MAHA SET Commerce Solved Paper JUNE 2019 [Paper II-A]

MAHA SET Solved Question Paper Commerce

[Time: 2 hour, 120 Minutes; Maximum Marks: 200]

Note: This paper contains HUNDERED[100] multiple choice questions, each carrying Two (2) marks. Attempt All questions.

In this post you will get MAHA SET Commerce Solved Paper JUNE 2019[Paper II-A] with Proper Explanation. MAHA SET General Paper 1 Solutions will also be available very soon on our website.

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1. ________ is a mechanism to reduce price risk inherent in open position.

(A) Swap.

(B) Hedging.

(D) Squaring off.

Ans: (B) Hedging.

2. The theory of mercantilism is based on:

(A) Gold.

(B) Dollar.

(D) Exchange of goods for goods.

Ans: (A) Gold.

3. Which one of the following is not a demerit of the MNCs?

(A) MNCs may destroy competition and acquire monopoly powers.

(B) MNCs retard growth of employment in the home country.

(D) Through transfer pricing MNCs avoid taxes in the home country.

Ans: (C) MNCs provide means of integrating national economies.

4. Balance of trade balances the exports and imports of ________ trade of a country.

(A) Invisible.

(B) Merchandise.

(D) Agricultural.

Ans: (B) Merchandise.

5. Which one of the following is not a form of counter trade?

(A) Buy back.

(B) Compensation deal.

(D) Purchase on credit.

Ans: (D) Purchase on credit.

6. Usually balance of payments accounts the transactions of a country for:

(A) Five years.

(B) Two years.

(D) Ten years.

Ans: (C) One year.

7. The key factor for attracting FDI is:

(A) Interest rates existing for a country.

(B) Entry/Exit policies.

(D) All of the above.

Ans: (D) All of the above.

8. South Asian Association for Regional Co-operation (SAARC) was established on December, 1985 in ________ city.

(A) Islamabad.

(B) Kathmandu.

(D) New Delhi.

Ans: (C) Dhaka.

9. Which of the following is not the type of tariff reduction mechanism under agreement on agriculture (AOA)?

(A) Amber box subsidy.

(B) Blue box subsidy.

(D) Purple box subsidy.

Ans: (D) Purple box subsidy.

10. Which one of the following is not economic factor to cause disequilibrium in the balance of payments?

(A) Development disequilibrium.

(B) Social disequilibrium.

(D) Cyclical disequilibrium.

Ans: (B) Social disequilibrium.

11. Human Resource Accounting is an expected solution over the limitations of ________.

(A) Assets and liability.

(B) Income and expenses.

(D) Money measurement concept.

Ans: (D) Money measurement concept.

12. Which of the following industries does not use the process costing?

(A) Oil refineries.

(B) Distilleries.

(D) Aircraft manufacturing.

Ans: (D) Aircraft manufacturing.

13. When prices show a rising trend, which one of the following methods of inventory valuation will result in lower income and lower valuation of inventory?

(A) FIFO.

(B) LIFO.

(D) Weighted average method.

Ans: (B) LIFO.

14. ABC Ltd. has profit after tax Rs. 80,000, Depreciation Rs. 15,000 and decrease in debtors Rs. 25,000. What is the cash flow from operating activities?

(A) Rs. 55,000.

(B) Rs. 40,000.

(D) Rs. 65,000.

Ans: (C) Rs. 1,20,000.

15. At the time of consolidation issue of bonus shares by subsidiary company out of capital profit will ________.

(A) Decrease cost of control.

(B) Increase cost of control.

(D) Have no effect on cost of control.

Ans: (D) Have no effect on cost of control.

16. The sweat shares are allotted to ________.

(A) Investors.

(B) Employees.

(D) Promoters.

Ans: (B) Employees.

17. Cost auditor is appointed by:

(A) The shareholders in the general meeting.

(B) The Central Government.

(D) The Board of Directors.

Ans: (D) The Board of Directors.

18. Employee benefits to employees in financial statements are recognised as per ________.

(A) Indian AS-1.

(B) Indian AS-9.

(D) Indian AS-19.

Ans: (D) Indian AS-19.

19. X and Y share profits and losses in the ratio of 2 : 1. They take Z as a partner and the new profit sharing ratio becomes 3 : 2 : 1. Z brings Rs. 4,500 as premium for goodwill. What will be the value of firm’s goodwill?

(A) Rs. 4,500.

(B) Rs. 18,000.

(D) Rs. 24,000.

Ans: (C) Rs. 27,000.

20. What is said as essence of Auditing?

(A) Vouching.

(B) Verification.

(D) Internal check.

