1. Business means ________.
a. commerce.
b. industry and commerce.
c. trade and commerce.
d. selling and buying of goods.
Answer: B
2. Which of the following is not an economic activity?
a. A doctor practicing.
b. A lawyer practicing law.
c. A professional cricketer playing cricket.
d. A student playing cricket.
Answer: D
3. ‘Fish culture’ should be classified as _____.
a. extractive industry.
b. genetic industry.
c. manufacturing industry.
d. construction industry.
Answer: B
4. Which of the following is an extractive industry?
a. Cattle breeding.
b. Forest cultivation.
c. Hunting.
d. Flour mills.
Answer: C
5. Which of the following is not a manufacturing industry?
a. Iron and steel works.
b. Flour bills.
c. Fruit canning.
d. Mining.
Answer: D
6. A valid definition of a business purpose is to ______.
a. create a customer.
b. maximize profits.
c. serve the society.
d. increase the wealth of the firm.Answer: A
7. Sole-trade organization is also called as ______.
a. individual proprietorship.
b. Partnership.
c. joint stock company.
d. co-operative society.
Answer: A
8. Who is dormant partner?
a. One who takes no active part in business.
b. A working partner.
c. Partner for profits.
d .Minor partner.
Answer: A
9. In case of minor acting as a partner, his personal properties are ___.
a. liable for the debts of the firm.
b .not liable for the debts of the firm.
c. partly liable for the debts of the firm.
d. only debts of the firm.
Answer: B
10. What is a holding company?
a. A company having control over another is called as the holding company.
b. A company whose major share holdings are owned by other company.
c. A company having a sister concern.
d. A company whose shares are owned by a particular family.
Answer: A
11. When a partnership is dissolved?
a. In any case of death of any of the partner.
b. By mutual consent.
c. By insolvency of any of the partner.
d. By insanity or madness.
Answer: A
12. What is the maximum number of the persons a private limited company can have as
its members?
a. 50.
b. 2.
c. 7.
d. Unlimited.
Answer: A
13. The agent of brokers who obtain business for them are _______.
a. remesiers.
b. trade agents.
c. middlemen.
d. taraniwala.
Answer: A
14.A dealer in securities who sells and purchases securities in his own name with a view
to earning profit due to price fluctuation is called as ________.a. jobber.
b .adealer.
c. taraniwala.
d. hundiwala.
Answer: A
15. The oldest form of business organization is ______.
a. partnership.
b. sole proprietorship.
c. joint stock company.
d. co-operative undertaking.
Answer: B
16. The liability of a sole proprietor is _______.
a. limited to the extent of his capital invested in the business.
b. limited to the extent of the value of business assets.
c. limited to the extent of the value of business assets and his all private assets.
d. limited value of the business assets.
Answer: C
17. Individual proprietorship form of business organization is not advisable for the
enterprises which ______.
a. require small amount of capital.
b. need personal attention of customers.
c. are large in size.
d. do not involve heavy risk.
Answer: D
18. The maximum number of partners in a firm carrying on banking business is__.
a. 7.
b. 10.
c. 50.
d. 20.
Answer: C
19. The agreement of partnership _______.
a. must be oral.
b. must be in writing.
c. can be either oral or in writing.
d. must be in writing on a stamp paper.
Answer: D
20. Liability of partners in respect of the firm’s debts is _______.
a. limited up to the amount of his capital in the business.
b. Unlimited.
c. limited up to the amount of guarantee given by the partner.
d. limited up the amount of his capital and loan to the firm if any.
Answer: D
21. A partner in a firm _______.
a. cannot transfer his share to an outsider.
b. can transfer his share to an outsider with the consent of majority partners.
c. can transfer his share to an outsider without the consent of any other partners.d. can transfer his share to an outsider with the consent of all other partners.
Answer: A
22. Partnership may come into existence ______.
a. by the operation of law.
b. by an express agreement only.
c. by an express or implied agreement only.
d. by inheritance of property.
Answer: C
23. A manager with a share in the profits ______.
a. is only a servant of the firm.
b. becomes a partner by the operation of law.
c. becomes a partner by implied agreement.
d. becomes a partner from status.
Answer:: A
24. When a partner is guilty of fraud or negligence within the scope of his authority__.
a. only he will be liable for his acts.
b. he can be expelled of he refuses to assume liability.
c. all partners are liable if there is an agreement to this effect.
d. all partners are liable even if there is no agreement to his effect.
Answer: D
25. Registration of partnership is ________.
a. optional under Indian partnership act.
b. compulsory under the Indian partnership act.
c. compulsory under the income tax act.
d. compulsory under Indian contract act.
