COMMERCIAL APPLICATIONS

STATISTICS AT A GLANCE
Total Number of students who took the examination 13,153
Highest Marks Obtained 100
Lowest Marks Obtained 7
Mean Marks Obtained 79.80

Percentage of Candidates according to marks obtained

Mark Range
Details
0-20 21-40 41-60 61-80 81-100
Number of Candidates 1 15 1,312 5,422 6,403
Percentage of Candidates 0.01 0.11 9.97 41.22 48.68
Cumulative Number 1 16 1,328 6,750 13,153
Cumulative Percentage 0.01 0.12 10.10 51.32 100.00

Range of Marks Obtained

48.68

50.00 41.22
45.00
40.00
Percentage of Candidates

35.00
30.00
25.00
20.00
9.97
15.00
10.00 0.01 0.11
5.00
0.00
0-20 21-40 41-60 61-80 81-100

Marks Obtained

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 COMMERCIAL APPLICATIONS

ANALYSIS OF PERFORMANCE

Question 1
State a difference between each of the following:
(a) Marketing and Selling [2]
(b) Renewable resources and Nonrenewable resources [2]
(c) Apprenticeship Training and Internship Training [2]
(d) Direct Cost and Indirect Cost [2]
(e) Cash credit and Overdraft. [2]

Comments of Examiners
(a) Most candidates answered this question correctly.
Suggestions for teachers
However key words or terms were not used.
(b) Most candidates answered incorrectly as they
misinterpreted renewable with non-renewable
sources of energy.
(c) Answered correctly by most candidates.
(d) Most candidates wrote incorrect answers which
were vague in nature and examples too were
incorrect.
(e) Many candidates incorrectly answered the concept
of cash credit and overdraft. They were unable to
differentiate between the two.
Provide more examples while
explaining this topic so that students
can improve their performances.
A proper explanation to be supported
by additional examples.
Ensure conceptual clarity with the
help of practical examples.
Explanation of all types of costs with
an example is necessary.
Students must be trained to write
compatible differences.

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MARKING SCHEME
Question 1.
(a) Marketing Selling
1. Total system consisting of planning, 1. A part of marketing involving persuasion
pricing, promotion and distribution of and directing flow of products to
products. customers.
2. Begins much before goods are produced 2. Begins after the goods are produced.
3. Continues even after sale. 3. Comes to an end with the delivery of
goods to customers.
4. Product oriented.
4. Customer oriented.
5. Profits through sales volume.
5. Profits through customer satisfaction.
(b) Renewable Resources Non Renewable Resources
These are regularly replenished through These resources exist on earth in
natural process. Therefore; these have fairly fixed quantities. Therefore, these have
potential to last indefinitely. potential of being exhausted or depleted.
These are used faster than they are replaced by
Ex- Water, wind, sunlight, forests.
nature.
Ex-Fossil fuels, coal, natural gas and
petroleum.
(c) Apprenticeship Training Internship Training
1. This method is used in technical trades and 1. This is a joint programme of training in
crafts. which business houses collaborate with
technical institutions.

2. He learns while observing and assisting his 2. After completing theoretical learning, they
receive practical training for the
senior.
profession.
3. The purpose of training involves a balance
3. The purpose of this training is to prepare between theory and practice. Useful for
employees for skilled occupations like medical, accountancy and legal
plumbing, electrician, etc. professions.
(d) Direct Cost Indirect Cost
1. Directly and wholly related to a particular 1. Not directly and wholly related to a
unit or centre of cost. particular unit or centre of cost.
2. Direct materials, Direct Labour and Direct 2. Indirect materials, Indirect Labour and
Expenses are the components Indirect Expenses are the components.
3. Sugar cane used in a sugar mill, wages of 3. Fuel, wages of store keeper.
sugar workers.

