case study class 11 business studies chapter 4

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Class 11 Business Studies Case Study Questions

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CBSE Class 11 Business Studies Case Study Questions are available on myCBSEguide App . You can also download them from our student dashboard .

For students appearing for grade 11 CBSE exams from the Commerce stream, Business Studies is a fundamental subject. Business Studies is considered to be quite interesting as well as an occupying subject as compared to all other core subjects of the CBSE class 11 commerce stream. To ace this CBSE exam, students are not only required to work hard but they ought to learn to do smart work too.

Among all the other core subjects of the Commerce stream i.e accountancy, economics and business studies, Business Studies is the one that is purely theoretical. It is termed to be comparatively easier and more scoring than the other mandatory subjects of the commerce stream. Many students who opt for the commerce stream after their 10-grade exams desire to learn in-depth about the business organizations and their work, for them the subject is of utmost importance. Business Studies is an essential component of the class 11 commerce stream curriculum.

In order to ace the subject the student needs to have conceptual clarity. CBSE has designed the syllabus for class 11 Business Studies so as to provide students with a basic understanding of the various principles prevalent in the Business organizations as well as their interaction with their corresponding environment.   

Case Study Questions in class 11 (Business Studies)

Case-based questions have always been an integral part of the Business Studies question paper for many years in the past. The case studies have always been considered to be challenging for the students, for such questions demand the application of their knowledge of the fundamental business concepts and principles. Last year i.e-  2021 CBSE introduced a few changes in the Business Studies question paper pattern to enhance and develop analytical and reasoning skills among students.

It was decided that the questions would be based on real-life scenarios encountered by the students.CBSE not only changed the way case-based questions were formulated but also incremented their weightage in the Business Studies question paper. The sole purpose of increasing the weightage of case-based questions in the class 11 curriculum by CBSE was to drift from rote learning to competency and situation-based learning.

What is a case study question? (Business Studies)

In Business Studies, a case study is more like a real-world test of how the implementation works. It is majorly a report of an organization’s implementation of anything, such as a practice,a product, a system, or a service. The questions would be based on the NCERT textbook for class 11 Business Studies. Case-based questions will definitely carry a substantial weightage in the class 11 Business Studies question paper. questions.

A hypothetical text will be provided on the basis of which the student is expected to solve the given case-based question asked in the Business Studies class 11 exam. Initially, the newly introduced case-based questions appeared to be confusing for both the students and the teachers. Perhaps, they were reluctant to experiment with something new but now a lot more clarity is there that has made the question paper quite student-friendly.

Case study questions could be based on any chapter or concept present in the NCERT textbook. Thus, it is expected from the students to thoroughly revise and memorize the key business fundamentals. 

Business Studies syllabus of class 11 CBSE   

The entire Business Studies course is divided into 2 parts:

• Part A, Foundation of Business
• Part B, Finance and Trade

The class 11 Business Studies exam is for a total of 100 marks, 80 marks are for the theory and the remaining 20 for the project. Most of the questions are based on the exercises from the NCERT textbook. It is recommended to rigorously go through the contents of the book. A single textbook has been published by NCERT for Class 11 Business studies. There are a total of 10 chapters in this book divided into 2 parts. 

CBSE Class – 11

Business Studies (Code No. 054)

Theory: 80 Marks Time: 3 Hours Project: 20 Marks

Case Study Passage (Business Studies class)

As part of these questions, the students would be provided with a hypothetical situation or text, based on which analytical questions will have to be answered by them. It is a must for the students to read the passage in depth before attempting the questions. In the coming examination cycle (2022-23), case-based questions have a weightage of around 30%. These questions can be based on each chapter in the NCERT book for Business Studies, grade 11.

Students must prepare well for the case-based questions before appearing for their Business Studies exam as these questions demand complete knowledge of the various concepts in their syllabus. CBSE plans to increase the weightage of such questions in the upcoming years.

Sample case-based Questions in Business Studies

Business Studies as a subject provides a way of perceiving and interacting with the business ecosystem. It is a core subject of the commerce stream that is purely theoretical and relevantly easier than the other compulsory subjects of the stream. Class 11 Business Studies syllabus is closely related to trade and commerce. The subject cannot be ignored as it is the foundation of many concepts and theories which are studied at an advanced level in class 12.

The case-based questions asked in the CBSE Business Studies question paper for class 11 are of two types:

As per the latest circular issued by CBSE on Assessment and Evaluation practices of the board for the session 2022-23, CBSE has clearly mentioned that competency-based questions including case studies will be different from subjective questions.  

The questions can also be categorized on their difficulty level:

• Direct: such questions can be easily solved. Their answer is visible in the given passage itself.
• Indirect/ Analytical: such questions are confusing and tricky. These can be solved by the application of the theory or principle that is highlighted in the provided text. 

How To Prepare For Case-based Questions? (Business Studies grade 11)

Students need to prepare well for the case-based questions before appearing for their class 11 Business Studies exam. Here are some tips which will help the student to solve the case-based questions at ease:

• Read the provided text carefully
• Try to comprehend the situation and focus on the question asked
• Analyze and carefully answer the question asked
• In general, the passage given would be lengthy in Business Studies case-based questions but their solutions are comparatively short and simple
• One can significantly save time if they follow a reversal pattern, that is going through the questions before reading the comprehensive case study passage.
• Answer in a concise manner
• One should concentrate on solidifying key fundamental principles/theories
• Go through the NCERT textbook in depth. The language used is crisp and simple.
• While providing solutions to the case-based question, pick the keyword/keyline based on which you are driving insights.

 In order to excel in the Business Studies class 11 exam, one needs to ignore the shortcut techniques and get to read the NCERT textbook rigorously. Case studies can be easily solved if your key fundamentals are strong and clear. The best part of having these questions is that the asked question itself projects a hint of its answer. These simple points if kept in mind will definitely help the students to fetch good marks in case study questions, class 11 Business Studies. 

Case study question examples in Business Studies

Here a re some given case study questions for CBSE class 11 Business Studies. If you wish to get more case study questions and other study material, download the myCBSEguide app now. You can also access it through our student dashboard.

Business Studies Case Study 1

Read the hypothetical text given and answer the following questions:

Manish, Rahul and Madhav live in the same locality. They used to meet and discuss their ideas. After discussing the recent fire breakout in their area, they decided to take fire insurance for their house or work area. Manish gets his house insured against fire for ₹1 lakh and during the policy period, his house gets damaged due to fire and the actual loss amounts to ₹2.5 lakh. The insurance company acquired the burning material and approved his claim. Rahul gets his godown insured against fire for ₹1 lakh but does not take enough precautions to minimize the chances of fire like installing fire extinguishers in the factory. During the policy, a fire takes place in his godown and he does not take any preventive steps like throwing water and calling the employees from the fire fighting department to control the fire. He suffered a loss of ₹1,20,000. Madhav took a fire insurance policy of ₹20 lakh for his factory at an annual payment of ₹24,000. In order to reduce the annual premium, he did not disclose that highly explosive chemicals are being manufactured in his factory. Due to a fire, his factory gets severely damaged. The insurance company refused to make payment for the claim as it became aware of the highly explosive chemicals.

How much can Manish claim from the insurance company?

• None of the above

How much compensation can Rahul get from the insurance company?

Which principle is violated in the case of Rahul?

• Insurable Interest
• Utmost Good Faith

How much amount is the insurance company liable to pay to Madhav if he files a case against it?

• Insufficient information

Which principle of Insurance is violated by Madhav?

• Insurable interest
• Subrogation
• Proximate Cause

The insurance company acquired the burnt material and approved his claim. Which principle of Insurance is highlighted in the given statement.

• (a) Mitigation
• (a) Utmost Good Faith
• (d) Subrogation

Business Studies Case Study 2

 Sarthak Electronics Ltd. has a loss of Rs 15,00,000 to pay. They are short of funds so they are trying to find means to arrange funds. Their manager suggested a claim from the insurance company against stock lost due to fire in the warehouse. He actually meant that they can put their warehouse on fire and claim from insurance companies against stock insured. They will use the claim money to pay the loan.

• Will the company receive a claim if the surveyor from the insurance company comes to know the real cause of fire?
• Write any two Values which the company ignores while planning to arrange money from false claims.
• State any three elements of fire insurance

Business Studies Case Study 3

OLX and qickr are examples of well-known websites used to conduct business. Tarasha’s sofa set got spoiled in the rain. Her friend suggested that she should change the fabric so that it looks new and put it for sale on Olx. Tarasha followed her friend’s advice and got her sofa repaired so that it looked better and uploaded nicely clicked pictures on the website without disclosing the fact that it was damaged from the inside. She found a buyer and sold it for Rs 10,000. After five days the buyer found the real state of the sofa set and called Tarasha but she did not answer any of the calls.

• identify the type of business highlighted in the above case.
• Identify any two values which are overlooked by Tarasha.
• Explain any two benefits and limitations of e-business.

Advantages of case study questions in Business Studies

Class 11 Business Studies syllabus is not very vast but has to be focussed upon as it forms the base for your 12th grade Business Studies syllabus. Students are supposed to prepare themselves thoroughly from the NCERT textbook. The Case-based questions prominently focus on the real and current scenarios of the Business world. Approximately 30% of the question paper will comprise case study questions that demand high-order thinking and reasoning skills from the students. The students ought to practice class 11 Business Studies case-based questions from the various options available to them, so as to excel in the subject.

• Enhance the qualitative and quantitative analysis skills of students
• Provides an in-depth understanding of the key Business theories/concepts
• Inculcate intellectual capabilities in students
• Help students retain knowledge for a longer period of time
• The questions would help to discard the concept of rote learning
• Case studies promote and strengthen practical learning.

“Failure is success if you learn from it”

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Monday 12 September 2016

Business studies case studies class 11; chapters 3,4 and 5, 14 comments:.

Sir inke solutions kha milenge

Sir where are the answers of all these questions

Yes sir we want answers

anssererdsd

sir answers pls

answer de na

Ans. Dasso yrr

Give answer of these case studies

answers bhej do yrr

Sir answer kaha h

Amul is a big brand now. Read how supply chain of amul work.

Thank you for sharing amazing case studies related to business. Case Studies For Small Businesses

• Commerce Important Questions
• Class 11 Business Studies
• Chapter 4 Business Services

Important Questions for Class 11 Business Studies Chapter 4 Business Services

Important Questions for CBSE Class 11 Business Studies Chapter 4 Business Services which is outlined by expert Business Studies teachers from the latest version of CBSE (NCERT) books.

CBSE Class 11 Business Studies Chapter -4 Important Questions

Mention the 5 I’s of services?

Answer : Inconsistency, Inventory, Intangibility, Involvement and Inseparability

What is Insurance?

Answer : Insurance is a contract, embodied by policy, in which an individual or entity receives financial security or reimbursement against losses from an insurance company. The company pools clients’ risks to make payments more affordable for the insured.

Also Check: Important Question for Emerging Modes of Business

Mention the name of two companies that offer DTH services in India.

Answer : Tata Sky and Airtel are the two companies that offer DTH services in India.

What is Banking?

Answer : A bank is a financial institution authorised to receive deposits and make loans. Banks may also give financial services, such as currency exchange, wealth management, and safe deposit boxes. There are two types of banks. Namely, commercial/retail banks and investment banks.

What are the types of insurance policies?

Answer : There are 5 types of insurance policies. Namely,

• Whole life policy
• Joint life policy
• Annuity policy
• Endowment life assurance policy
• Children’s endowment policy

Mention 6 functions of warehousing.

Answer : Functions of warehousing:

• Consolidation
• Stockpiling
• Value-added services
• Price stabilisation
• Break the bulk

What are the 3 significant types of insurance that are involved in Marine insurance?

