Explore topic-wise InterviewSolutions in Current Affairs.

This statement is FALSE.

Reasons:

‐  Economic activities are undertaken for the purpose of earning livelihood while non‐economic activities are performed for gaining happiness, pleasure and satisfaction.

‐  Reward for economic activity is money or money’s worth.

‐  Examples of economic activities are: a teacher teaching in a school, a worker performing work in a factory, a doctor treating a patient etc.

‐  Non‐economic activities are undertaken without the intention of gaining money or material rewar

‐  Examples of non‐economic activities are: cooking for one's children, reading a book, listening to music etc.

Thus, the above statement is false.

This statement is TRUE.

Reasons:

‐  Primary and secondary industries are involved in the production of some or the other kind of output or product.

‐  Tertiary Industry, on the other hand, is known as service industry since it provides supportive services to the primary and secondary sector.

‐  It facilitates the functioning of primary and secondary industries by providing them with much needed services such as banking, transport, insurance, warehousing etc.

‐  In other words, the activities of the tertiary sector help in the development of the primary and secondary sectors.

‐  However, tertiary activities alone do not produce any product. They simply aid the process of production carried out by the primary and secondary sectors.

Hence, tertiary industry depends upon the primary and secondary industry for its growth.

This statement is FALSE. 

Reasons:

‐  Industry refers to all such business activities that involve production and manufacturing of goods and services.

‐  It processes raw materials or semi‐finished goods into finished goods.

‐  These goods can be either consumer goods which are directly used by the ultimate consumers or they might be capital goods which are used by another industry for further production.

‐  Commerce deals with the distribution of these goods and services produced by the Industry. All goods and services produced are to be made available to those who need them i.e. consumers.

‐  Thus, Industry produces goods first and later the function of commerce helps in selling the produced goods.

Thus, commercial activities are undertaken only after Industry finishes its role.

Activities that facilitate buying and selling of goods (trade) are known as Auxiliaries to Trade. It not only facilitates smooth flow of goods and services between the seller and the buyer but also provides the necessary support to the entire business for its successful functioning.

Following are the different Auxiliaries to Trade:

i. Transport:

‐  Transport helps:

in the movement of raw‐materials up to the factory site

in the movement of finished goods from the factory to the markets 

Thus, transport helps in creating place utility by making the goods available wherever they are required.

ii. Warehousing:

A trader needs to store the goods on account of the following reasons:

‐  Goods purchased in bulk by a trader are sold in smaller quantities to the customers as and when demanded.

‐  Goods produced in one season may be demanded throughout the year. For e.g. agricultural produce.

‐  Goods produced throughout the year may be demanded only in one season. For e.g. Sweaters in winter.

‐  Warehousing helps a trader to store the goods till they are demanded.

‐  Warehouse is a place or building used for safe storage of goods.

‐  Thus, warehousing creates time utility by making the goods available whenever they are required.

iii.  Insurance:

‐  A business is exposed to the risk of damage (of goods) on account of floods, fire, robbery etc.

‐  To safeguard against such causes of damage, a business can take an insurance policy from an insurance company.

‐  Here, the business is required to pay premium to the insurance company for the coverage of risk.

‐  In the event of loss, the insurance company will pay compensation that would be equivalent to the amount of loss suffered.

iv. Banking:

‐  A business requires continuous flow of money for its smooth working.

‐  A businessman may not be able to invest large sums as capital and thus face the difficulty of finance.

‐  Banking provides finance to the businessman.

‐  Banking offers the following services to traders:

capital funding for the business through loan facili

working capital to fund day‐to‐day operations through overdraft and cash credit facilities

other value‐added services such as cheques, demand drafts, debit card, credit card etc.

v. Advertising:

‐ There is a multitude of products available in the market. However, the consumers lack the necessary awareness about the products available for sale.

‐  For increasing sales, it is important for a seller to make the consumers aware about his product.

‐  However, the consumers are spread over a wide area. Hence, the seller faces difficulty in communication. This difficulty is solved through advertising.

‐  Advertising communicates all the required information about the product, to the prospective consumers and creates in them a strong desire to purchase the product.

‐  This results in increased amount of sales. However, a company should provide correct information through advertising to maintain the level of trading activities in the long term.

