credit policy, capital subsidy, concession and
exemption in excise and sales tax, special support for promotion, financing and
development of small-scale industries through SIDBI, NABARD, and DIC.
7. Role of small scale business in Indian economy
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Learn new points:

• Small-scale industry - are those industries in which the manufacturing, production and
rendering of services are done on a small or micro scale.
• Self-employment- Self-employment refers to working for oneself rather than working for
a specific employer who pays them a salary.
• Micro business- refers to a small business that employs few people.
Evaluate yourself
1. Share your views regarding self employment is necessary or not?
2. Which types of self employment you want to practice explain?
3. Mr X. wants to start his own manufacturing business on a small-scale, but having financial crises.
Guide him about the sources from where he can get help?
Maximize your marks

• Read the chapter carefully
• Go through the learning point
• Get into the little details of the above mentioned important points.
Page 3 of 3
NIOS/Acad./2020/319/08/E
Lesson 8: Self Employment
Worksheet-8
1. Self-employment involves doing something on one’s own to earn one’s livelihood. With
reference to this, explain the concept of self-employment. Also, explain the characteristics of it.
2. How does self-employment play an important role in making one’s livelihood?
3. Your friend wishes to run an enterprise. He wants some ideas from you about the avenues in
which self-employment opportunities are available. Explain to him the various avenues available
for self-employment in different areas.
4. How does National Bank for Agriculture and Rural Development help small businesses in
establishment?
5. Discuss the classifications of small businesses in India on the basis of investment in fixed capital
in plant and machinery or on the basis of nature or place of operation.
6. How do small businesses in India play an important role in the socio-economic development of a
country?
7. Discuss the scope for small businesses in India.
8. What are the steps taken by the Government for development of small businesses in India?
9. Discuss the role of State Small Industries Development Corporations and SIDBI in providing
support to small businesses.
10. Your friend does not know about the small business. Explain to him the various characteristics of
small businesses with the help of real life examples.
Lesson-9
GETTING READY FOR WAGE EMPLOYMENT
Introduction
How will you enter into the world of employment? In the present employment situation of our
country it is not an easy task to get into any job. It requires serious preparation in addition to
having required qualification and experience for any job. You need to find out the vacant
position of the jobs in different organizations. In this lesson you will learn to prepare and post
your resume for the same and be ready to face the employment test.

1. The various sources of information about job vacancies.
a. Employment Exchanges
b.Placement Agencies,
c. Newspapers and Magazines,
d.Employment News,
e. Internet,
f. Leaflets,
g.Notice boards of the Offices and Factories,
h.Television and Radio, (i) Mobile Phone, and (j) Friends and Relatives.
2. The Placement Agencies bring together the employers and suitable candidates available
for a job. They advertise the post, prepare the data bank of job seekers and inform them
as per the availability of post.
3. The advertising media also play an important role in informing the job seekers about the
job vacancies. The advertising media may consist of print media and electronic media.
4. A standard bio-data should have four basic sections.
(a) Name and contact details

(b) Educational qualifications (academics and technical)
(c) Work history (responsibilities, experience and achievements etc.)
(d) Details regarding references
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5. When applying for a job, the bio-data should be accompanied with an appropriate
covering letter. This letter contains four parts.
6. The selection test for employment is usually held in the form of written test, physical
fitness and interview. The personal interview may be arranged in the form of
(a) Telephonic Interview;

(b) Interview through Teleconference;
(c) Chatting through Internet;
(d) Face to face interaction.
Page 2 of 3
Learn new points:

• Bio-data – Bio data is a shorter form of resume. It consists of your basic details like your
name, dob etc
• Curriculum Vitae- a brief account of a person's education, qualifications, and previous

occupations, typically sent with a job application.
• Personal Interview- Personal interview is basically a meeting organized by a recruiter in

which he evaluates a potential employee for prospective employment.
• Physical Fitness Test- A physical fitness assessment includes measures of body

composition, cardio respiratory endurance, muscular fitness, and musculoskeletal
flexibility.
• Placement Agencies – an agency specializing in the recruitment of staff to fill vacant

positions.
Evaluate yourself
1. Create your Bios data with the above mentioned points
2. What are the points to be considered while preparing Resume?
3. Share your point of view about the selection process in employment?
4. When applying for a job, the bio-data should be accompanied with an appropriate
covering letter. Prepare your bio data and covering letter.
Maximize your marks

Page 3 of 3
NIOS/Acad./2020/319/09/E
National Institute Open Schooling
Lesson 9: Getting Ready for Wage Employment
Worksheet-9
1. Mr.Saurabh is looking for a job. But he does not know the sources of information about
job vacancies. According to you, from where he will get the information about the
vacancies in different offices.
2. Discuss the role of Employment Exchanges in India.
3. Your friend wants to register his name in an employment exchange. Explain to him the
procedure of getting his name registered in an employment exchange.
4. How do the placement agencies help an individual in the employment process?
5. Advertising media play an important role in informing the job seekers about the job
vacancies. In the light of the statement, discuss the role of advertising media in India.
6. Is it necessary to have a covering letter while applying for a job?
7. What is the information one should give in the Bio-Data.
8. Discuss the various types of employment tests that can be conducted for selecting a
candidate for employment.
9. Describe the different aspects of a personal interview that would help individuals to face
the interview board comfortably and confidently.
10. Describe in brief the Do’s and Don’ts one needs to follow while applying for a job.
Lesson-10
FUNDAMENTALS OF MANAGEMENT
Introduction
Do you know, we find management everywhere, every housewife manages her household work,
every professional manages his tasks and every businessman manages his business. We shall
learn about the concept of management in the context of managing a business, and its
characteristics, nature, importance, functions and the general principles guiding managerial
actions in the management process
Important points from the text:-

1) Management is a significant aspect of our day-to-day life. In a business organization,
management helps in better utilization of inputs like money, raw materials, machines and
men and this help in achieving better outputs.
2) Objectives of Management:
Optimum utilisation Increase in Fair return on

of resources productivity capital invested
Meeting challenges
Creation of
of the changing
goodwill
environment.
3) Co-ordination helps in maintaining harmony among workers. • Importance of Co-ordination

include :-
• unity of action,
• prevents overlapping of work,
• Achieve good human relations, increases efficiency and moral of the employees.
• Management is an intangible, continues goal directed, universal activity.
• It deals with people, hence called a social process.
• Management helps in achieving goals with efficiency. It ensures both stability and
growth keeping in touch with change in the environment.
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4) Management can be divided into three levels:-
5) In every organisation managers perform six important functions:
6) Taylor’s scientific principles are Development of science for each element of man’s work.
Scientific selection, training and development of workmen. It is a close co-operation between
workers and management.
7) Techniques of scientific management include work studies, standaralisation, functional
foremanship and differential piece rate plan.
Learn new points:

• Unity of command – Unity of command provides that an employee is responsible to
only one supervisor
• Scalar chain - Scalar chain is a chain of all supervisors from the top management to
the person working in the lowest rank.
• Scientific management - Scientific management is a theory of management that

analyzes and synthesizes workflows.
• Esprit de corps- Esprit De Corps means union is strength. It is one of the fourteen
principles of management developed by Fayol
Page 2 of 3
Evaluate yourself
1. Suppose you are a head of games activities which is going to be held after a month.
Mention all the activities and task into different functions of management.
2. A person should receive order from one person only. Share your views
3. Management is an art, science as well as profession. Explain how?
Maximize your marks