• Ship or hull insurance
• Freight insurance
• Cargo insurance

Expand RTGS and NEFT.

RTGS – Real Time Gross Settlement

NEFT – National Electronic Funds Transfer

What are the principles of insurance?

7 principles of insurance are,

• Utmost good faith
• Insurable interest
• Proximate cause
• Subrogation
• Contribution

Question 10

What are the types of warehouses?

• Private warehouse
• Public warehouse
• Bonded warehouse
• Government warehouse
• Cooperative warehouse

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Important Questions for CBSE Class 11 Business Studies Chapter 4 – Business Services

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Business Services Class 11 Questions and Answers

Business Studies is an essential subject as it greatly influences how we think about money and purchases. It discusses companies in general and delves into topics such as accounting, markets, human resources, personnel, and trade. Business Services is the fourth chapter in the NCERT textbook of Class 11 Business Studies. This chapter covers concepts such as characteristics of services, distinguishing services from goods, classifying business services, the concept of e-banking, type of insurance policies, types of warehouses and more. Students can easily access all this and more on the Extramarks’ website.

Quick Links

The NCERT Business Studies Class 11 syllabus is essential not just for the board examination but also as a discipline that students may choose later in their careers. Hence, Extaramarks experts have gathered them from various sources, such as the NCERT Textbook, NCERT Exemplar, other reference books, past years’ exam papers, and so on. Our Business Studies experts have curated a list of step-by-step solutions to help students understand each chapter. Students can register today with Extramarks and access all of it.

Get Access to CBSE Class 11 Business Studies Important Questions 2022-23 with Solutions

Sign Up and get complete access to CBSE Class 11 Business Studies Important Questions for other chapters too:

Business Services Class 11 Important Questions for Business Studies Chapter 4

Apart from Chapter 4 Class 11 Business Studies Important Questions, students can easily access materials like NCERT Solutions, CBSE revision notes , past years’ question papers, NCERT books, and much more on the Extramarks’ website.

Business Studies Class 11 Chapter 4 Important Questions and Answers

Business Studies experts at Extramarks have curated an entire list of Business Studies Class 11 Chapter 4 Important Questions from many different sources. The questions comprise a wide variety of topics, including characteristics of services, distinguishing services from goods, classifying business services, the concept of e-banking, type of insurance policies, types of warehouses and more. These questions and solutions help students to comprehend the aspects of Business Services.

Given below are a few Important Questions from Class 11 Business Studies Chapter 4 and their solutions:

Q1. Explain warehousing and its functions.

Answer. Warehousing was once conceived as scientifically preserving commodities to retain their quality, worth, and utility. It has grown more significant as a logistical service provider in modern times, emphasising delivering items on time and at a reasonable cost while maintaining value and quality.

The following are some functions of warehousing:

• Warehouses simplify keeping items and raw materials that won’t be sold or manufactured immediately while safeguarding them from rotting and damage.
• Product grading, packing, and labelling are examples of value-added services they give to manufacturers.
• Warehouses are in charge of breaking down vast amounts of commodities received from manufacturers into smaller quantities. The tiny batches are then transported according to customer needs.
• Before sending material/goods to a specific customer via a single transportation package, warehouses aggregate and consolidate material/goods from numerous production units.
• The receipt of the warehouse can also be used as collateral by the owner of the items or raw materials stored in the warehouse to borrow money from banks or other financial institutions.

Q2. What are the many sorts of financial services available? Briefly explain them.

Answer. The following new financial services have evolved in addition to the classic banking and insurance financial services.

• Loan Syndication: Loan syndication is the process of borrowers approaching various banks who are prepared to syndicate a loan and specifying the amount and period of the loan.
• Venture capital: Subscribing to borrowers’ equity shares in exchange for a portion of their ownership.
• Merchant banking: Merchant banking refers to the services of an intermediary concerning the issuing, management, and underwriting of corporate restructuring. They contribute to developing the capital market and increasing the numbers of investment in the country.
• Leasing: A legal transaction in which the user of an item pays a lease rent to the asset’s owner in exchange for use. The lessee gets custody of the assets at the end of the agreement.
• Mutual Funds: A service provided by experts who source money from individual investors to invest in stocks, bonds, and other short-term investments.
• Factoring: Factoring is selling accounts receivable to other businesses or organisations to raise revenue.

Q3. Define services and goods.

Answer. At the time of delivery, services are intangible activities that need face-to-face interaction between the consumer (service purchaser) and the service provider (service seller). There is no necessity that the services include product manufacturing or sales. Services are classified into the two categories below.

• Professional Services: Examples of professional services include legal services, medical counselling, and tax advice.
• Business Services: Business services include banking, insurance, and warehousing, to name a few.

In contrast to services, the term “goods” refers to actual, tangible items whose ownership is transferred to the buyer as soon as the product is acquired. Plants and machines, for example, are examples of products.

Q4. What are the three most significant insurances in Marine Insurance?

Answer. A marine insurance contract is an agreement between the insurer and the insured to reimburse them against maritime losses in the manner and to the degree agreed upon. Marine insurance covers damages resulting from marine risks, sometimes known as sea perils.

Under this, there are three significant insurances:

• Cargo insurance: While transported by ship, cargo or commodities are subject to several perils; this insurance covers the risk of the journey.
• Ship or Hull insurance: This insurance policy is meant to pay the insured for losses sustained due to ship damage because the ship is exposed to many perils at sea.
• Freight insurance: If the cargo is damaged or lost in transit, the shipping firm is not compensated for the freight payments; thus, the shipping company purchases this insurance policy to avoid this eventuality.

Q5. What are services? Explain their distinct characteristics.

Answer. At the time of delivery, services are intangible economic activities that need face-to-face interaction between the consumer and the service provider. Services are usually provided to suit the requirements of persons and do not need the manufacturing or sale of things.

The services are business services (such as banking, insurance, and warehousing) and professional services (including legal services, medical advice and tax consultancy).

The types of services are as follows:

• Inventory: Services can’t be kept in stock and sold later. When service users request them, they must be made available. This is because services lose value if they are not used immediately.
• Inseparable: The production and consumption of services appear inseparable due to the simultaneous activity of production and consumption. Unlike products developed today and sold later, services must be utilised as soon as they are made available.
• Intangible: Services are intangible since they cannot be seen or felt. They can only be discovered via personal experience. As a result, they are assessing the quality of services before their use is impossible. Hence, service providers must provide services tailored to the requirements of the persons involved.
• Inconsistent: Services have no set standards; they must be offered based on the demand and expectations of service users at any given time. Because each service user has different interests and preferences, the type and quality of services available differ.
• Engagement: The service user and provider must be involved during service delivery. The instructor and the students are actively participating in the exchange of knowledge-transfer services in a school.

Q6. Define the terms “double insurance” and “reinsurance,” as well as the differences between the two.

Answer. Double Insurance: Anyone can purchase several insurance policies for the same property or items. However, because an insurance policy is an indemnity contract, one can only collect the amount of damage they sustained. Double insurance is when you insure the same risk with two or more businesses. A claim can be submitted with any insurer, although it is limited to an actual loss in the case of fire and marine coverage. Each insurer will contribute a proportion to the amount covered.

Reinsurance: When an insurer faces risks beyond his control, he may choose to have all or part of his risk reinsured with other insurers. This derisking is referred to as reinsurance. It’s a sub-insurance agreement between the insurer and the reinsurer. The insured will file a claim with the original insurer, who will then file a claim with the reinsurers. Reinsurers are not compelled to contribute to losses in any way.

Q7. Explain in detail the warehousing services.

Answer. Warehousing used to be thought of as a static unit that kept and stored goods scientifically and systematically to preserve their original quality, value, and utility. Still, it is now considered a logistical service that makes the correct quantity at the right place and time available. The following are the many warehouse services available:

• Value-Added Services: They provide value-added services to manufacturers such as product grading, packing, and labelling.
• Storage: Warehouses simplify keeping items and raw materials that won’t be sold or manufactured immediately away while safeguarding them from rotting and damage.
• Consolidation: Before sending material/goods to a specific customer via a single transportation package, warehouses aggregate and consolidate material/goods from numerous production units.
• Breaking the Bulk: Warehouses are in charge of breaking down vast amounts of commodities received from manufacturers into smaller quantities. The smaller volumes are subsequently conveyed to clients’ locations by their needs.
• Financing: The warehouse receipt can also be used as collateral by the owner of the items or raw materials stored in the warehouse to borrow money from banks or other financial institutions.
• Price Stabilisation: Warehousing plays a role in price stabilisation by adjusting goods supply to market demand.
• Stockpiling: The subsequent use of warehousing is stockpiling, the seasonal storage of goods for specific industries. Warehouses store raw resources that aren’t needed immediately for sale or manufacture. They are made available to businesses based on how many customers they have .

Q8. What is the role of insurance in the company, and what are the benefits?

Answer. The future is always a guessing game. Uncertainty in the workplace renders plans useless and investments worthless. Different sorts of insurance policies are acquired to reduce risk. The following are some of the benefits of insurance policies:

Its benefits are:

• Indemnity: The insurance company compensates for the damage caused by fire and other mishaps. Insurance protects against losses, allowing business owners to feel comfortable and worry-free.
• Diffusion of Risk: Insurance distributes the risk of loss among many people. The impact of a loss on one industry is not overly severe, and the insurance firm can shift the risk to others.
• Protection: Insurance offers protection against the danger of financial loss. Although an individual’s loss cannot be repaid in the event of life insurance, receiving the covered sum from the Life Insurance Corporation aids him in standing. Insurance allows a business person to operate with confidence and peace of mind.
• Industrial development: Insurance firms collect a significant amount of money as a premium. This money is invested in industrial endeavours, resulting in the expansion of the industry.
• Social utility: Insurance creates social usefulness by ensuring the safety of the ordinary man. It’s a type of social insurance. It also creates new job possibilities.

Q9. What is e-banking? What are the advantages of e-banking?

Answer. Electronic banking, often known as e-banking, is the use of an electronic medium to execute various financial operations such as money transfers, account balance checks, applying for a cheque book, and applying for loans. Banks provide these services to assist their consumers in accessing financial services anywhere, anytime.

The following are some of the benefits of e-banking:

• It guarantees that most financial services are available 24 hours a day, seven days a week, making life easier for consumers.
• Banking transactions may be completed at any time using a mobile device, PC, or laptop.
• It eases the burden on banks by allowing transactions to be completed online.

Q10. What exactly do you mean when you say “merchant bankers”? Briefly describe the services offered by merchant bankers.

Answer. Merchant bankers, often known as lead managers, manage a company’s fresh capital offerings. A merchant banker assists a corporation in seeking new capital in producing the prospectus (or statement in place of prospectus), arranging underwriters, selecting brokers, publicising the issue, and appointing the registrar to the offer. Several banks in India have specific sections or subsidiaries dedicated to providing merchant banking services.

Merchant bankers offer a diverse range of financial services to businesses. They investigate the numerous legal and administrative elements of issuing securities and generating loans. They also offer advice on investment, capital restructuring, valuation, mergers and acquisitions, and other topics.

Q11. Briefly explain the principles of insurance with suitable examples.

Answer. The following are the insurance principles:

• Insurable Interest: An insurance policy owner should hold a stake in the subject matter or item being covered. The insurance is null and void if there is no insurable interest.

A truck driver, for example, has an insurable interest in his vehicle since it is his source of income; if he sells it, he will not be able to make any more money from it.