‐  The various mediums used for the purpose of advertising are newspapers, radio, television, cinema theatres, wall posters and hoardings at prominent places.

vi. Mercantile Agents:

‐  Consumers are spread over a wide area, thus it is difficult to have a direct contact between the producer and consumer.

‐  Mercantile agents are middlemen who form a link between the seller and the large number of buyers.

‐  Mercantile agents remove the difficulty of personal contact and complete the transaction on behalf of the seller.

‐  Thus the mercantile agents bridge the gap between the seller and the buyer.

‐  There are several types of mercantile agents such as brokers, commission agents, auctioneers, underwriters, insurers etc.

vii. Communication:

‐  In today’s world, the distance between two traders is very vast.

‐  It becomes difficult to establish a direct contact between two traders.

‐  This difficulty of distance makes it complex for a retailer to place an order with a wholesaler located at a far off place.

‐  This difficulty is solved by various means of communication. Communication refers to exchange of information from one person to another.

‐  Communication can be in the form of oral or written communication. With the modern communication facilities, a retailer can simply visit the website of the wholesaler and place an order.

‐  Modern means of communication like telephone, telex, telegraph, email, teleconference etc., play an important role in establishing contact between businessman, producers and consumers.

‐  These modern means of communication save time and money.

This statement is TRUE.

Reasons:

‐  In the process of distribution, producers and consumers are unable to have direct contact, as consumers are spread over a vast area.

‐  Mercantile agent is an agent who is authorized by a principal (producer/wholesaler/retailer) to buy or sell goods on his behalf.

‐  Mercantile agents thus remove the difficulty of personal contact by acting as middlemen who form a link between the buyers and the sellers.

‐  They do not carry on business in their own name but in the name of the seller.

‐  With the help of mercantile agents, a seller can thus sell more goods and services and create new customers.

In this way, mercantile agents help the business to expand as they widen the distribution area of the business. 

Every business operates with an aim of earning profit. It is a reward for taking risk and investing time, money and energy in the business. Profit not only ensures the survival and growth of a business but also helps the concern to fund its social initiatives.

Importance/Role of Profit:

The importance/role of profit can be explained as follows:

i. Survival of Business:

‐  Profit is necessary for the survival and growth of a business enterprise.

‐  A new business may find it difficult to survive the initial stages in the constantly evolving markets.

‐  However, if the business makes even small profits, it can survive and aim for better profits in the near future.

‐  Profits also boost the morale of the employees, ease negotiations with banks, attract investors and build customer confidence.

ii. Reward for Risk Taking:

‐  Profit is a return on investment.

‐  A businessman invests his capital and also runs his business with an uncertainty of making profit and the risk of incurring losses.

‐  Thus, earning profit is a reward for risk taken in the business.

iii.  Availability of Funds:

‐  Regularity in profit making helps a business to create a pool of available funds in the form of savings or retained earnings.

‐  These funds can be utilized to meet future contingencies in business.

‐  Also, savings indicate a sound financial standing and thus help to build public confidence.

‐  This helps the business in raising funds by means of issuing shares to the public or taking loans from financial institutions.

Thus, profits make the availability of funds from internal as well as external sources possible.

iv. Research and Development:

‐  Reasonable amount of profit making encourages the management to undertake research and development.

‐  This may lead to the creation of innovative products and services that help the business to earn more profits.

v. Index of Performance:

‐  Profit acts as an indicator of financial performance.

‐  Higher profits indicate enhanced efficiency in the functioning of the business and lower profits signal the management towards taking corrective steps.

vi. Income to Satisfy Needs:

‐  Business is an economic activity i.e. its main purpose is to earn profit.

‐  Profit is the income earned by the businessman.

‐  Through this income earned, he can satisfy the needs and wants of his family.

vii. Growth and Expansion:

‐  Profits are required to fund the growth, expansion and diversification plans of a business.

‐  Growth and expansion may be in the form of opening new branches, offering different types of goods and services etc.

‐  Profits are also required to make a business globally competitive.

viii. Satisfaction of Interest Groups:

‐  A business depends on customers, employees, government investors, etc. for its functioning.

‐  These factors are known as interest groups.

‐  A profitable business is able to satisfy these interest groups by:

providing good quality products at a reasonable price to its customers;

offering fair remuneration to its employees;              paying taxes to the government and              distributing dividends on time to its investors.

ix. Increases Efficiency:

‐  Profits help in making payments to suppliers, employees and vendors on time.