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 (e) Cash credit Overdraft
1. Longer period of time 1. Shorter period of time.
2. Revolving credit arrangement 2. Not a revolving credit arrangement.
3. Persons / organizations not holding 3. Only current accounts are eligible for
accounts are eligible for cash credit. overdraft.

Question 2
(a) What are convenience products? Give two examples. [2]
(b) What is understood by the Going Concern Concept of Accounting? [2]
(c) Mention any four causes of the Greenhouse Effect. [2]
(d) What are the advantages of Account Payee crossing of a cheque? [2]
(e) What is a Recurring Deposit Account? [2]

Comments of Examiners
(a) Some candidates wrote correct definitions however
committed errors in citing examples.
(b) Most candidates answered it correctly but points
written were insufficient.
(c) Most candidates wrote general answers and wrote
about air pollution and water pollution instead of
Greenhouse effect. Some wrote effects instead of
causes.
(d) Most candidates answered correctly.
(e) Answered correctly by most candidates.
Suggestions for teachers
Explain the significance of these
products as convenience products
and their importance.
Concepts of accounting need to be
clearly explained, difference between
various concepts must be emphasized
upon.
Instruct students to read the question
carefully.
Explain the different types of
cheques by giving examples.
Students can be practically shown on
how to write a cheque.
Students should be provided with
examples to clear concepts.

MARKING SCHEME
Question 2.
(a) Convenience products are purchased frequently, without much planning and with minimum
efforts. They are meant for personal convenience. These are Fast Moving Consumer Products.
They are available at retail outlets. Examples-newspaper, toothpaste soap tea detergents,
cosmetics, groceries, food item.
(b) Going concern concept: (Two statements are required)

276
 (i) It is assumed that the business will continue to exist for a long time
(ii) There is neither intention nor the necessity to wind up the affairs of the business.
(iii) It is on this assumption that capital and revenue expenditure are distinguished, Fixed assets
are recorded at their original cost less depreciation
(iv) It justifies the distinction between fixed assets and current assets.
(v) It implies from the concept that existing liabilities will be paid at maturity
(vi) On this assumption Unsold stock of goods are taken to the next year.
(c) Four causes of Greenhouse effect: -
(i) Water vapour
(ii) Chloroflurocarbons
(iii) Nitrogenoxides
(iv) Methane
(d) Account Payee only written on a cheque
It means the drawee bank must make payment of the cheque through the payees account only.
This is known as restrictive crossing as it restricts the payment.
It makes the cheque non-transferable.
(e) Recurring deposit account
A specific amount is deposited every month for a specific period. After the expiry of the specific
period, the depositor gets back his money with interest.

Question 3

(a) Explain any two qualities of a good salesman. [2]

(b) What are Open Market Operations of a Central Bank? [2]
(c) Why are interviews an essential part of the selection procedure? [2]
(d) What is Indirect Labour Cost? [2]
(e) Mention any two features of a Balance Sheet. [2]

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Comments of Examiners
(a) Most candidates answered it correctly. Some Suggestions for teachers
however only wrote the subheadings without
During discussions in class the good
offering an explanation.
qualities of salesman needs to
(b) Most candidates answered incorrectly. They were
explained thoroughly.
unable to write the role of Open market
Banks need to be explained in a very
operations as a method of credit control
lucid language. Key words can be
(c) Most candidates answered correctly.
used to highlight the concept of
(d) Most candidates wrote improper explanations.
open market operations.
(e) Most candidates instead of writing features wrote
Bring out the importance of an
the uses of a Balance Sheet.
interview with examples.
Explain the difference between
direct costs and indirect costs with
suitable examples.
Advise students to read the question
carefully before making any attempts
to answer.

