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September 2025 term · Business Data Management · BSMS2001

Business Data Management End Term: 21 December 2025 (September 2025 term)

The IIT Madras BS Business Data Management (BDM) End Term paper sat on 21 Dec 2025, in the September 2025 term: 50 questions for 60 marks in 180 minutes. Every question is below with its answer. Take it as a timed mock test to be marked, or read it through first.

Questions
50
Marks
60
Duration
180 min
MCQ
48
Written
2

Updated

Official paper: Business Data Management 18 Dec 25 · No negative marking.

Question 1

+1 markOne correct option

A beverage company wants to estimate the annual “Addressable Market” (in ₹) for a new premium coffee brand in India. They purchase a national survey with 10,000 households and the following summary:
● 70% of households consume coffee at least once a week. ● 40% of coffee-drinking households have monthly household income ≥ ₹80,000. ● Among those higher-income coffee-drinking households, the average is: ● 20 cups of coffee per month per household, ● Expected willingness to pay of ₹50 per cup for premium coffee.
Assume this survey is nationally representative of 300 million households in India.
Which is the BEST first step to avoid overestimating the “Addressable Market” for this premium brand?

  1. A

    Multiply 70% of 300M households × 20 cups/month × ₹50 × 12 months.

  2. B

    Multiply 40% of 300M households × 20 cups/month × ₹50 × 12 months.

  3. C

    Multiply 70% × 40% of 300M households × 20 cups/month × ₹50 × 12 months.

  4. D

    Multiply 300M households × 20 cups/month × ₹50 × 12 months.

Show answer

Correct answer

  • C

    Multiply 70% × 40% of 300M households × 20 cups/month × ₹50 × 12 months.

Question 2

+1 markOne correct option

A "Left Join" between Table A (100 rows) and Table B (100 rows) results in a table with 105 rows. What does this definitely prove?

  1. A

    The join condition was wrong.

  2. B

    Table A has duplicate keys matching records in Table B

  3. C

    Table B has duplicate keys matching records in Table A.

  4. D

    It is impossible; a Left Join cannot exceed the row count of the left table.

Show answer

Correct answer

  • C

    Table B has duplicate keys matching records in Table A.

Question 3

+1 markOne correct option

You are analyzing market share data for the smartphone industry.
● Last year, total market volume was 100 million units; this year it is 105 million units. ● Last year, Company X sold 20 million units; this year its sales volume remained 20 million units.
Which statement best describes Company X’s performance in terms of market share?

  1. A

    Company X has maintained a 20% market share.

  2. B

    Company X has lost market share, from 20% to about 19%.

  3. C

    Company X has grown slower than the overall market and thus must have lower revenue.

  4. D

    Company X has increased its market share in value terms because prices increased YoY.

Show answer

Correct answer

  • B

    Company X has lost market share, from 20% to about 19%.

Question 4

+1 markOne correct option

A B2B SaaS company tracks leads through this funnel:
● Stage 1: MQL (Marketing Qualified Lead) ● Stage 2: SQL (Sales Qualified Lead) ● Stage 3: Demo Completed ● Stage 4: Closed Won
You have two tables: ● Leads(LeadID, CreatedDate, Acquisition_Channel, Region) ● Opportunities(LeadID, Stage, Stage_Change_Date, Deal_Value)
You are asked: “Which acquisition channel has the highest conversion rate from Demo Completed to Closed Won in the last 12 months?”
An analyst writes the following query:
● Filters Opportunities to rows where Stage IN ('Demo Completed','Closed Won') in the last 12 months. ● Groups by Acquisition_Channel. ● Computes: Conversion_Rate = (COUNT(DISTINCT LeadID WHERE Stage='Closed Won')) / (COUNT(DISTINCT LeadID WHERE Stage='Demo Completed')).
Which subtle issue is most likely to bias this conversion rate upward for some channels?

  1. A

    Using DISTINCT LeadID instead of counting total rows in Opportunities.

  2. B

    Not restricting “Demo Completed” leads to those whose demo occurred before their “Closed Won” date.

  3. C

    Not including Leads that never reached the Demo Completed stage in the denominator.

  4. D

    Filtering to the last 12 months by Stage_Change_Date instead of by Lead CreatedDate.

Show answer

Correct answer

  • B

    Not restricting “Demo Completed” leads to those whose demo occurred before their “Closed Won” date.

Question 5

+1 markOne correct option

A business analyst is studying how “Macro-economic indicators” relate to the sales of luxury cars. Over the last 3 recessions:
● Each recession began in Q4 of Year 3, Q2 of Year 7, and Q1 of Year 12 (as dated by the central bank). ● Luxury car sales started declining sharply in Q2 of Year 3, Q4 of Year 6, and Q3 of Year 11. ● Unemployment rates peaked in Q2 of Year 4, Q1 of Year 8, and Q3 of Year 13.
In this context, luxury car sales are best classified as:

  1. A

    A lagging indicator, similar to unemployment.

  2. B

    A coincident indicator, moving at the same time as the recession dates.

  3. C

    A leading indicator, typically declining 2 quarters before an official recession starts.

  4. D

    A noisy indicator, because car sales and recessions don’t show any clear time pattern.

Show answer

Correct answer

  • C

    A leading indicator, typically declining 2 quarters before an official recession starts.