‐  This ensures that the above associates are motivated to provide prompt and quality services to the business unit, whenever required. This in turn helps to improve the efficiency in functioning. 

This statement is TRUE.

Reasons:

• e‐business means using the internet to connect people and processes.
• It involves web‐enabling in the existing business so that the transactions can be conducted over the internet. 
• Since e‐business uses internet, it is not restricted to any physical space and thus the entire world becomes the market and the goods can be sold to any person in any corner of the world.  
• e‐business helps in developing closer and more responsive relationships with partners, employees and suppliers.
• Example of e‐business is Online Ticketing (like  booking  of  air  tickets,  movie  tickets,  train  tickets, play tickets, tickets to sporting events, etc. online). 
• Online ticketing eliminates the need to queue up at ticket counters by connecting the buyers and sellers globally for many fields.

Thus, e‐business allows you to work across the globe in any field.  

In online transactions, account and shopping cart are password protected : True 

Explanation: 

Yes, it is correct. Both the account and shopping cart are password protected because if the information goes into wrong hands, it can be misused. Thus, to protect sensitive information from getting misused, the information is encrypted through various methods such as SSL.

Three Stages in online transactions: 

• Pre-purchase/sale....Purchase/sale...Delivery stage 

Pre-purchase/sale: - It is based on advertising and information about the product. 

Purchase/sale: - It includes the price of the product, price negotiation, actual purchase or sale, and payment. 

Delivery stage: - After completing the sale-purchase stage, this is the final stage. The following are the various steps involved in online transactions: 

i. Registration - The purchaser first needs to create an account on the shopping website. The account can be created by filling in required details like name, e-mail id, and contact number. The process is known as registration. 

ii. Placing an Order - After opening an account, the buyer can start browsing through the listed products, go through other customers’ reviews and compare products. The buyer may scan various items according to his or her preferences and put them in the shopping cart. The buyer can then place the final order and proceed towards the payment window. 

iii. Payment Mechanism - In this step, the buyer chooses his/her preferred mode of payment. The following are the different payment modes generally available on a trading website: 

a. Cash on Delivery (CoD) - Here, the payment is made in cash at the time of the delivery of the product. 

b. Cheque - The user makes the payment through a cheque. When the cheque is realized, the goods selected are delivered by the seller. 

c. Net Banking - The user makes an electronic payment to the bank account of the online vendor through the internet. 

d. Credit or Debit Card - The user can also use a credit or debit card (also known as plastic money) to make an online payment. The payment so made is linked to the bank account of the user. 

e. Digital cash or e-cash - This type of currency has no physical existence. It is a system of purchasing cash in relatively small amounts and storing it in the computer system. The consumer can spend cash when making electronic purchases over the internet.

1. e‐business       

2. Internet        

3. e‐commerce       

4. Net Banking       

5. Digital Cash       

6. Payment Gateway     

7. Paynet       

8. Secure Sockets Layers     

9. Secure Hyper Text Transfer Protocol    

10. Outsourcing        

11. Outsourcing   

E-business allows you to work across the globe in any field : True 

Explanation: 

The reach of e-business surpasses international boundaries, as it is conducted through the internet. Thus, it facilitates trade beyond national boundaries.

This statement is TRUE.

Reasons: 

• Unlike a host of procedural requirements for setting up an industry, e‐business is relatively easy to start.
• The initial investment for starting up an e‐business is generally lower than the costs associated with starting an equivalent business using a traditional model.
• Online sellers are able to reduce their overheads as they don’t need expensive shop fronts, too many employees or large inventory on hand.
• e‐business does not require physical space. It requires qualified technical professionals.

Thus, it is easy to set up e‐business as compared to traditional business.

i. Pre purchase or sale, Purchase or sale, Delivery stage.

ii. Registration, Placing an order, cash on delivery

(1) Outsourcing is a process of allocation of specific business processes or functions to a specialist external service provider or agency for certain monetary consideration. In outsourcing, the service provider or contractor enters into an agreement or formal contract with the company or the firm for providing services against certain monetary charges. After this the service provider, will take the responsibility of carrying out the tasks as per the expectation of the company.

