Disclaimer: This question bank is for practice and revision purposes. It is curated using leading sources, teacher insights, and previous board trends, but does not guarantee actual board appearance.
As we approach the CBSE Class XII HSC Board Exam 2026, our expert faculty has analyzed emerging board trends and examination patterns to create this comprehensive question bank. This strategic compilation benefits students by providing targeted practice aligned with the latest CBSE guidelines, ensuring thorough preparation for the upcoming Business Studies examination.
Why This Matters
Your performance in the CBSE Class XII Business Studies examination directly impacts your academic future and career opportunities in the field of commerce and management. Our comprehensive trend analysis reveals that students who practice with expertly curated question banks score significantly higher than those relying solely on textbooks. This collection has undergone rigorous expert review to ensure alignment with current board expectations and emerging examination patterns.
Business Studies is the foundation of commercial understanding, entrepreneurial thinking, and management skills, requiring mastery of concepts, case studies, and practical applications. This comprehensive question bank has been designed to help students prepare effectively for their HSC Board Exam 2026, covering all important topics and providing practice questions that mirror the actual exam pattern.
Key Topics Covered
This question bank covers all essential Business Studies topics from the CBSE Class XII syllabus:
- Nature and Significance of Management
- Principles of Management
- Business Environment
- Planning
- Organizing
- Staffing
- Directing
- Controlling
- Business Finance
- Financial Markets
- Marketing Management
- Consumer Protection
Question Types and Format
This question bank includes various types of questions designed to test different levels of understanding and application:
- Multiple Choice Questions (MCQs) – Test conceptual understanding and quick recall
- Very Short Answer Questions – Brief conceptual and definition-based questions
- Short Answer Questions – Explanation of concepts and principles
- Long Answer Questions – Comprehensive analysis and detailed explanations
- Case Study Questions – Real-world business scenarios and applications
- Higher Order Thinking Skills (HOTS) Questions – Critical analysis and evaluation
Study Tips and Exam Strategy
To maximize your performance in the CBSE Class XII Business Studies exam, follow these essential study tips:
- Master fundamental concepts before attempting complex case studies
- Practice diagram-based questions regularly for better visual representation
- Create concept maps linking different management functions
- Solve previous year question papers to understand exam patterns
- Focus on high-weightage topics like Marketing, Finance, and Management Principles
- Time yourself while practicing to improve exam speed
- Review current business examples and case studies
- Practice step-by-step answers for better presentation
- Use flowcharts and diagrams wherever applicable
- Stay updated with recent business developments and government policies
This comprehensive question bank serves as your complete preparation guide for the CBSE Class XII Business Studies examination. Regular practice with these questions, combined with a thorough understanding of concepts and consistent revision, will significantly boost your confidence and performance in the 2026 HSC Board Exam. Remember, success in Business Studies comes from understanding real-world applications and connecting theoretical concepts with practical scenarios.
Access our complete question bank with detailed solutions and expert explanations. Unlock premium content to boost your CBSE Class XII Business Studies preparation.
2026 Board-Ready Business Studies Important Questions
📊 COMPREHENSIVE BUSINESS STUDIES QUESTION BANK – CBSE CLASS XII 2026
CHAPTER 1: NATURE AND SIGNIFICANCE OF MANAGEMENT
A. Multiple Choice Questions (MCQs)
- Which of the following best describes the nature of management?
a) It is a pure science
b) It is both an art and science
c) It is only an art
d) It is neither art nor science
Answer: b) It is both an art and science - The father of scientific management is:
a) Henri Fayol
b) F.W. Taylor
c) Max Weber
d) Peter Drucker
Answer: b) F.W. Taylor - Management is needed because:
a) Resources are limited
b) Group efforts are required
c) Goals need to be achieved efficiently
d) All of the above
Answer: d) All of the above - Which is NOT a characteristic of management?
a) Goal-oriented process
b) Pervasive activity
c) Static process
d) Multidimensional activity
Answer: c) Static process - The process of getting things done through and with people is called:
a) Leadership
b) Management
c) Administration
d) Organization
Answer: b) Management
B. Very Short Answer Questions (1-2 marks)
- Define management.
Answer: Management is the process of planning, organizing, staffing, directing, and controlling organizational resources to achieve predetermined goals efficiently and effectively. - List any three characteristics of management.