Page 3 of 3
NIOS/Acad./2020/319/10/E

Lesson 10: Fundamentals of Management
Worksheet -10
1. Management is a significant aspect of our day-to-day life. In the light of the statement, explain
the concept of management. Also, explain the various characteristics of management.
2. Describe the different objectives of management.
3. Management is regarded as a science as well as an art. Elaborate this statement.
4. Taylor is best known for the techniques of scientific management, particularly in the production
department and that too at the shop level. What are the different techniques of scientific
management given by him?
5. Is it necessary for the organizations to work in cooperation with others to achieve the business
objectives? If yes, explain why?
6. Coordination plays an important role in managing the various business activities. In the light of
the statement, explain the various features of coordination.
7. Discuss the fourteen principles of management given by Henry Fayol.
8. Could management can be treated as a profession. Give your comments on it.
9. Management principles have considerable importance in all group efforts. In the light of the
given statement, explain the importance of management principles.
10. Your friend does not know about the levels of management. How would you explain to him the
levels of management in an organization?
Lesson-11
PLANNING AND ORGANISING
Introduction
You learnt about the various functions of management, viz., planning, organizing, staffing,
directing, coordinating and controlling. we shall discuss the first two functions i.e., planning and
organizing emphasizing the nature, importance, process of planning with its limitations and
types, and the basic concepts of organizing including process of organizing, the organization
structure, delegation and decentralization of authority.
Important points from the text:-

1. Planning is deciding in advance what is to be done and how it is to be done.
2. Planning is a primary function of management:
3. Planning process:
making assumptions about

development of alternative
establishment of objectives external and internal
course of action
conditions
selecting the appropriate arranging for

evaluation of alternatives
course of action implementation.
4. Planning suffers from several limitations: rigidity, probabilistic, expensive and time
consuming, delay in actions, misdirection, false sense of security.
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5. Organizing is the next important function of management after planning. It refers to

identifying and grouping the activities to be performed, defining the responsibility and
authority for each job position, establishing relationships between various job positions
and determining detailed rules and regulations of working.
6. Formal organization refers to the officially established pattern of relationship among

departments, divisions and individuals to achieve well-defined goals. Informal
organizations on the other hand, refers to relationship between individuals in the
organization based on personal attitudes, likes and dislikes
Learn new points:
• Authority: It means the right to take decision, right to issue orders and right to take
action if orders are not carried out.
• Decentralization : It is the effort to delegate authority at all levels of management.
• Delegation :It is the process of entrustment of part of work or responsibility and requisite
authority to another person and creating accountability for performance.
• Budgets : are quantitative statements indicating expected results and expenditure
required for achieving the goal.
• Rules are guidelines designed to guide behaviour.
Evaluate yourself
1. Suppose you are a Planner of an event which is going to be held after a month. Mention
all the activities and task into different functions of Planning.
2. Mr X wants to set up his shop. Now help him to differentiate the activities into planning
and organizing.
3. Share your views if you have to organize a function at your home. Take ideas from
organization function.
Maximize your marks

Page 2 of 2
NIOS/Acad/2020/319/11/E
Business Studies (319)

Senior Secondary Course
Worksheet (2020)
L-11 PLANNING AND ORGANISING
1. Planning is a systematic way of deciding about and doing things in a purposeful manner.
In the light of this statement, elaborate the concept of planning as a concept of
management. Also, explain its importance for the organizations.
2. Planning is a systematic process without which it may be difficult to build up proper

plans and ensure their implementation. In reference to this statement, explain the process
of planning.
3. How does a formal organization differ from informal organization?
4. Mr. Shobit is a manager working in a big organisation. He is facing difficulty in

completing the tasks assigned to him. His friend suggested him to delegate some part of
the task to others in a formal way so that he can make his subordinates answerable to him
for non-performance. In this context, discuss the elements of delegation.
5. Mr. Ankit is a bit confused between the term delegations and decentralization. Explain to
him the difference between the two.
6. Do you think planning suffers from some limitations? Give suitable comments.
7. As we know the planning begins with the determination of objectives and directed
towards their achievement. With reference to this, explain the various types of plan.
8. How the organizing function is considered as an important function of management after

the planning. Also, discuss the various steps to be followed in the process of organizing.
9. Kapil runs a factory wherein he manufactures leather shoes. The business is doing well
and he intends to expand by diversifying into leather bags as well as leather jackets.
Which type of organisation structure would you recommend for his expanded
organisation and why? Give reasons.
10. Explain the importance of decentralization for the manager in organisations.

Lesson-12
STAFFING
Introduction
Do you know as the business grows in size business man may find it difficult to manage all the activities
alone and may have to find out suitable persons and employ them. We will learn in detail about the
staffing function including the sources of recruitment, the process of selecting the employees with the
importance of training and development and the various methods of their training.

1. Staffing refers to the managerial function of employing and developing human resources for
carrying out the various activities in an organization. It helps in getting right persons for various
jobs in the organization and ensures that they have job satisfaction and work in harmony for
achievement of organizational goals.
2. The staffing process involves the following steps.
3. Development Off-the job training Recruitment Induction On-the-job training Selection

Job analysis Performance appraisal Training Job description Placement Transfer Job
specification.
4. Training and Development : The process of improving the knowledge and skills of the
employees to enable them to perform their jobs more efficiently. The methods used may
be on the job and off the job.
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5. Human resource management is a broader concept staffing is one part of HRM. HRM
includes staffing, training, development and motivation of workers.
6. Training is concerned with teaching technical skill. Development is concerned with teaching
human and conceptual skill. Advantages of training are :
Learn new points:

• Performance Appraisal: Assessing the performance quality of the employees
• Compensation : Determining the remuneration to be given to employees including incentives
• Promotion : Advancement of employees to higher level or position
• Transfer: A type of job change where an employee is assigned a different job with same
rank and pay.
Evaluate yourself
1. Mr X. wants to do staffing for his business organization. Help him to know
the process how he can do the staffing smoothly.
2. Do you think that training is very necessary for any kind of work? If yes,
then explain how.
3. Mr Ramesh works in a factory and he receives daily wages for his work.
Explain which method of recruitment is this?
Maximize your marks

• Get into the little details of the above mentioned important points
Page 2 of 2
NIOS/Acad/2020/319/12/E