(2) When services such as security, canteen, sanitation, etc. are outsourced by a company, then the security guards, waiters, cooks, sanitation scavangers, etc. are not the employees of the company although they work inside the company premises. They directly work under the control of service provider or contractor. Many organisations, companies, corporate houses, establishments, hospitals, shops, malls, housing societies, offices, etc. outsource their non-core (less important) areas of business such as canteen, sanitation, security services, etc. to outside agencies.

i. delivery stage

ii. e-business

iii. online transactions

iv. Registration

v. outsourcing

Business to Consumer (B2C) : The transactions under B2C include transactions between business firms and consumers. When consumer identifies a need or requirement, he searches for the product or services to fulfil his need. He then selects a vendor, negotiates the price, receives product or services, makes payment and gets service and warranty claims. The business firms use their website for different range of marketing activities such as sales or product promotion, product information, reviews about the product or service and delivery of the products at doorstep. In order to get more response from the customers, the cost of products and services is kept low through this method and the speed of transaction is faster, e.g. www.flipkart.com, www.yebhi.com, etc.

C2C business refers to business transactions taking place between consumers. E-bay, OLX etc where consumers sell their goods and services to other consumers is an example of C2C business.

It is easy to set up e-business as compared to traditional business : True 

Explanation: 

Yes, the statement is correct. E-business is easy to set up compared to traditional business because of the following reasons: 

1) E-business is easy to start, as physical facilities are not required. For setting up ebusiness, all you need is one computer with the internet facility. 

2) It does not require a host of procedures for the formation and working that are usually required in traditional forms of business.

This statement is TRUE.

Reasons:

• e‐mail is the system through which messages, images, videos, etc. can be exchanged through the medium of internet. It is a means of communication between individuals or firms.
• e‐commerce refers to the ordering, buying and selling of goods and/or services online. e‐commerce is the trading part of e‐business.
• The concept of e‐business mainly emerged in order to provide the buyers a platform on the internet to buy and sell their goods.
• e‐business refers to the “web‐enabling” of the existing business processes to conduct transactions via internet.
• It is to be noted that, a business can be termed as an e‐business even if it doesn’t perform trading activities over the internet.  
• The business can be termed as e‐business even if it uses the internet for communicating via e‐mails within the staff or with the suppliers or the creditors/debtors.  

Thus, the term ‘e‐business’ is derived from the terms ‘e‐mails’ and e‐commerce’.

i. BPO

ii. KPO

iii. LPO.

i. easy

ii. three

iii. First

iv. electronic currency

v. more

The term “e-business” is derived from the terms “e-mail” and “e-commerce” : True 

Explanation: 

The above statement is correct. The term “e-business” is derived from the terms “email” and “e-commerce”. It refers to the use of the internet to not only conduct online transactions and emails but also to carry out other business functions such as production and inventory management, product development and accounting, which are conducted electronically.

(1) KPO stands for Knowledge Process Outsourcing. In KPO, the important functions related to knowledge and information are outsourced (assigned to perform) to third party service providers. KPO is the sub-part (Section) of BPO in which services of outside or third party service provider are hired not only for its ability to do particular business process or function but also to provide expertise it has.

(2) KPO is nothing but the allotment of more important or relatively high level tasks or functions to an outside organisation or to a different group specially in a different geographic location. KPO is a subset of Business Process Outsourcing (BPO). KPO implies outsource of more important or core functions or business process to third party service provider or organisation to perform which may or may not reduce its cost of the parent company but surely assists in value addition.

(A) Meaning : Outsourcing is a process of allocation of specific business processes or functions to a specialist external service provider or agency for certain monetary consideration. In outsourcing, the service provider or contractor enters into an agreement or formal contract with the company or the firm for providing services against certain monetary charges. After this the service provider, will take the responsibility of carrying out the tasks as per the expectation of the company.

(B) Advantages : 

The advantages of outsourcing are explained as follows:

(1) Overall cost advantages : Outsourcing reduces cost. Outsourcing avoids the need to hire employees in houses. 

Hence, recruitment and training costs can be eliminated or minimised. It is also saves time and efforts on training the employees. Similarly, cost of outsourcing services is much less than recruiting work force for the company.

(2) Stimulates entrepreneurship, employment and experts : Outsourcing encourages and stimulates entrepreneurship, employment and expertness in the country from where outsourcing is done.