Answer:
- Goal-oriented process
- Pervasive activity
- Multidimensional activity
- Why is management called a universal activity?
Answer: Management is called universal because it is needed in all types of organizations (business, non-business, government) and at all levels of the organization. - State any two objectives of management.
Answer:
- Organizational objectives (survival, profit, growth)
- Social objectives (creating employment, providing quality products)
C. Short Answer Questions (3-4 marks)
- Explain management as both an art and science.
Answer:
Management as Science:
- Systematized body of knowledge
- Principles based on observation and experimentation
- Principles have universal validity
Management as Art:
- Requires personal skill and creativity
- Practical application of knowledge
- Results are judged by success achieved
- Explain any four characteristics of management.
Answer:
- Goal-oriented: Management aims to achieve predetermined organizational goals
- Pervasive: Required at all levels and in all types of organizations
- Multidimensional: Involves managing work, people, and operations
- Continuous process: It’s an ongoing activity that never ends
- Distinguish between efficiency and effectiveness.
Answer:
Efficiency Effectiveness
Doing things right Doing right things
Means-oriented Ends-oriented
Resource utilization focus Goal achievement focus
Cost minimization Output maximization D. Long Answer Questions (5-6 marks)- Explain the importance of management in modern organizations.
Answer:
- Achieving group goals: Coordinates individual efforts toward common objectives
- Optimum utilization of resources: Ensures efficient use of human, financial, and material resources
- Reduces costs: Eliminates wastage and improves efficiency
- Establishes sound organization: Creates proper organizational structure and relationships
- Maintains equilibrium: Balances conflicting interests of various stakeholders
- Development of personnel: Provides opportunities for employee growth and development
- How many principles of management were given by Henri Fayol?
a) 12
b) 14
c) 16
d) 18
Answer: b) 14 - The principle of unity of command means:
a) One person should have only one superior
b) Orders should come from one source
c) There should be unity in objectives
d) Both a and b
Answer: d) Both a and b - Which principle suggests that there should be a place for everyone and everyone should be in their place?
a) Order
b) Equity
c) Initiative
d) Discipline
Answer: a) Order - Scalar chain refers to:
a) Chain of superiors
b) Unity of direction
c) Division of work
d) Authority responsibility relationship
Answer: a) Chain of superiors - The principle that suggests employees should be treated with kindness and justice is:
a) Equity
b) Discipline
c) Unity of command
d) Esprit de corps
Answer: a) Equity
- What is meant by principles of management?
Answer: Principles of management are fundamental truths or guidelines that serve as a basis for management decisions and actions. - Name any three principles given by Henri Fayol.
Answer:
- Division of work
- Unity of command
- Unity of direction
- What is meant by ‘esprit de corps’?
Answer: Esprit de corps means team spirit and unity among employees. It promotes harmony and cooperation in the organization.
- Explain the principle of ‘Division of Work’ with an example.
Answer:
Division of work means breaking down complex tasks into smaller, manageable parts and assigning them to different individuals based on their skills and capabilities.
- Increases efficiency and productivity
- Develops specialization
- Reduces learning time
- Distinguish between Unity of Command and Unity of Direction.
Answer:
Unity of Command Unity of Direction
One subordinate should receive orders from one superior only All activities with same objective should be under one head and one plan
Prevents confusion and conflict Ensures coordination
Individual level Group/departmental level
Example: A sales executive reports only to sales manager Example: All marketing activities under marketing manager D. Long Answer Questions (5-6 marks)- Explain any six principles of management given by Henri Fayol.
Answer:
- Business environment includes:
a) Economic factors only
b) Political factors only
c) All external and internal factors
d) Social factors only
Answer: c) All external and internal factors - Which of the following is NOT a dimension of business environment?
a) Economic
b) Political
c) Managerial
d) Technological
Answer: c) Managerial - Economic environment includes:
a) GDP growth rate
b) Inflation rate
c) Interest rates
d) All of the above
Answer: d) All of the above - Liberalization means:
a) Removing barriers to trade
b) Increasing government control
c) Nationalizing industries
d) None of these
Answer: a) Removing barriers to trade - Which policy was introduced in India in 1991?
a) LPG Policy
b) Industrial Policy
c) Economic Reforms
d) All of the above
Answer: d) All of the above
- Define business environment.
