Chapter 4 - Social Responsibility Of Business
Organisation of Commerce Management Solutions for Class 12 Commerce Business studies
Select the proper option from the option given below and rewrite the completed sentences.
Businessmen are ________ of the society.
(a) Representatives
(b) Members
(c) Trustees
Answer: Correct option- c
Businessmen are trustees of the society.
Explanation: Businessmen are trustees of the society. This means that the relationship of a business with the society is based on trust. In other words, businessmen carry out activities that are morally and legally correct. This is also referred to as the theory of trusteeship.
In modern business environment, ________ provides more opportunities and challenges.
(a) Privatization
(b) Globalization
(c) Specialization
Answer: Correct option- b
In modern business environment, globalisation provides more opportunities and challenges.
Explanation: Globalisation can be defined as the opening up of the world economies to each other. With globalisation, the whole world has become one market. It provides more opportunities to businessmen, as they can procure raw materials and labour at a cheaper rate from anywhere in the world. It is also a challenge, as it infuses competition in the market.
Business organization should try to make ________ utilization of natural resources.
(a) minimum
(b) maximum
(c) optimum
Answer: Correct option- c
Business organisation should try to make optimum utilisation of natural resources.
Explanation: Optimal utilisation means there should be minimum wastage of natural resources. The society supports the existence and growth of every business. It provides natural resources that are utilised to run the business. Therefore, it is the responsibility of business organisations to utilise the available resources optimally. Optimal utilisation also ensures sustained business growth.
Business is a ________ activity.
(a) Socio-economic
(b) Industrial
(c) Profit making
Answer: Correct option- a
Business is a socio-economic activity.
Explanation: The primary objective of any business enterprise is profit maximisation. Profit acts as a measure of success. However, it is argued that business enterprises are not just profit-making entities. They also fulfil the duties and responsibilities towards society, as their members carry out activities that are favourable to the society. Thus, a business activity has economic as well as social goals. Therefore, it is regarded as a socio-economic activity.
Location of industries should be in ________ zones.
(a) Residential
(b) Industrial
(c) Commercial
Answer: Correct option- b
Location of industries should be in industrial zones.
Explanation: Industries should be set up in industrial zones because of the following reasons:
i. To minimise the adverse effects of industries in residential areas.
ii. To avoid congestion in cities.
For economic growth and national security, ________ stability is required.
(a) Political
(b) Social
(c) Natural
Answer: Correct option- a
For economic growth and national security, political stability is required.
Explanation: Political stability is essential for economic growth, as it provides a conducive environment to the potential investors which assure them high returns at a lower degree of risk. Besides this, national security also calls for political stability, as frequent changes in power lead to changes in the country’s external policies and international relationships.
Business organization is a part of ________.
(a) Industry
(b) Government
(c) Society
Answer: Correct option- c
Business organisation is a part of society.
Explanation: The society supports the existence and growth of business organisations, as it provides raw materials and labour that are used in the production of goods and services. These goods and services are sold in the society by the business firms at a profit. Thus, it is said that a business is a part of society.
To make timely payment of proper taxes is the responsibility of organization towards ________.
(a) Shareholders
(b) Customers
(c) Government
Answer: Correct option- c
To make timely payment of proper taxes is the responsibility of organisation towards government.
Explanation: The government levies various taxes such as corporate tax, sales tax and excise duty on business units. It is the responsibility of the business units to timely pay these taxes. This tax revenue is used by the government to provide infrastructure and other facilities to the public.
Ultimate goal of business must be satisfaction of ________.
(a) Shareholders
(b) Consumers
(c) Owners
Answer: Correct option- b
Ultimate goal of business must be satisfaction of consumers.
Explanation: Customer satisfaction should be the ultimate goal of business organisations. Businesses should not indulge in customer exploitation, as a good customer experience enables them to generate repetitive orders. A business unit exists because of customers only. Bad customer experiences can affect the demand of goods and services adversely.
To maintain industrial peace is the responsibility of organization towards ________.
(a) Customers
(b) Employees
(c) Society
Answer: Correct option- b
To maintain industrial peace is the responsibility of organisation towards employees.
Explanation: Promoting peace is the responsibility of every organisation towards its employees. This can be achieved through the formation of an effective trade union. A trade union should comprise people who can resolve the problems of workers or employees through meetings, negotiations or talks with the management.
Business or organization should protect health and provide safety measures to ________.
(a) Employees
(b) Shareholder
(c) Customers
Answer: Correct option- a
Business or organisation should protect health and provide safety measures to employees.
Explanation: Business organisations should provide proper medical, canteen and sanitation facilities to their employees. They should also ensure the safety of employees through regular maintenance of machines to prevent accidents. A healthy employee will always be more productive and the organisation which takes care of its employees' needs will earn a reputation in the market.