Question 6

+1.5 marksOne correct option

You are visualizing a funnel for an e‐commerce site:
● Visits → Add to Cart → Checkout → Payment → Order Confirmed
You observe the following over the past week: ● 10,000 users reached Checkout. ● 5,000 users reached Payment. ● 4,800 users reached Order Confirmed. ● Error logs show <0.5% payment gateway errors. ● Session replays show many users dropping off on the Payment page before submitting their card details.
What is the most reasonable data‐driven hypothesis to investigate first?

  1. A

    Price sensitivity at Checkout is high; users reconsider the value once they see the order summary.

  2. B

    There is friction or unexpected elements on the Payment page (e.g., extra fees, forced account creation, or complex forms) causing users to abandon before submitting payment.

  3. C

    The payment gateway is silently failing for many users despite low logged error rates.

  4. D

    Top‐of‐funnel traffic is poorly targeted, so users who reach Checkout were never serious buyers.

Show answer

Correct answer

  • B

    There is friction or unexpected elements on the Payment page (e.g., extra fees, forced account creation, or complex forms) causing users to abandon before submitting payment.

Question 7

+1.5 marksOne correct option

You are given a 100% stacked bar chart comparing market share of 5 competitors over 3 years. Each year’s bar is normalized so that the total height is 100%, and only percentage splits are shown. What key business insight cannot be inferred from this chart alone?

  1. A

    How competitor ranks compare within each individual year.

  2. B

    Whether the total smartphone market grew from Year 1 to Year 3.

  3. C

    Whether the smallest player’s share increased from Year 1 to Year 3.

  4. D

    Whether the market leader’s percentage share is declining over time.

Show answer

Correct answer

  • B

    Whether the total smartphone market grew from Year 1 to Year 3.

Question 8

+1 markOne correct option

A business analyst is studying how “Macro-economic indicators” relate to the sales of luxury cars. Over the last 3 recessions:
● Each recession began in Q4 of Year 3, Q2 of Year 7, and Q1 of Year 12 (as dated by the central bank). ● Luxury car sales started declining sharply in Q2 of Year 3, Q4 of Year 6, and Q3 of Year 11. ● Unemployment rates peaked in Q2 of Year 4, Q1 of Year 8, and Q3 of Year 13.
In this context, luxury car sales are best classified as:

  1. A

    A lagging indicator, similar to unemployment.

  2. B

    A coincident indicator, moving at the same time as the recession dates.

  3. C

    A leading indicator, typically declining 2 quarters before an official recession starts.

  4. D

    A noisy indicator, because car sales and recessions don’t show any clear time pattern.

Show answer

Correct answer

  • C

    A leading indicator, typically declining 2 quarters before an official recession starts.

Question 9

+1 markOne correct option

An external agency provides you with data on both Customer Lifetime Value (CLV) and Share of Wallet (SOW) for your retail clients. Customer R shows high CLV (top 5% of your portfolio), but only 20% SOW in the relevant product category. A recent market survey finds the average SOW for your top CLV segment is 55%. (Share of wallet is the percentage of a customer's total spending in a specific product or service category that goes to a particular company.)
What is the most strategic action to maximize future revenue from this customer?

  1. A

    Maintain current strategy—such high CLV likely means this customer’s wallet is already saturated.

  2. B

    Prioritize this customer for targeted cross-selling, because their high CLV and below-average SOW indicates room to grow.

  3. C

    Reduce marketing spend—marketing ROI on high CLV customers tends toward diminishing returns.

  4. D

    Offer broad-based discounts to all top CLV customers to encourage higher SOW.

Show answer

Correct answer

  • B

    Prioritize this customer for targeted cross-selling, because their high CLV and below-average SOW indicates room to grow.

Question 10

+1 markOne correct option

You are analyzing market share data for the smartphone industry.
● Last year, total market volume was 100 million units; this year it is 105 million units. ● Last year, Company X sold 20 million units; this year its sales volume remained 20 million units.
Which statement best describes Company X’s performance in terms of market share?

  1. A

    Company X has maintained a 20% market share.

  2. B

    Company X has lost market share, from 20% to about 19%.

  3. C

    Company X has grown slower than the overall market and thus must have lower revenue.

  4. D

    Company X has increased its market share in value terms because prices increased YoY.

Show answer

Correct answer

  • B

    Company X has lost market share, from 20% to about 19%.

Question 11

+1 markOne correct option

You are auditing a “Sales Transaction” dataset. For true Beverage items, the “Product Category” column contains:
● “Bev.” in 40% of rows ● “Beverages” in 30% ● “Drinks” in 20% ● “Soft Drinks” in 5% ● Blank in 5%
Your BI dashboard defines “Beverage revenue” using: ● A filter: Product Category IN ("Beverages", "Drinks")
Last month, the dashboard reported ₹80 crore as “Beverage revenue.” You run a corrected query that groups all 4 labels together as “Beverage” and find actual Beverage revenue is ₹120 crore.
Which data quality dimension is the root cause of this ₹40 crore under-reporting?

  1. A

    Accuracy – because some non-beverage items may also be included in the report.

  2. B

    Completeness – because 5% of Beverage rows are blank in Product Category.

  3. C

    Consistency – because the same logical category is split across multiple labels that the filter does not fully capture.

Show answer

Correct answer

  • C

    Consistency – because the same logical category is split across multiple labels that the filter does not fully capture.