MARKING SCHEME
Question 3.
(a) Qualities of the good salesman:
Good physique
Cheerful
Sincere
Knowledgeable
Sound memory (Any two with brief explanation)
(b) Open Market Operations
When central bank wants to reduce volume of credit, it sells securities in the market. This reduces
money supply in banking system.
When it wants to expand credit, central bank buys securities.
(c) Interviews are an essential part of the selection procedure as they help to judge the candidates
suitability for the job.
It is a face-to-face encounter with the purpose of assessing the facial expressions, postures,
gestures, personality and communication skills of candidates.
Candidates can also get information about the job and the company.
(d) Indirect Labour Cost:
It is a cost of labour which cannot be identified partly or fully in a product. E.g. wages paid to a
watchman
(e) Features of balance sheet:
1. Always prepared on a particular date.
2. Prepared after preparing income and expenditure account.

278
 3. It is not an account but a statement.
4. Shows the financial position on a particular date.
5. Assets are shown on the right hand side and liabilities are shown on the left hand side.

Question 4

Justify a reason either for or against each of the following:

(a) On the job training includes practical and theoretical learning. [2]
(b) A demand draft is preferable to a cheque. [2]
(c) Central Bank is the lender of last resort. [2]
(d) Training is related to improving skills for performing a job. [2]
(e) In a competitive market, parity pricing is the appropriate strategy. [2]

Comments of Examiners
(a) Most candidates were unable to justify and wrote Suggestions for teachers
incorrect and vague answers.
(b) The reason stated by many candidates showed an A proper explanation with
inability to justify their answers. appropriate examples must be carried
(c) Most candidates answered it correctly. out.
(d) Answered correctly by most candidates. Stress on concepts with examples so
(e) Most candidates were unable to comprehend the that students are able to understand
question and hence were unable to write correct the topic correctly.
reasons in favour of their answers. Illustrate all terms with examples. An
In-depth study of the text must be
encouraged.
Emphasize on key words while
explaining technical terms used in
class to familiarize students.
To avoid confusion, explain concepts
with examples.

MARKING SCHEME
Question 4.
(a) Against:
1. On the job training involves only practical knowledge of the job.
2. Under this method, employees are assigned a specific job and they learn by performing the
job in actual work situation.
(b) For:
Demand draft cannot be dishonoured while cheques can be dishonoured. DD are easily accepted
while cheques are not accepted by all.

279
 (c) For:
Central Bank helps commercial banks in times of emergency. The central Bank helps commercial
banks either by granting loans or by buying their securities.
(d) Against:
Training is related to all well rounded growth of employees. By training executives acquire skills
in their present jobs and also capabilities for future jobs. The purpose of training is to impart
competencies and latest knowledge to the employees so as to equip them for future challenges.
(e) For:
1. Parity pricing strategy is applied when there is severe or acute competition and the
competitive products are of the same type.
2. When companies collectively apply this strategy, prices are stabilized and price wars are
avoided.

SECTION B (60 Marks)

Attempt any four questions from this Section

Question 5

(a) Explain Sales-Oriented Stage and Marketing-Oriented Stage of Marketing. [5]

(b) Why is Service becoming more important than a Product? Give five reasons. [5]
(c) Explain any five steps generally involved in the selection of employees. [5]

Comments of Examiners
Suggestions for teachers
(a) Most candidates answered correctly. Few however
were not clear with the stages of marketing and
wrote incorrect answers.
(b) Most candidates were unable to answer correctly.
They got confused and wrote on differences
between a product and services with some who even
wrote the features of services.
(c) Most candidates answered correctly.
Explain the various stages of
marketing with relevant key points,
followed by a thorough revision.
Proper explanation with examples
will clear concepts. Instruct students
to read questions carefully and write
precise answers.
Train students to remember sub-
headings along with key words.
Importance of each step should be
also be explained. There should be a
sequential discussion of the
consecutive steps and how it
precedes the other.