• Good faith: The concept of utmost good faith stipulates that the insurer and the insured must trust each other and the contract they have signed. For example, the claim may be denied if a person is diagnosed with cancer but fails to tell the insurance company.
• Contribution: If there are two insurers from which insurance is purchased, both insurers will contribute to covering the loss in the event of a loss. If a person takes a loan from two banks, both institutions should share equally in the event of payback.
• Subrogation: This theory argues that after the necessary compensation is given, the ownership of the property or item is passed to the insurer, preventing the insured from profitably selling it.

For example, if a guy receives 1 lakh in automobile insurance damage, he can fix the vehicle but not sell it for profit.

• Indemnity: The indemnity concept assures that the insurance contract safeguards and pays the insured in the event of a loss. For example, if a car insured for 2 lakhs sustains damage worth Rs.1 lakh, the insurance company would only reimburse the insured for that amount. The goal is to reimburse the insured rather than create a profit for him.
• Mitigation: The insured should take good care of the insured item. As though it had been taken care of before receiving the insurance. For example, if a car is acquired, the owner must adequately care for and maintain the vehicle.
• Proximate cause: This principle assesses the cause of loss and whether the insured object causes the loss. For example, if a fire burns a house down, an expert will investigate the cause, and reimbursement will be based on fire insurance.

Q12. Define the Reserve Bank of India and its key responsibilities:

Answer. It was established as a shareholders’ bank on April 1, 1935. The central government owned most of the stock. On April 1, 1949, the Reserve Bank of India was nationalised following India’s independence. The Reserve Bank of India has the following essential responsibilities:

The Reserve Bank of India performs the following functions:

Primary functions:

• Issuing banknotes (except one rupee note issued by the ministry of finance).
• The government’s bank.
• Working at a bank as a banker.
• Controlling the bank rate or interest rate.
• Controlling the rate of exchange.

Subsidiary functions:

• Buying and selling foreign currency.
• Different banks’ bills are discounted.
• Investing in government bonds.
• Accepting interest-free deposits.
• Taking care of clearing homes.
• Agricultural credit management.
• Providing banks and financial institutions with short-term loans.
• Governing India’s developmental, industrial, and commercial operations.

Q13. Explain the functions of commercial banks with an example of each.

Answer. Commercial banks oversee the following responsibilities:

• Lending funds: Banks give loans and advances based on the amount of money they have. Overdrafts, trade bill reductions, cash or consumer credit advances, and other advances are also available. Banks’ interest on these loans makes them a lot of money.
• Deposits: Banks take a range of public deposits, such as savings account deposits, current account deposits, and fixed account deposits, and pay interest on them. They owe it to the depositor to return the money they have deposited with them.
• Provision of ancillary services: Banks provide ancillary services such as lockers, underwriting, and bill payment in addition to their primary responsibilities. They also manage items like stock and debenture purchases and sales on behalf of their clients.
• Transferring funds: Banks help consumers transfer cash from one area to another. These transactions can be made using bank draughts and pay orders, and there are no commission costs.
• Extending the Cheque Facility: Banks function as clearing houses by collecting checks made on other banks. The two most frequent cheques are bearer cheques (instantly encashable at bank counters) and crossed checks (only deposited in the payees’ accounts).

Q14. What are the different types of warehouses?

Answer. The practice of storing items systematically and ordered to retain their value and quality is known as warehousing. Warehouses provide not just storage but also logistical services by identifying the correct amount in the right location at the right time and at the right price.

The following are the many types of warehouses:

• Private Warehouses: To suit their storage needs, large manufacturers and merchants own and operate private warehouses. Big companies with a lot of storage space regularly and the financial means to do so develop and maintain their warehouses.
• Duty-paid Warehouses: If an importer has trouble transferring goods after paying duty, the commodities might be stored in a duty-paid warehouse. All duty-paid warehouses are public warehouses and are available to all importers. Duty-paid warehouses help importers since the goods are well cared for and processed, such as sorting and repacking.
• Public Warehouses: A public warehouse is a type of business that charges a fee to provide storage space to the public. It might be owned and operated by a person or a cooperative organisation. It observes all necessary laws and regulations and operates under a government-issued licence. Small manufacturers and dealers can store their goods in public warehouses for free. These warehouses are well-built and secured 24 hours a day, seven days a week, to ensure the safe custody of supplies. Typically, public warehouses are located around railway, highway, and canal junctions.
• Cold storage warehouses: Cold storage facilities keep perishable goods, including fruits, flowers, vegetables, dairy products, and other perishable items, cool. In cold storage facilities, goods are kept and cooled at extremely low temperatures to preserve and use in the future. International trading is now possible thanks to these warehouses.
• Cooperative Warehouses: These warehouses are owned, managed, and administered by cooperative societies. They mainly offer warehousing services at the lowest possible cost. These warehouses benefit farmers, dealers, and the general public.
• Government Warehouses: These warehouses are owned, managed, and controlled by the federal and state governments, as well as public bodies. Because having a warehouse is difficult for small farmers, enterprises, and dealers, the government provides warehouses for a charge to help them store their goods.

Q15. Describe various types of insurance and examine the nature of risks protected by each type of insurance.

Answer. There are three types of insurance to choose from:

Fire Insurance:

• The insurer agrees to make good any loss or damage caused by fire during a defined period, up to the amount stated in the policy, in exchange for the premium paid.
• Fire insurance policies typically last a year and must be renewed regularly.
• A fire damage claim must fulfil two criteria: A monetary loss must exist, and the fire must be unintentional and unintentional.

Life Insurance:

• It is a contract between the insurer and the insured in which the insurer agrees to pay the insured a set sum if the insured dies or the insurance contract matures first, whichever comes first.
• If the insured individual dies before the contract’s maturity date, their family receives the guaranteed cash. If the insured survives to the conclusion of the contract’s term, the agreed-upon sum will be paid.
• In exchange for this assurance, the insured pays a specified amount to the insurer as a premium. Life’s uncertainties necessitate the acquisition of a life insurance policy.
• Risks Covered: Life insurance policies safeguard us from two types of dangers: The danger of dying too soon and The chance of dying is a real possibility.

Marine Insurance:

A marine insurance contract is an agreement between the insurer and the insured to reimburse them against maritime losses in the manner and to the degree agreed upon.

Risk covered: Maritime insurance covers damages caused by marine perils, sometimes known as sea perils. There are three things to think about:

• Hull Insurance: This insurance policy is meant to pay the insured for losses suffered due to ship damage because the ship is exposed to many perils at sea.
• Cargo Insurance: While being transported by ship, cargo or commodities are subject to several perils; this insurance covers the risk of the journey.
• Freight Insurance: If the cargo is damaged or lost in transit, the shipping firm is not compensated for the freight payments; thus, the shipping company purchases this insurance policy to avoid this eventuality.

Q16. Write a note on various telecom services available for enhancing business.

Answer. There are many various kinds of telecom services that might help you improve your business. The following are some of them:

• Fixed-line service refers to voice, non-voice, and data services that use fibre optic lines to make long-distance connections.
• Cable Service: In cable service, media information is transferred in a designated region, and a licence is required to send such information. In this sort of service, the information flow is one-sided.
• Radio Paging Service: This service helps transmit information in the form of tones, numbers, or letters.
• Cellular mobile service: All sorts of voice, non-voice, and data transfer services are included in cellular mobile service.
• DTH (Direct-to-Home) Services: DTH (Direct-to-Home) Services are satellite-based media services in which media channels are sent via satellite and received using a tiny dish and antenna.
• VSAT Service: VSAT (Very Small Aperture Terminal) is a satellite-based communication system that transmits information to remote places.

Q17. Banking is essential to any economy’s survival. Mention banking’s function or significance in the economy.

Answer. Banking is the economy’s backbone , just as capital is the pillar of trade, commerce, and industry. Banking’s significance can be defended on the following grounds:

Without financial services, the modern economy is powerless. Banking has taken on the following signs as the economy’s lifeblood:

• Credit creation: Banks collect deposits, keep a little portion of the money as a cash reserve, and lend the remainder to trade, industry, and commerce at a higher interest rate. Credit creation is the term for it.
• Safe custody of possessions: Banks provide locker services and store our valuables such as jewellery, notes, and papers, which we may access anytime we need them.
• Savings mobilization: Banking accepts excess savings and returns them with interest when needed. It instils in people the habit of saving. It’s in charge of capital formation.
• Foreign trade promotion: Finance is the lifeblood of all business activity, including international commerce. Banks serve as a source of finances, assisting with payments and money transfers, providing foreign exchange, issuing letters of credit, and assisting with international trade in various ways.
• Social and National welfare: People’s surplus money is taken as deposits by banks and used as loan for trading, commerce, and industry for constructive uses, resulting in social and national welfare. It works to improve people’s lives.

Q18. Write a detailed note on various facilities offered by the Indian Postal Department.

Answer. The Indian Postal Department provides the following services:

Financial facilities: The public has access to various savings opportunities through post offices. These services are available through the post office’s savings plans, which include:

• Public Provident Fund (PPF)
• Kisan Vikas Patra for farmers
• Certificate of National Savings (NSC)
• The Recurring Deposit Scheme
• Fixed Deposit Plan

Mail facilities: Among the mail services available are:

• Parcel Facilities: They make transporting an item from one area to another easier.
• Registration Services: These services guarantee the security of the article being transmitted.
• Insurance coverage: This protects you from the dangers of mail delivery.

Some of the mail services provided by banks are as follows:

• Postcards: Postcards are the most cost-effective mode of letter delivery.
• Letter: Letters are enclosed in an envelope and ensure that the information is kept private.
• Registered mail: It guarantees that the mail sent to the recipient is delivered or, if not returned to the sender.

Additional services: These departments also include greeting cards, media mail, foreign money transfers, speed mail, passport services, and e-billing services.

Q19. Write a short note on using the RTGS and NEFT systems. Also, differentiate between them.

Answer. NEFT and RTGS have been explained below:

NEFT: NEFT is an abbreviation that stands for National Electronic Funds Transfer. It’s a method of transferring money from one bank to another in India using the internet (usually banks). The system was launched in November 2005 to replace the SEFT clearing system’s inquiry bank. The NEFT system is a Postponed Net Basis system in which transactions are packed and deferred for a certain time. NEFT also processes transactions in batches with no minimum or maximum constraints.

RTGS: RTGS is an acronym for Real-Time Gross Settlement. The Real-Time Gross Funds Transfer System (RTGS) is a real-time gross funds transfer system that allows money to move from one bank to another. When using the banking method, RTGS is the fastest way to transfer money. The term ‘real-time’ refers to the absence of delay in the payment procedure since the transaction will be completed upon processing completion. Furthermore, gross settlement denotes that a transfer is completed one at a time rather than being combined with other transactions.

The above-stated section of Class 11 Business Studies Chapter 4 Important Questions is a list of Important Questions covering the entire chapter.

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Mentioning below are some benefits of solving Important Questions of Business Services Class 11 :

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Q.1 Explain the following principles of insurance: i. Utmost good faith ii. Indemnity

Marks: 4 Ans

i. Utmost Good Faith: The insurer and the insured both must show good faith towards each other and give correct information about the subject matter of insurance and the terms of policy, the absence of which may make the contract void. All contracts of insurance require both the parties to disclose all the facts correctly & honestly.

ii. Indemnity: This principle states that the insurer undertakes to compensate the insured for the loss caused to him due to damage of the property insured. All insurance contracts of fire and marine insurance are the contract of indemnity. This principle is not applicable to life insurance.

Q.2 Explain any 4 services offered by e-banking.

Services offered by e-banking are: Electronic Funds Transfer System (EFTS) – This refers to a system by which a bank transfers wages and salaries directly from the companys account to the accounts of its employees.