Ans: (A) Vouching.

21. Which of the following is not the basic economic problem?

(A) What to produce?

(B) How to produce?

(D) For whom to produce?

Ans: (C) What to consume?

22. The ________ effect of a change in price is negative for superior goods.

(A) Price.

(B) Income.

(D) Inflation.

Ans: (B) Income.

23. If two goods are perfect complements to each others, then indifference curves are ________.

(A) Right angled.

(B) Left angled.

(D) Downward sloping.

Ans: (A) Right angled.

24. X: Long run average cost curve is flat U-shaped.

Y: It is called an envelope curve.

(A) Only X is correct.

(B) Only Y is correct.

(D) Both X and Y are incorrect.

Ans: (C) Both X and Y are correct.

25. Which of the following is not a fixed cost?

(A) Payment of interest on borrowed capital.

(B) Charges for fuel and electricity.

(D) Contractual rent for equipment or building.

Ans: (B) Charges for fuel and electricity.

26. In which of the following market structure is the demand curve of the market represented by the demand curve of the firm?

(A) Monopolistic competition.

(B) Perfect competition.

(D) Oligopoly.

Ans: (C) Monopoly.

27. X: The extra expenditure incurred by a firm on competitive advertisement is selling cost.

Y: There are several wastes under monopolistic competition.

(A) Only X is correct.

(B) Only Y is correct.

(D) Both X and Y are incorrect.

Ans: (C) Both X and Y are correct.

28. This is not a feature of monopolistic competition:

(A) Product differentiation.

(B) Free entry and exit.

(D) Interdependence.

Ans: (D) Interdependence.

29. Match the columns:

Group-A

Group-B

(w) Monopolistic competition.

(x) Price rigidity.

(y) Dumping.

(z) Collusion.

(1) Sale of goods at varying prices in foreign and domestic market.

(2) Edward Chamberlin.

(3) Firms working together in price determination.

(4) Paul Sweezy.

Codes:

(A) (w)-(2), (x)-(3), (y)-(1), (z)-(4).

(B) (w)-(4), (x)-(2), (y)-(1), (z)-(3).

(D) (w)-(4), (x)-(1), (y)-(3), (z)-(2).

Ans: (C) (w)-(2), (x)-(4), (y)-(1), (z)-(3).

30. Who among the following has not contributed to the theory of games?

(A) J. Von Neumann.

(B) Oskar Morgenstern.

(D) Robert Samuelson.

Ans: (D) Robert Samuelson.

31. The measure of business risk is:

(A) Operating leverage.

(B) Financial leverage.

(D) Working capital leverage.

Ans: (A) Operating leverage.

32. DCF technique of Capital Budgeting does not include the following:

(A) NPV (Net Present Value).

(B) P.I. (Profitability Index).

(D) ARR (Average Rate of Return).

Ans: (D) ARR (Average Rate of Return).

33. A firm has a cash dividend of Rs. 42 per share and an average growth rate of 5% per annum in cash dividend. The required rate of return is 12% per annum. Find the present value of the share:

(A) Rs. 600.

(B) Rs. 294.

(D) Rs. 650.

Ans: (A) Rs. 600.

34. The nominal rate of interest is equal to:

(A) Real rate + Risk premium – Inflation.

(B) Real rate + Risk premium + Inflation.

(D) Real rate.

Ans: (B) Real rate + Risk premium + Inflation.

35. SDRs are:

(A) International reserve assets.

(B) US currency.

(D) ADR.

Ans: (A) International reserve assets.

36. Domestic currency tends to depreciate owing to:

(A) Lowering of inflation rate.

(B) Constant inflation rate.

(D) No inflation rate.

Ans: (C) High inflation rate.

37. Money market hedge involves:

(A) Going for a forward contract.

(B) Going for a future contract.

(D) A position to cover a future payables receivable position.

Ans: (D) A position to cover a future payables receivable position.

38. Multilateral Investment Guarantee Agency (MIGA) covers:

(A) Political risk.

(B) Commercial risk.

(D) Exchange risk.

Ans: (A) Political risk.

39. At operating Break-even Point which of the following is true?

(A) Sales revenue just covers the fixed cost.

(B) Sales revenue is just equal to revenue variable cost.

(D) EBIT is zero.

Ans: (D) EBIT is zero.

40. As per Net Income Approach theory a firm can increase its value and reduce the overall cost of capital by increasing the proportion of ________ in its capital structure.

(A) Debt.

(B) Equity.

(D) Retained earnings.

Ans: (A) Debt.

41. If each observation in a group is increased by 5, then the arithmetic mean will ________.

(A) Increase by 5.

(B) Not change.