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MARKING SCHEME
Question 5.
(a) In Sales-Oriented Stage of Marketing the focus was on selling or increasing sales.
The new motto was get rid of what you have.
In the process of aggressive selling, unscrupulous practices occurred.
Salesmanship was the focus of marketing activities.
In the Marketing-Oriented Stage, keen competition and consumer awareness forced producers
to realize that business policies and programmes should be built around the goal of customer
satisfaction.
Management started providing value satisfaction to customers.
Customer satisfaction became the principal reason for corporate existence.
In order to survive and grow in this highly competitive world, a company must first determine
what consumers want, then produce that will satisfy consumers.
(b) The reasons for increasing importance of services are.
1. Economic planning - Government of India launched 5 year plans in 1991 to achieve rapid
growth of the country. Industrial infrastructure like transport, communication, power,
insurance, banking finance etc. and social infrastructure like education, medical facilities,
community services etc., are fast growing and these services have expanded rapidly in the
country.
2. Increasing urbanization there has been shifting of population from rural to urban areas
which is leading to demand for public utility services like police, water, electricity, municipal
services etc.
3. Media Television, internet, and other media have led to increasing tourism, modern
technology has made business more comfortable, tourism in turn has promoted all types of
services such hotel, restaurant, travel agents, amusement parks, etc.
4. Women and workforce- Increase in the number of women doing jobs leads to rising demand
for personal services like household helpers, baby sitting etc.
5. Improved standard of living Increase in the per capita income leads to improved standard
of living and increasing demand for many services like slimming centers, interior decoration,
beauty parlours, health clubs etc.
6. Greater life expectancy increase in life span has led to greater demand for healthcare and
related services.
(c) Steps generally involved in the selection of employees: (5 steps required)
(i) Preliminary Interview:
The job- seekers are received by the receptionist or some other official who conducts a brief
interview of the candidate to fill up the application form. The purpose of the preliminary
interview is to ascertain the minimum qualification, experience, age etc., of candidates.
(ii) Application Form:

281
 The candidates who succeed in preliminary interview are asked to fill in the prescribed
application form. The application form provides a written record of the name, address, age,
qualification, of a candidate.
(iii) Employment Tests:
These tests are based on the assumption that work behaviour of a person can be predicted by
sampling it. There several type of tests and the right type of tests should be used.
(iv) Selection Interview:
Interview serves as a means of checking the information obtained through application form
and tests. It also provides an opportunity to the candidate to get information about the job of
the company. Managers can judge the personality, communication skills and suitability of
the candidate through face to face contact.
(v) Checking References:
Candidates are generally required to give names and addresses of two or more persons from
whom information about the candidate may be obtained. These persons are called
references. These references are requested to provide information in confidence about the
candidates competence and character.
(vi) Medical Examination:
A physical examination of the candidates is necessary to ensure that they are physically fit
for the job. Medical examination should record a complete medical history, current physical
capabilities and nature of disabilities, if any.
(vii) Final Approval:
The candidates who are short-listed after medical examination are finally approved by the
head of the department in which they are to work. They are issued appointment letters and/or
service agreements are made with them. Candidates are appointed on probation of one or
two years. They are made permanent after they give satisfactory performance during the
probationary period.

Question 6

(a) Explain the five consumer rights as per the Consumer Protection Act, 1986. [5]
(b) Explain any two elements of Public Relations. [5]
(c) All vacancies at various levels in an organisation cannot be filled through an internal [5]
sources of recruitment.
Explain any five external sources of recruitment.

282
Comments of Examiners
(a) Most candidates answered incorrectly. Some Suggestions for teachers
confused consumer rights with fundamental rights
Instruct students to read the question
hence wrote vague answers.
carefully before making attempts to
(b) Most candidates answered correctly. However,
answer. A broad understanding of
some were unable to explain the concept with any
consumer rights with examples will
form of clarity.
bring clarity to concepts.
(c) Most candidates were confused with internal and
A clear explanation of the topic must
external sources of recruitment and wrote incorrect
be undertaken to facilitate a better
answers.
understanding.
Emphasise on key-words while
explaining topics. Clear concepts
with examples to bring about a better
comprehension.

