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Francis Aguilar has introduced PEST Analysis. In his book, "Scanning the Business
Environment" he mentioned a scanning tool called ________ .The name was
later changed to the current acronym.
Options:
(a) ETPS
(b) STPE
(c) PTES
(d) EPTS
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Correct Option/Answer: (a)
Explanation: PEST Analysis is an industry analysis tool which checks all the
external factors which affects any business like political, economic, social and
technological factors.
PEST Analysis (political, economic, social and technological) is a management
method whereby an organization can assess major external factors that influence
its operation in order to become more competitive in the market. As described by
the acronym, those four areas are central to this model.

Assertion: BCG matrix classifies business portfolio into five categories.
Reason: The general purpose of the analysis is to help understand, which brands
the firm should invest in and which ones should be divested.
Options:
(a) (A) and (R) are correct and (R) is the correct explanation of (A)
(b) (A) and (R) are correct and (R) is not the correct explanation of (A)
(c) (A) is correct and (R) is incorrect
(d) (A) is incorrect and (R) is correct

Correct Option/Answer: (d)
Explanation: BCG matrix is a matrix used to find out the business position. It
divides the business into four categories based on industry attractiveness and
competitive position. It has 4 divisions which are a dog, cash cow, question mark,
and star.

What is the BCG matrix in marketing?
The Boston Consulting group's product portfolio matrix (BCG matrix) is designed
to help with long-term strategic planning, to help a business consider growth
opportunities by reviewing its portfolio of products to decide where to invest, to
discontinue or develop products. It's also known as the Growth/Share Matrix.
BCG matrix (also referred to as Growth-Share Matrix) is a portfolio
planning model used to analyse the products in the business's portfolio according
to their growth and relative market share. The model is based on the observation
that a company's business units can be classified into four categories: Cash Cows.
Stars

What is the full form of SPACE matrix?
Options:
(a) Simple Position & Action Evaluation matrix
(b) Strategic Position & Achievement Evaluation matrix
(c) Strategic Position & Action Evaluation matrix
(d) Strategic Position & Action Estimation matrix

Correct Option/Answer: (c)
Explanation: The Strategic Position & Action Evaluation matrix or a SPACE matrix
is a strategy formulation tool. The SPACE matrix can be used as a base for other
tools as well, such as the SWOT analysis, BCG matrix model, industry analysis.
What is the space matrix?
The SPACE matrix is a management tool used to analyze a company. It is used to
determine what type of a strategy a company should undertake. ... The SPACE
matrix can be used as a basis for other analyses, such as the SWOT analysis,
BCG matrix model, industry analysis, or assessing strategic alternatives (IE matrix).

What are the 7S in McKinsey 7S Framework?
Options:
(a) Strategy, Scope, Systems, Style, Staff, Skills, Shared Values
(b) Strategy, Structural Support, Systems, Soft skill, Staff, Skills, Shared Values
(c) Strategy, Structure, Systems, Style, Staff, Skills, Shared Values
(d) Strategy, Structure, Systems, Style, Staff, Setting, Shared Values

Explanation: The 7S in McKinsey 7S Framework are Strategy, Structure, Systems,
Style, Staff, Skills and Shared Values.
What are the elements of McKinsey 7S model?
The McKinsey 7S Model refers to a tool that analyzes a company's “organizational
design.” The goal of the model is to depict how effectiveness can be achieved in
an organization through the interactions of seven key elements – Structure,
Strategy, Skill, System, Shared Values, Style, and Staff.

Why McKinsey 7S model is used?
Using the McKinsey 7-S Model. You can use it to identify which elements you
need to realign to improve performance, or to maintain alignment and
performance during other changes. These changes could include restructuring,
new processes, an organizational merger, new systems, and change of leadership.

What does McKinsey and Company do?
McKinsey & Company is a global management consulting firm that serves leading
businesses, governments, non governmental organizations, and not-for-profits.
We help our clients make lasting improvements to their performance and realize
their most important goals.