(D) Decrease or increase depending upon the observations.

Ans: (A) Increase by 5.

44. A company can complete the job in time with probability 0.8. Suppose 5 jobs are assigned then the probability that all the jobs will be completed in time is ________.

(A) 5 × 0.8.

(B) 0.8.

(D) (0.8)⁵.

Ans: (D) (0.8)⁵.

45. In systematic sampling the samples drawn ________.

(A) Are not overlapping.

(B) May be overlapping.

(D) Are not proper representative.

Ans: (A) Are not overlapping.

46. The critical region in testing of hypothesis is a region of ________.

(A) Rejection for H₀.

(B) Rejection for H₁.

(D) Acceptance for H₁.

Ans: (A) Rejection for H₀.

47. We use Mann-Whitney U test for testing equality of means of two populations if ________.

(A) The samples are from normal populations with unknown variances.

(B) The samples are from no normal populations.

(D) The samples are unequal in size.

Ans: (B) The samples are from no normal populations.

48. If the two regression lines are

x + 2y = 5 and

2x + 3y = 8

then the means of x and y are:

(A) –3, 4.

(B) 2, 4.

(D) 2, 1.

Ans: (C) 1, 2.

49. If X is a normal variate with mean 20 and variance 64, then P(X > 20) = ________.

(A) 0.

(B) 20/64.

(D) 1.

Ans: (C) 0.5.

50. Arrange the following steps in research in appropriate order:

(a) Hypothesis testing.

(b) Drawing a sample.

(d) Conduct the survey.

(e) Decide the sampling method.

(A) a, b, c, d, e.

(B) b, c, a, d, e.

(D) d, e, a, b, c.

Ans: (C) e, c, b, d, a.

51. Another term used for 360 degree appraisal and feedback is:

(A) Multi rater.

(B) Complete appraisal.

(D) Periodic assessment.

Ans: (A) Multi rater.

52. ________ is not the part of on the-job training method.

(A) Apprenticeship.

(B) Simulation.

(D) Internship.

Ans: (B) Simulation.

53. ________ suggests that managerial knowledge may be transferred from one country to another and from another within the same country.

(A) Universality of Management.

(B) Scientific Management.

(D) Administrative Management.

Ans: (A) Universality of Management.

54. ________ is used to evolve behavioural description of a job.

(A) Critical Incident Technique.

(B) Position Analysis Questionnaire/Technique.

(D) Method Analysis.

Ans: (A) Critical Incident Technique.

55. ________ is concerned with physical location, management of buildings and equipments.

(A) Ad hoc Planning.

(B) Formal Planning.

(D) Physical Planning.

Ans: (D) Physical Planning.

56. ________ is a technique for planning and controlling complex projects and for scheduling the resources required for such projects.

(A) Complexities Analysis.

(B) Network Analysis.

(D) Internal Analysis.

Ans: (B) Network Analysis.

57. ________ signifies all out efforts for increase in production, creation of spirit of mutual trust and develop scientific attitude towards problem solving.

(A) Time study.

(B) Mental Revolution.

(D) Works study.

Ans: (B) Mental Revolution.

58. The process resolving the differences between union and management in the absence of any third party is widely designated as ________.

(A) Adjudication.

(B) Arbitration.

(D) Conciliation.

Ans: (C) Collective bargaining.

59. Which one of the following is not the factor that affects the span of control?

(A) Similarities of functions.

(B) Geographical closeness of employees.

(D) Delegation.

Ans: (D) Delegation.

60. ________ is not off the job training method.

(A) Vestibule.

(B) Simulation.

(D) Special assignments.

Ans: (D) Special assignments.

61. ________ it is a risk arising out of human errors, technical faults, infrastructure breakdown and faulty systems?

(A) Exchange risk.

(B) Settlement risk.

(D) Operational risk.

Ans: (D) Operational risk.

62. In case of ________ debentures, the investors are given the option to convert their investment in the form of equity shares of the company.

(A) Fully convertible.

(B) Partly convertible.

(D) Optionally convertible.

Ans: (D) Optionally convertible.

63. ________ are the persons legally permitted to deal in or handle transactions related to foreign exchange as per FEMA 1999.

(A) Underwriters.

(B) Authorised persons.

(D) Joggers.

Ans: (B) Authorised persons.

64. ________ is a communication system which provides transmission of financial messages, certifying the authenticity, across the globe between members.

(A) RTGS.

(B) NEFT.

(D) FINFAST.

Ans: (C) SWIFT.

65. Bank should classify an account as NPA only if the interest charged during any quarter is not serviced fully within ________ from the end of quarter.

(A) 90 days.