Answer: Business environment refers to all external and internal factors that influence the functioning and performance of a business organization. - Name the dimensions of business environment.
Answer:
- Economic environment
- Political environment
- Social environment
- Technological environment
- Legal environment
- What is meant by liberalization?
Answer: Liberalization means removing restrictions and barriers on business activities to promote free trade and competition.
- Planning is:
a) A mental process
b) Future-oriented
c) Primary function of management
d) All of the above
Answer: d) All of the above - Which is the first step in planning process?
a) Setting objectives
b) Developing premises
c) Identifying alternatives
d) Selecting best alternative
Answer: a) Setting objectives - A single-use plan designed to carry out a special course of action is:
a) Policy
b) Procedure
c) Program
d) Method
Answer: c) Program - Standing plans include:
a) Policies, procedures, methods
b) Programs and projects
c) Budgets
d) All of these
Answer: a) Policies, procedures, methods - MBO stands for:
a) Management by Objectives
b) Management by Operations
c) Management by Organization
d) None of these
Answer: a) Management by Objectives
- Define planning.
Answer: Planning is the process of setting objectives and determining the course of action to achieve those objectives. - List steps in planning process.
Answer:
- Setting objectives
- Developing premises
- Identifying alternatives
- Evaluating alternatives
- Selecting best alternative
- Implementing the plan
- Follow-up action
- What are single-use plans?
Answer: Single-use plans are those plans which are used once and are not repeated, such as programs, projects, and budgets.
- Employees are receiving conflicting instructions from different managers
- There’s no clear division of work, leading to confusion and overlap
- Decision-making has become slow as everything needs Rajesh’s approval
- Employee morale is declining due to unclear reporting relationships
- The company is struggling to adapt to changing market conditions quickly
- Identify the management principles that are being violated in TechCorp Solutions. (3 marks)
- Unity of Command: Employees are receiving conflicting instructions from different managers
- Division of Work: No clear division of work leading to confusion and overlap
- Unity of Direction: Lack of coordination and unified approach
- Scalar Chain: Slow decision-making due to centralized approval process
- Suggest how Rajesh can apply Fayol’s principles to solve these problems. (4 marks)
- Implement Unity of Command: Establish clear reporting relationships where each employee reports to only one superior
- Apply Division of Work: Create specialized departments and assign specific roles based on expertise
- Ensure Unity of Direction: Develop unified plans and policies for each department working toward common goals
- Establish proper Scalar Chain: Create clear hierarchical structure with defined authority levels and delegation
- Implement Authority and Responsibility: Delegate authority along with responsibility to middle management
- Apply Discipline: Establish clear rules, procedures, and performance standards
- What benefits can TechCorp expect from implementing proper management principles? (3 marks)
- Improved Efficiency: Clear division of work and specialization will increase productivity
- Better Coordination: Unity of direction will ensure all departments work toward common goals
- Faster Decision Making: Proper delegation will reduce bottlenecks
- Higher Employee Morale: Clear reporting relationships and job roles will reduce confusion
- Enhanced Growth: Better organizational structure will support scalable growth
- Improved Adaptability: Decentralized decision-making will help respond to market changes quickly**
- Explain any six principles of management given by Henri Fayol.
- Explain the importance of management in modern organizations.
This comprehensive question bank contains over 250 carefully selected questions aligned with CBSE guidelines and recent examination trends.
Focus on understanding business concepts, management principles, and their practical applications as they carry maximum weightage in the CBSE Class XII Business Studies examination. Practice case study analysis and real-world business scenarios. Always support your answers with relevant examples and use appropriate business terminology. Time management is crucial – allocate specific time slots for different question types during your preparation.
Ready to Excel in Business Studies 2026?
This comprehensive question bank represents months of expert analysis and careful curation to ensure your success in the CBSE Class XII Business Studies examination. Regular practice with these questions will build your confidence and improve your analytical thinking skills.
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Best of luck for your 2026 board examinations!
Our question bank maintains the highest standards of academic accuracy and alignment with current CBSE examination patterns. Regular updates incorporate feedback from practicing teachers and recent board exam trends to provide students with the most relevant preparation material.