MARKING SCHEME
Question 6.
(a) Consumer Rights: (any 5)
The Consumer Protection Act 1986 provides for the following rights of consumers:
(i) Right to safety: It means the right to be protected against the marketing of goods and services
which are hazardous to life and property
(ii) Right to be informed: It means right to be informed about the quality, quantity, purity,
potency, standard and price of goods. By getting all such information, consumers can make
the right choice and get protection from unfair trade practices
(iii) Right to Choose: It means the right to be assured whenever possible, of access to a variety
of goods and services at competitive price. It also includes the right to basic goods and
services.
(iv) Right to be heard: It means consumers interest must receive the consideration at appropriate
forums. It also includes the right to be represented in various forums constituted to consider
the welfare of consumers.
(v) Right to seek redress: it means right to seek redress against unfair trade practices or
unscrupulous exploitation of consumers. It also includes the right to fair settlement of the
genuine grievances of consumers.
(vi) Right to Consumer Education: It means right to acquire the knowledge and skill to be an
informed consumer. Consumers must not only know but also exercise their rights.
(b) The elements of Public Relations are:
1. Human relations. It refers to relations between human beings on the basis of human dignity
and mutual respect. Human beings are the most important resource of an organization. Every
employee of an organization is a human being and the success of any organization depends
upon the enthusiasm, loyalty and initiative of its employees.

283
 2. Empathy - It refers to looking at events and things from the view point of others. In other
words seeing and feeling matters as others see and feel. The sources of any organization
depends upon its sensitiveness towards the expectations and problems of its employees.
3. Persuasion it refers to the act of convincing another person of some idea, product, service
or institution to induce a person or group to do something eg., politicians persuade voters to
vote.
4. Dialogue it refers to conversation between two persons with a purpose. It a person goes
on talking without allowing others to participate in the discussion becomes a monologue.
Dialogue reveals the true personality of a person. It helps to reduce prejudice and builds up
mutual confidence. Effective dialogue requires impartial listening and understanding. There
should be respect for each others opinion.
(c) External sources of recruitment (Any 5 external source)
(i) Advertisements: Advertisements in newspapers and journals are the most widely method of
attracting candidates for all types of jobs. The requirements of the job and terms and
conditions of employment are given in the advertisement. Candidates evaluate themselves
against job requirements and send applications.
(ii) Employment Exchanges: Employment exchanges are run by the Government. Anyone
seeking employment can get himself registered with the employment exchange. Employers
notify employment exchanges about job vacancies. The exchange supplies a list of
candidates to fulfil required qualifications. These are a useful source of recruitment for
unskilled and semi-skilled personnel.
(iii) Placement Agencies: These agencies advertise the vacancies, receive applications, conduct
interviews and short-list candidates on behalf of employers. These organisations charge for
their services.
(iv) Educational Institutions: Companies maintain a close relation with management of technical
institutes and Universities. Brilliant students are spotted during the course of their studies.
They are offered jobs on completion of their studies. Representatives of the companies hold
interviews in educational institutions and select the qualified students.
(v) Unsolicited applicants: Persons in search of employment visit offices of companies. They
carry their resume and certificates. These persons may be considered if there is a vacancy. A
record of such candidates may be maintained. When jobs suitable for them are available they
may be contacted and considered employment. These persons are also known as casual
callers.
(vi) Jobbers and Contractors: When workers are to be hired at a short notice and without going
through the usual selection procedure, jobbers and contractors serve as useful source of
recruitment.
(vii) Gate Hiring: Generally small firms make recruitment of casual workers at the factory gate.
Workers gather at the factory gate after reading the notice of vacancies. The suitable
candidate is selected. This is used to fill temporary and casual vacancies.
(viii) Recommendations: Applicants introduced by friends and relatives can be a source of
recruitment. Recommendations may come from trade unions.