Brand equity model identifies five brand equity components. They are:
Options:
(a) Brand Loyalty, Brand Awareness, Perceived Quality, Brand Associations,
Proprietary Assets
(b) Brand Loyalty, Brand Value, Perceived Quality, Brand Associations, Proprietary
Assets
(c) Brand Loyalty, Brand Awareness, Perceived Service, Brand Associations,
Proprietary Assets
(d) Brand Loyalty, Brand Awareness, Perceived Quality, Brand Image, Proprietary
Assets

Explanation: David Aaker developed a brand equity model (also called Five Assets
Model) in which he identifies five brand equity components − Brand Loyalty, Brand
Awareness, Perceived Quality, Brand Associations, Proprietary Assets.
What is Aaker's Brand Equity Model?
In his Brand Equity model, David A. Aaker identifies five brand
equity components: (1) brand loyalty, (2) brand awareness, (3) perceived quality,
(4) brand associations and (5) other proprietary assets. These assets
include brand loyalty, name awareness, perceived quality and associations. .

What is Aaker brand equity model?
Aaker defines brand equity as the set of brand assets and liabilities linked to
the brand – its name and symbols – that add value to, or subtract value from, a
product or service. ... These assets include brand loyalty, name awareness,
perceived quality and associations.
Aaker summarized his Brand Identity System as a model. Each brand can employ
one or many of these dimensions of identity. Each organization should, however,
consider all of the dimensions in the development of a differentiated brand
identity. Brand identity consists of a core identity and an extended identity.

Keller’s Brand Equity Model is also known as:
Options:
(a) Five Assets Model
(b) Customer Based Brand Equity (CBBE) model
(c) Brand Extension Model
(d) Brand Equity Models

Correct Option/Answer: (b)
Explanation: Kelvin Lane Keller gave the brand equity model known as Keller’s
Brand Equity model which states that the power of a brand is what the consumer
has heard, learned, felt, and seen as a brand over time. This model is also termed
as a Customer-Based Brand Equity model.

What is Keller's brand equity model?
Overview. Keller's Brand Equity Model is also known as the Customer-
Based Brand Equity (CBBE) Model. ... You have to build the right type of
experiences around your brand, so that customers have specific, positive
thoughts, feelings, beliefs, opinions, and perceptions about it.

Which of the following statements regarding Retail outlets are correct?
(i) A discount store is a set-up which offers a wide range of products to the end-users under
one roof.
(ii) The department stores generally offer a limited range and the quality in certain cases might
be a little inferior as compared to the department stores.
(iii) A retail store which generally sells food products and household items, properly placed and
arranged in specific departments is called a supermarket.
(iv) A retail format which sells limited stock in bulk at a discounted rate is called a warehouse
store.
Options:
(a) (i) (ii) (iii) (iv)
(b) (iii) (iv)
(c) (i) (ii) (iii)
(d) only (iv)

Explanation:
A department store offers a wide range of products to customers under one roof.
In a department store, the consumers can get almost all the products they aspire
to shop at one place only. Discount stores also offer a huge range of products to
the customers but at a discounted rate. The discount stores generally offer a
limited range and the quality might be a little inferior as compared to the
department stores.

Question: In __________ an activity level is determined at which all relevant
costs are recovered and there is a situation of no profit or no loss. This activity
level is called breakeven point.
Options:
(a)CVP/BEP analysis
(b)Marginal Cost
(c)Margin of Safety
(d)Stock Valuation

Explanation: In break-even analysis or CVP analysis an activity level is determined
at which all relevant costs are recovered and there is a situation of no profit or no
loss. This activity level is called breakeven point. Cost–volume–profit (CVP)
analysis is defined as the study of the effects on future profit of changes in fixed
cost, variable cost, sales price, quantity and mix.
Break-even analysis, a subset of cost-volume-profit (CVP) analysis, is used by
management to help understand the relationships between cost, sales volume
and profit. This techniques focuses on how selling prices, sales volume, variable
costs, fixed costs and the mix of product sold affects profit.

Material Usage Variance=
Options:
(a)(Standard Quantity*Actual Price) – (Actual Quantity*Actual Price)
(b) (Standard Quantity*Standard Price) – (Actual Quantity*Actual Price)
(c) (Actual Quantity*Standard Price) – (Standard Quantity*Standard Price)
(d) (Standard Quantity*Standard Price) – (Actual Quantity*Standard Price)

Explanation: The materials usage variance is favorable when the actual quantity of
materials used is less than the standard quantity of material. The materials usage
variance is unfavorable when the actual quantity of materials is more than the
standard quantity of materials.