Worksheet (2020)
L-12 STAFFING
1. Staffing function is an integral part of human resource management. In the light of this
statement, elaborate the concept of planning as a concept of management. Also, explain
its importance.
2. How does Human Resource Management differ from staffing?
3. Mr. Rohit runs a factory wherein he manufactures pens. The business is doing well and
he intends to increase the production of pens. He felt there is a need to hire more labour
for the expansion. Explain to him the process of staffing so that he can employ the right
people for the work.
4. Your friend Vikas wants to open a restaurant. He found that there are various positions
that are required to be filled up. Suggest to him the external sources of recruitment to fill
up the vacancies.
5. Mahender, the director of a garment company, is planning to manufacture trousers. He

has decided that this manufacturing unit will be set-up in a rural area of Delhi. He also
thought of giving equal opportunities to men and women. For this, he wanted four
different heads for sales, account, purchase and production. He gave an advertisement
and received applications from many candidates per post. Explain the selection procedure
to him for choosing the best candidate out of the applications received.
6. How does the induction programme play an important role in development of a favorable
attitude among the new employee?
7. Training is necessary for new employees as well as the existing employees for improving
their performance at work. In this context, explain the different methods of training to the
employees in the organization.
8. Some learning opportunities are designed and delivered to improve skills and abilities of
employees whereas some others are designed to help in the growth of individuals in all
respects. Describe the concept of training and development in reference to this statement
given. Also, differentiate between the two.
9. Why performance appraisal is needed in an organisation.
10. Ms. Ankita is a bit confused between the term promotion and transfer. Explain to him the
difference between the two.
Lesson-13
DIRECTING
Introduction
If a teacher teaches in a classroom, in order to teach, a teacher has to guide his students to
maintain discipline likewise managers have to guide people who work under them, inspire and
lead them to achieve common objectives so Directing is a very important function in the
management of any enterprise. It helps the managers in ensuring quality performance of jobs by
the employees and achievement of organizational goals. It involves supervision, communication
and providing leadership to the subordinates and motivating them to contribute to their best of
capability.

1. Directing is concerned with instructing, guiding and inspiring people in the organization
to achieve its objectives. It’s important components are communication, supervision,
motivation and leadership.
2. Communication is the process by which a person transmits information or message to
another person. The process facilitates the task of issuing orders and instructions to
convey the superiors’ ideas about the work to be done by subordinates.
3. When communication is made between people who are neither in the same department
nor at the same level of organizational hierarchy, it is called diagonal communication.
Communication may be in the form of oral or written or even non-verbal like gestural.
4 Supervision is necessary at all levels of management; it is of great importance at the first

level. It is at this level that supervisors are in direct contact with employees. Supervisors are in
key positions in the hierarchy of management. They act as a link between higher level managers
and the workers.
4. Motivation helps managers in getting things done more efficiently by the employees. If
the employees are motivated, they will fully utilize the production facilities and put in
their best efforts in performing the job.
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5. Leadership is the ability to persuade others to work in a desired way. Thus, a person who
persuades others and makes them follow his instructions willingly is called a leader.
6. Characteristic of good leader:
7. Financial incentives include pay and allowances, bonus, commission, retirement benefit etc.
Non-financial incentives are career advancement opportunity, status, employee participation and
employee recognition programme.
Learn new points:

1. Physiological needs are the basic needs which must be satisfied before all other
needs are satisfied.
2. Safety needs can be satisfied by giving job security, pension, insurance etc. •
Social needs include need for love, affection, association etc.
3. Esteem needs include need for self confidence, self-respect etc.

4. Self actualisation need refers to need to grow and self-fulfillment.
Evaluate yourself
1. Motivation is an important factor to improve productivity and to create
positive environment. Explain by giving examples
2. Communication process has certain barriers , if yes then explain.
Maximize your marks
• Read the chapter carefully and go through the learning points
Page 2 of 2
NIOS/Acad/2020/319/13/E

Worksheet (2020)
L-13 DIRECTING
1. Every action in the organization is initiated through directing. Elaborate the concept of
directing. Also, explain how directing helps in efficient and effective functioning of the
organization?
2. Do you think communication is a two way process? Also state the importance of
communication in the organization.
3. Discuss the classification of communication on the basis of the flow or direction of

communication in organizations.
4. There are some barriers in communication which are concerned with the state of mind of
both the sender and the receiver. Explain in detail the barriers to effective
communication.
5. How does motivation improve efficiency and facilitate the accomplishment of

organisational goals?
6. You are the manager of M/S XYZ Co. You find that there is some barrier between you
and your subordinates. How would you remove such barriers so that the communication
can be made more meaningful and effective?
7. How does supervision play an important role in different levels of management?
8. Maslow’s Need of Hierarchy theory is considered fundamental to understand the

motivation. Explain the role of hierarchy of needs in motivation.
9. Money is not the only motivator. Then what else is required to motivate employees?
Explain briefly the non-financial incentives that motivate the employees.
10. Leadership is an important factor in making any organization successful. Do you agree
with this statement? Also, describes the various qualities of a good leader.
Lesson-14
CO-ORDINATIO AND CONTROLLING
Introduction
You know that the various business activities of an organization are grouped and carried out by different
departments and within each department there are divisions and sub-divisions. In order to achieve the
organizational goals effectively, departments are harmonized and duly monitored so that the performance
of the organization confirms to the plans and the prescribed time schedule. This can be achieved through
proper coordination and control of the activities of all groups. Let us now learn about the concepts of
coordination and control and the various steps involved in the control process.

• Co-ordination means orderly arrangement of group efforts to provide unity of action in
the pursuit of a common goal.
• Controlling is important to make planning a success. For this purpose, it is necessary to
compare actual performance with the planned performance. The difference between
actual and planned performance is called ‘deviation’. Control means determining the
deviation, identifying the reasons for deviation and correcting the deviations.
• Characteristics of the controlling function of management
• Steps in the process of control :-
• Establishment of standards;
• Measurement of performance;
• Comparison of actual performance with planned performance;
• Determination of reasons for deviation;
• Taking corrective action.
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• The significance of co-ordination as a function of management arises mainly from the fact that
without harmonized efforts, different activities may result in neglect of the organizational goals.
Learn new points:

1. Unity of action - The Unity of Action limits the supposed action to a single set
of incidents which are related as cause and effect.
2. Deviations - the action of departing from an established course or accepted standard.
Evaluate yourself
1. Mr X. fixed a target of 500 shoes for the month of April 2020.Mr X. changed defective
machines and also the incompetent workers. On 30 May 2020 Goal found only 400 shoes
could be prepared. Why there is a difference in actual and standard performance.
2. Share your views with examples if control is important or coordination in a management.
3. Control means determining the deviation, identifying the reasons for deviation and correcting the
deviations.
Maximize your marks

Page 2 of 2
NIOS/Acad/2020-21/319/14/English
National Institute of open schooling

Senior Secondary Course : Business Studies
Lesson 14 : Co-Ordination and Controlling
Worksheet – 14
1. Coordination involves synchronization of different activities and efforts of the various

units of an organization. Explain this statement in 120 words.
2. How significance of co-ordination becomes more important. State any reasons.
3. What is meant by ‘essence of management? Explain with suitable examples?
4. Controlling as a functions of management refers to the evaluation of actual performance

of work. Put light on this statement.
5. Planning and controlling are closely related and depend upon each other. What is the
basis characteristic comment?
6. At which level control is needed and when actual performance is different from planned
performance.
7. Control is a continuous process? Explain the various steps with suitable examples?
8. Control means determining the deviation. What is meant by deviation explain in 60

worlds.
9. Comparison of actual and standard performance may lead to other possible outcome.
Explain how with the below situations
(a) Equal to (b) more than
(c) less than the standard
10. The importance of control has considerably increased now-a-days due to several reasons.
State the reason.
Lesson-15
FINANCING OF BUSINESS
Introduction
Are you aware to become successful in an occupation or business all of them need some
amount of funds (money) to buy the required materials, tools and equipments. Occupations or
doing business is important to earn livelihood. Now, the question arises from where do the
businessmen gather the required amount of money? Are they able to manage with their own
money to start and run their business? Obviously, it is difficult and in case of large business, it is
ruled out. So we have to know what are the various options available to them to arrange the
required amount of funds (also called capital)