Question 12

+1 markOne correct option

You have the following Tables:
● Customer_Master(CustID) with 10,000 active customers. ● Transactions(CustID, TxnDate) with all purchase records.
You want a list of customers who have been active in the past (at least one transaction ever) but have made no purchases in the last 6 months. Conceptually, which operation on sets best describes this logic?
Let: ● A = set of customers with at least one transaction in the last 6 months. ● B = set of customers with at least one transaction more than 6 months ago.

  1. A

    A ∩ B

  2. B

    B − A

  3. C

    A ∪ B

  4. D

    A × B

Show answer

Correct answer

  • B

    B − A

Question 13

+1 markOne correct option

A retail manager wants to analyze Daily Inventory Turnover for SKU A to identify days with possible stockout risk.
The IT team provides this dataset for the last month (30 days): ● Total units sold in the month: 3,000 ● Stock level on Day 1: 400 units ● Stock level on Day 30: 400 units ● No data on stock levels or sales by day in between
The manager suggests estimating Daily Inventory Turnover by: Daily Turnover = (3,000/30) / ((400+400)/2)
Why is this approach fundamentally flawed for detecting stockout risk?

  1. A

    It violates the standard inventory turnover formula, which must use the cost of goods sold instead of units sold.

  2. B

    It uses only opening and closing stock to compute an average, so any days with zero stock or very low stock in the middle of the month are hidden by the monthly smoothing.

  3. C

    It assumes demand is evenly spread across days, so days with sales spikes or stock-outs cannot be distinguished from normal days.

  4. D

    It is invalid because you cannot calculate a daily metric using any monthly data.

Show answer

Correct answer

  • C

    It assumes demand is evenly spread across days, so days with sales spikes or stock-outs cannot be distinguished from normal days.

Question 14

+1 markOne correct option

A beverage company wants to estimate the annual “Addressable Market” (in ₹) for a new premium coffee brand in India. They purchase a national survey with 10,000 households and the following summary:
● 70% of households consume coffee at least once a week. ● 40% of coffee-drinking households have monthly household income ≥ ₹80,000. ● Among those higher-income coffee-drinking households, the average is: ● 20 cups of coffee per month per household, ● Expected willingness to pay of ₹50 per cup for premium coffee.
Assume this survey is nationally representative of 300 million households in India.
Which is the BEST first step to avoid overestimating the “Addressable Market” for this premium brand?

  1. A

    Multiply 70% of 300M households × 20 cups/month × ₹50 × 12 months.

  2. B

    Multiply 40% of 300M households × 20 cups/month × ₹50 × 12 months.

  3. C

    Multiply 70% × 40% of 300M households × 20 cups/month × ₹50 × 12 months.

  4. D

    Multiply 300M households × 20 cups/month × ₹50 × 12 months.

Show answer

Correct answer

  • C

    Multiply 70% × 40% of 300M households × 20 cups/month × ₹50 × 12 months.

Question 15

+1 markOne correct option

In a tidy retail dataset, you track weekly sales for 5 stores over 52 weeks. You want a structure that:
● Allows you to easily compute total sales per store, ● And also average sales per week across stores.
Which layout is most consistent with tidy‐data principles?

  1. A

    One row per week, with 5 columns: Store1_Sales, ..., Store5_Sales.

  2. B

    One row per store, with 52 columns: Week1_Sales, ..., Week52_Sales.

  3. C

    One row per StoreID–Week pair, with columns StoreID, Week, Sales.

  4. D

    Five separate tables, one per store, each with 52 weekly sales rows.

Show answer

Correct answer

  • C

    One row per StoreID–Week pair, with columns StoreID, Week, Sales.

Question 16

+1.5 marksOne correct option

You are presenting to the CEO. She asks: “Which region contributed the most to our profit growth this year compared to last year?”
You have the following data for each region: ● Previous Year Profit ● Current Year Profit ● Profit Change (Current − Previous)
Which visualization is most effective to clearly answer her question?

  1. A

    A pie chart showing each region’s share of Current Year Profit.

  2. B

    A line chart of total company profit over the last 5 years.

  3. C

    A bar chart showing Current Year Profit by region, sorted descending.

  4. D

    A waterfall chart where each bar shows the profit change for one region, summing to the total profit growth.

Show answer

Correct answer

  • D

    A waterfall chart where each bar shows the profit change for one region, summing to the total profit growth.

Question 17

+1 markOne correct option

You have the following Tables:
● Customer_Master(CustID) with 10,000 active customers. ● Transactions(CustID, TxnDate) with all purchase records.
You want a list of customers who have been active in the past (at least one transaction ever) but have made no purchases in the last 6 months. Conceptually, which operation on sets best describes this logic?
Let: ● A = set of customers with at least one transaction in the last 6 months. ● B = set of customers with at least one transaction more than 6 months ago.

  1. A

    A ∩ B

  2. B

    B − A

  3. C

    A ∪ B

  4. D

    A × B

Show answer

Correct answer

  • B

    B − A

Question 18

+1 markOne correct option

In a tidy retail dataset, you track weekly sales for 5 stores over 52 weeks. You want a structure that:
● Allows you to easily compute total sales per store, ● And also average sales per week across stores.
Which layout is most consistent with tidy‐data principles?

  1. A

    One row per week, with 5 columns: Store1_Sales, ..., Store5_Sales.

  2. B

    One row per store, with 52 columns: Week1_Sales, ..., Week52_Sales.

  3. C

    One row per StoreID–Week pair, with columns StoreID, Week, Sales.