Automated Teller Machine (ATM) – This refers to a self service terminal offering 24 x 7 service of withdrawal of cash up to a specified limit, by using a plastic card & an identification code .

Credit Card – This refers to a plastic card issued by a bank to its customers, offering the holder an option to use the card to purchase goods or services on credit (upto the limit specified by the bank).

Debit cards – This is a plastic electronic card issued by a bank to its cutomer, which can be used to withdraw cash or make payment for goods and services purchased, upto the balance available in customer’s account.

Q.3 Write down the difference between Fire Insurance and Marine Insurance.

Marks: 6 Ans

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Important Questions for CBSE Class 11 Business Studies Chapter 4 - Business Services

• Class 11 Important Question
• Business Studies
• Chapter 4: Business Services

Business Services Important Questions with Answers for CBSE Class 11: Free PDF Download

To help Class 11 students better prepare for the Business Studies Chapter 4- Business Service, Vedantu has provided important questions for the same in a downloadable pdf format. The pdf provides insights into the important topics of the Business Studies Chapter 4, from which questions are frequently asked in previous year’s business studies question papers of CBSE Class 11. Download the pdf to check them out.

With these important questions, you can master the chapter's important concepts in no time. Class 11 students are suggested to download a pdf with a single click on the pdf link provided below and practice questions to enhance their preparation.

Topics Covered in Class 11 Business Studies Chapter 4

4.1: Introduction to Business Service

4.2: Nature of Business Services

4.3: Types of Services

4.4: Banking

4.5: Insurance

4.6: Communication Service

4.7: Transportation

4.8: Warehousing

Study Important Questions for Class 11 Business Studies Chapter 4 - Business Services

Very short answer questions                                  (1 or 2 marks).

1. State the five I's of services?

Ans: The five I’s of services are:

Intangibility

Inconsistency

Inseparability

Involvement.

2. What is the meaning of Banking?

Ans: Banking companies transact the business of banking for the aim of lending and investing public money deposits repayable on demand or otherwise, and withdrawable by checks, drafts, orders, or some  other means.  In simple terms, a bank accepts money on deposit that is repayable on demand, as well as lending money to generate a profit margin.

3. It is the prime responsibility of the insured to take reasonable steps to minimize loss/damage to the insured property. Name the principle of insurance.

Ans: Principle of Mitigation of Loss.

This principle states, as the owner of an insurance policy, the insured has an obligation to take the required actions to limit the loss of his/her insured property. The insured can't be careless or irresponsible just because he’s insured.   The insured shall treat the insured thing with the same care as he or she would if the insurance were not present.

4. Define Insurance.

Ans: Insurance is a device that spreads the risk of a loss produced by an unpredictable event among a group of people who are exposed to it and who prepare to protect themselves against it. It's a contract or agreement in which one party agrees to pay an agreed amount of money to another party in the event of a loss, damage, or injury to something of value in which the insured has a pecuniary interest as a result of an uncertain event in exchange for a consideration.

5. Rahul's father wants to save Rs. 100,000 so that he can gift the money to Rahul on his graduation day. Which type of deposit should he open with the bank?

Ans: Fixed Deposit should be opened with the bank. Fixed accounts are time deposits with higher rates of interest as compared to savings accounts.

6. Name two companies that offer DTH service in our country?

Ans: Airtel, Tatasky offers DTH services in our country.

7. A company insures its stock against fire for Rs. 15 Lakh. A fire broke down and the total stock was lost. At the time of the fire, there was stock worth Rs. 25 Lakh. What is the value of compensation the company would be entitled to?

Ans: The contract for fire insurance is a rigorous indemnity contract. An insurance contract's objective is to make you whole in the case of a loss, not to allow you to profit. Hence in case of insurance other than life insurance, one can only be compensated for the amount of loss or the amount assured, whichever is lower.

As a result, the value of compensation the company would be entitled to is Rs 15 lakh.

Short Answer Questions                                          (3 or 4 Marks)

8. Mr. Satish gets his house insured against fire of Rs. 20 Lakh with insurer A and for Rs. 10 Lakh with insurer B. A loss of Rs. 3 Lakh occurred.

(a) How much compensation can be claimed from A and B separately and Why?

Ans: According to this principle, the insurer can only seek compensation from all insurers or from a single insurer to the extent of the real damage. If one insurer provides the full compensation, the other insurers must pay a proportionate share of the claim.

Total value of insurance: Rs. 20,00,000 + Rs. 10,00,000 = Rs. 30,00,000

$\mathrm{A’s}\; \mathrm{Contribution} = \mathrm 3,00,000 \times \dfrac{20,00,000} {30,00,000}$

A’s Contribution = Rs. 2 Lakhs

$\mathrm{B’s}\; \mathrm {Contribution} = \mathrm 3,00,000 \times \dfrac{10,00,000} {30,00,000}$

B’s Contribution =1 Lakh

(b) Name the principle of Insurance in the above case.

Ans: Principle of Contribution is followed. If an individual purchases many insurance policies for the same item, the insurers will pool their resources to reimburse the insured for the real loss. The insured can only claim reimbursement to the extent of actual loss from all insurers or from any one insurer, according to this concept.

It applies when: 

Different policies cover the same subject matter; 

The policies cover the same period that generated the loss; 

All the policies are in force at the time of loss; and 

One of the insurers has paid the insured more than his share of the loss, the right of contribution arises.

9. Explain the function of Insurance

Ans: Insurance's Functions are as follows: 

Insurance tends to reduce the level of  risks, and the insured receives the payment for loss. The insurer charges for providing the certainty, in terms of premium.

Protection:

Insurance provides protection from probable chances of loss, such as loss due to fire, theft etc. Insurance may not prevent a risk or event from occurring, but it can compensate for losses incurred as a result of it.

Risk sharing:

All those who have been affected by the loss, share it. Every insured member pays a premium to acquire their share.

Capital formation:

The assets accumulated by insurers as a result of premium payments made by the insured are invested in a variety of income-generating schemes.

Promote effectiveness and motivation: 

Insurance has made significant contributions to the progress of industry and commerce. Insurance businesses provide a variety of services that have resulted in today's large-scale industrial and commercial enterprises.

10. Explain the Difference between Goods and services based on its nature.

Ans: On the basis of nature, the following differences exist between services and goods:

11. Name the principle of insurance for each of the following statements:

(a) The insured is expected to disclose all the important facts related to the property insured.

Ans:  Principle of Utmost Good Faith.

(b) Insured must have some economic interest in the subject matter of Insurance contract.

Ans: Principle of Insurable Interest.

(c) To claim for insurance the insured must take reasonable steps to minimize the loss.

Ans: Principle of Mitigation of loss.

(d) Insured is entitled to recover the loss suffered by him, up to the limit of the policy amount.

Ans: Principle of Indemnity.

12. Explain the types of Life Insurance Policies?

Ans: Different types of life insurance policies include:

Whole Life Policy: In this type of policy, the sum due to the insured is not paid until the assured passes away. The money is then solely due to the deceased's beneficiaries or heirs.

Endowment Life Assurance Policy: The insurer agrees to pay a set amount when the insured reaches a certain age or dies, whichever comes first. In the event of the assured's death, the payment is payable to his legal heirs or nominee stated therein. Otherwise, the payment will be paid to the assured when a certain amount of time has passed.

Joint Life Insurance: This coverage is purchased by two or more people. The premium is paid jointly or by either of them in installments, or in a lump sum assured sum or policy money is due to the other survivor or survivors upon the death of any one of them.

Policy on Annuities : After the person reaches a particular age, the promised sum or policy money is paid out in monthly, quarterly, or annual installments. 

Policy on Children's Endowment : A person purchases this policy for his or her children in order to cover the costs of their education or marriage. The agreement specifies that the insurer will pay a certain amount when the children reach a certain age.

13. Explain electronic banking and state its three benefits?

Ans: Online banking, often known as internet banking, e-banking, or virtual banking, is an electronic payment system that allows bank or other financial institution customers to execute a variety of financial transactions via the financial institution's website. The word "internet banking" refers to the process of a client doing banking transactions over the internet. This sort of banking makes use of the internet as the primary mode of delivery for all banking transactions.

The following are some of the advantages:

Availability 24x7: E-banking is available 24 hours a day, 365 days a year. At any moment, a client can log into his or her own bank account and execute financial activities online. Customers benefit from increased flexibility and comfort because they do not have to visit their banks in person.

Convenient access: Transactions may be done on mobile phones and PCs as needed.

E-banking decreases bank workload: E-banking reduces bank workload by allowing a substantial part of tasks to be performed electronically.

14. Explain the Functions of Warehousing?

Ans: The functions of warehousing are:

Storage: Warehouses make it easier to store products and raw materials that aren't needed right away for sale or manufacture, while also protecting them from rotting and damage.

Value-added services: They provide producers with value-added services such as product grading, packaging, and labelling.

Financing: The warehouse receipt can be used as collateral to borrow money from banks or other financial organisations by the owner of the products or raw materials kept in the warehouse.

Break the bulk: Warehouses are responsible for dividing large quantities of items received from manufacturing companies into smaller quantities. The smaller quantities are then transported according to the requirements of clients to their places of business

Consolidation: The warehouses gather and consolidate material/goods from various manufacturing units before dispatching them to a specific consumer via a single transportation package.

Stockpiling: The seasonal storing of commodities for certain businesses is the next role of warehousing. Raw materials, which are not required immediately for sale or manufacturing, are stored in warehouses. They are made available to enterprises according to the number of consumers they have .

Price stabilisation: Warehousing provides the role of price stabilisation by adapting the supply of products to the demand condition.

15. Explain the three important insurances involved in Marine Insurance?

Ans: A marine insurance contract is an arrangement in which the insurer agrees to indemnify the insured against marine losses in the way and to the extent agreed upon. Marine insurance protects against losses caused by marine perils, often known as sea perils. 

There are three important insurances under this:

Ship or Hull Insurance: Because the ship is exposed to several dangers at sea, this insurance policy is designed to compensate the insured for losses incurred as a result of ship damage.

Cargo insurance: Cargo or the goods in the ship is exposed to numerous dangers while being transported by ship, this insurance covers the risk of voyage.

Freight insurance: If the cargo is damaged or lost in transit, the shipping business is not reimbursed for the freight payments, hence to avoid this scenario, the shipping company takes up this insurance policy.

Long Answer Questions                                            (5 or 6 Marks)

16. Describe briefly Types of warehouses?

Ans: Warehousing is the process of keeping things in a systematic and orderly way in order to preserve their worth and quality. Warehouses provide not only storage but also logistical services by locating the appropriate amount in the right place at the right time and at the right price. 

The different types of warehouses are:

Private Warehouses: Large manufacturers and merchants own and run private warehouses to meet their own storage needs. Big businesses who require a lot of storage space on a regular basis and can afford it build and manage their own warehouses.

Public Warehouses: A public warehouse is a specialised business entity that charges a fee for providing storage facilities to the general public. An individual or a cooperative organisation may own and operate it. It operates under a government-issued license and follows all applicable rules and regulations. Small producers and traders can store their goods for free in public warehouses. To assure the safe custody of commodities, these warehouses are well-built and guarded 24 hours a day, seven days a week. Public warehouses are typically found around railway, highway, and canal intersections.

Duty-paid Warehouses: If an importer encounters any difficulties in transporting goods after paying duty, the products can be housed at a duty-paid warehouse. All duty-paid warehouses are open to all importers and are public warehouses. Importers benefit from duty-paid warehouses because the items are properly cared for and processed, such as sorting and repacking.