1. Business finance’ refers to the money required for business purpose and the ways by
which it is raised.
2. Every business needs funds to purchase fixed assets to meet its day-to-day ex penses, to
fund business growth, bridge the time gap between production and sales, to meet
contingencies and to avail of business opportunities.
3. Business finance is classified as
4. There are two sources of raising the required funds by the business
Internal sources External source
5. Methods of raising short-term finance:
Page 1 of 3
Factoring
Bank Credit
Customers’
advances
Trade Credit
Loans for
Installment credit unorganised
sectors
6. The loans and advances are granted by the banks by taking some security that will ensure
the bank about safe return of its money. Securities offered against bank credit may be of
two types:
Personal Security of
security assets
7. The methods of raising long term finance are:
Loan from Special

Issue of
Issue of shares Financial
Debentures
Institutions (SFI)
Borrowings from Public Deposits

Retained Earnings
Commercial Banks
Foreign Global Depository

Lease Financing
Investment Receipts.
Learn new points:
1. Equity shares: They are shares which do not enjoy any preferential right in the
matter of payment of dividend or repayment of capital.
2. Preference shares : They carry preferential rights in respect of dividend and
return of capital.
3. Preference shares that a company can issue are: Convertible and non-
convertible preference shares
Page 2 of 3
Evaluate yourself
1. Find out what are the various ways in which finance are provided to a business
enterprises.
2. Mr. Iran had started his garment business as a sole proprietor, with a capital of Rs.
55,000/-. Now, after three years, he has decided to form a company to run his expanding
business. Where he should approach for finance.
Maximize your marks

Page 3 of 3

Lesson 15 : Financing of Business
Worksheet – 15
1. Why does Business need finance and also explain the ways by which it is raised.
2. In every business activity money is an important as well as an essential component.

Define the nature of financial requirement of the business enterprise.
3. When the business men get the required amount of fund to meet the short term, medium
term and long term requirement, then share your view point that who can provides them
the required amount.
4. As you are aware of loans and advances are granted by the banks on the basis of some
security. What are the types of security offered against bank credit?
5. When the banks ask for security of assets from Mr Ashok, then which type of security is
generally accepted for extending short term finance?
6. A sole proprietorship form the business organization has very limited sources form which
it can arrange funds for business. State any five of them.
7. The debenture is a written acknowledgment of money borrowed. How can it be

classified explain in your own words also Name any four of them.
8. Mrs Rita has a company and has an option to issue different types of preference share.
State the preference share a company can issue.
9. A company has option to issue different types of preference share. State the preference
share a company can issue.
10. Mr Rohit is interested to know about foreign investment. Explain him about foreign
investment in not more than 120 words.
Lesson-16
FINANCING OF BUSINESS
Introduction
Now you are aware of various methods of raising long-term finance. But, as a matter of fact
the methods refer only to the forms in which the funds are raised, and hence may or may
not include the sources from, or through which the funds are raised. Hence, we must also
have an idea about the sources of finance.

1. Capital market, special financial institution, banks, non-banking financial companies,
retained earnings and foreign investment and external borrowings are the main sources
of long-term finances for companies. The institutions or agencies from or through
which finance for a Long period is obtained are termed as sources of long-term
finance.
2. The companies raise long-term funds by issuing shares and debentures through securities
market. This market is divided into two parts:
Stock
New issue
exchange
market
3. Commercial banks and Co-operative banks also provide long and medium finance to
enterprises.
4. To provide long-term finance and other support services to industrial enterprise, special
financial institution (SFI) have been set up by central and state governments.
5. Important SFIs are: IFCI, ICICI, IIBI, IDBI, SIDBI, SFCs, SIDC also there are few other
financial institutions such as LIC, GIC, UTI, etc EXIM Bank.
6. Mutual Funds act as an investment intermediary that collects the savings of a large number of
investors and invest them in big companies. This minimizes the risk of the investors and
ensures them good return. To attract the investors. Mutual fund companies offer different
schemes which are categorized under open ended schemes and close ended schemes.
7. The leasing companies also extend long term support in the form of providing plants and
machineries, building, land etc. on rent basis.
8. Foreign sources take the form of
External Foreign Non-resident

borrowings investments Indians.
9. The undistributed profits of the company which is kept for future use constitute a
major source of long-term finance. It does not involve any cost of floatation and it
strengthens the firm’s equity base.
Learn new points:

New Issue Market – New issue market is in which new securities are issued
Stock exchange - A market in which securities are bought and sold.
Venture Capital - It is a form of private equity and a type of financing that investors provide to
startup companies and small businesses
Net Asset Value - Net asset value," or "NAV," of an investment company is the company's total assets minus its total
liabilities
Retained Earnings- Retained earnings are the portion of a company's cumulative profit that is held or
retained and saved for future use.
Leasing – Leasing is the process by which a firm can obtain the use of certain fixed assets for which it must make a
series of contractual, periodic, tax-deductible payments.
NRI - An Non Resident Indian (NRI) is an Indian Citizen who resides in India for less than one hundred & eighty two
days during the course of the preceding financial year, or. who has gone out of India or who stays outside India for the
purpose of employment.
Evaluate yourself
1. List out what are the various sources through which funds can be raised?
2. Suppose your friend Raman, who runs a big readymade garments shop, needs long term
finance. So explain him from where he can get help?
3. Name any five financial institutions you have seen and come across?
Maximize your marks


Lesson 16 : Sources of Long Term Finance
Worksheet – 16
1. Mr. Ram is interested in trading of securities. Explain him the two different segments in
capital Market?
2. Mrs. Rubina wants to set up an institution and therefore explain her about the financial
institution which offers support services in launching of the new enterprises?
3. Explain in details which financial institution provides long term and mediums term
finance to large industrial enterprises?
4. Which bank act as an apex institution in the field of financing foreign trade? Explain in
120 words.
5. Mr. Ramjan wants to know about an investment agency for small investor as he wants
to invest and also help him in knowing a good source for long-term finance for the
business.
6. Explain in detail about the sources which plays an important role in meeting long-term
finance needs of the business in India?
7. Now a day’s business firms avail the facility of huge capital in buying the assets. Explain
how?
8. List any five special financial institutions which provide long term finance and other
support services to industrial enterprise.
9. Explain about such funds which continuously offer units for sale and is ready to buy back
the unit surrendered?
10. “The investors cannot redeem their units till the specified maturity date” put light on
this statement.
Lesson-17
FINANCIAL MANAGEMENT
Introduction
Do you know that a trading concern or a construction company needs funds for carrying on
its activities successfully? It requires funds to acquire fixed assets like machines,
equipments, furniture’s etc. and to purchase raw materials or finished goods, to pay its
creditors, to meet its day-to-day expenses, and so on. Every businessman has to be very
careful not only in assessing the firm’s requirement of finance but also in deciding on the
forms in which funds are raised and utilized. Now you will learn about the process of
estimating the firm’s financial requirement and deciding on the pattern of finance.