Which assumption regarding Net Income Approach of Capital Structure is not
correct?
Options:
(a) The total capital requirement of the firm is given and remains constant.
(b) Cost of debt (Kd) is less than cost of equity (Ke).
(c) Cost of equity (Ke) is less than cost of debt (Kd).
(d) Both Kd and Ke remain constant

Explanation: According to the NOI approach, there is a relationship between
capital structure and the value of the firm, it means that the firm value can
change if the debt proportion in capital structure gets changed. The Net Income
Approach makes the following assumptions:
1. The total capital requirement of the firm is given and remains constant.
2. The cost of debt (Kd) is less than the cost of equity (Ke).
3. Both Kd and Ke. remain constant

The popular approach used to estimate the cost of equity using the below
formula is:
Ke = Rf + (Rm - Rf ) ß
Options:
(a) Bond Yield Plus Risk Premium Approach
(b) CAPM model
(c) Dividend Growth Model Approach
(d) Earnings-Price Ratio approach

Correct Option/Answer:(b)
Explanation: CAPM is a method used to calculate cost of equity. According to the
CAPM, the cost of equity capital is:
Ke = Rf + (Rm - Rf ) ß
Where:
Ke = Cost of equity
Rf = Risk-free rate
Rm = Equity market required return (expected return on the market portfolio)
ß = beta is Systematic Risk Coefficient.

The statement which is correct regarding suitability of using NPV method is:
Options:
(a) Where the firms suffers from liquidity problem and is interested in quick
recovery of fund than profitability
(b) High external financing cost of the project
(c) For projects involving very uncertain return
(d) Where availability of resources is not a constraint

Explanation: NPV method is used in a firm where there is a large
amount of financial resources.

Question: What is the right sequence of Capital Budgeting Processes?
(a) Identification of Investment Opportunities, Assembling Investment Proposals,
Budgeting Capital Expenditure, Decision Making, Implementation and Controlling of
Projects, Follow-up and Performance Report
(b) Assembling Investment Proposals, Identification of Investment Opportunities,
Decision Making, Budgeting Capital Expenditure, Implementation and Controlling of
(c) Identification of Investment Opportunities, Assembling Investment Proposals,
Decision Making, Implementation and Controlling of Projects, Budgeting Capital
Expenditure, Follow-up and Performance Report
(d) Identification of Investment Opportunities, Assembling Investment Proposals,
Decision Making, Budgeting Capital Expenditure, Implementation and Controlling of

Explanation: Capital budgeting consists of planning how to use finance for the
maximization of long-term profitability. The Capital Budgeting process is
Identification of Investment Opportunities, Assembling Investment Proposals,
Decision Making, Budgeting Capital Expenditure, Implementation and Controlling
of Projects, Follow-up, and Performance Report.

Question: Which of the following statements is the assumption of Gordon’s
Model?
Options:
(a) A corporate tax does exist
(b) The firm has a very long or infinite life
(c) The retention ratio (b) once decided upon is constant
(d) The firm finances all investment through retained earnings; that is debt or new
equity is not issue

Explanation: Gordon’s Model is the relevance theory of the firm which states that
the use of debt has a direct impact on the value of the firm. This model which
opines that the dividend policy of a firm affects its value of the share and firm is
based on the following assumptions:
(a) The firm is an all-equity firm.
(b) There is no outside financing and all investments are financed exclusively by retained
earnings.
(c) The internal rate of return of the firm is constant.
(d) The cost of capital (k) of the firm also remains.
(e) The firm derives its earnings in perpetuity.
(f) The retention ratio (b) once decided upon is constant. Thus the growth rate of frim (g) is also
constant (g=br).
(g) ke >g.
(h) A corporate tax does not exist

It occurs when someone purchases a company using almost entirely debt. The
purchaser secures that debt with the assets of the company they're acquiring
and it (the company being acquired) assumes that debt.
Options:
(a) Leveraged Buyout
(b)Takeover
(c)Merger
(d)Acquisition

Explanation: A leveraged buyout (LBO) occurs when someone purchases a
company using debt only. The purchaser secures that debt with the assets of the
company they're acquiring

What is LBO and MBO?
A management buyout (MBO) is a corporate finance transaction where the
management team of an operating company acquires the business by borrowing
money to buy out the current owner(s). An MBO transaction is a type of leveraged
buyout (LBO) and can sometimes be referred to as a leveraged management
buyout (LMBO).
A leveraged buyout (LBO) is the acquisition of another company using a
significant amount of borrowed money to meet the cost of acquisition. The assets
of the company being acquired are often used as collateral for the loans, along
with the assets of the acquiring company.