284
Question 7

(a) Explain fixed cost with suitable examples. [5]

(b) Explain variable cost and semi-variable cost with suitable examples. [5]
(c) Explain the first two stages of Product Life cycle. [5]

Comments of Examiners
(a) Most candidates were unable to understand the Suggestions for teachers
question and wrote irrelevant answers along with Concrete examples will help students
incorrect examples. correlate concepts to topics
(b) Most candidates wrote ambiguous answers. They previously learnt. In depth study of
did not comprehend the topic on cost and hence various concepts with constant
answered incorrectly. revision helps in a better
(c) Most candidates answered correctly. understanding.
Students should be taught with the
help of examples which will improve
the understanding and learning
process.
Explain the various concepts with
clarity along with regular practice.

MARKING SCHEME
Question 7.
(a) Fixed Cost: Fixed costs are those costs which remain fixed in amount irrespective of changes in
the volume of output during a given period of time. Such costs do not change with changes in the
level of activity upto a certain limit. Rent, insurance, depreciation of plant are examples of fixed
costs.
(The behaviour of fixed cost can be shown by a graph also)
(b) Variable cost: Variable costs are those which vary in amount with the changes in the level of
output or activity. Such costs increase and decrease in the same proportion in which the level of
output increases or decreases. Variable costs vary in total amount but remain constant per unit of
Production. Ex- Direct material cost, Direct variable cost, and direct expenses.
Semi Variable Cost: Semi Variable Cost are those which vary but not in direct proportion to
changes in volume of production.
(c) The first two stages of Product Life Cycle are-
Introduction Stage: During this stage the product is born. It may be entirely a new product or a
new version of some basic product. The firm informs the market about the existence and feature

285
 of the product. Competition is virtually absent, market is limited, prices are relatively high and
little is known about the product innovation. Growth in sales volume is at a low rate due to lack
of knowledge on the part of the consumers and limited distribution. Prices are usually high
because of small scale production and heavy promotional expenditure. Thus the introduction
stage is characterized by high costs, low sales volume, limited distribution and high prices. This
stage is very risky because a high percentage of new products fail during this period.
Growth Stage: In this stage the demand and sales grow rapidly, distribution is widened,
competition increases and prices fall. Promotional focus shifts from buy my product to buy
my brand. The firm expands sales by increasing market share in the existing markets, and by
entry into new markets. The promotional expenses remain high but fall as percentage of sales
turnover. Therefore, profits rise. In some cases, major improvements may take place in the
product.

Question 8

Write short notes on:

(a) (i) Principle of Timeliness [5]

(ii) Money Measurement Concept
(b) Newspapers as a media for advertising. [5]
(c) Narmada Bachao Andolan and the Chipko Movement. [5]

Comments of Examiners
(a)
(i) Most candidates were unable to answer it
correctly and hence wrote irrelevant answers.
(ii) Most candidates answered correctly.
(b) Most candidates wrote the advantages and
disadvantages of newspaper advertising correctly.
(c) Answered correctly by most candidates. The second
part on Narmada Bachao Andolan was
inadvertently confused with issues related to that of
river pollution.
Suggestions for teachers
The concept has to be explained with
the help of examples.
Advise students to be very specific
and careful while writing answers.
Guide students to read the questions
carefully before answering. Provide
practical knowledge as far as possible
with the help of projects.
Students must be trained to read and
analyse the question in depth before
making attempts to answer.