1. The process of estimating the financial requirement, determining the pattern of
financing and formulating financial policies and procedures is termed as ‘Financial
planning’. To achieve the objectives of financial planning effectively.
2. The firm’s capital requirement can be broadly divided :
Fixed capital Working capital
3. The main objective of financial management:
4. Financial planning is helpful in developing a sound capital structure, estimating

accurate requirement of fund, effective utilization of fund, in avoiding shortage of
funds and surplus of funds, provides policies for different departments and
control financial activities.
5. The financial requirement of a firm can be met through ownership capital (equity)
and/or borrowed capital (debt). The firms normally use a judicious mix of debt
and equity in order to ensure a higher return on owners’ funds. Such a mix is
termed as the ‘Capital structure’ of the firm
6. The choice of an appropriate capital structure is determined by a host of factors:

Expected Cost of debt Effect on right

earnings to control
Capital
market
Regulatory Flexibility Investors’ attitude

norms towards investment.
7. Dividend refers to the amount of profits distributed by a company to its

shareholders. The amount of profit to be distributed as dividend and the amount
of profit to be retained by the company for meeting its future financial
requirement is determined by factors like future financial needs of the company,
liquidity requirement, and company’s access to capital market, expectations of
the shareholders, tax policy, investment opportunity and growth prospects and
legal constraints.
Learn new points:
• Fixed capital: - It represents the requirement of capital for permanent or
long-term financial needs of the business.
• Working capital: - It represents the amount of funds required for financing current
assets.
• Investment decision: - It is concerned with careful selections of assets in which
funds will be invested by the firm.
• Financial decision :- It specify the ratio of owned funds and borrowed funds
• Dividend decision: It decide how much profits to be distributed as dividend and
how much to retain for expansion activities.
• Financial planning: - It decides how much to spend and on what to spend.
Evaluate yourself
1. Mrs Sonika selected any 5 items/products that she uses, for example, sugar,
furniture, cooler etc. Help her to list them and analyze whether each of them
require huge or less working capital for production and why?
2. Do you think financial planning is important for any kind of business
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Lesson 17 : Financial Management
Worksheet – 17
1. Mr. Ashok plans to buy new technology machinery for his company in order to replace
old and outdated machinery. Explain him the types of decision involved in it?
2. Mrs. Sunita decided to distribute a portion of the profit earned in the previous year among
its shareholders. Therefore discuss the type of decision the involved?
3. If your friend Mr. X wants to ensure a sound financial plan in meeting the organizational
objective then what would you suggest.
4. Explain in detail how financial planning is important for any organization.
5. Explain an investment where fixed assets are a long term commitment and amount
invested cannot be withdrawn quickly.
6. List down the factors that will help your friend Mr. Y to determine the fixed capital
requirement in business.
7. Mr. Aditya wants to run the business smoothly and efficiently. Therefore, explain the
factors that influence such requirements?
8. Financial planning decides how much to spend and what to spend. Support your view
with reasons.
9. Mr. X and Mr. Y discussed that an appropriate capital structure is determine by a host of
factors. Share your view in this regard and explain?
10. Support your view with reasons that how to maximize the wealth of shareholders?
Lesson-18
INDIAN FINANCIAL MARKET
Introduction
You are aware that business units have to raise short-term as well as long-term funds to meet their
working and fixed capital requirements from time to time. Financial market is the market that
facilitates transfer of funds between investors/ lenders and borrowers/ users. It provides security to
dealings in financial assets, liquidity to financial assets for investors and ensures low cost of
transitions and information. This necessitates not only the ready availability of such funds but also a
transmission mechanism and transfer the funds to them as and when required. This is taken care of
by the financial markets which provide a place where or a system through which, the transfer of
funds by investors/lenders to the business units is adequately facilitated.

1. Financial Markets can be classified as :
Money Capital
Market market
2. Money market refer to the network of financial institutions dealing in short term funds
through instruments like bills of exchanges, promissory notes, commercial papers, treasury
bills etc.
3. Capital Market is an institutional arrangement for borrowing medium and long-term funds
and which provides facilities for marketing and trading of securities. So it constitutes all
long-term borrowings from banks and financial institutions, borrowings from foreign
markets and rising of capital by issue of various securities such as shares debentures, bonds,
etc.
4. The securities market has two different segments :
Primary Market Secondary Market.
5. The primary market consists of arrangements for procurement of long-term funds by

companies by fresh issue of shares and debentures. The secondary market or stock
exchange provides a ready market for existing long-term securities.
6. Stock Exchanges are regulated by the Securities Contracts (Regulation) Act and by SEBI. SEBI
has initiated a number of reforms in the primary and secondary market to regulate the
stock market. Documentary and procedural requirements for listing and trading have been
made stricter and foolproof to protect investors’ interest. Stock exchange is the secondary
market, which provides a place for regular sale and purchase of different types of securities
like shares, debentures, bonds & government securities.
7. Stock exchanges provide many benefits to companies, investors and the society as a whole.
But they also suffer from limitations like exclusive speculation and fluctuation in prices due
to rumors and unpredictable events.
8. The functions of a stock exchanges are :
9. Services provided by Depository :
Dematerialization Rematerialization Transfer of Settlement of

securities trade.
10. Benefits of depository services include :
Learn new points:

• A bill of exchange is a written order binding one party to pay a fixed sum of
money to another party on demand or at some point in the future.
• A promissory note is an instrument in writing (not being a bank note or a

currency note) containing an unconditional undertaking, signed by the maker,
to pay a certain sum of money only to or to the order of a certain person or to
the bearer of the instrument
• NSEI is the national level stock exchange.
• The main objective of NSEI is to provide a nationwide transparent market.

• Investor in share market open a demat account to keep these securities in

electronic form
• Investors approach depository participant for dematerialization procedure
• NSDL and CDSL are the two depositories in India.
Evaluate yourself
1. Ms. Amrita is an investor in the business at stock exchange, therefore, helps her with role
played by SEBI in protecting investor’s interest.
2. Mr. X enterprises are a company and Mr. Y is an investor. Explain the importance of stock of
exchange from Mr. X and Mr. Y point of view.
Maximize your marks

• Go through the learning points

Lesson 18 : Financial Market
Worksheet – 18
1. The financial market act as a link between groups and is defined as ‘a transmission
mechanism between investor’ Share you view point’s related to this statement.
2. Money market does not deal in cash or money. Share your view.
3. Mrs. Rita needs instruments for the business to borrow the funds to meet her short term
requirement. Therefore explain all the instruments which will help her for the business
unit?
4. Explain how financial institution and corporation normally plays major role in increasing
bill market?
5. Explain in your words and give a brief idea about two segments of securing market?
6. Explain by giving examples how capital market is different from money market?
7. Describe a place where existing securities can be bought and sold on regular basis and
also mention its characteristic?
8. Find out the popular instruments traded in the market?
9. Ms. Radhika is an investor in the business at stock exchange, therefore, helps her with
role played by SEBI in protecting investor’s interest.
10. Mr. X enterprises are a company and Mr. Y is an investor. Explain the importance of
stock of exchange from Mr. X and Mr. Y point of view.
Lesson-19
INTRODUCTION TO MARKETING
Introduction
Do you know how do all these goods and services reach our home? Obviously the business houses
that produce the goods and services have to ensure that these are to be sold, and so they have to
make the consumers/users aware of their products and place them at points convenient to the
consumers. There are number of activities taken together are termed as Marketing. We will learn
about the concept of marketing, its importance, objectives and functions