Government Warehouses : The federal and state governments, as well as public authorities, own, administer, and control these warehouses. Because owning a warehouse is difficult for small farmers, businesses, and traders, these government warehouses aid them in storing their goods for a fee.

Co-operative Warehouses: Co-operative societies own, manage, and administer these warehouses. They mostly provide warehousing services at the most affordable prices. Farmers, traders, and the general public benefit greatly from these types of warehouses.

Cold storage warehouses: Cold storage warehouses are used to store perishable goods such as fruits, flowers, vegetables, dairy products, and other perishable items. Goods are held and chilled at extremely low temperatures in cold storage facilities in order to preserve them and utilize them in the future. These warehouses have made international trade possible.

17. A factory owner gets his stock of goods insured, but he hides the fact that the electricity board has issued him a statutory warning letter to get his factory's wiring changed. Later on, the factory catches fire due to a short circuit of wiring. Can he claim compensation ?

Ans: No, he cannot claim the compensation. This is because he has hidden a very crucial fact about his factory wirings. Therefore, he has violated the principle of Utmost Good faith. 

This principle states that the insurance contracts require that both parties act with the utmost good faith. This means that both parties must provide all relevant information honestly and completely. This not only measures the level of risk, but also helps insurance companies accurately price premiums for insurance applicants. Insurance policies can be declared null and void if an applicant provides wrong representation of material fact that was relied on by the insurance company.

18. Write notes on the RTGS system and NEFT. Also, state the difference between them.

Ans: The notes are:

NEFT: The acronym NEFT stands for National Electronic Funds Transfer. It is an internet technique for moving payments within India from one banking institution to another (usually banks). The system was introduced in November 2005, and it was designed to take over the SEFT clearing system's query bank. NEFT is a Deferred Net Basis system, in which transactions are packaged and deferred for a defined period of time. Also, in NEFT, the transactions are processed in batches with no minimum and maximum limits.

RTGS: The abbreviation RTGS stands for Real Time Gross Settlement. RTGS is a real-time gross funds transfer system that allows money to travel from one bank to another in real time. RTGS is the fastest way to transfer money when using the banking method. The term 'real-time' refers to the lack of a waiting period in the payment process, as the transaction will be finished, as soon as the processing is done. Also, gross settlement means a transfer is performed one by one, without being grouped with other transactions.

Following are the Difference Between RTGS and NEFT:

19. Divya Garments Ltd. has a loan of Rs. 10,00,000 to pay. They are short of funds so they are trying to find means to arrange funds. Their manager suggested claiming from the insurance company against stock lost due to a fire in the warehouse. He actually meant that they can put their warehouse on fire and claim from an Insurance company against stock insured. They will use the claim money to pay the loan.

(a) Will the company receive a claim if the surveyor from the company comes to know the real cause of the fire?

Ans: No, the company will not be reimbursed if the surveyor discovers the true cause of the fire, and the contract will be voided.

(b) Which values did the company ignore while planning to arrange money from the false claims?

Ans: When attempting to arrange money from a false claim, the principle of utmost good faith is disregarded. Insurance contracts demand that both parties operate in the best interests of the other. This means that both parties must provide all relevant information honestly and completely. This maintains impartiality while also assisting insurance firms in appropriately pricing premiums for applicants. If an applicant makes a major fact deception that the insurance company relies on, the policy might be deemed null and void.

Hence, the values disregarded are trust, honesty and transparency.

(c) Explain three elements of fire insurance.

Ans: There are three aspects to fire insurance:

Insurable Interest: The insured must have an insurable interest in the insurance's subject matter. The insurance contract is void if there is no insurable interest.

Utmost Good Faith: When providing information to the insurance company about the subject matter of the policy, the insured should be accurate and honest .

Indemnity: The contract for fire insurance is a rigorous indemnity contract. In the case of a loss, the insured can sue the insurer for the full amount of the loss. This is subject to the maximum amount of insurance coverage for the subject matter.

20. Write a detailed note on various facilities offered by the Indian Postal Department and different types of telecom services offered?

Ans: The Indian Postal and Telegraph Department provides a variety of postal services throughout the country. 

Facilities provided by Indian Postal Department 

Financial facilities:  

Post offices provide a range of savings options to the general public. These facilities are provided through the post office's savings schemes like:

Public Provident Fund (PPF)

Kisan Vikas Patra

National Saving Certificate (NSC)

Recurring Deposit Scheme

Fixed Deposit Scheme 

Mail facilities: 

Mail services include:

Parcel facilities: They make it easier to transport an item from one location to another.

Registration services: These services ensure that the article being sent is secure.

Insurance facilities: These cover the risks associated with postal transmission.

The following are some of the mail services supplied by banks:

Postcards: This is the least expensive method of mail delivery.

Letter: It is enclosed in an envelope and guarantees the confidentiality of the information communicated.

Registered mail: Registered mail ensures that the mail sent to the recipient is delivered or returned to the sender if it is not.

Additional Services : 

Greeting cards, media mail, international money transfers, speed mail, passport services, and e-billing services are also offered by these departments.

Telecom Services

Cellular mobile service: This includes voice and non-voice transmission, as well as data transmission.

Radio paging service: This is a one-way communication system that sends out information in the form of a tone, numeric, or alphanumeric message.

Fixed-line service: This type of service entails the installation of fibre optic cables across the nation for the transmission of data, including voice and non-voice communications.

Cable service: This service transmits media-related information to a designated operational region for which a licence has been obtained. The information flow is one-way with this sort of telecom service.

VSAT service: VSAT stands for "Very Small Aperture Terminal" and refers to a satellite-based communication service that allows information to be sent to far-flung and remote locations. As a result, businesses benefit from a broader reach and greater flexibility.

DTH service : DTH stands for Direct-To-Home, and it is a form of telecommunications service provided by DTH providers. Customers receive TV channels through satellites from the corporations. Customers may watch several channels by connecting their television to a tiny dish antenna and a set-top box.

21. State Six Difference Between Life Insurance, Fire Insurance, and Marine Insurance?

Ans: The difference between Life Insurance, Fire Insurance, and Marine Insurance is:

22. Explain in detail the principles of Insurance?

Ans: Insurance is a service that protects you from certain sorts of risks that can occur as a result of unforeseeable circumstances. It provides confidence to individuals by offering a set amount of money in the event of death or damage to personal property. In exchange for this assurance, the insured must pay a premium. The concepts of insurance on which insurance contracts are built are as follows:

Principle of Absolute good faith: Both the insurer and the insured must believe in each other and the contract they have signed. For example, if Rahul has a heart condition, he should tell his insurance firm about it while purchasing a life insurance policy.

Principle of Insurable interest: The insurable interest requires that the owner of a particular insurance policy has an insurable interest in the subject matter of the insurance policy. For example, a wife having insurable interest in her husband’s life due to financial dependency, a person’s interest in his property etc.

Principle of Indemnity : The goal of an insurance contract, according to the indemnity principle, is to restore the insured to the same financial position as before the loss. to he or she For example, if a person loses Rs. 1 lakh in a fire, the insurance company will only accept a claim up to Rs. 1 lakh and not more.

Principle of Proximate cause: The proximate cause insurance principle states that the nearest or closest cause should be considered, and the insurance company will compensate only for the causes that have been mentioned in the insurance contract, or any proximate causes, and not the remote causes of damage. For example, if a person is injured in a fire, this should be included in the contract so that the individual may collect the insurance benefits.

Principle of Subrogation: Once the compensation is paid, the insurer gains ownership of the damaged item, preventing the insured from profiting from the sale of the damaged property. For example, if a person receives Rs. 1 lakh for a damaged stock, the stock's ownership will be transferred to the insurance company, and the person will no longer have control over the stock.

Principle of Contribution: If an individual purchases many insurance policies for the same item, the insurers will pool their resources to reimburse the insured for the real loss. If a person A insures his or her home for Rs. 2 lakh with insurance B and Rs. 1 lakh with another insurer, say C, then in the event of a loss of Rs. 90,000, insurer B and insurer C will pay A Rs. 90,000 in total and no more.

Mitigation: The insured shall treat the insured thing with the same care as he or she would if the insurance were not present. For example, if a person obtains fire insurance, he or she should take all reasonable steps to minimise property damage in the event of a fire, just as he or she would have done if the insurance had not been purchased.

Benefits of Practicing Important Questions for CBSE Class 11 Business Studies 

Practicing important questions helps you analyze your weak areas, and you can use appropriate study material to improvise them.

It helps you to know the different ways questions can be put up in the exams.

Practicing important questions regularly enhances your time and speed of attempting accurate answers in exams.

Boost your confidence level in the examination hall.

Extra Question for Practice

Discuss the nature of services in brief.

How are services different from Goods?

What are commercial and cooperative banks?

What is E-Banking?

What is the basic principle of Insurance?

Describe any three functions of insurance.

What are the different elements of a Life Insurance Contract?

Mention different types of life insurance policies.

How do life, marine, and fire insurance differ?

Describe communication services in brief.

Chapterwise Important Questions for CBSE Class 11 Business Studies

Chapter 1 - Business, Trade and Commerce

Chapter 2 - Forms of Business Organisation

Chapter 3 - Private, Public and Global Enterprises

Chapter 5 - Emerging Modes of Business

Chapter 6 - Social Responsibilities of Business and Business Ethics

Chapter 7 - Formation of a Company

Chapter 8 - Sources of Business Finance

Chapter 9 - Small Business

Chapter 10 - Internal Trade

Chapter 11 - International Business

Practicing the important questions for the topic Business Services allows Class 11 students to go through the important topics of the chapter quickly. They will be able to precisely answer the related questions in the exam in less time.  Class 11 students are highly suggested to consider these important questions as part of their Revision for the business studies Exam.

FAQs on Important Questions for CBSE Class 11 Business Studies Chapter 4 - Business Services

1. What are Class 11 business studies?

Business services are defined as actions that help businesses but do not produce a physical product. Information technology can be cited as an appropriate example as it is a business service that provides its support to multiple varieties of other business services including shipping, procurement, and finance. Work that supports a firm but does not generate a physical product is referred to as business services. These are quite important for any firm or business and play a crucial role in their overall functioning.

2. What is public sector class 11 business?

The public sector is made up of a variety of entities that are owned and administered by the federal, state, or both governments. Through these companies, the government engages in the country's economic activity. The different types of public goods and governmental services, for example, law enforcement and military, infrastructure, public transit, and so on along with the individuals who work for the government, such as elected politicians, are all included in the public sector.

3. Why are government companies considered superior to other forms of the public sector?

The government corporation is chosen above other forms of public-sector organizations for the following reasons:

 It is simple to establish a government corporation because no specific legislation is required. 

A government company's management is more flexible than that of a department. 

Due to its benefits over other kinds of organizations, government companies are chosen over other forms of organizations. These benefits include registration under the Companies Act and as a legal entity, it exists independently.

4. What are the different types of Public Sectors in Class 11?

In India, the public sector is organized in three main ways. These are Departmental Undertaking, Government Company and Statutory (or Public) Corporation.

Government-owned companies in India are often termed PSUs or PSEs (Public Sector Undertakings). India's central government, one of India's numerous state and territorial administrations, and even both of them jointly control these firms. These hold a lot of advantages over the other sectors but just like all sectors, these too hold a few disadvantages.

5. Where can I avail the Solutions of NCERT Class 11 Business Studies Chapter 4?

The solutions are easily available on the Vedantu site. 

Visit the page NCERT Solutions for Class 12 MicroEconomics Chapter 4.

The webpage with Vedantu’s solutions for Class 11 Business Studies Chapter 4 will open.

To download this, click on the Download PDF button and you can view the solutions offline. 