  4. D

    Five separate tables, one per store, each with 52 weekly sales rows.

Show answer

Correct answer

  • C

    One row per StoreID–Week pair, with columns StoreID, Week, Sales.

Question 19

+1.5 marksOne correct option

A SKU (Stock Keeping Unit) has a "Long Tail" sales distribution. In an ABC analysis, this SKU would likely fall into Category C. What is the primary risk of managing this data using simple "Average Demand"?

  1. A

    It will slightly underestimate storage costs, but this effect is negligible for long‐tail SKUs.

  2. B

    It will mix many zero‐demand periods with rare spikes into a single value, leading to excess stock in most periods and still not guaranteeing enough stock when a spike happens.

  3. C

    It will mainly affect the ABC classification, but not the replenishment policy.

  4. D

    It will always underestimate demand for long‐tail SKUs, causing frequent stockouts but never over‐stocking.

Show answer

Correct answer

  • B

    It will mix many zero‐demand periods with rare spikes into a single value, leading to excess stock in most periods and still not guaranteeing enough stock when a spike happens.

Question 20

+1 markOne correct option

You are auditing a “Sales Transaction” dataset. For true Beverage items, the “Product Category” column contains:
● “Bev.” in 40% of rows ● “Beverages” in 30% ● “Drinks” in 20% ● “Soft Drinks” in 5% ● Blank in 5%
Your BI dashboard defines “Beverage revenue” using: ● A filter: Product Category IN ("Beverages", "Drinks")
Last month, the dashboard reported ₹80 crore as “Beverage revenue.” You run a corrected query that groups all 4 labels together as “Beverage” and find actual Beverage revenue is ₹120 crore.
Which data quality dimension is the root cause of this ₹40 crore under-reporting?

  1. A

    Accuracy – because some non-beverage items may also be included in the report.

  2. B

    Completeness – because 5% of Beverage rows are blank in Product Category.

  3. C

    Consistency – because the same logical category is split across multiple labels that the filter does not fully capture.

Show answer

Correct answer

  • C

    Consistency – because the same logical category is split across multiple labels that the filter does not fully capture.

Question 21

+1.5 marksOne correct option

You are presenting to the CEO. She asks: “Which region contributed the most to our profit growth this year compared to last year?
You have the following data for each region:
● Previous Year Profit ● Current Year Profit ● Profit Change (Current − Previous)
Which visualization is most effective to clearly answer her question?

  1. A

    A pie chart showing each region’s share of Current Year Profit.

  2. B

    A line chart of total company profit over the last 5 years.

  3. C

    A bar chart showing Current Year Profit by region, sorted descending.

  4. D

    A waterfall chart where each bar shows the profit change for one region, summing to the total profit growth.

Show answer

Correct answer

  • D

    A waterfall chart where each bar shows the profit change for one region, summing to the total profit growth.

Question 22

+1.5 marksOne correct option

You are analyzing "Basket Co-occurrence" (Market Basket Analysis). You find that [Bread, Milk] has high lift, but [Bread, Butter] has low lift. However, the raw sales volume of [Bread, Butter] is higher than [Bread, Milk]. What does this imply?

  1. A

    Bread and Butter are popular individually, so they appear together frequently, but one does not trigger the need for the other specifically more than average.

  2. B

    People buy Bread and Butter together only by random chance.

  3. C

    The data is corrupted.

  4. D

    You should stop promoting Bread and Milk.

Show answer

Correct answer

  • A

    Bread and Butter are popular individually, so they appear together frequently, but one does not trigger the need for the other specifically more than average.

Question 23

+1.5 marksOne correct option

In a Pivot Table, you drag "Region" to Rows, "Year" to Columns, and "Sales" to Values. You then drag "Sales" into the Values area a second time. A business analyst sets:
● The first "Sales" field to “Sum” (normal). ● The second "Sales" field to “% of Row Total”.
What is the main reason for doing this?

  1. A

    To compare absolute Sales by Region-Year and each Region’s percentage contribution within the same table.

  2. B

    To fix rounding errors that occur when using Sum alone.

  3. C

    To enable the Pivot Table to automatically detect duplicate regions.

  4. D

    To convert Sales into Profit without creating a calculated field.

Show answer

Correct answer

  • A

    To compare absolute Sales by Region-Year and each Region’s percentage contribution within the same table.

Question 24

+1 markOne correct option

A chain of gyms analyzes member data and finds:
● Strong positive correlation between “Number of Personal Training (PT) Sessions purchased per month” and “Likelihood of renewing annual membership”. ● Members who buy ≥4 PT sessions per month have a 90% renewal rate. ● Members who buy 0 PT sessions per month have a 50% renewal rate.
The sales director concludes: “If we push every member to buy at least 4 PT sessions per month, our renewal rate will jump to 90%.”
What is the most important concern you should raise about this conclusion?

  1. A

    The observed relationship may be driven by underlying member motivation or fitness commitment, not PT sessions themselves, so forcing PT on everyone may not cause a 90% renewal rate.

  2. B

    The renewal rate is too low to be meaningful, regardless of PT sessions.

  3. C

    The correlation is negative, not positive; the director is reading the numbers backwards.

  4. D

    PT sessions are a cost center, so increasing them will automatically reduce renewal rates.

Show answer

Correct answer

  • A

    The observed relationship may be driven by underlying member motivation or fitness commitment, not PT sessions themselves, so forcing PT on everyone may not cause a 90% renewal rate.