Why Leveraged buyouts are bad?
Criticisms-of-leveraged-buyouts
The risks of a leveraged buyout for the target company are also high. Interest
rates on the debt they are taking on are often high, and can result in a lower
credit rating. If they're unable to service the debt, the end result is bankruptcy.

Who developed the first modern portfolio analysis model?
Options:
(a) William F Sharpe
(b) Dr. Harry M. Markowitz
(c) John Linter
(d) Jan Mossin

Explanation: Dr. Harry M. Markowitz is credited with developing the first modern
portfolio analysis model. It provides a theoretical framework for analysis of risk-
return choices. The concept of efficient portfolios has been used in this model. A
portfolio is efficient when it gives the highest return for a particular level of risk.

Who invented modern portfolio theory?
Harry Markowitz
Invented by Harry Markowitz in the 1950s, MPT is based on several key
principles: Portfolios are described by various levels of expected risk and return.
Who is the father of modern portfolio theory?
Harry Markowitz
Modern portfolio theory, introduced by Harry Markowitz in 1952, is
a portfolio construction theory that determines the minimum level of risk for an
expected return. It assumes that investors will favor a portfolio with a lower risk
level over a higher risk level for the same level of return.

Question: The risk penalty formula is:
Options:
(a) Risk penalty = Risk squared/Risk tolerance
(b) Risk penalty = Risk tolerance/ Risk squared
(c) Risk penalty = Risk covered/Risk tolerance
(d) Risk penalty = Risk squared/Risk coverage

Explanation: Risk penalty = Risk squared/Risk tolerance
Risk squared is the variance of return of the portfolio. Risk tolerance is a number
from zero through 100. The size of the risk tolerance number reflects the
investor’s willingness to bear more risk for more return. Low (high) tolerance
indicates low (high) willingness. Risk penalty is less as tolerance is increased.

How is risk tolerance calculated?
risk tolerance (the degree of uncertainty you are willing to take on to achieve
potentially greater rewards) is determined by a combination of factors, including
your investment goals and experience, how much time you have to invest, your
other financial resources and your “fear factor.”
What are the different levels of risk tolerance?
There are three basic levels of risk tolerance: aggressive, moderate and
conservative.

What are the two fundamental types of risk?
Broadly speaking, there are two main categories of risk: systematic and
unsystematic.
What is systematic and unsystematic risk?
While systematic risk can be thought of as the probability of a loss that is
associated with the entire market or a segment thereof, unsystematic risk refers
to the probability of a loss within a specific industry or security.
Examples of systematic risks include: Macroeconomic factors, such as inflation,
interest rates, currency fluctuations. Environmental factors, such as climate
change, natural disasters, resource, and biodiversity loss. Social factors, such as
wars, changing consumer perspectives, population trends.
unsystematic risk can be eliminated through diversification of a portfolio.

The Practice of Management written by __________.
A. Peter F. Drucker.
B. Terry.
C. Louis Allan.
D. Henry Fayol.

Which management thinker has written the book titled The Practice of
Management?
About the Author
Peter F. Drucker is considered the most influential management thinker ever. The
author of more than twenty-five books, his ideas have had an enormous impact
on shaping the modern corporation. Drucker passed away in 2005.
Peter F. Drucker is considered the most influential management thinker ever. The
author of more than twenty-five books, his ideas have had an enormous impact
on shaping the modern corporation.

Espirit de corps means______________.
A. union is strength.
B. service is our motto.
C. buyer beware.
D. product is our strength.

A. union is strength.
What is the origin of esprit de corps?
If you've ever been on a sports team that had great morale and team spirit, you've
experienced esprit de corps. The term is French, and it literally means "the spirit
of the body," with body in this case meaning "group." Originally, esprit de
corps was used to describe the morale of military troops.

General and Industrial Management was written
by_________________.
A. Harold Koontz.
B. Terry.
C. Louis Allan.
D. Hendry Fayol.