All other types of problems and solutions with their plausible explanations are also provided on the Vedantu website and on the Vedantu app at free of cost.

CBSE Class 11 Business Studies Important Questions

Cbse study materials.

NCERT Solutions for Class 6, 7, 8, 9, 10, 11 and 12

NCERT Solutions For Class 11 Business Studies Business Services

October 9, 2019 by phani

Free PDF download of NCERT Solutions for Class 11 Business Studies Chapter 4 Business Services solved by Expert Teachers as per NCERT (CBSE) Book guidelines. All Chapter wise Questions with Solutions to help you to revise complete Syllabus and Score More marks in your examinations.

NCERT Solutions Class 11 Business Studies Business Studies Sample Papers

TEXTBOOK QUESTIONS SOLVED

I. Multiple Choice Questions Tick the appropriate answer: Question 1. DTH services are provided by (a) Transport companies (b) Banks (c) Cellular companies (d) None of the above Question 2. The benefits of public warehousing includes (a) Control (b) Flexibility (c) Dealer relationship (d) None of the above Question 3. Which of the following is not a function of insurance? (a) Risk sharing (b) Assist in capital formation (c) Lending of funds (d) None of the above Question 4. Which of the following is not applicable in Life Insurance contract? (a) Conditional contract (b) Unilateral contract (c) Indemnity contract (d) None of the above Question 5. CWC stands for (a) Central Water Commission (b) Central Warehousing Commission (c) Central Warehousing Corporation (d) Central Water Corporation Answers: 1. (c) 2. (b) 3. (c) 4. (c) 5. (c)

II. Short Answer Type Questions Question 1. Define services and goods. Answer:  A good is a physical product which can be delivered to a buyer and involves the ownership from seller to customer. For example; mobile phone, book, purse etc. Services are those separately identifiable, essentially intangible activities which provide satisfaction of wants, and are not necessarily linked to the sale of a product or another service. For example, communication services, teaching services, legal services etc.

Question 2. What is e-banking? What are the advantages of e-banking? Answer:  E-banking is a service provided by many banks, in which a customer is allowed to conduct banking transactions through internet. It includes ATMs, credit cards, debit cards, mobile banking and internet banking. Advantages of e-banking

• It provides competitive advantage to a bank.
•  Load on different branches gets considerably reduced due to centralised data base.
• Banking network is no more limited to the number of branches. It expands far and wide due to facility of internet banking.
•  It provides 24 hours, 365 days a year service to the consumers.
•  It can be used at any place and at any time even while travelling.
• It reduces risk and ensures greater security.
• It increases financial discipline by keeping record of each and every transaction.
• Availability of banking facility at any time and anywhere increases satisfaction of the consumers.

Question 3. Write a note on various telecom services available for enhancing business. Answer:  Various telecom services available for enhancing business are as follows:

• Cellular Mobile Services: These companies provide all types of telecom services like voice and non-voice messages, data services, PCO connectivity etc.
• Radio Paging Services: It is one way information broadcasting solution and has spread its reach to a large area. It includes services including tone only, numeric only and alpha/numeric only.
• Fixed Line Services: These services utilise any type of network equipment connected through fibre optic cable laid across the length and breadth of the country.
•   Cable Services: These are linkages and switched services within a license area of operation to operate media services.
• VSAT Services: VSAT stands for Very Small Aperture Terminal. It is a satellite based communication service which is highly flexible and reliable communication solution in urban as well as rural areas. It is being used for tele-medicine, newspaper online, tele-education, online trading, e-banking etc.
•  DTH Services: DTH stands for Direct to Home. It is also a satellite based service provide by cellular companies which allows one to receive media services through a satellite with the help of a small dish antenna and a set up box.

Question 4. Explain briefly the principles of insurance with suitable examples. Answer:  The principles of insurance are explained below:

• Principle of Utmost Good Faith: Under this insurance, contract both the parties should have faith over each other. As a client it is the duty of the insured to disclose all the facts to the insurance company. Any fraud or misrepresentation of facts can result into cancellation of the contract.
• Principle of Insurable interest: Under this principle of insurance, the insured must have interest in the subject matter of the insurance. Absence of insurance makes the contract null and void. If there is no insurable interest, an insurance company will not issue a policy. An insurable interest must exist at the time of the purchase of the insurance. For example, a creditor has an insurable interest in the life of a debtor, A person is considered to have an unlimited interest in the life of their spouse etc.
•  Principle of Indemnity:  Indemnity means security or compensation against loss or damage. The principle of indemnity is such principle of insurance stating that an insured may not be compensated by the insurance company in an amount exceeding the insured’s economic loss. In this type of insurance the insured would be provided compensation with the amount equivalent to the actual loss and not the amount exceeding the loss. This is a regulatory principle. This principle is observed more strictly in property insurance than in life insurance. The purpose of this principle is to set back the insured to the same financial position that existed before the loss or damage occurred.
• Principle of Subrogation: The principle of subrogation enables the insured to claim the amount from the third party responsible for the loss. It allows the insurer to pursue legal methods to recover the amount of loss. For example, if you get injured in a road accident, due to reckless driving of a third party, the insurance company will compensate your loss and will also sue the third party to recover the money paid as claim.
• Principle of Contribution: If the same subject matter, except life is insured by more than one insurers, then the actual loss will be shared by all the insurers.
• Principle of Mitigation: If means that the insured should try to minimise the loss of the subject matter of the insurer even if it is insured.
• Principle of Proximate Cause: Proximate cause literally means the ‘nearest cause’ or ‘direct cause’. This principle is applicable when the loss is the result of two or more causes. The proximate cause means; the most dominant and most effective cause of loss is considered. This principle is applicable when there are series of causes of damage or loss.

Question 5. Explain warehousing and its functions. Answer:  Warehousing refers to holding or keeping of goods from the time of their production or purchase until they are sold or consumed. It removes time gap between production and consumption and thereby creates time utility. In addition to providing services of storage, warehouse also provides logistical service in a cost effective manner. Functions of Warehouses

• Consolidation: There are certain goods which are produced in small quantities but are sold to consumers in bulk quantity. Such goods need consolidation. Warehouses receive goods in small quantities from different producers and dispatch them to consumers in bulk.
• Break the Bulk: This function is just opposite of consolidation. Under it, the warehouse receives the quantity in bulk from the producers and sells them in small quantities to consumer. These small quantities are then sold to customers according to their requirements.
• Stock Piling: Usually there is a time gap between production and consumption of goods. Warehouse fills this gap. It stores those goods which are in surplus i.e., whose supply is more than their demand. When demand exceeds supply, it makes goods available from its own stock.
• Value Added Services: Warehouses also provide some value added services like transit mixing, packaging and labeling.
• Price Stabilization: Warehouses help to equalize demand and supply and thereby stabilize the prices.
•  Financing: Warehouse owners advance money to owners of goods on the security of these goods and they also provide these goods on credit to customers.

III. Long Answer Type Questions Question 1. What are services? Explain their distinct characteristics. Answer:  A service is an act or performance offered by one party to another. They are economic activities that create value and provide benefits for customers at specific times and places as a result of bringing desired change. According to Sir William B, “Service refers to social efforts which includes the Govt.to fight five giant evils – wants, disease, ignorance, squalor and illness in the society”. Characteristics of Services Service is an act or performance offered by one party to another. They are economic activities that create value and provide benefits for customers at specific times and places as a result of bringing about a desired change in or on behalf of the recipient of the service. The term, service, is not limited to personal services like medical services, beauty parlors, legal services, etc. According to the marketing experts and management thinkers the concept of services is a wider one. The term services are defined in a number of ways but not a single one is universally accepted. The distinct characteristics of services are mentioned below:

• Intangibility: Services are intangible. We cannot touch them, it is not a physical object. According to Carman and Uhl, a consumer feels that he has the right and opportunity to see, touch, hear, smell or taste the goods before they buy them. This is not applicable to services. The buyer does not have any opportunity to touch, smell, and taste the services. While selling or promoting a service one has to concentrate on the satisfaction and benefit a consumer can derive having spent on these services. For example: Railways sells a train ticket from A destination to B destination. Here it is the matter of consumer’s perception of services than smelling it or tasting it.
• Inventory: Services too, are perishable like labour. Service has a high degree of perishability. Here the element of time assumes a significant position. There will be complete loss of labour. If labour stops working, it is a complete waste. It cannot be stored. Utilized or unutilized services are an economic waste. An unoccupied building, an unemployed person, credit unutilized, etc. are economic waste. Services have a high level of perishability.
• Inseparability: Services are generally created or supplied simultaneously. They are inseparable. For example, the entertainment industry, health experts and other professionals create and offer their services at the same given time. Services and their providers are associated closely and thus, not separable. Donald Cowell states ‘Goods are produced, sold and then consumed whereas the services are sold and then produced and consumed’. Therefore inseparability is an important characteristic of services which proves challenging to service management industry.
• Inconsistency: This character of services makes it difficult to set a standard for any service. The quality of services cannot be standardized. The price paid for a service may either be too high or too low as is seen in the case of the entertainment industry and sports. The same type of services cannot be sold to all the consumers even if they pay the same price. Consumers rate these services in different ways. This is due to the difference in perception of individuals at the level of providers and users. Heterogeneity “makes it difficult to establish standards for the output of service firm.
• Involvement: In the sale of goods, after the completion of process, the goods are transferred in the name of the buyer and he becomes the owner of the goods. But in the case of services, we do not find this. The users have only an access to services. They cannot own the service. For example: a consumer can use personal care services or medical services or can use a hotel room or swimming pool. However, the ownership remains with the providers. According to Philip Kotler, “A service is an activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything” From this it is clear that the ownership is not affected in the process of selling the services.

Question 2. Explain the functions of commercial banks with an example of each. Answer:  The main functions of commercial banks are accepting deposits from the public and advancing them loans. However, besides these functions there are many other functions which these banks perform. All these functions can be divided under the following heads: 1. Accepting deposits; 2. Giving loans; 3. Overdraft; 4. Discounting of Bills of Exchange; 5. Investment of Funds; 6. Agency Functions.