Question 25

+1.5 marksOne correct option

You are visualizing a funnel for an e‐commerce site:
● Visits → Add to Cart → Checkout → Payment → Order Confirmed
You observe the following over the past week: ● 10,000 users reached Checkout. ● 5,000 users reached Payment. ● 4,800 users reached Order Confirmed. ● Error logs show <0.5% payment gateway errors. ● Session replays show many users dropping off on the Payment page before submitting their card details.
What is the most reasonable data‐driven hypothesis to investigate first?

  1. A

    Price sensitivity at Checkout is high; users reconsider the value once they see the order summary.

  2. B

    There is friction or unexpected elements on the Payment page (e.g., extra fees, forced account creation, or complex forms) causing users to abandon before submitting payment.

  3. C

    The payment gateway is silently failing for many users despite low logged error rates.

  4. D

    Top‐of‐funnel traffic is poorly targeted, so users who reach Checkout were never serious buyers.

Show answer

Correct answer

  • B

    There is friction or unexpected elements on the Payment page (e.g., extra fees, forced account creation, or complex forms) causing users to abandon before submitting payment.

Question 26

+1.5 marksWritten answer

You are analyzing seasonality for an Ice Cream brand. December sales (in 1,000 units) over the last 5 years were:
Year 1: 80 Year 2: 120 Year 3: 60 Year 4: 140 Year 5: 100
You calculate the average December sales as 100,000 units and share this with the production team. They say: “This doesn’t help us decide how much risk we have of over or under‐producing in December.”
What other metric would satisfy them? Answers Case Sensitive : No

Show answer

Correct answer: standard deviation

Question 27

+1 markOne correct option

A small shop owner keeps data in a notebook. For January he writes entries like:
● "15th Jan: Sold 10 kg Rice, 5 kg Dal. Purchase: 50 kg Rice." ● "20th Jan: Sold 5 kg Rice. Purchase: 20 kg Rice."
You are asked to digitize this to calculate the current stock of Rice on 31st Jan. The notebook is missing one critical piece of information that makes accurate historical stock reconstruction difficult.
Which data attribute is essential but missing?

  1. A

    The selling price per kg of Rice for each day.

  2. B

    The supplier name for each Rice purchase.

  3. C

    The Opening Stock balance of Rice on 1st Jan.

  4. D

    The customer name for each Rice sale.

Show answer

Correct answer

  • C

    The Opening Stock balance of Rice on 1st Jan.

Question 28

+1 markOne correct option

An external agency provides you with data on both Customer Lifetime Value (CLV) and Share of Wallet (SOW) for your retail clients. Customer R shows high CLV (top 5% of your portfolio), but only 20% SOW in the relevant product category. A recent market survey finds the average SOW for your top CLV segment is 55%. (Share of wallet is the percentage of a customer's total spending in a specific product or service category that goes to a particular company.)
What is the most strategic action to maximize future revenue from this customer?

  1. A

    Maintain current strategy—such high CLV likely means this customer’s wallet is already saturated.

  2. B

    Prioritize this customer for targeted cross-selling, because their high CLV and below-average SOW indicates room to grow.

  3. C

    Reduce marketing spend—marketing ROI on high CLV customers tends toward diminishing returns.

  4. D

    Offer broad-based discounts to all top CLV customers to encourage higher SOW.

Show answer

Correct answer

  • B

    Prioritize this customer for targeted cross-selling, because their high CLV and below-average SOW indicates room to grow.

Question 29

+1.5 marksOne correct option

You are analyzing "Basket Co-occurrence" (Market Basket Analysis). You find that [Bread, Milk] has high lift, but [Bread, Butter] has low lift. However, the raw sales volume of [Bread, Butter] is higher than [Bread, Milk]. What does this imply?

  1. A

    Bread and Butter are popular individually, so they appear together frequently, but one does not trigger the need for the other specifically more than average.

  2. B

    People buy Bread and Butter together only by random chance.

  3. C

    The data is corrupted.

  4. D

    You should stop promoting Bread and Milk.

Show answer

Correct answer

  • A

    Bread and Butter are popular individually, so they appear together frequently, but one does not trigger the need for the other specifically more than average.

Question 30

+1.5 marksOne correct option

A SKU (Stock Keeping Unit) has a "Long Tail" sales distribution. In an ABC analysis, this SKU would likely fall into Category C. What is the primary risk of managing this data using simple "Average Demand"?

  1. A

    It will slightly underestimate storage costs, but this effect is negligible for long‐tail SKUs.

  2. B

    It will mix many zero‐demand periods with rare spikes into a single value, leading to excess stock in most periods and still not guaranteeing enough stock when a spike happens.

  3. C

    It will mainly affect the ABC classification, but not the replenishment policy.

  4. D

    It will always underestimate demand for long‐tail SKUs, causing frequent stockouts but never over‐stocking.

Show answer

Correct answer

  • B

    It will mix many zero‐demand periods with rare spikes into a single value, leading to excess stock in most periods and still not guaranteeing enough stock when a spike happens.