To maintain safety of investment is the responsibility of business towards _______.
(a) Community
(b) Investors
(c) Employees.
Answer: Correct option- b
To maintain safety of investment is the responsibility of business towards investors.
Explanation: Investors provide finance to the business organisations which is essential for the working of any organisation. In return, the business should also ensure that their investment is secured and should invest in those avenue which is likely to bring high returns.
Business organization can maximize profitability by ________ wastage.
(a) Ignoring
(b) Utilizing
(c) Minimizing
Answer: Correct option- c
Business organisation can maximise profitability by minimising wastage.
Explanation: Minimising wastage means optimum utilisation of resources which means that the available resources are utilised to the maximum. This reduces the cost of production thereby resulting in higher profits.
Business should provide periodic information to ________.
(a) Customers
(b) Owners
(c) Employees
Answer: Correct option- b
Business should provide periodic information to owners.
Explanation: Owners refer to the shareholders of the business. They provide capital to the business. It is the responsibility of a business organisation to provide periodic information to its owners. In other words, a business organisation should provide complete and accurate data about its progress and financial position to its owners. This can be done through periodic reports, statement of profits, etc.
Business ethics refers to the system of _______ principles.
(a) Economic
(b) Social
(c) Moral
Answer: Correct option- c
Business ethics refers to the system of moral principles.
Explanation: Business ethics can be defined as the code of conduct that a business organisation must follow. Such a set of rules is desirable from the viewpoint of the society. The purpose of business ethics is to ensure that the managers and other employees in an organisation perform their jobs in a socially acceptable manner.
Business ethics is a ________ structured examination of the behaviour of people.
(a) Moral
(b) Critical
(c) Economical
Answer: Correct option- b
Business ethics is a critical, structured examination of the behaviour of people.
Explanation: Business ethics has two types of elements: critical and structured. It is critical in the sense that it deals with the benefits of morality and examines the behaviour of people by analysing their values. It is structured, as it talks about higher order, rationalisation and unified moral duties.
Business organization should not create _________ profit.
(a) Reasonable
(b) Secret
(c) Maximum
Answer: Correct option- b
Business organisation should not create secret profit.
Explanation: Making secret profits is against the ethical code of conduct. Business organisations should maintain trust and honesty with everyone. An organisation should work with full trustworthiness and maintain transparency.
Business organization should avoid creation of ________.
(a) Trade Unions
(b) Consumer's cell
(c) Monopoly
Answer: Correct option- c
Business organisation should avoid creation of monopoly.
Explanation: According to the code of business ethics, business organisations should not create monopoly. A monopolistic market is not good from consumers’ point of view, as it reduces consumer surplus. Also, the quantity demanded by consumers in the monopolistic market is less than that in other markets.
Environmental management System is mandatory in ________.
(a) India
(b) USA
(c) China
Answer: Correct option- b
Environment management system is mandatory in U.S.A.
Explanation: Environmental Management System (EMS) is a document created by business units to assess the impact of their operations on the environment. It is compulsory in the USA. It aims at preventing environmental pollution caused by industries.
Environmental Management System which provides guidelines for incorporating eco-design is ________.
(a) ISO 14001-2004
(b) ISO 14005-2010
(c) ISO 14006-2011
Answer: Correct option- c
Environment management system which provides guideline for incorporating eco design is ISO 14006-2011.
Explanation: ISO 14006-2011 standardisation is used for environmental management. It provides a set of standards that business organisations should maintain to protect the environment. Environment management system aims at preventing environmental pollution caused by industries.
Match the correct pairs.
Answer:
Explanations:
a. It is the responsibility of business units to create a good image in the public so that trust and respect for the organisation can be established in the share, labour and consumer markets.
b. Business units must ensure that the goods and services they are providing to customers are of good quality, as it is the ethical responsibility of business to provide high-quality goods and services to the customers. Business organisations should have a quality check department to ensure that no defective or low-quality product is sent for sale.
c. Investors provide capital for the effective running of a business. Thus, business units should maintain transparency about how the money of the investors is being utilised.
d. The prime objective of an organisation is to earn profit. As it deals with minimising costs and maximising the revenue, it is regarded as an economic objective. Its secondary objective is the welfare of people.
e. Business ethics is a branch of social science. It teaches us the concept of good and right, fair and unfair and justice and injustice. It includes a set of moral values that guide us to behave in a proper and well defined manner.
Match the correct pairs.
Answer:
Explanations:
a. It is the ethical responsibility of business organisations to protect their confidential records from getting leaked. Also, they should not indulge in any malpractice to obtain such information from their competitors.
b. It is the responsibility of business organisations to provide job security to their employees so that the employees can work without tension. This will increase the productivity of the employees and create a sense of loyalty in them towards the organisation.
c. Business organisations should provide financial and medical assistance to the weaker sections of the society and work towards their upliftment.
d. Business organisations must operate according to the rules and regulations laid down by the government. Their acts should not force the government to take action against them. They should also suggest new ideas to the government for the betterment of the society.
e. Trade unions protect the rights of employees or workers. Their role is to put forward the demands of the employees before the management and negotiate them with the management.