• Accepting Deposits: The most important function of commercial banks is to accept deposits from the public. Various sections of society, according to their needs and economic condition, deposit their savings with the banks. For example, fixed and low income group people deposit their savings in small amounts from the points of view of security, income and saving promotion. On the other hand, traders and businessmen deposit their savings in the banks for the convenience of payment. Therefore, keeping the needs and interests of various sections of society, banks formulate various deposit schemes. Generally, there are three types of deposits which are as follows: (i) Current Deposits: The depositors of such deposits can withdraw and deposit money whenever they desire. Since banks have to keep the deposited amount of such accounts in cash always, they carry either no interest or very low rate of interest. These deposits are called Demand Deposits because these can be demanded or withdrawn by the depositors at any time they want. Such deposit accounts are highly useful for traders and big business firms because they have to make payments and accept payments many times in a day. (ii) Fixed Deposits: These are the deposits which are deposited for a definite period of time. This period is generally not less than one year and, therefore, these are called as long term deposits. These deposits cannot be withdrawn before the expiry of the stipulated time and, therefore, these are also called as time deposits. These deposits generally carry a higher rate of interest because banks can use these deposits for a definite time without having the fear of being withdrawn. (iii) Saving Deposits: In such deposits, money up to a certain limit can be deposited and withdrawn once or twice in a week. On such deposits, the rate of interest is very less. As is evident from the name of such deposits their main objective is to mobilise small savings in the form of deposits. These deposits are generally done by salaried people and the people who have fixed and less income.
• Giving Loans: The second important function of Commercial Banks is to advance loans to its customers. Banks charge interest from the borrowers and this is the main source of their income. Banks advance loans not only on the basis of the deposits of the public rather they also advance loans on the basis of depositing the money in the accounts of borrowers. In other words, they create loans out of deposits and deposits out of loans. This is called as credit creation by Commercial Banks. Modern banks give mostly secured loans for productive purposes. In other words, at the time of advancing loans, they demand proper security or collateral. Generally, the value of security or collateral is equal to the amount of loan. This is done mainly with a view to recover the loan money by selling the security in the event of non-refund of the loan. At times, banks give loan on the basis of personal security also. Therefore, such loans are called unsecured loan. Banks generally give following types of loans and advances: (i) Cash Credit: In this type of credit scheme, banks advance loans to its customers on the basis of bonds, inventories and other approved securities. Under this scheme, banks enter into an agreement with its customers to which money can be withdrawn many times during a year. Under this set lip banks open accounts of their customers and deposit the loan money. With this type of loan, credit is created. (ii) Demand Loans: These are such loans that can be recalled on demand by the banks. The entire loan amount is paid in lump sum by crediting it to the loan account of the borrower, and thus entire loan becomes chargeable to interest with immediate effect. (iii) Short-term Loan: These loans may be given as personal loans, loans to finance working capital or as priority sector advances. These are made against some security and entire loan amount is transferred to the loan account of the borrower.
• Over-Draft: Banks advance loans to its customer’s up to a certain amount through over-drafts, if there are no deposits in the current account. For this, banks demand a security from the customers and charge very high rate of interest.
• Discounting of Bills of Exchange: This is the most prevalent and important method of advancing loans to the traders for short-term purposes. Under this system, banks advance loans to the traders and business firms by discounting their bills. In this way, businessmen get loans on the basis of their bills of exchange before the time of their maturity.
• Investment of Funds: The banks invest their surplus funds in three types of securities—Government securities, other approved securities and other securities. Government securities include both, central and state governments, such as treasury bills, national savings certificate etc. Other securities include securities of state associated bodies like electricity boards, housing boards, debentures of Land Development Banks, units of UTI, shares of Regional Rural banks etc.
• Banks collect cheques, drafts, bills of exchange and dividends of the shares for their customers.
• Banks make payment for their clients and at times accept the bills of exchange: of their customers for which payment is made at the fixed time.
• Banks pay insurance premium of their customers. Besides this, they also deposit loan installments, income tax, interest etc. as per directions.
• Banks purchase and sell securities, shares and debentures on behalf of their customers.
• Banks arrange to send money from one place to another for the convenience of their customers.

Question 3. Write a detailed note on various facilities offered by Indian Postal Department. Answer:  Indian Post and Telegraph Department provides various postal services all over India. India has been divided into 22 postal circles for this. There are 1,54,149 post offices in India. It has 5,64,701 letter boxes, which transmits 1575 crore mails every year. 5,01,716 villages have a public telephone and 26000 post offices are connected through the network. It links major 97 countries across the world. It provides speed post facility for over 1000 destinations in India. Facilities of postal department are broadly divided into:

• Financial Facilities: Post and Telegraph Department provides financial services using post office’s saving schemes like Public Provident Fund, Kisan Vikas Patra, National Saving Certificate, normal retail banking functions of monthly income schemes, recurring deposit account, savings account, time deposits and money order facility etc.
• Mail Facilities: It consists of parcel facilities which consists of transmission of articles from one place to another which can be registered and insured. It also provides facilities for greeting post, (a range of delightful greeting card on all occasions) and Media Post (a way for Indian corporate to advertise their brands through aerograms, telegrams and letterboxes).
• International Money Transfers: It enables money transfer from 185 countries in collaboration with Western Union Money Transfer.
• Passport Facilities: It has joint hands with Ministry of External Affairs and accepts application for passport.
• Speed Post: It has more than 1000 destinatiory in India. It covers 97 major countries of the world.
• E-Bill Post: It is the latest addition in facilities by Indian Post whereby it collects bill payment across the counter for BSNL and Bharti Airtel.

Question 5. Explain in detail the warehousing services. Answer:   Primary warehousing services include the following:

• Consolidation: Warehouse receives and consolidates goods from different production stations and dispatches it to customer on a single transportation shipment.
• Break the Bulk: Warehouse breaks the bulk received according to the requirements of the client.
• Stock Piling: The next function of warehousing is the seasonal storage of goods to select business.

Secondary Functions of a Warehouse

• Protection of goods: A warehouse provides protection to goods from loss or damage due to heat, dust, wind and moisture, etc. It makes special arrangements for different products according to their nature. It cuts down losses due to spoilage and wastage during storage.
• Risk Bearing: Warehouses take over the risks incidental to storage of goods. Once goods are handed over to the ware housekeeper for storage, the responsibility of, these goods passes on to the ware housekeeper. Thus, the risk of loss or damage to goods in storage is borne by the warehouse keeper. Since it is bound to return the goods in good condition, the warehouse becomes responsible for any loss, theft or damage etc., thus, it takes all precautions to prevent any mishap.
• Financing: When goods are deposited in any warehouse, the depositor gets a receipt, which acts as a proof about the deposit of goods. The warehouses can also issue a document in favour of the owner of the goods, which is called warehouse keeper’s warrant. This warrant is a document of title and can be transferred by simple endorsement and delivery. So while the goods are in custody of the ware housekeeper, the businessmen can obtain loans from banks and other financial institutions keeping this warrant as security. In some cases, warehouses also give advances of money to the depositors for a short period keeping their goods as security.
• Processing: Certain commodities are not consumed in the form they are produced. Processing is required to make them consumable. For example, paddy is polished, timber is seasoned, and fruits are ripened, etc. Sometimes warehouses also undertake these activities on behalf of the owners.
• Grading and branding: On request warehouses also perform the functions of grading and branding of goods on behalf of the manufacturer, wholesaler or the importer of goods. It also provides facilities for mixing, blending and packaging of goods for the convenience of handling and sale.

MORE QUESTIONS SOLVED

I. Multiple Choice Questions Question 1. Which of the following is an example of E-banking? (a) EFT (b) Online banking (c) ATM id) All of the above Question 2. Who can get an overdraft from a bank? (a) A Current Account Holder (b) A Saving Account Holder (c) A Fixed Deposit Account Holder (d) A Recurring Deposit Account Holder Question 3. Give full form of ATM. (a) Automatic Tele Money (b) Any Time Money (c) Automatic Teller Machine (d) Automatic Transfer Money Question 4. In which type of insurance, interest must exist only at the time of insurance? (a) Life Insurance (b) Marine Insurance (c) Fire Insurance (d) All of the above Question 5. Which of the following companies offer DTH services in our country? (a) Reliance (b) Idea (c) Tata sky (d) All of the above Question 6. Name the type of banking under which ATM, credit card and EFT facilities are available. (a) Internet Banking (b) E-banking (c) Modern Banking (d) Online Banking Question 7. VSAT stands for: (a) Very Small Aperture Terminal (b) Vidyut Supply and Transport (c) Very Small Application Terminal (d) Video Screening Aperture Terminal Question 8. Name the controlling authority of telecom services in India, (a) TRAI (b) SEBI (c) RBI (d) IRDA Question 9. In which of the insurance policy loss cannot be measured? (a) Life Insurance (6) Marine Insurance (c) Fire Insurance (d) All of the above Question 10. To which insurance, principle of indemnity is not applicable? (a) Life Insurance (b) Marine Insurance (c) Fire Insurance (d) All of the above Question 11. Speed post in India connects major countries of the world. (a) 120 (b) 140 (c) 97 (c) 82 Question 12. Sports insurance is not available for: (a) Professional Sportsmen (b) Non-professional Sportsmen (c) Rural Area Sportsmen (d) Urban Area Sportsmen Question 13. FCI, STC, CWC are examples of: (a) Bonded Warehouses (b) Government Warehouses (c) Private Warehouses (d) Cooperative Warehouses Question 14. It is the duty of the insured to make an effort for minimization of loss. It is the principle of: (a) Utmost Good Faith (b) Contribution (c) Mitigation id) Insurable Interest Question 15. Insurer must have some pecuniary interest in the subject matter of interest. It is the principle of: (a) Mitigation (b) Contribution (c) Utmost Good Faith (d) Insurable Interest Answers: 1. (d) 2. (a) 3. (c) 4. (a) 5. (d) 6. (b) 7. (a) 8. (a) 9. (a) 10. (a) 11. (c) 12. (a) 13. (b) 14. (c) 15. (d)

Question 2. Explain the functions of e-banking. Answer:  E-banking means banking transactions carried out with the help of computer systems (i.e., banking over the internet).

• Electronic Fund Transfer (EFT): Under this system, a bank transfers wages and salaries directly from the company’s account to the account of employees of the company.
•  Automatic Teller Machine (ATM): It refers to an electronic terminal that allows people with plastic card to perform simple banking transactions like withdrawal of cash 24 x 7 without any help of human teller.
•   Debit Card: It refers to a plastic card that allows the bank to take money from the customer’s account and transfer it to a seller’s account.
• Credit Card: It refers to a plastic card that allows the customer to buy now and pay back the loaned amount to bank at a future date.
• Online Banking: Under this system, when the customer gives instruction on his computer, the bank computer transfers money from customer’s account to biller’s account.

Question 3. What do you mean by mode of transport? Name different modes of transport. Answer:  Modes Of Transport: Modes of transport can also be called as means of transport or transport mode or transport modality. It is a general term used to specify the different kinds of transport facilities that are used by people to move from one place to the other and also to shift the goods from one place to other. When more than one mode -of transport is used by a person for transportation then it can be described as a multi-model transport. Generally there are four modes of transport that uses different types of vehicle, infrastructure and operation. Each mode of transport has its own advantages and disadvantages. The person will choose their mode of transport based on the cost, capability, routes and speed. The general modes of transport are as follows: 1. Human powered transport; 2. Animal powered transport; 3. Roadways; 4. Waterways; 5. Railways; 6. Airways; 7. Other modes like pipe line, sewage, cable cars.

Question 4. Write short notes on different types of marine insurance. Answer:  Different types of marine insurance are as follows:

• Cargo Insurance: Cargo insurance caters specifically to the cargo of the ship and also pertains to the belongings of a ship’s voyagers.
• Hull Insurance: Hull insurance mainly caters to the torso and hull of the vessel along with all the articles and pieces of furniture in the ship. This type of marine insurance is mainly taken out by the owner of the ship in order to avoid any loss to the ship in case of any mishaps occurring.
•   Liability Insurance: Liability insurance is that type of marine insurance, where compensation is sought to be provided to any liability, occurring on account of a ship crashing or colliding and on account of any other induced attacks.
• Freight Insurance: Freight insurance offers and provides protection to merchant vessels’ corporations which stand a chance of losing money in the form of freight in case the cargo is lost due to the ship meeting with an accident. This type of marine insurance solves the problem of companies losing money because of a few unprecedented events and accidents occurring.