Question 31

+1.5 marksOne correct option

In a "Churn Prediction" model, you include a variable "Customer calls to support line". You find a positive correlation (More calls = Higher Churn). However, for a subset of high-value customers, More calls = Lower Churn. This phenomenon is known as:

  1. A

    Simpson’s Paradox

  2. B

    The Pareto Principle

  3. C

    Regression to the Mean

  4. D

    The Law of Large Numbers

Show answer

Correct answer

  • A

    Simpson’s Paradox

Question 32

+1.5 marksOne correct option

A chain of clinics measures “Doctor Utilization Rate”:
Utilization = Total Consultation Minutes / Available Working Minutes
Data for last quarter: ● Overall across all clinics: Utilization = 80%. ● You then segment by Clinic_Type: ● Urban clinics: Utilization = 78% ● Rural clinics: Utilization = 76%
A senior manager concludes: “Segmentation doesn’t change the picture; utilization is around 77–80% everywhere.”
You dig deeper and find: ● Urban clinics account for 90% of Available Working Minutes. ● Rural clinics account for 10%. ● Within Urban, junior doctors average 60% utilization, senior doctors 95%. ● Within Rural, junior doctors average 85%, senior doctors 70%.
Which statement best describes the main analytical risk in the manager’s conclusion?

  1. A

    The manager ignored seasonality effects across the quarter.

  2. B

    The manager is averaging across subgroups in a way that can hide opposite trends at a finer level

  3. C

    The manager should have used Median utilization instead of Mean.

  4. D

    The manager is wrong because utilization cannot exceed 80% if any subgroup is below 80%.

Show answer

Correct answer

  • B

    The manager is averaging across subgroups in a way that can hide opposite trends at a finer level

Question 33

+1 markOne correct option

A "Left Join" between Table A (100 rows) and Table B (100 rows) results in a table with 105 rows. What does this definitely prove?

  1. A

    The join condition was wrong.

  2. B

    Table A has duplicate keys matching records in Table B

  3. C

    Table B has duplicate keys matching records in Table A.

  4. D

    It is impossible; a Left Join cannot exceed the row count of the left table.

Show answer

Correct answer

  • C

    Table B has duplicate keys matching records in Table A.

Question 34

+1.5 marksOne correct option

In a Pivot Table, you drag "Region" to Rows, "Year" to Columns, and "Sales" to Values. You then drag "Sales" into the Values area a second time. A business analyst sets:
● The first "Sales" field to “Sum” (normal). ● The second "Sales" field to “% of Row Total”.
What is the main reason for doing this?

  1. A

    To compare absolute Sales by Region-Year and each Region’s percentage contribution within the same table.

  2. B

    To fix rounding errors that occur when using Sum alone.

  3. C

    To enable the Pivot Table to automatically detect duplicate regions.

  4. D

    To convert Sales into Profit without creating a calculated field.

Show answer

Correct answer

  • A

    To compare absolute Sales by Region-Year and each Region’s percentage contribution within the same table.

Question 35

+1 markOne correct option

Why is "Metadata" critical for Business Data Management?

  1. A

    It reduces the file size of the database.

  2. B

    It allows users to understand the context (units, source, definitions) of the raw numbers.

  3. C

    It encrypts the data.

  4. D

    It automatically creates charts.

Show answer

Correct answer

  • B

    It allows users to understand the context (units, source, definitions) of the raw numbers.

Question 36

+1 markOne correct option

A retail manager wants to analyze Daily Inventory Turnover for SKU A to identify days with possible stockout risk.
The IT team provides this dataset for the last month (30 days): ● Total units sold in the month: 3,000 ● Stock level on Day 1: 400 units ● Stock level on Day 30: 400 units ● No data on stock levels or sales by day in between
The manager suggests estimating Daily Inventory Turnover by: Daily Turnover = (3,000/30) / ((400+400)/2)
Why is this approach fundamentally flawed for detecting stockout risk?

  1. A

    It violates the standard inventory turnover formula, which must use the cost of goods sold instead of units sold.

  2. B

    It uses only opening and closing stock to compute an average, so any days with zero stock or very low stock in the middle of the month are hidden by the monthly smoothing.

  3. C

    It assumes demand is evenly spread across days, so days with sales spikes or stock-outs cannot be distinguished from normal days.

  4. D

    It is invalid because you cannot calculate a daily metric using any monthly data.

Show answer

Correct answer

  • C

    It assumes demand is evenly spread across days, so days with sales spikes or stock-outs cannot be distinguished from normal days.

Question 37

+1.5 marksWritten answer

You are analyzing seasonality for an Ice Cream brand. December sales (in 1,000 units) over the last 5 years were:
Year 1: 80 Year 2: 120 Year 3: 60 Year 4: 140 Year 5: 100
You calculate the average December sales as 100,000 units and share this with the production team. They say: “This doesn’t help us decide how much risk we have of over or under‐producing in December.”
What other metric would satisfy them? Answers Case Sensitive : No

Show answer

Correct answer: standard deviation

Question 38

+1 markOne correct option

A retail chain runs a new loyalty program in only some stores. After 3 months, you compare:
● Program stores: average bill size = ₹1,200 ● Non-program stores: average bill size = ₹900
The marketing head says: “The loyalty program increased bill size by ₹300.”
You dig into the setup and find: ● Program stores were all high-income urban locations. ● Non-program stores were mostly mid-income suburban locations. ● No random assignment was used.
What is the most accurate data-driven response?

  1. A

    The conclusion is valid; a ₹300 uplift proves the program works.

  2. B

    The comparison is confounded by store/location differences; we cannot attribute the full ₹300 difference to the program.

  3. C

    The result must be ignored because observational data is never usable for business decisions.

  4. D

    The loyalty program definitely had no effect; the entire ₹300 is due to income differences.