(B) 180 days.

(D) 450 days.

Ans: (A) 90 days.

66. ________ is an indirect instrument of credit control used by the RBI to meet day to day liquidity mismatches in the system and check volatility in the short-term money market.

(A) Credit monitoring arrangement (CMA).

(B) Liquidity adjustment facility (LAF).

(D) Market stabilization scheme (MSS).

Ans: (B) Liquidity adjustment facility (LAF).

67. The balance of a joint account in the name of X, Y and Z should be paid on the death of X:

(A) To the legal representative of X.

(B) To Y and Z.

(D) To the legal representative of X, Y and Z.

Ans: (D) To the legal representative of X, Y and Z.

68. The main purpose of insurance is:

(A) Compensate the loss.

(B) Provide security.

(D) Indemnification.

Ans: (D) Indemnification.

69. Secondary financing of bills or credit portfolio already financed by banks or institutions as a support to primary financers is termed as ________.

(A) Refinance.

(B) Supplementary finance.

(D) Demand based finance.

Ans: (A) Refinance.

70. Pre-matured payment of term loan will result in interest rate risk of ________ type.

(A) Basic risk.

(B) Yield curve risk.

(D) Mismatch risk.

Ans: (C) Embedded option risk.

71. Functions of physical supply include:

(A) Buying, Assembling, Selling.

(B) Transportation, Storage.

(D) Transport, Grading and Storage.

Ans: (B) Transportation, Storage.

72. ________ method of pricing strategies assumes that sales and profits are independent of costs, but are dependent on the demand.

(A) Break-even pricing.

(B) Market based pricing.

(D) Affordability based pricing.

Ans: (B) Market based pricing.

73. In ________ pricing method of service marketing, a marketer chooses to charge low price for a basic service to attract customers but every extra service above basic is charged additionally high.

(A) Differential pricing.

(B) Discount pricing.

(D) High price maintenance pricing.

Ans: (C) Diversionary pricing.

74. In the case of some market leaders, the companies are very highly respected that the channel members are proud to be associated with them is known as ________.

(A) Reward power.

(B) Coercive power.

(D) Referent power.

Ans: (D) Referent power.

75. ________ describes how and where information gets into memory.

(A) Memory retrieval.

(B) Memory reconstructive.

(D) Memory decoding.

Ans: (C) Memory encoding.

76. A customer strongly prefers a specific brand once will not accept a substitute is ________.

(A) Brand recognition.

(B) Brand insistence.

(D) Brand loyalty.

Ans: (B) Brand insistence.

77. ________ is one of the additional factor hindering new producer development, which suggest companies must aim their new products at smaller market segments and this can mean lower sales and profits for each product.

(A) Shortage of important ideas in certain areas.

(B) Social and governmental constraints.

(D) Cost of development.

Ans: (C) Fragmental markets.

78. Rising sales at increasing rate is witnessed in ________.

(A) Maturity stage.

(B) Growth stage.

(D) Decline stage.

Ans: (B) Growth stage.

79. ________ is a form of licensing where the parent company grants another independent company the right to do business in a prescribed manner.

(A) Franchising.

(B) Contract manufacturing.

(D) Licensing.

Ans: (A) Franchising.

80. Customer satisfaction is no longer good enough to survive in today’s competitive market. What is needed is ________.

(A) Customer orientation.

(B) Customer retention.

(D) Customer delight.

Ans: (D) Customer delight.

81. Section ________ of Indian Contract Act, 1872 defines contract as an agreement enforceable by law.

(A) 2(h).

(B) 2(b).

(D) 2(d).

Ans: (A) 2(h).

82. Chapter V of the Maharashtra Goods and Service Tax Act, 2017 deals with ________.

(A) Input tax credit.

(B) Time and value of supply.

(D) Administration.

Ans: (A) Input tax credit.

83. What is the time limit to get the information concerning with the life and liberty of a person as per RTI Act, 2005?

(A) 24 Hours.

(B) 48 Hours.

(D) 10 Days.

Ans: (B) 48 Hours.

84. As per section 24 of IPR Act, the term of copyright in Posthumous works is ________ years.

(A) 30.

(B) 40.

(D) 60.

Ans: (D) 60.

85. What is the validity of the GST registration certificate?

(A) One year.

(B) Ten years.

(D) Five years.

Ans: (C) Validity till it is cancelled.

86. Match the following groups:

Group-I

Group-II

(1) Trade Mark Act.

(2) Copyright Act.

(3) Patent Act.

(4) Design Act.

(a) Year 1999.

(b) Year 1957.

(c) Year 1970.

(d) Year 2000.