1. Marketing refers to the process of ascertaining consumers’ needs and supplying various
goods and services to the final consumers or users to satisfy those needs. Marketing starts
with identifying consumer’s needs then plan the production of goods and services
accordingly to provide them the maximum satisfaction.
2. The terms ‘marketing’ and ‘selling’ are related but not synonymous. While selling starts
after production is over, marketing starts with finding out consumers’ needs, wants and
preferences. Marketing revolves around the customers, whereas selling revolves around
the product. Marketing seeks customers’ satisfaction, selling seeks profits.
3. Marketing aims to achieve many objectives:
4. Marketing helps business to keep pace with the changing tastes of the consumers and
meeting the threats posed by competitors. It helps in providing better goods and services to
the consumers.
5. Marketing performs many functions :
Learn new points:

• Promotion of the Product: Promotional activities include advertising, personal selling, sales
promotion and publicity.
• Pricing the Product: Pricing involves decisions regarding fixation of product prices, keeping
in view the product costs, the capacity of customers to pay, and the prices of the competitive
products.
• Packaging: Packaging involves putting the goods in attractive packets according to the
convenience of consumers.
• Marketing Research: Marketing research involves collection and analysis of facts relevant to
various aspects of marketing.
Evaluate yourself
1. Mrs Alka is a successful mother and wants to develop standard goods with respect to shape,
design, etc. Help her to know about standardization and grading?
2. Mr Sunil wants to start practicing marketing. Help him to understand the basic objective of
marketing and its functions?
3. Share your view about how Branding of products is important for sale?
Maximize your marks


Lesson 19 : Introduction To Marketing
Worksheet – 19
1. Marketing helps business to keep pace with the changing taste, fashions and preferences
of the customer. Share your view in regard to this statement?
2. Do you know traditionally marketing emphasizes on promotions and sale of goods and
services what you think? Explain?
3. The term marketing and selling are related but not synonymous share your understanding.
4. Mrs. Mira wants to start practicing marketing. Help her to understand the basic objective
of marketing.
5. Explain in 60 words how marketing is important to consumers.
6. Marketing starts much before the actual production. What do you understand by this
statement?
7. What are those activities that direct the flow of goods and services from producers to
consumers?
8. If you have to promote any kind of product, what activities you will include in
promotion.
9. Mr. X is a successful mother and wants to develop standard goods with respect to shape,
design, etc. Help him to know about standardization and grading.
10. Share your view about Branding of product is important for sale of product?
Lesson-20
MARKETING MIX
Introduction
You will learn about the basic aspects relating to the 4‘P’s: product, price, place and
promotion. These 4 ‘P’s are called as elements of marketing and together they constitute the
marketing mix. All these are inter-related because a decision in one area affects decisions in
other areas. So the marketing manager concentrates on four major decision areas while
planning the marketing activities, namely, products, price, place (distribution) and promotion.

1. Product is defined as anything that can be offered to a market to satisfy a want. It not only
includes physical objects and services but also the supporting services like packaging,
installation, after sales services etc.
2. Based on use, products can be classified as:
Consumers goods Industrial goods
3. Based on durability products can be classified as:
Durable goods Non-durable goods
4. Based on tangibility, products can be classified as :
Tangible goods Intangible goods
5. Price is the consideration in terms of money, paid by consumers for the bundle of benefits
he/she derives from use of product/services. The different methods of price fixation :
6. Channels of distribution are a vital link between manufacturers/producers and the ultimate
consumers/users. It includes the middlemen/agents engaged in the process of transfer of
title of goods. The various channels used for distribution of consumer goods are
Zero stage channel : Manufacturer → Consumers

One stage channel : Manufacturer → Retailer → Consumers
Two stage channel : Manufacturer → Wholesaler → Retailer → Consumers
Three stage channel : Manufacturer → Agent → Wholesaler → Retailer →
Consumers
7. Factor affecting choice of distribution channel :
8. Promotion is an applied communication used by marketers to convey persuasive messages

and information between the firm and its potential customers. The different tools used for
promotional activities are :
Advertising Publicity Personal Sales

selling promotion
Learn new points:

Branding is the process of using a name, term, symbol or design to identify the product.
Packaging includes all the activities which are involved in making a container and protecting
a product.
Labeling provide a detailed information about a product.
Publicity is a non-paid communication which gives information about a product.
Evaluate yourself
1. Mr.Akhil buys a Printing machine for his shop and its helps him in printing pages. How this
can be classified? Explain
2. Mrs Rubina has to choose 5 different kinds of products. Help him to choose the product
according to durability, tangibility, industrial good and consumer good, non tangible good.
Explain with the help of examples.
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Lesson 20 : Marketing Mix
Worksheet – 20
1. Mr. Ashok is a marketing manager and is not aware with planning of marketing activities.
Help him to know about major decision while planning market activities?
2. “Customer is considered as the king of the marketing” explain?
3. What do you understand by the term 4 Ps and how it is related to marketing mix?
4. Mr. X buys a washing machine and its helps him in washing clothes. How this can be
classified?
5. Share your views that the same product can be classified as consumer goods as well as
industrial goods.
6. Mrs. Sunita opens up a shopping complex and she wants to brand the product. Explain
the meaning and process the brand the product.
7. Mr. Faizal is a vegetables seller and increases the prices of onion due to high demand.
Which method of price fixation is being referred?
8. Where there is a set of people and firm involved in transfer of title to a product as the
product moves from producer to consumer or user?
9. Mr. Ayansh has to choose 5 different kinds of products. Help him to choose the product
according to durability, tangibility, industrial good and consumer good, non tangible
good.
10. Mrs. Rita has to sell the toys in the local market and in the near town. Explain her to
analyze proper distribute channel?
Lesson-21
ADVERTISING AND SALESMANSHIP
Introduction
As you are already aware that the main purpose of advertising is to inform the prospective customers
about the availability, quality, price etc. of the products and motivate them to buy. Besides
advertising, sales promotion and personal selling are the other tools commonly used by the firms for
promotion of their products. We shall learn about all these elements of the promotion mix. . For each
product, a number of companies advertise their brand, as in case of television, Videocon, Sony, BPL,
LG etc.