D. Hendry Fayol.
When was general and industrial management published?
1916
General and Industrial Management/Originally published
Fayol's work became more generally known with the 1949 publication of "General
and industrial administration", the English translation of the 1916 work
"Administration industrielle et générale". In this work Fayol presented his theory
of management, known as Fayolism.

Study of the movements of both the workers and the machine to
eliminate wasteful movement is
_____________.
A. fatigue study.
B. time study.
C. motion study.
D. work-study.

C. motion study.
Motion study is a systematic way of determining the best method of
doing the work by scrutinizing the motions made by the worker or
the machine. As per Gilbreath it is the science of eliminating the
wastefulness due to unnecessary motions. He was interested in
finding the one best way to do the job.
What is the purpose of motion study?
The main aim of motion study is to find the scheme of least wastage
of labour. Subsequently, the scope of Motion Study was enlarged
and it was named as Method Study.

Who has given the motion study?
Frank B. Gilbreth
Motion study was developed by Frank B. Gilbreth and Lillian M. Gilbreth and
consists of a wide variety of procedures for the description, systematic analysis,
and means of improving work methods. It is difficult to separate these two
aspects completely.

Who is known as the father of motion study?
Frank Bunker Gilbreth
Frank Bunker Gilbreth (July 7, 1868 – June 14, 1924) was an American engineer,
consultant, and author known as an early advocate of scientific management and
a pioneer of time and motion study, and is perhaps best known as the father and
central figure of Cheaper by the Dozen.

Who invented time study?
Frederick Winslow Taylor
A time and motion study (or time-motion study) is a business efficiency technique
combining the Time Study work of Frederick Winslow Taylor with the
Motion Study work of Frank and Lillian Gilbreth (the same couple as is best known
through the biographical 1950 film and book Cheaper by the Dozen).

A study relating to the fixing of the working hours with rest periods
to recoup the energy while performing
in a job is called ____________.
A. fatigue study.
B. time study.
C. motion study.
D. work-study.

A. fatigue study.
The main objective of fatigue study is to determine the amount and frequency of
the break time or rest intervals in order to complete a task or the job. It is
mainly done in order to improve and boost the efficiency level of the staff or
the employees.
Who introduced the studies of fatigue and motion?
Frank B. and Lillian M. Gilbreth, Fatigue Study: The Elimination of Humanity's
Greatest Waste; A First Step in Motion Study (New York, 1919; 1st edition, New
York, 1916).

What is fatigue study in management?
Fatigue study determines breaks or intervals which are required during work. It is
natural that if a worker works continuously, then fatigue sets in. This leads to the
reduction in efficiency. Every worker requires regular rest or breaks.
Who is the father of time study?
Fredrick Winslow Taylor
Fredrick Winslow Taylor: The Father of Time and Motion Theories. He is most
remembered for his time and motion study. He proposed to break a job into its
segment parts and measure each to the second. One of his most
famous studies involved shovels.

The critical assumption of CAPM is:
Options:
(a) Transaction costs are high
(b) Assets cannot be bought and sold
(c) The investor is limited by his wealth and the price of the asset only
(d) Taxes do affect the choice of buying assets

Explanation: The CAPM assumptions are:
1. –The investor is limited by his wealth and the price of the asset only.
2. – Taxes do not affect the choice of buying assets.
3. – All individuals assume that they can buy the assets at the going market price and they
all agree on the nature of the return and risk associated with each investment.
4. --Investors are risk averse and use the expected rate of return and standard deviation of
return as appropriate measures of risk and return for their portfolio.
5. – Investors make their investments decisions based on a single period horizon which is
the immediate next time period.
6. --Transaction costs are either absent or so low that these can be ignored.
7. – Assets can be bought and sold in any desired unit.

Economic Value Added is defined as:-
Options:
(a) EVA= Gross Profit - Taxes - Cost of Capital
(b) EVA= Net Operating Profit - Taxes
(c)EVA= Net Operating Profit - Taxes - Cost of Capital
(d) EVA= Net Operating Profit - Cost of Capital

Explanation: Economic Value Added is defined as net operating
profit after taxes and after the cost of capital. The cost of capital is
the rate of return required by the shareholders and lenders to
finance the operations of the business. Capital includes cash,
inventory, and receivables, plus equipment, computers and real
estate.