Write a word or phrase or a term which can substitute each one of the following.
Duties, obligations of business directed towards welfare to society.
Answer:
Duties, obligations of business directed towards the welfare of society- Social responsibility
Explanation:
Social responsibility of a business organisation refers to its duties and obligations towards the society. Society supports the existence of business units; therefore, business organisations also have a huge responsibility towards society.
Indian philosopher who had promoted concept of social responsibility in ancient times.
Answer:
Indian philosopher who had promoted concept of social responsibility in ancient times- Chanakya
Explanation:
Social responsibility has been existing in India since ancient times. Indian philosopher Chanakya promoted ethical principles that should be followed in a business. The contemporary emperors and traders used to help the poor and underprivileged through the profits earned.
The newest management strategy about social obligations of business.
Answer:
The newest management strategy about social obligations of business- Corporate social responsibility
Explanation:
According to this newest strategy, business houses should not only focus on profits but also aim towards the welfare of the people. Fulfilment of social obligations by a business house helps it to earn goodwill, which, in turn, benefits the business in getting a greater market share.
Movement of the consumers against business malpractices.
Answer:
Movement of the consumers against business malpractices- Consumer movement
Explanation:
Time to time, consumers have raised their voice against the injustice faced by them. Consumer forums and other related associations have also created pressure on business units to abstain from fraudulent or deceptive practices.
An activity motivated by profit.
Answer:
An activity motivated by profit- economic activity
Explanation:
An activity that is performed with the motive of earning profit is known as an economic activity, for example, teaching and farming. Profit is the main motive of any economic activity.
The name of employee's organization protecting their rights.
Answer:
The name of employee’s organisation protecting their rights- Trade union
Explanation:
Trade union exists to protect the rights of workers or employees. It puts forward their demands before the management and also negotiates them with management.
Creditors who provide finance to business organization.
Answer:
Creditors who provide finance to business organisation- Investors
Explanation:
Investors provide capital to business organisations. This capital is essential to run the operations of any business. Thus, investors are the creditors of business organisations.
Getting good quality products is the basic right of this group of society.
Answer:
Getting good quality product is the basic right of the group of society- Consumers
Explanation:
It is the right of consumers to get products of good quality. Consumers can file a complaint against the business firm who provides goods that are hazardous or defective. Some large business houses also have quality check departments that ensure that the goods sold are of high quality.
A set of principles of right conduct.
Answer:
A set of principles of right conduct- Business Ethics
Explanation:
Business ethics refers to the code of conduct that a business must follow for social welfare. It is the aggregate of principles and morals that a businessperson is expected to follow.
Rules of standards dealing with morality in business environment.
Answer:
Rules of standards dealing with morality in business environment- Business ethics
Explanation:
Business ethics refers to a set of moral principles followed by business firms. It lays down the rules and standards pertaining to morality that should be followed while performing business activities.
Corporate ethics which is a form of applied ethics.
Answer:
Corporate ethics which is form of applied ethics- Business Ethics
Explanation:
Corporate ethics is another name for business ethics. It is a form of applied or professional ethics that examines the ethical and moral principles to be followed by a business firm.
An element of business ethic in which opinions and feedbacks from clients are considered.
Answer:
An element of business ethics in which opinions and feedback from clients are considered -
Openness
Explanation:
Openness is one of the elements of business ethics. It supports that the opinions and feedback from clients and employees should always be welcomed and treated with respect, even if they are of no value to the business.
Running an efficient business is the responsibility of business towards this group.
Answer:
Running efficient business is the responsibility of business towards this group- Owner
Explanation:
It is the ethical responsibility of a business organisation towards its owners to run the business efficiently. Organisations should make maximum utilisation of their resources, with no or minimum wastage. Also, providing fair returns on investments is the responsibility of organisations towards their investors.
Providing fair returns on investment is the responsibility of organization towards this group.
Answer:
Providing fair returns on investment is the responsibility of organization towards this group- Investors
Explanation:
Investors provide finance to the business and finance is the backbone for any business. Hence, it is an ethical responsibility of the organisation to provide timely and fair return on investment to the investors.
The critical, structured examination of how people and institutions behave in the world of commerce.
Answer:
The critical, structured examination of how people and institutions behave in the world of commerce- Business ethics
Explanation:
Business ethics has two integral parts: critical and structured. The former deals with the benefits of morality and examines the behaviour of people, while the latter talks about higher order, rationalisation and unified moral duties.