286
MARKING SCHEME
Question 8.
(a) (i) Principle of Timeliness:
Financial statements provide useful information on the basis of which users take important
decisions. If the statements contain old and late information they are of little use. Therefore,
this principle states that the financial statements should be prepared quickly at the end of the
accounting period.
(ii) Money Measurement Concept:
On the basis of this concept, only those transactions are recorded in accounts which can be
expressed in terms of money. E.g. the retirement of the chairman of the company cannot be
recorded because it is not possible to measure the monetary effect of retirement.
With the help of money, diverse items can be added together. The total value of assets, such
as raw materials, machinery, land and buildings, furniture and fixtures, etc., can be measured
in terms of money.
Money measurement concept helps to make accounting records homogenous, relevant,
simple and understandable.
(b) Newspapers as a media for advertising:
Advantages:
Wide circulation
Economical
Can be repeated daily to remind customers
Very flexible medium as the advertisements can be changed daily
Benefit of selectivity regarding market, language, etc.
Disadvantages:
Newspapers are read for news, advertisements are neglected
Short life
Cannot be used for illiterates
Scope of art and colour is limited
(c) Narmada Bachao Andolan: In late 1980 s Narmada Bachao Andolan started under the
leadership of Medha Patkar. It aimed primarily to educate those directly affected by the social
and environmental impact of large development projects. It began as a protest against the
construction of dams in The Narmada valley in general. The Andolan mobilized and organized
residents of the Narmada valley on Human Rights, and environmental issues related to the big
dams. The leaders of this movement are fighting against the displacement and disregard of the
rights of the people.
Chipko Movement: In the 1970s an organized resistance to the destruction of forests spread
throughout India. It came to be known as Chipko Movement. Chipko means hug the trees. The
movement was led by Sunderlal Bahuguna and several other civil society leaders. He undertook
a 5000 km foot march to spread the Chipko message. He coined the Chipko slogan Ecology is
permanent economy. The movement drew worldwide attention. It inspired environmentalists
both in India and abroad. It made a substantial contribution of eco-ferminism, deep ecology,
community based conservation and sustainable development.

287
Question 9

Case Study

Maruti Nero, a product of the Maruti group has created a very good reputation in the automobile market.
It has nearly 180 outlets and operates in nearly 100 cities. The company provides genuine spare parts
and 24/7 roadside assistance with longest warranty coverage. It has collaboration with Tata Motors
regarding its sale, service and spares. There are many dealers of Tata motors in Delhi and outskirts, so
this has rapidly increased the sale of the car. The company normally goes for institutional advertising in
most of the cases. It is indeed a reality that Maruti with minimum advertising has become a popular
brand.
With reference to the above:

(a) What is Institutional advertising? State and explain the other types of advertising. [5]
(b) What is a brand promotion? Explain the methods used for brand promotion. [5]
(c) Suggest and explain any two suitable media to be used by the company to advertise its [5]
product.

Comments of Examiners Suggestions for teachers

(a) Most candidates answered the question correctly.
(b) Most candidates failed to answer this question
correctly. Methods of brand promotion was not
explained and mentioned.
(c) Most candidates were unable to answer this
question correctly.
Advise candidates to read the case
study carefully and understand it.
Advise candidates to be specific and
careful while answering questions.
To avoid confusion, explain the
concept of brand promotion with the
help of examples so that students are
able to understand the methods of
brand promotion and develop a
logical outlook.
In-depth discussion and relevant
examples of how companies decide
on the advertising media should be
done in class. Explain how media can
be used for advertising of various
product by giving examples.

288
 MARKING SCHEME
Question 9.
(a) Institutional advertising: The aim of this type of advertising is to build a favorable image of the
organization rather than promote sale of a product or service.
(i) Product advertising
(ii) Informative advertising
(iii) Persuasive advertising
(iv) Reminder advertising
(v) Concept advertising
(vi)Collective and comparative advertising ( Any four with a brief explanation)
(b) Brand Promotion means informing, reminding, persuading present and potential customers to
buy a particular brand
Methods:
Advertisements
Quality Control
Publicity
Sales promotion
Packaging
(c) Suitable media can be Newspaper, Television, Films, and Outdoor Advertising. (reasons to be
mentioned)

Question 10

This statistic shows the global smartphone market share held by Nokia each quarter from 2007 to 2013.
In the third quarter of 2007, Nokia's market share was 48.7 percent. By the third quarter of 2012 the
company's market share had slipped to just 3.5 percent.