1. Advertising is ‘any paid form of non-personal presentation and promotion of ideas, goods and
services of an identified sponsor’. It also generates huge revenue, employment opportunities
in the country.
2. Objectives of Advertising:
3. Advantages of Advertising :
4. Limitation of Advertising:
5. Media of Advertising :
6. Sales promotion: All promotional activities other than advertising, salesmanship and publicity
which help in increasing the market demand of the product.
7. Objectives of Sales promotion :
• Inform the potential buyer

• Persuades customers
• Increase in sales volume
• Incentive to retailers
• Create product identity
8. Qualities of a good salesperson:

• Good personality
• Mental qualities like alertness, imagination, foresightedness, empathy
• Good behavior
• Knowledge about the product
• Ability to communicate and persuade
9. Tools used in sales promotion :

Bonus Exchange
Price off Fairs and
offer offer exhibition
Free offer Money Discount Deferred

refund coupon payment
Learn new points:

Personal selling is a process of assisting and persuading the prospective customers
to buy a product in a face-to-face situation.
Deferred Payment Plan : During 1980’s, some of the airlines offered deferred
payment plans - ‘Travel today pay fare later’ for air journeys for promoting travel
Evaluate yourself
1. As you know that advertising adds to the cost and prices of product. Do you think it is
essential to do advertising of products?
2. Visit any shops selling a readymade garments and list down the different qualities of the
salespersons you noticed during your conversation.
3. Make a list of products you generally see around, where media is used for their
advertising.
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Lesson 21 : Advertising and Salesmanship
Worksheet – 21
1. Do you think that the main purpose of advertising is to inform the prospective customer
about the availability and price? Comment?
2. Share your views as a customer about the most powerful sources among advertisement
and publicity.
3. Mr. Rakesh is running a cosmetic business and wants to promote a product in the market
to increase sale so, guide him to do promotions for the product.
4. Share your views whether Advertisement is helpful for customer to make a right choice
or not?
5. Advertisement is considered to be a wasteful activity and something harmful for the

customer and the society. List out the activity and explain in your own words.
6. What is the kind of advertising media through which messages regarding product and
services are transmitted to people.
7. Mrs. Sunita went to a garment shop to buy one shirt for his husband. The salesman
showed the latest collation and the sales person persuaded her to buy two. So, this
unplanned purchase leads to what? Explain the process.
8. Share your experience, when you come across a good sales person in a shop and explain
all his good qualities.
9. Have you ever thought why companies distribute their small sample product free or buy
one get one free? Explain with all the promotional tools you know?
10. Explain in 120 words “Advertising generates huge revenue and employment”?
Lesson-22
INTERNAL TRADE
Introduction
Where do you buy all products? Your answer will be – from the nearby market. Now the question is,
how do all these products reach the market? There are a number of firms/people who are involved in
this activity of bringing the product from the place of production to the market and then making it
available to the ultimate consumers. They act as a link or bridge between the producers and the
consumers. Now we will learn about the firms/people who link the producers and consumers within a
particular country and also about the various options available to consumers to buy the products for
their consumption.
1. Buying and selling of goods and services within the geographical boundaries of a country is
referred to as internal trade.
2. On the basis of volume of goods traded we can classify internal trade as wholesale trade and
retail trade.
3. Wholesale trade refers to buying of goods in large quantity from the producers or
manufactures for sale to other traders or buyers in small quantities.
4. Retail trade refers to buying goods from the manufacturers or wholesalers and selling them
to the ultimate consumers.
5. Types of Retail trade:
6. Retailing is now aiming towards earning profit by offering customers more choice, more
convenience and better facilities.
Learn new points:
Franchise is a form of retailing wherein two parties enter into an agreement in which one
party authorizes others to sell or produce and sell specified goods and services.
The mail order retailers place the advertisements in newspapers, magazines etc. or publicize
about their products in booklets, catalogues, brochures and handouts.
Consumer Cooperative Store is another form of large scale retail trade which is owned by the
cooperative society.
Super Market is another kind of large-scale retail organization from where we can buy most
of our household requirements for a week or a month in one visit.
Performa Invoice : It is a document sent prior to the actual sale to the buyer
Invoice : It is a document sent by the seller to the buyer when goods are supplied
Debit Note : It is a document prepared by one party (either by the seller or the buyer) to
inform the other party (either the seller or the buyer) that receiver’s account has been debited
with the specified amount and for the specified reasons
Evaluate yourself
1. Mr Rakesh is a wholesaler in a distribution channel. List out the role and
responsibility of a wholesaler.
2. Visit at least five different retail shops of your locality and from your point of view classify
them according to the different types?
Maximize your marks


Lesson 22 : Internal Trade
Worksheet – 22
1. Explain in not more than 60 words about the nature of relationship with
producer/consumer, where there is direct Link with produces and indirect link with the
consumers?
2. Explain the trade in which it requires display of product attractively?
3. “Presence of too many middle men increases the price of product” explain how.
4. Mr. X has a shop which enjoys large scale purchase or production of goods. Do you
think that customer can bargain in this shop? Explain.
5. Share your views whether upper markets are more convenient for customers and why?
6. Mrs. Reshma is a wholesaler in the distribution channel. Explain in your words the role
and responsibilities of Mrs. Reshma as a wholesaler.
7. Explain in not more than 60 words about the interesting trends that have emerged in
Retailing?
8. What kind of marketing relates to the situation where producers approach the consumers
over the telephone and ultimately persuade them to buy a product? Are the customers
satisfied?
9. Share your views about the middle men as they provide services to both producers and
consumers and if they should exist in the trade or eliminated from the same?
10. Explain in details about the role of wholesalers and retailers in the chain of distribution.
Lesson-23
EXTERNAL TRADE
Introduction
Today, we can buy goods of our need from other countries and also sell our surplus goods abroad
without facing much difficulty. When the business firms of two different countries participate in the
process of buying and selling of goods it is termed as External Trade. So we will learn the difference
in the nature and procedure of this type of trade.

1. Meaning of External trade: When buying and selling of goods take place across the national
boundaries of different countries it is called External trade. It is also known as Foreign trade or
International trade.
2. Kinds of External Trade :
Import Export Entrepot

Trade Trade Trade
3. Importance of External trade :
4. Difficulties faced in External Trade :
Greater Cost
Distance Lack of
personal risk
Changes in rules
Restrictions Frequent and regulations.
price change
5. Essential requirement for Exporters/Importers:
IEC number RCMC.
6. Procedure for Export Trade:
7. Procedure for Import Trade :
8. Documents Used in External Trade :
Learn new points:

Credit Enquiry: The exporter must ensure that there is no risk of default in payment.
Excise Clearance: In India, manufactured products are subject to excise duty under the
Central Excise Act.
Mate’s receipt: The captain or mate will issue a receipt known as “mate’s receipt” after the
goods has been loaded.
Bill of lading: The forwarding agent has to present the mate’s receipt at the office of the
shipping company and in exchange will get a document known as Bill of Lading.
Letter of credit: The exporter can get immediate payment on the strength of the letter of
credit which is issued by the importer’s bank in favour of the exporter.
Bill of Entry: The agent has to fill in and submit three copies of the bill of entry to the custom
authority.
Insurance Policy: The insurance policy is issued by the insurance company to cover the risks
of loss or damage to goods due to specified causes.
WTO has been playing an important role in facilitating and promoting international trade.
Evaluate yourself
1. Mrs Anisha wants to export leather shoes. You are required to explain to her the procedure for
the same.
2. Share your point of view in terms of goods, which needs to be imported and are not available
here and demanded by many customers.
Maximize your marks