(3) Low manpower cost : In every organisation manpower is required to operate machineries, to do routine work, to perform jobs, to administer and manage business affairs. Recruitment and appointment of personnel on permanent basis are costly. Manpower through outsourcing is available at a lower cost. Outsourcing is beneficial in some portions of business process.

(4) Access to professional, expert and high quality services : Usually the non-core areas or tasks are given to the people who are expert, specialised and skilled in that particular field. These people provide better level of services. They commit less errors and avoid wastage and misuse.

(5) Emphasis on core process rather than the supporting ones : Outsourcing supporting the business processes, facilitates the organisation to concentration on its core (more important) areas to improve the quality of its products and services. This in turn leads to better profits and increase output and turnover.

(6) Investment requirements are reduced : By outsourcing the non-core areas, the organisation can easily save on investing in the latest technology. These organisation allow the outsourcing partners to handle the entire infrastructure. 

Thus, the organisation itself is required to manage only remaining portion of business process. Hence, investment requirements of the organisation are very less.

(7) Increased efficiency and productivity : Many a time tasks are outsourced to the vendors who are specialised in their fields. Outsourced vendors have deep knowledge, experience, specific equipment and technical expertise. They give performance or do assigned task much better than the ones at the outsourcing organisation. As a result the tasks can be completed faster, with greater efficiency and with better quality output.

(8) Knowledge sharing : Most of the times tasks are outsourced to the vendors who are specialised and expert in their fields. While working together outsourced partners (vendors) share their knowledge, experience, technical expertise, etc. with the employees of the organisation. This is one of the prime advantages of outsourcing. Organisation also uses and shares particular kind of service. Thus, outsourcing helps to develop both the companies and also boosts goodwill in the industry.

(C) Disadvantages of outsourcing :

The disadvantages of outsourcing are explained as follows:

(1) Lack of customer focus : An outsourced vendor may be catering to the expertise needs of several companies at a time. In such cases, the vendors may lack complete focus on outsourcing company’s needs or tasks. As a result, the quality of the outsourced service may not be up to the mark.

(2) A threat to security and confidentiality : When an organisation outsources some portions of business process, it involves a risk of exposing its confidential information to a third party. Similarly, there is danger of the misuse of company’s confidential information by the contractors. So outsourcing involves security issues.

(3) Dissatisfactory services : In case the organisation does not select right partner for outsourcing, it has to face several problems such as substandard quality output, delayed delivery, inappropriate categorisation of responsibilities, etc. It has to compromise on the quality of outsourcing.

(4) Ethical issues : In some cases, the company outsourcing its non-core areas, ignores ethical issues related to outsourcing. When the functions of the organisation are outsourced to a company from another country, the employment opportunities from one’s own country get reduced, which in turn aggravates the unemployment problem.

(5) Other disadvantages :

1. Misunderstanding of contracts ultimately creates many problems for the organisations.

2. Lack of effective communication also creates many problems to the organisations outsourcing their functions.

3. Some times the quality of the outsourced service is not up to the mark, poor and delayed services. In such cases company has to suffer heavy loss on account of wastage.

The term e‐business is derived from the terms e‐mail and e‐commerce.

(1) BPO stands for Business Process Outsourcing. BPO basically refers to the outsourcing of some work or functions of the organisation to third party or service provider to save overall cost of the organisation. In other words, BPO is a business system in which one company hires another company or service provider to do certain process of work (or task) for certain money consideration.

(2) In brief, BPO is a subset of outsourcing that involves the contracting of the operations and responsibilities to a third party to minimise cost and increase efficiency.

(1) BPO stands for Business Process Outsourcing. BPO basically refers to the outsourcing of some work or functions of the organisation to third party or service provider to save overall cost of the organisation. In other words, BPO is a business system in which one company hires another company or service provider to do certain process of work (or task) for certain money consideration.

(2) In brief, BPO is a subset of outsourcing that involves the contracting of the operations and responsibilities to a third party to minimise cost and increase efficiency.