Show answer

Correct answer

  • B

    The comparison is confounded by store/location differences; we cannot attribute the full ₹300 difference to the program.

Question 39

+1.5 marksOne correct option

A subscription video platform wants to understand “Customer Engagement Value” (CEV) by combining:
● Customer_Master(CustID, Region, Acquisition_Channel) ● Subscriptions(CustID, Plan_Type, Monthly_Fee) ● Viewing_Logs(CustID, Date, Minutes_Watched)
They define: ● Active_Months = number of distinct months a customer watched ≥ 30 minutes. ● CEV = Active_Months × Monthly_Fee.
You are asked: “Which acquisition channel is driving the highest average CEV per customer?”
Which of the following strategies is most likely to produce a systematically biased (overstated) estimate of average CEV per customer for a given acquisition channel?

  1. A

    Aggregating Viewing_Logs to customer–month level first, then joining to Subscriptions and Customer_Master on CustID.

  2. B

    Filtering Viewing_Logs to customers in a given acquisition channel using Customer_Master before computing Active_Months.

  3. C

    Computing Active_Months per customer from Viewing_Logs, then joining once to Subscriptions and Customer_Master on CustID.

  4. D

    Joining Viewing_Logs directly to Subscriptions at the row level and then summing Monthly_Fee × Active_Months without removing duplicate CustID–month combinations.

Show answer

Correct answer

  • D

    Joining Viewing_Logs directly to Subscriptions at the row level and then summing Monthly_Fee × Active_Months without removing duplicate CustID–month combinations.

Question 40

+1 markOne correct option

A small shop owner keeps data in a notebook. For January he writes entries like:
● "15th Jan: Sold 10 kg Rice, 5 kg Dal. Purchase: 50 kg Rice." ● "20th Jan: Sold 5 kg Rice. Purchase: 20 kg Rice."
You are asked to digitize this to calculate the current stock of Rice on 31st Jan. The notebook is missing one critical piece of information that makes accurate historical stock reconstruction difficult.
Which data attribute is essential but missing?

  1. A

    The selling price per kg of Rice for each day.

  2. B

    The supplier name for each Rice purchase.

  3. C

    The Opening Stock balance of Rice on 1st Jan.

  4. D

    The customer name for each Rice sale.

Show answer

Correct answer

  • C

    The Opening Stock balance of Rice on 1st Jan.

Question 41

+1 markOne correct option

A B2B SaaS company tracks leads through this funnel:
● Stage 1: MQL (Marketing Qualified Lead) ● Stage 2: SQL (Sales Qualified Lead) ● Stage 3: Demo Completed ● Stage 4: Closed Won
You have two tables: ● Leads(LeadID, CreatedDate, Acquisition_Channel, Region) ● Opportunities(LeadID, Stage, Stage_Change_Date, Deal_Value)
You are asked: “Which acquisition channel has the highest conversion rate from Demo Completed to Closed Won in the last 12 months?”
An analyst writes the following query: ● Filters Opportunities to rows where Stage IN ('Demo Completed','Closed Won') in the last 12 months. ● Groups by Acquisition_Channel. ● Computes: Conversion_Rate = (COUNT(DISTINCT LeadID WHERE Stage='Closed Won')) / (COUNT(DISTINCT LeadID WHERE Stage='Demo Completed')).
Which subtle issue is most likely to bias this conversion rate upward for some channels?

  1. A

    Using DISTINCT LeadID instead of counting total rows in Opportunities.

  2. B

    Not restricting “Demo Completed” leads to those whose demo occurred before their “Closed Won” date.

  3. C

    Not including Leads that never reached the Demo Completed stage in the denominator.

  4. D

    Filtering to the last 12 months by Stage_Change_Date instead of by Lead CreatedDate.

Show answer

Correct answer

  • B

    Not restricting “Demo Completed” leads to those whose demo occurred before their “Closed Won” date.

Question 42

+1 markOne correct option

Why is "Metadata" critical for Business Data Management?

  1. A

    It reduces the file size of the database.

  2. B

    It allows users to understand the context (units, source, definitions) of the raw numbers.

  3. C

    It encrypts the data.

  4. D

    It automatically creates charts.

Show answer

Correct answer

  • B

    It allows users to understand the context (units, source, definitions) of the raw numbers.

Question 43

+1.5 marksOne correct option

A chain of clinics measures “Doctor Utilization Rate”:
Utilization = Total Consultation Minutes / Available Working Minutes Data for last quarter:
● Overall across all clinics: Utilization = 80%. ● You then segment by Clinic_Type: ● Urban clinics: Utilization = 78% ● Rural clinics: Utilization = 76%
A senior manager concludes: “Segmentation doesn’t change the picture; utilization is around 77–80% everywhere.”
You dig deeper and find: ● Urban clinics account for 90% of Available Working Minutes. ● Rural clinics account for 10%. ● Within Urban, junior doctors average 60% utilization, senior doctors 95%. ● Within Rural, junior doctors average 85%, senior doctors 70%.
Which statement best describes the main analytical risk in the manager’s conclusion?

  1. A

    The manager ignored seasonality effects across the quarter.

  2. B

    The manager is averaging across subgroups in a way that can hide opposite trends at a finer level

  3. C

    The manager should have used Median utilization instead of Mean.

  4. D

    The manager is wrong because utilization cannot exceed 80% if any subgroup is below 80%.