Lesson 23 : External Trade
Worksheet – 23
1. “A firm purchases good and services from another country”. Explain the kind of trade in
detail.
2. Mr. Rakesh wants to exports goods to London. Explain to him about the procedure.
3. Mr. X is an external trader and while trading, she faced many difficulties. List down all
the problems and Explain.
4. Share your points regarding measures taken up by Government of India to facilitate

export.
5. Mrs. Sunita is a new trader in market. So explain her procedure to import cosmetic item
from Paris.
6. Share your opinion about the goods and services that are not available and you think can
be imported.
7. From your point of view what kind of goods can be exported to boost the foreign
exchange of our country?
8. Name and explain the function of the organization which is more powerful for resolving
disputes in international trade.
9. Explain the trade in which a “X” firm imports goods in order to export the same to
another country.
10. Mr. Mahesh was importing goods from London with the help of clearing Agent and was
very successful but Mr. Sanjeev was also in same business and was not so successful.
Explain the role of clearing agent?
Lesson-24
CONSUMER PROTECTION
Introduction
We shall learn about the concept and practice of consumer protection, the rights and responsibilities
of consumers, legal provisions and mechanism for settlement of consumer grievances. Whatever we
buy we pay for it and derive satisfaction from its consumption and use. But sometimes we do not feel
satisfied with the product we buy. Therefore Consumer Protection is a measures adopted for the
protection of consumers from unscrupulous and unethical malpractices by the business and to provide
them speedy redressal of their grievances.

1. Consumer is a person who buys goods or hires services to be used or consumed by
himself/herself or by someone on behalf of the buyer. A consumer will get information of
consumer rights and remedies through the Consumer Protection Organization.
2. Consumer protections helps business to provide right quality product, increases social
responsibility and prevents unfair trade practices. Consumer organizations and NGOs can
play a vital role for consumer protection.
3. Consumer organizations objectives: It will educate consumers about their right through
published materials, exhibitions, seminars.
4. The need for consumer protection arises:
5. Reasons for consumer protection are:
• Social Responsibility
• Increasing Awareness
• Consumer Satisfaction
• Principle of Social Justice
• Principle of Trusteeship
• Survival and Growth of Business

6. Rights of a Consumer as given in the Consumer Protection Act 1986:
7. Responsibilities of Consumers shall include the following :
8. Ways and Means of Consumer Protections :
9. Consumer Protection Act 1986: The main objective of the Consumer Protection Act 1986 is
to provide better and all-round protection to consumers and effective safeguards against
different types of exploitation such as defective goods, deficient services and unfair trade
practices.
Learn new points:

Public Interest Litigation (PIL) is a scheme under which any person can move to the court of
law in the interest of the society.
Right to Seek Redressal : The consumers have been given the right of redressal of their
grievances relating to the performance, grade, quality etc.
Right to Consumer Education: It means the right to receive knowledge and skill to become
informed consumer. In this direction the consumer associations, educational institutions and
the policy makers can play an important part
Lok Adalat : Lok Adalats are the effective and economical system for quick redressal of the
public grievances.
Consumer Protection Councils : Under the Consumer Protection Act 1986, a judicial system
has been set up to deal with the consumer grievances and disputes at district level, state
level and national level
Evaluate yourself
1. Mrs Sushma bought a cell phone in January 2020 with a warrantee period of 2 years. In June
2021 she noticed some defect and asked the company to rectify it. The company did not listen
to his complaint. So guide her and explain the necessary action which she could take?
2. Your friend bought a Computer system from a computer shop. When she fitted the computer
system at home, she discovered that it was not functioning. The shopkeeper now refuses to
exchange the computer or return the money. Where and how can your friend file a complaint
to get redressal of her grievance?
Maximize your marks


Lesson 24 : Consumer Protection
Worksheet – 24
1. Mrs. Radhika bought a Laptop in April, 2020 with a warranty period of 1 year. In August
2021, she noticed some defect and asked the company to rectify. The company did not
listen to her complaint. So guide her and explain the necessary action which she could
take.
2. If a shopkeeper refuses to exchange the computer or return the money. Then From where
and how can you file a complaint to redressal of their grievances?
3. Explain the act which protects and safeguards consumer against different types of
exploitation.
4. “The consumer has been given the right of redressal of their grievances”. Do you think
it is right? Complain.
5. Share your view about Lok Adalet whether it is effective for quick redressal of public
grievances.
6. List out the responsibilities of consumers which they should be aware off?
7. Mr. Rahul is not aware about the different ways and means of consumer’s protection.
Help him to know the ways so that he can re-solve his issues?
8. Identify which of their right as consumers are violated and how these problems could
have been avoided through responsible behavior of consumers.
9. Share your view about the various publicity measures to increase the level of awareness
among the consumers.
10. Do you know any NGOs who are helping consumers in protecting their rights? Explain in
your own words.

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NATURE AND SCOPE OF BUSINESS

Important points from text

2. Business objectives are something, which a business organization wants to achieve or

5. Nature of Business Risk :

6. Causes of Business Risks

7. Industry primarily refers to all such business activities concerned with

Learn new words:

4. Non Economic Activities: Activities undertaken to derive mere satisfaction

2. Differentiate between Business, Profession and Employment on the basis of definition,

4. What objectives would you keep in mind while starting a Business?

8. Elaborate the various classifications of business activities giving relevant examples.

9. What is industry? Give its various classifications.

Important points from the text:

2. Functions of commercial banks

(b) Secondary functions :

3. Insurance: Based on the subject matter of insurance and nature

Learn new key words:

1) Explain the concept of business support services

Maximize your marks

 Learn the key words

National Institute of Open Schooling

1. Why do you think that banks are important to us?

3. What are the primary and secondary functions of Commercial Banks?

5. What is insurance and why do you think it is important?

7. What is transportation? Why it is important for any business?

 Recent development in Indian Economy

(a) Liberalisation: Liberalisation refers to the process of eliminating unnecessary

 Social Responsibility of Business: Social responsibility of business refers to the

Need for Pollution Control:-

Learn new key words:

 Non Economic Environment-Non-economic environment comprises social,

Maximize your marks

 Learn the key words

1. What do you mean by ‘Business Environment’? Explain its features.

3. Discuss the various Economic and Non-economic Business Environment.

4. Briefly explain Liberalisation, Privatization and Globalisation reforms in India.

5. How Government policy changes have impacted business and industry?

6. Explain the concept of Social Responsibility in business.

7. What are various responsibilities of business towards their interest groups.

8. How does business contribute in environmental pollution?

MODERN MODES OF BUSINESS

Important points from the text:

(a) It lacks personal touch with customers

5. The Transaction Process

(a) Protected by Passwords

6. Outsourcing is a management strategy by which an organisation contracts out its major

Learn new points:

4. Explain the concept of outsourcing of services, its merits and limitations.

Maximize your marks

National Institute of Open Schooling

1. The Internet is the global system of interconnected computer networks to communicate

8. Roshan manages an IT firm. He wants to outsource services like payroll processing or

10. Risks involved in business transactions may be financial, reputational or physiological.

FORMS OF BUSINESS ORGANISATION