What is economic value added?
Economic value added (EVA) is a measure of a company's financial performance
based on the residual wealth calculated by deducting its cost of capital from its
operating profit, adjusted for taxes on a cash basis.

1. (iii) (ii) (iv) (i)
2. (ii) (i) (iv) (iii)
3. (i) (iii) (iv) (ii)
4. (iv) (iii) (i) (ii)
Future Contract A contract is an agreement between two parties in which one party agrees to buy from
the seller an underlying at a later date for a price established at the start of the contract.
Forward Contract A contract is similar to a forward contract in that it is an agreement that obligates the
seller, at a specified future date, to deliver to the buyer a specified underlying in
exchange for the specified futures price.
Option Contract They are typically derivatives in which two parties exchange (swap) cash flows or other
financial instruments over multiple periods (months or years) for mutual benefit,
usually to manage risk.
Swap Contract It give one party (the buyer) to the contract the right to demand an action from the
other party (the seller) in the future.

Explanation:
A forward contract is an agreement between two parties in which one party
agrees to buy from the seller an underlying at a later date for a price established
at the start of the contract.
A futures contract is similar to a forward contract in that it is an agreement that
obligates the seller, at a specified future date, to deliver to the buyer a specified
underlying in exchange for the specified futures price.
Options give one party to the contract the right to demand action from the other
party in the future.
Swaps are derivatives in which two parties exchange cash flows or other financial
instruments over multiple periods for mutual benefit.

What is difference between forward contract and future contract?
A forward contract is a private and customizable agreement that settles at the
end of the agreement and is traded over-the-counter. A futures contract has
standardized terms and is traded on an exchange, where prices are settled on a
daily basis until the end of the contract.

What is call and put option?
What are calls and puts? From a buyer's perspective, a call gives you the right to
buy an underlier at a predetermined price from the seller on a particular date.
A put gives you the right to sell an underlier at a preset price on a particular date
to the seller.
Options are financial instruments that are derivatives based on the value of
underlying securities such as stocks. ... Call options allow the holder to buy the
asset at a stated price within a specific timeframe. Put options allow the holder to
sell the asset at a stated price within a specific timeframe.

Is Options Trading Better Than Stocks?
Options can be less risky for investors because they require less financial
commitment than equities, and they can also be less risky due to their relative
imperviousness to the potentially catastrophic effects of gap
openings. Options are the most dependable form of hedge, and this also makes
them safer than stocks.

Question: The correct sequence of evolution of marketing concepts?
Options :
(a) The Production Concept, The Selling Concept, The Marketing Concept, The
Societal Marketing Concept, The Product Concept
(b) The Product Concept, The Selling Concept, The Marketing Concept, The
Production Concept, The Societal Marketing Concept
(c) The Production Concept, The Product Concept, The Selling Concept, The
Marketing Concept, The Societal Marketing Concept
(d) The Production Concept, The Product Concept, The Marketing Concept, The
Selling Concept, The Societal Marketing Concept

Explanation:
Evolution of marketing concepts in correct order is
1. The Production Concept
2. The Product Concept
3. The Selling Concept
4. The Marketing Concept
5. The Societal Marketing Concept

1. (iii) (ii) (iv) (i)
2. (ii) (i) (iv) (iii)
3. (i) (iii) (iv) (ii)
4. (iv) (iii) (i) (ii)
Product Mix Explanation
Product Width It refers to the total number of products within a product line
Product Length It refers to how closely products are linked to each other
Product Depth It refers to the total number of products in the mix
Product Consistency It refers to the number of product lines the company has to
offer

Explanation: The width of the mix refers to the number of product lines the
company is offering. Length of the product mix refers to all the products in the
mix. The depth of the product mix refers to the total number of products within a
product line. Product mix consistency refers to how closely products are related to
each other.

A __________ is attacking a competitor ahead on by producing
similar products with similar quality and price.
Options:
(a) Flank Attack
(b) Frontal Attack
(c) Encirclement Attack
(d) Bypass Attack

Explanation: A frontal attack is attacking a competitor directly by producing similar
products with similar quality and price. Example- Pepsi & Coca Cola.

What is frontal attack in marketing?
A frontal attack strategy in marketing focuses on a challenger taking on
the market leader head-on. This means focusing on your competitors' strengths
and matching your own pricing, products, marketing, and promotions to the
leading brand.
flank attack in marketing
a competitive marketing strategy in which one company attacks another in a
weak spot, commonly by paying maximum attention to either a geographic region
or a market segment in which the rival is under-performing.