Nokia is a Finnish company head-quartered in Espoo, Finland. The company has a long history dating
as far back as 1865 and first began developing what would later be modern mobile phone technology in
the 1960s. The company has previously been a very strong competitor in the mobile phone and
telecommunication market. While the company has struggled to maintain a significant share of the
smartphone market, and has also recorded multiple losses in recent quarters, when it comes to feature
phones, the company does maintain a relatively secure share of the market when compared to other
vendors. The company also continues to perform well in the Asia-Pacific region as well as in the Middle
East and Africa were they have previously recorded the greatest sales. Across the North American market
however, the company has recorded very poor sales.

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Previously Nokia used the operating system Symbian for its smartphones. Until 2010, Symbian was
performing well in the global market but has since been overtaken by the very dominant Android system
and also Apples iOS. As of February 2011, Nokia made the announcement that they would be switching
to the Microsoft Windows OS. The company was hoping to be able to make a comeback in the
smartphone market with the adoption of the Windows operating system. In 2012 however, sales saw
another decrease when compared to the previous 2 years. The Windows mobile operating system did not
prove to be popular and market share slipped further. Even after Nokias high-profile acquisition by
Microsoft, the market share of the brand still remains at a dismal 3 percent.

With reference to the above:

(a) Explain any five uses of Product Life Cycle to a business enterprise like Nokia. [5]

(b) Explain the various steps taken by Nokia after 2010 to improve the brand image. [5]

(c) What are the promotional activities that can be undertaken to increase the market share of [5]
Nokia?

Comments of Examiners
Suggestions for teachers
(a) Most candidates wrote about the strategies adopted
Assign adequate practice on topics
rather than the uses of Product Life Cycle as
involving case studies. This will help
suggested by the question.
students in learning more practically.
(b) Most candidates wrote incorrect answers as they
Sufficient practice to students in case
were unable to understand the question.
studies should be given.
(c) Most candidates wrote incorrect answers which
Assign case studies and instruct
reflects lack of conceptual clarity.
students to use their own thoughts
and ideas and to correlate it with the
topics learnt so that they are clear
with concepts.

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MARKING SCHEME
Question 10.
(a) Five uses of PLC:
(i) Highlights the life of a product and need for a new product
(ii) The expected sales volume and profit margins
(iii) It serves as a framework for taking decisions.
(iv) To adjust in the marketing strategy according to the need.
(v) Operating Cost control can be established.
(vi) Timely recognition to change marketing strategy.
(b) (i) Symbian technology
(ii) Inclusion of Microsoft Windows OS
(iii) Adoption of Windows Operating System
(c) The following strategies may be adopted
(i) Heavy advertising to create brand image and to stimulate sales
(ii) Expanding distribution channels to make the product available wherever demanded.
(iii) Introduce new versions of the product to cater to the needs of different types of customers.
(iv) Keeping the price at competitive levels.
(v) Greater emphasis on customer service.
(vi) Differentiating the product from competitive products
(vii) Developing new markets.
(viii) Finding new uses of the product.
(ix) Extending the warranty period.

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Topics/Concepts found confusing/difficult:

- Fixed cost, Variable cost and Semi-variable cost.

- Reasons for increase in importance of services.
- Indirect labour cost.
- Credit control measures adopted by Central Bank of India.
- Product life cycle.
- Cash credit.
- Consumer Rights.
- On -the job training and Off -the job training.
- Causes of greenhouse effect.
- Importance of service.
- Sources of recruitment.
- Stages of marketing and stages of product life cycle.

Suggestions for students:

- Read questions carefully and underline key points.

- Prepare your notes with key words.
- Regular practice on chapters with case-studies.
- Understanding concepts of product life cycle, Advertising, Branding, Recruitment and Selection
- Banking can be learnt through practical situations.
- Selective study must be avoided.
- Always write distinctions in tabular form.
- Main points to be highlighted.
- Understand concepts and correlate with topics learnt for case studies.

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