(3) It refers to the outsourcing of less important (non-core) or non-primary activities of the organisation to an external organisation or service provider to minimise the cost and increase efficiency of the organisation

(4) For instance, customer care centres for various banks, service providers, etc. BPO is less complex and requires process expertise. It also requires good communication skills. It focuses on low level process.

i. Electronic business

ii. 1997

iii. Internet

iv. superset

v. subset

vi. Outsourcing

(1) LPO stands for Legal Process Outsourcing. LPO is a type of KPO that renders legal services ranging from drafting legal documents, performing legal research to offering legal advice. LPO implies practice of law firm. It refers to obtaining legal services from outside legal support service company or law firm for certain consideration.

(2) In some industry or organisation in house legal department or a company outsourced legal work to such law firms where it can be done or performed at less cost. For instance, many companies in Europe or US outsource their legal work to Indian law firms where it can be done at considerably lower cost.

Legal Process Outsourcing (LPO) is a form of outsourcing in which legal services, ranging from drafting legal documents, performing legal research to offering legal advice are hired or obtained from outside law firm or legal support services company for money consideration.

Consumer to Consumer (C2C) : The transactions under Consumer to Consumer are between two people. Using e-business facility on internet, the consumers can buy and sell goods and services to other consumers, through some third party. A common consumer posts the product or services for sale with the price and other details online and other consumers tries to buy them. The sites are performing the role of intermediaries, just to match the consumers. For buying and selling, internet allows a lot of space for consumers group to be formed. The consumer forums interact with each other for best variety of goods and services. Through such groups redressal of complaints is also possible. One may sell his products through an online retail space operated by eBay or Yahoo! shopping, etc.

i. True

ii. True

iii. True

iv. False

v. True

vi. False

(1) LPO stands for Legal Process Outsourcing. LPO is a type of KPO that renders legal services ranging from drafting legal documents, performing legal research to offering legal advice. LPO implies practice of law firm. It refers to obtaining legal services from outside legal support service company or law firm for certain consideration.

(2) In some industry or organisation in house legal department or a company outsourced legal work to such law firms where it can be done or performed at less cost. For instance, many companies in Europe or US outsource their legal work to Indian law firms where it can be done at considerably lower cost.

(3) In recent years, LPO an high end industry has been growing rapidly in India. LPO is superficially a media invention which is derived from BPO. LPO has made tremendous progress in India in past few years.

(4) LPO gained success by producing and rendering services such as document review, legal research and writing, drafting of briefings, etc. Important benefits of outsourcing legal functions is cost savings and to access high level talent and niche expertise that may not exist within the firm or company.

(i) Microsoft Edge:

The faster, safer way to get things done on the web. Edge go from your mobile device or tablet.

(ii) Opera:

Opera browser for windows with a built-in ad blocker and VPN. Our free web browser for windows brings you more speed and privacy.

(iii) Vivaldi:

We use cookies to offer you a better browsing experience and analyze site traffic. If you continue to use this site, you consent to our use of cookies.

(iv) Comodo Dragon:

It helps you stay safe and secure. Provides unsurpassed speed. Friendly user interface, customized plug-ins and add-ons. No more crashes or frozen screens.

(v) Brave:

Brave is on a mission to fix the Web. Much more than a browser, Brave is a new way of thinking about how the Web works. No more data changes to download unwanted content.

ISDN (Integrated Services Digital Network) allows users to send data, voice and video content over digital telephone lines or standard telephone wires. The installation of an ISDN adapter is required at both ends of the transmission – on the part of the user as well as the Internet access provider.

The difference between B2B and B2C of e-business:

i. RTO

ii. A2Z

iii. Aadhaar card

This is most common method used when travelling. The device (Eg: Smart phone) connects directly to the Internet using 3G/4G mobile networks or public Wi-Fi.

This is most common method used when travelling. The device (Eg: Smart phone) connects directly to the Internet using 3G/4G mobile networks or public Wi-Fi.

There are two access methods Direct and indirect and these can be either fixed or mobile.

Indirect Acess :

This is most common method used in home and office networks.

The device (Eg: Computer) connects to a network using Ethernet or Wi-Fi and the network connects to the internet using Asymmetric Digital Subscriber Line ADSL (cable or fiber.)

Direct Access :

This is most common method used when travelling. The device (Eg: smart phone) connects directly to the internet using 3G/4G mobile networks or public Wi-Fi

(d) Business and Consumer

Correct answer is (a) Cellphone

Correct answer is (b) B2B

Correct answer is  (a) broad bandwidth

(a) broad bandwidth