What is encirclement attack in marketing?
a competitive strategy used by a strong challenger to attack the market leader;
the market challenger launches an attack on several fronts at once in an attempt
to break the leader's grip on the market.
Bypass Attack marketing
The Bypass Attack is the most indirect marketing strategy adopted by the
challenging firm with a view to surpassing the competitor by attacking its easier
markets. The purpose of this strategy is to broaden the firm's resources by
capturing the market share of the competing firm.

Apollo Hospital may offer a bank, bookstore, coffee shop, restaurant, drug store
in their compound for the visitors to the hospital. What type of strategy is it?
Options:
(a) Conglomerate or unrelated diversification
(b) Internationalization
(c) Horizontal Diversification
(d) Stability Strategies

Correct Option/Answer: (C)
Explanation: Horizontal Diversification means providing new products or services
to present customers. Apollo Hospital may offer a bank, bookstore, coffee shop,
restaurant, drug store in their compound for the visitors to the hospital.

Why is a conglomerate or unrelated diversification strategy is adopted?
Conglomerate diversification occurs when a firm diversifies into areas that
are unrelated to its current line of business. Synergy may result through the
application of management expertise or financial resources, but the primary
purpose of conglomerate diversification is improved profitability of the acquiring
firm.
Diversifying as a conglomerate is also called unrelated diversification.
... Conglomerates spread risk across one or more industries, reducing company-
wide sales and profit fluctuations due to seasonal or cyclical
risk. Conglomerates can experience difficulties due to management's lack of
multi-industry knowledge.

Horizontal diversification
Horizontal diversification includes providing new and unrelated products or
services to an existing consumer. It also means adding products or services to the
product or service line already existing. After adding, the existing marketing,
technical, and financial expertise is also applied to the new products.
Horizontal Diversification. To diversify your company horizontally means
introducing brand new products or services to your current offering in order to
expand market share, either in a new market segment or your company's existing
market.

Porter’s 5 Forces was introduced by Michael Porter in his 1980 book. What is the
name of the book?
Options:
(a) Fewer, Bigger, Bolder: From Mindless Expansion to Focused
(b) Competitive Strategy: Techniques for Analyzing Industries and Competitors
(c) Business Strategy: Managing Uncertainty, Opportunity, and Enterprise
(d) Tilt: Shifting Your Strategy from Products to Customers

Explanation: The industry analysis model which is Porter’s 5 Forces, was
introduced by Michael Porter in his 1980 book “Competitive Strategy: Techniques
for Analyzing Industries and Competitors.”
Porter's Five Forces is a business analysis model that helps to explain why various
industries are able to sustain different levels of profitability. The model was
published in Michael E. Porter's book, "Competitive Strategy: Techniques for
Analyzing Industries and Competitors" in 1980.

Match List-I with List-II
Choose the correct code
1. a-iv, b-i, c-ii, d-iii
2. a-i, b-ii, c-iii, d-iv
3. a-iv, b-iii, c-ii, d-i
4. a-iv, b-ii, c-i, d-iii

AnsA
Sol
1. ● AS 6 deals with accounting for depreciation.
2. ● AS 10 deals with accounting for fixed assets.
3. ● AS 21 deals with accounting for consolidated financial statements
4. ● AS 3 deals with accounting for cash flow statements.
Thus, Option A is correct.

Statement I: The values that are most important or most desirable like happiness,
self-respect, recognition are Instrumental values.
Statement II: The values which views on acceptable modes, which are the means
of achieving happiness, self-respect are Terminal values.
Choose the correct option from those below:
1. Statement I is correct, Statement II is incorrect.
2. Statement I is incorrect, Statement II is correct.
3. Both Statement I and Statement II are correct.
4. Both Statement I and Statement II are incorrect.

Ans D
Types of values includes:
● Instrumental values-The acceptable behaviours which are the means to reach
the goal. It is the medium of achieving the goals. It is permanent in nature and
practiced in day to day life.
● Terminal values-It represents the goals which are to be achieved. They are
desirable states of existence. Those things that we can work towards or we think
are most important and we feel more desirable.
Thus, option D is correct.

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