Question 5. What are different types of warehouses? Answer:  Different types of warehouses are as follows:

• Public Warehouse: It is operated in accordance with the law for the purpose of storing goods for other people at profit. Sometimes a large amount of goods arrives in part when it is not convenient for the importer to take it into his custody. During such periods these goods have to be stored somewhere. Similarly, even in trade they have to be stored between the time they are made and the time they are required for use. A public warehouse provides facilities for storing all such goods. It thus renders many useful services to the trade. It enables smaller sellers to carry regional stocks. This factor is very important in competitive markets.
• Private Warehouse: This type of warehouse belongs to the owner of goods, usually a wholesaler, who stored his goods. This is in order to supply to retailers in future. Goods are produced in large quantities in anticipation of future demand and for the unknown customers. The ultimate wholesaler finds it necessary to purchases goods in advance in large bulk and to store them for future supply.
•   Bonded Warehouses: It is one which is licensed to accept imported goods for storage before payment of customs duties. By storing his goods in a bonded warehouse the importer gains some control without paying the duty. The goods in bonded warehouses are under the strict supervision of customs officers and before the owner can interfere with them, previous permission is necessary.
•  Government Warehouse: This type of warehouse is mainly located at the important sea ports and in most cases is owned by the Dock Authorities. The general public can also use this group of warehouse on payment of fixed charges. If a customer cannot pay the rent within the specified period or time, then the authority can recover the rent by disposing of the goods

III. Long Answer Type Questions Question 1. Explain different types of life insurance policies. Answer:  The life insurance policies Eire of many types. The principal types of policies are discussed below:

• Whole life Policy: Under this policy premiums are paid throughout life and the sum insured becomes payable only at the death of the insured. The policy remains in force throughout the life of the assured and he continues to pay the premium till his death. This is the cheapest policy as the premium till his death. This is the cheapest policy as the premium charged is the lowest under this policy. This is also known as ‘ordinary life policy. This policy is suitable to persons who want to provide for payment of estate duty, make bequeathments for charitable purposes and to provide for their families after their death.
• Children’s Endowment Policy: This policy is taken by the person for his or her children to meet the expenses of education or marriage. The agreement states that a certain sum of money will be paid by the insurer when the children attain a particular age. There will be no need of paying premium if the person entering into the contract dies before maturity.
• Endowment Policy: It runs only for a limited period or up to a particular age. Under this policy the sum assured becomes payable if the assured reaches a particular age or after the expiry of a fixed period called the endowment period or at the death of the assured whichever is earlier. The premium under this policy is to be paid up to the maturity of the policy, i.e., the time when the policy becomes payable. Premium is naturally a little higher in the case of this policy than the whole life policy. This is a very popular policy these days as it serves the dual purpose of family and old age pension.
• Double Endowment Policy: Under this policy the insurer agrees to pay to the assured double the amount of the insured sum if he lives on beyond the date of maturity of the policy. This policy is suitable for persons with physical disability who are otherwise not acceptable for other classes of assurance at the normal tabular rates. Premiums are to be paid for a selected term of years or until death, if earlier.
• Joint Life Policy : This policy covers the risk on two lives and is generally available to partners in business. Policies are however, issued on the lives of husband and wife under specified circumstances. Sum assured becomes payable at the end of the selected term or on the death of either of the two lives assured, if earlier.
• Fixed term (marriage) Endowment Policy and Education Annuity Policy: It is a policy suitable for making provisions for the marriage or education of children. Premiums are payable for a selected term or till prior death. The benefits are payable for selected term or till prior death. The benefits are payable only at the end of selected term. Tn case of the marriage endowment, the sum assured is paid in lump sum, but in case of the educational annuity, it is paid in equal half- yearly installments over a period of five years.
•  Annuities : It is a policy under which the insured amount is payable to the assured by monthly or annual installments after he attains a certain age. The assured may pay the premium regularly over a certain period or he may pay the premium regularly over a certain period or he may pay a lump sum of money at the outset. These policies are useful to persons who wish to provide a regular income for themselves and their dependants.

Question 3. Write a short note on GATS. Answer:  The creation of the GATS was one of the landmark achievements of Uruguay became Round, whose results entered into force in January 1995. While services currently account for over 60 percent of global production and employment, they represent no more than 20 percent of total trade (BOP basis). This—seemingly modest—share should not be underestimated, however. Many services, which have long been considered genuine domestic activities, have increasingly become internationally mobile. This trend is likely to continue, owing to the introduction of new transmission technologies (e.g., electronic banking, tele-health or tele-education services), the opening up in many countries of long entrenched monopolies (e.g. voice telephony and postal services), and regulatory reforms in hitherto tightly regulated sectors such as transport. Combined with changing consumer preferences, such technical and regulatory innovations have enhanced the “tradability” of services and, thus, created a need for multilateral disciplines. All WTO members, some 140 economies at present, are at the same time members of the GATS and, to varying degrees, have assumed commitments in individual service sectors. The GATS schedule largely follows a classification. It classifies services into 12 sectors which are as follows:

• Business services;
• Communication services;
• Construction and related engineering services;
• Distribution services;
•  Educational services;
• Environmental services;
• Financial services;
• Health related and social services
• Tourism and travel related services;
• Recreational, cultural and sporting services;
•  Transport services;
• And other services.

Question 4. Write a short note on Indian insurance sector. Answer:  The health of the insurance sector reflects a country’s economy. This sector not only generates long term funds for infrastructure development, but also increases a country’s risk taking capacity. India’s economic growth since the turn of the century is viewed as a significant development in the global economy. This view is helped in no small part by a booming insurance industry. The future of the Indian insurance sector looks bright. The sector which stood at a strong US$ 72 billion in 2012 has the potential to grow to US$ 280 billion by 2020. This growth is driven by India’s favourable regulatory environment which guarantees stability and fair play. This environment has given rise to an insurance market which encourages foreign investors to tap into the sector’s massive potential. Ever since the Indian government liberalised the insurance sector in 2000 and opened the doors for private participation, the sector has become stronger. The resultant competition has provided the’ consumer with a never-before-seen range of products and providers, and also enhanced service levels markedly. Consistent growth in the insurance sector depends on a few factors. Some of these are:

• Effective distribution channels: The efficiency and cost of the various distribution strategies used by companies are significant to their success in the insurance business. This particularly holds true for the retail business.
• Focus on overall financial inclusion: As time evolves, so must the approach of the insurance sector in India. The objective of the insurance sector should ideally be to offer a broader range of activities to a wider populace.
• Consumer needs and preferences: The growth of India’s insurance industry can be attributed to product innovation, dynamic distribution channels, and vibrant publicity and promotional campaigns run by insurance companies. Benefits attached to the products and the manner in which they are delivered (through various marketing tie-ups) have helped bring customers and insurance companies closer to each other and made the latter more relevant.
•  Health Insurance is an up-and-coming segment in this sector: Currently, it caters for 10 per cent of the overall US$ 30 billion healthcare expenditure in India. Consequently, there is plenty of scope for players in this area.
•  The life insurance segment contributes about 4 per cent to India’s gross domestic product (GDP) in terms of total premiums underwritten annually. There are 23 private companies in the segment. The state owned Life Insurance Corporation (LIC) dominates the field, with about 71 per cent of the market share, according to Insurance Regulatory and Development Authority (IRDA).

IV. Higher Order Thinking Skills (HOTS) Question 1. Manju obtained a life insurance policy of her husband. After 5 years, she divorced her husband. After one year of divorce, her husband died in a car accident. Can she claim the amount of policy from the insurance company? Answer:  Yes, she can claim because in life insurance insurable interest has to be present at the time of affecting the policy but need not be present at the time when the claim falls due.

Question 2. A person gets his stock of goods insured, but he hides the fact that the electricity board has issued him statutory warning letter to get his factory’s wiring changed later on, the factory catches fire due to short circuit. Can he claim compensation? State the name of “Principle”. Answer:  No, he cannot claim the compensation because the principle of utmost good faith is not followed. According to this principle, it is the duty of the insurer and insured to voluntarily make full accurate disclosure of all facts, material to the insurance contract.

Question 3. Anju has taken a loan from Avi against the security of his factory. Can Avi take a fire insurance policy of that factory? Answer:  No, she cannot. Because in case of fire insurance, insurable interest has to be present both at the time of affecting the policy and also when the claim falls due.

V. Value Based Questions Question 1. A person took an insurance policy and did not disclose that he is a patient of cancer. Which value is missing in this case? Answer:  Honesty is missing in this case and the principle of utmost good faith is violated and hence the person’s beneficiary cannot get the claim for his policy.

Question 2. There are three types of services: Business Services, Social Services and Personal Services. Which of the services in your opinion are of utmost importance and why? Answer:  In my opinion, these services are complementary to each other and hence, they have their own importance. I can’t say that tourism or recreation (Personal Service) is less important than services of a charitable hospitals (Social Service) or vice-versa. Similarly I can’t say that banking (Business Service) is less important than services of restaurants (Personal Service) or vice-versa. Still if I have to choose one, I will select social services because:

• They benefit to a larger section of society.
• They are sometimes provided without a payment in lieu.
• They have long lasting effects on our society and economy.

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Home » 11th Class » NCERT Solutions for Class 11 Business Studies Chapter 4 Business Services | Question Answer PDF

NCERT Solutions for Class 11 Business Studies Chapter 4 Business Services | Question Answer PDF

NCERT Solutions for Class 11 Business Studies Chapter 4 Business Services has been published by Aglasem. You can now download the Class 11 Business Studies Ch 4 Questions and Answers PDF here. This NCERT Solutions for Class 11 Business Studies contains answers of all questions asked in Chapter 4 in textbook, Business Studies . Therefore you can refer it to solve Business Services exercise questions and learn more about the topic.

NCERT Solutions for Class 11 Business Studies Chapter 4 Business Services

Class – Class 11 Subject – Business Studies Chapter – Ch 4 Chapter Name – Business Services Book – Business Studies Study Material – NCERT Solutions

NCERT Solutions for Class 11 Business Studies Chapter 4 PDF

While you can read NCERT Solutions for Class 11 Business Studies Ch 4 for all exercises here on aglasem. You can also download this NCERT Solutions PDF to refer ncer question answer at anytime when you study Business Services. Here it is.

NCERT Solutions for Class 11 Business Studies Chapter 4 PDF Download Link – Click Here to Download Solutions PDF

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You can download the complete NCERT solutions for chapter 4 of this NCERT Book i.e. Business Studies with following steps.

• First search NCERT Solutions for Class 11 Business Studies Ch 4 PDF aglasem and come to this page.
• Now you will see the exercise questions answers of Business Services and download pdf link on it.
• Click the Download PDF link to obtain the Business Services questions with answers document.
• NCERT Solutions for Class 11 Business Studies

There are more chapters to study besides Business Services in this subject. So here are NCERT solutions for all topics of Business Studies taught in 11th class here at aglasem.

• Chapter 1 Business, Trade and Commerce
• Chapter 2 Forms of Business Organisation
• Chapter 3 Private, Public and Global Enterprises
• Chapter 4 Business Services
• Chapter 5 Emerging Modes of Business
• Chapter 6 Social Responsibilities of Business and Business Ethics
• Chapter 7 Formation of a Company
• Chapter 8 Sources of Business Finance
• Chapter 9 MSME and Business Entrepreneurship
• Chapter 10 Internal Trade
• Chapter 11 International Business

NCERT Solutions for Class 11

Just like you got Business Studies Ch 4 solutions here. You can see exercise questions answers of other subjects and their topics too on aglasem. Here are NCERT solutions for all subjects of 11th standard NCERT books.

• NCERT Solutions for Class 11 Accountancy
• NCERT Solutions for Class 11 Biology
• NCERT Solutions for Class 11 Chemistry
• NCERT Solutions for Class 11 Economics
• NCERT Solutions for Class 11 English
• NCERT Solutions for Class 11 Geography
• NCERT Solutions for Class 11 Hindi
• NCERT Solutions for Class 11 History
• NCERT Solutions for Class 11 Maths
• NCERT Solutions for Class 11 Physics
• NCERT Solutions for Class 11 Political Science
• NCERT Solutions for Class 11 Psychology
• NCERT Solutions for Class 11 Sociology

NCERT Solutions for Class 11 Business Studies Chapter 4 – An Overview

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