Code:

(A) (a-1), (b-2), (c-3), (d-4).

(B) (a-4), (b-3), (c-2), (d-1).

(D) (a-3), (b-4), (c-1), (d-2).

Ans: (A) (a-1), (b-2), (c-3), (d-4).

87. Section ________ of the Competition Act, 2002 deals with goods.

(A) 2(i).

(B) 2(a).

(D) 2(h).

Ans: (A) 2(i).

88. Which of the following is not an example of termination of agency by operation of law?

(A) Agreement.

(B) Expiry of time.

(D) Dissolution of company.

Ans: (A) Agreement.

89. As per the Right to Information Act, 2005 first appeal shall be disposed off by the first appellate authority within ________ days from the date of its receipt.

(A) 40 Days.

(B) 30 Days.

(D) 50 Days.

Ans: (B) 30 Days.

90. A limited liability partnership is to have at least two members as per section ________ of LLP Act, 2008.

(A) 14.

(B) 13.

(D) 6.

Ans: (D) 6.

91. Which of the following is not an ‘Agricultural Income’ under Income Tax Act, 1961?

(A) Sale of replanted trees.

(B) Income from growing flowers and creepers.

(D) Income from supply of water from a tank in agricultural land.

Ans: (D) Income from supply of water from a tank in agricultural land.

92. Mr. Rajesh is Indian citizen, went to Canada for the first time for the purpose of employment on 10^th May, 2018. He came back to India on 19th Nov., 2018. His residential status for the assessment year 2019-20 will be:

(A) Resident.

(B) Non-resident.

(D) Foreign citizen.

Ans: (B) Non-resident.

93. Which of the following allowances is not taxable in the hands of employee?

(A) City compensatory allowance.

(B) Tiffin allowance.

(D) Allowance from UNO in India.

Ans: (D) Allowance from UNO in India.

94. Which of the following income will be taxable as income from house property?

(A) Letting of farm house.

(B) Letting of an office building.

(D) Sub-letting of house.

Ans: (B) Letting of an office building.

95. Mr. Anil is carrying on manufacturing business of engineering goods. His data regarding machinery used for business is as follows:

Date

Particulars

Amount

1-4-18

30-9-18

10-11-18

Opening W.D.V.

Machinery sold at (Book value Rs. 2,50,000)

New Machinery purchased

15,00,000

3,00,000

6,00,000

Depreciation u/s 32 of Income Tax Act, 1961 will be:

(A) Rs. 2,85,000.

(B) Rs. 2,25,000.

(D) Rs. 4,27,000.

Ans: (A) Rs. 2,85,000.

96. Which of the following is not an ‘unpaid statutory liability’ at the end of previous year u/s 43-B of the Income Tax Act, 1961?

(A) G.S.T.

(B) Interest on term loan from scheduled bank.

(D) Interest on cash credit from a small cooperative bank.

Ans: (D) Interest on cash credit from a small cooperative bank.

97. Profit on transfer of whole undertaking as a going concern as a slum sale after five years of setting up of a business is taxable as:

(A) Short-term capital gain.

(B) Long-term capital gain.

(D) Income from other sources.

Ans: (B) Long-term capital gain.

98. Mr. Kumar sold his residential house property at Pune Rs. 18,00,000 on 23rd April, 2017, which was purchased by him on 11th April, 2014 for Rs. 9,70,000. Value opted for stamp duty purpose was Rs. 26,40,000. On June 16, 2017, he purchased a house at Kolhapur for Rs. 10,00,000 for the purpose of residence of his daughter. What will be the capital gain taxable in his hand for the assessment year 2018-19. C.I. for F.Y. 2017-18 was 272:

(A) Rs. 3,05,133.

(B) Rs. 8,30,000.

(D) Rs. 16,70,000.

Ans: (C) NIL.

99. Maximum deduction for medical expenditure on the health of senior citizen person, if Mediclaim insurance is not paid on his health, for A.Y. 2019-20 is:

(A) Rs. 25,000.

(B) Rs. 30,000.

(D) Actual expenditure incurred.

Ans: (C) Rs. 50,000.

100. Techno India (Pvt.) Ltd. an Indian company purchased goods from Jems Ltd. U.K. an associated enterprise at Rs. 3,000 per piece. The following arm’s length prices have been determined by the most appropriate method:

Situation

Price

2,890

3,050

2,700

2,940

The arm length price assuming international transaction is not in respect of wholesale trading will be:

(A) Rs. 3,000.

(B) Rs. 2,895.

(D) Rs. 2,940.

Ans: (B) Rs. 2,895.

MAHA SET Commerce Solved Paper JUNE 2019 [Paper II-A]