Answer: A
26. A nominal partner is ______.
a. not entitled to share the profits of the concern.
b. entitled to equal share in the profits unless there is an agreement to any other profit
sharing ratio.
c. not liable for the acts of other partners.
d. not able to third parties.
Answer: A
27. The minimum number of members in a private limited company is ___.
a. 2.
b. 3.
c. 7.
d. 10.
Answer: A
28. A Joint stock company is governed by _______.
a. companies act 1956.
b. companies act 1936.
c. companies act 1946.
d. companies act 1926.
Answer: A
29. Memorandum of association of a firm contains _______.a. rules regarding the internal management of the company.
b. rules regarding the constitution and activities of the company.
c. rules regarding the external management.
d. rules regarding the constitution.
Answer: B
30. The liability of shareholders of a public company is limited to the _____.
a. paid up value of shares.
b. nominal value of shares.
c. extent of their private assets.
d. accounts called up.
Answer: A
31. The most important advantage of a joint stock company form of business organization
is that ______.
a. the liability of its member is limited.
b. members can conveniently transfer their shares.
c. it offers infinite scope for expansion.
d. it mobilizes vast amount of financial resources.
Answer: B
32. A Government company is one in which ______.
a. the entire share capital is held by the central and / or state government.
b.50% of capital is held by central government and the remaining 50% by one or more
state governments.
c. at least 50% of the capital is held by central and / or state governments.
d. entire share capital held by state government.
Answer: D
33. The existence of a joint stock company is interrupted by _____.
a. the death of its members.
b. the death of its directors.
c. the death or insolvency of its managing director.
d. the death of the holder.
Answer: C
34. A Company is called an artificial person because ____.
a. it does not have the shape of a natural person.
b. it cannot be used in the court of law.
c. it is invisible and intangible.
d. it exists only in contemplation of law.
Answer: C
35. In the co-operative organization, the voting rights of members are___.
a. in proportion to the capital paid by each member.
b. equal, irrespective of amount of capital contribution.
c. in proportion to the nominal value of capital held by each member.
d. in proportion to the total finance supplied including the amount of loan by each
Answer: D
36. Localized materials are available at _____.
a. all the places.b. certain places.
c. central places.
d. local places.
Answer: B
37. The liability of members of a co-operative society is ______.
a. limited to the amount of nominal value of capital held.
b. limited to the amount of paid up value of the capital held.
c. unlimited.
d. limited or unlimited depending upon what the society has opted for it.
Answer: D
38. Membership of a co-operative is_________.
a. compulsory.
b. voluntary.
c. not essential.
d. not compulsory.
Answer: B
39. The minimum number of members required for registration of a co-operative society
is ______.
a. two.
b. seven.
c. ten.
d. twenty.
Answer: C
40. Co-operative and public companies are similar in respect of _______.
a. the liability of members.
b. the minimum number of members required for registration.
c. the maximum number of members.
d. method of distribution of profit.
Answer: C
41. A member of a co-operative society can leave the society by _____.
a .transferring his share to another person without anybody’s consent.
b. transferring his share to another person with the consent of the managing committee.
c. transferring his share to a fellow number.
d. withdrawing his capital from the society.
Answer: D
42. Reserve bank of India is a/an _______.
a .statutory corporation.
b. company limited by guarantee.
c. company limited by shares.
d. unlimited company.
Answer: A
43. Which of the following is an example of a company incorporated by a special act of
a. Delhi cloth and general mills ltd.
b. Tata iron and steel Co. Ltd.
c. Industrial Finance Corporation of India Ltd.d. Swedish Cotton Mills Ltd.
Answer: C
44. Dividend on preference capital will be paid ______.
a. only when there are profits.
b. even if there are no profits.
c. only when directors recommend.
d. only when share holders recommend.
Answer: C
45. A public corporation means _____.
a. public company.
b .government company.
c. statutory corporation.
d. department of union government.
Answer: B
46. The partnership entity is _______.
a. legal entity.
b. legal entity and accountable entity.
c. neither entity nor accountable entity.
d. group of individuals without legal status.
Answer: B
47. Promoter is a person who ________.
a. takes part in the incorporation of a company.
b. is a director.
c. is a relative of the managing director.
d. works to publicity to the company.
Answer: A
48. The minimum number of shareholders in a public limited company is ___.
a. 2.
b. 3.
c. 5.
d. 7.
Answer: D
49. The limit for maximum number of members in a public company is restricted
a. 2000.
b. 5000.
c. 10000.
d. no limit.
Answer: D
50. A private company should have at least _____.
a. 2 members.
b. 7 members.
c. 10 members.
d. 50 members.
Answer: A

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