Show answer

Correct answer

  • B

    The manager is averaging across subgroups in a way that can hide opposite trends at a finer level

Question 44

+1.5 marksOne correct option

A subscription video platform wants to understand “Customer Engagement Value” (CEV) by combining:
● Customer_Master(CustID, Region, Acquisition_Channel) ● Subscriptions(CustID, Plan_Type, Monthly_Fee) ● Viewing_Logs(CustID, Date, Minutes_Watched)
They define: ● Active_Months = number of distinct months a customer watched ≥ 30 minutes. ● CEV = Active_Months × Monthly_Fee.
You are asked: “Which acquisition channel is driving the highest average CEV per customer?”
Which of the following strategies is most likely to produce a systematically biased (overstated) estimate of average CEV per customer for a given acquisition channel?

  1. A

    Aggregating Viewing_Logs to customer–month level first, then joining to Subscriptions and Customer_Master on CustID.

  2. B

    Filtering Viewing_Logs to customers in a given acquisition channel using Customer_Master before computing Active_Months.

  3. C

    Computing Active_Months per customer from Viewing_Logs, then joining once to Subscriptions and Customer_Master on CustID.

  4. D

    Joining Viewing_Logs directly to Subscriptions at the row level and then summing Monthly_Fee × Active_Months without removing duplicate CustID–month combinations.

Show answer

Correct answer

  • D

    Joining Viewing_Logs directly to Subscriptions at the row level and then summing Monthly_Fee × Active_Months without removing duplicate CustID–month combinations.

Question 45

+1 markOne correct option

A CEO dashboard shows monthly revenue for the last 3 years. You notice:
● The y‐axis starts at ₹95 crore instead of 0. ● The actual revenue range is from ₹100 crore to ₹105 crore. ● The line chart visually appears to have huge swings (steep peaks and valleys).
The CEO says: “Our revenue is extremely volatile; we need an urgent cost‐cutting task force.”
As the data analyst, what is the most appropriate first response?

  1. A

    Confirm that revenue is volatile and immediately pull detailed cost data to support the CEO’s proposed task force.

  2. B

    Suggest smoothing the line with a 12‐month moving average so the volatility looks less extreme and is easier for executives to accept.

  3. C

    Point out that the chart uses a truncated y‐axis which exaggerates visual volatility, and propose re‐plotting with either a zero baseline or a chart of month‐over‐month % change before drawing conclusions.

  4. D

    Explain that small revenue fluctuations are normal and recommend removing the y‐axis entirely so the focus is on the overall upward trend.

Show answer

Correct answer

  • C

    Point out that the chart uses a truncated y‐axis which exaggerates visual volatility, and propose re‐plotting with either a zero baseline or a chart of month‐over‐month % change before drawing conclusions.

Question 46

+1 markOne correct option

A CEO dashboard shows monthly revenue for the last 3 years. You notice:
● The y‐axis starts at ₹95 crore instead of 0. ● The actual revenue range is from ₹100 crore to ₹105 crore. ● The line chart visually appears to have huge swings (steep peaks and valleys).
The CEO says: “Our revenue is extremely volatile; we need an urgent cost‐cutting task force.”
As the data analyst, what is the most appropriate first response?

  1. A

    Confirm that revenue is volatile and immediately pull detailed cost data to support the CEO’s proposed task force.

  2. B

    Suggest smoothing the line with a 12‐month moving average so the volatility looks less extreme and is easier for executives to accept.

  3. C

    Point out that the chart uses a truncated y‐axis which exaggerates visual volatility, and propose re‐plotting with either a zero baseline or a chart of month‐over‐month % change before drawing conclusions.

  4. D

    Explain that small revenue fluctuations are normal and recommend removing the y‐axis entirely so the focus is on the overall upward trend.

Show answer

Correct answer

  • C

    Point out that the chart uses a truncated y‐axis which exaggerates visual volatility, and propose re‐plotting with either a zero baseline or a chart of month‐over‐month % change before drawing conclusions.

Question 47

+1 markOne correct option

A retail chain runs a new loyalty program in only some stores. After 3 months, you compare:
● Program stores: average bill size = ₹1,200 ● Non-program stores: average bill size = ₹900
The marketing head says: “The loyalty program increased bill size by ₹300.”
You dig into the setup and find: ● Program stores were all high-income urban locations. ● Non-program stores were mostly mid-income suburban locations. ● No random assignment was used.
What is the most accurate data-driven response?

  1. A

    The conclusion is valid; a ₹300 uplift proves the program works.

  2. B

    The comparison is confounded by store/location differences; we cannot attribute the full ₹300 difference to the program.

  3. C

    The result must be ignored because observational data is never usable for business decisions.

  4. D

    The loyalty program definitely had no effect; the entire ₹300 is due to income differences.

Show answer

Correct answer

  • B

    The comparison is confounded by store/location differences; we cannot attribute the full ₹300 difference to the program.

Question 48

+1.5 marksOne correct option

You are given a 100% stacked bar chart comparing market share of 5 competitors over 3 years. Each year’s bar is normalized so that the total height is 100%, and only percentage splits are shown. What key business insight cannot be inferred from this chart alone?

  1. A

    How competitor ranks compare within each individual year.

  2. B

    Whether the total smartphone market grew from Year 1 to Year 3.

  3. C

    Whether the smallest player’s share increased from Year 1 to Year 3.

  4. D

    Whether the market leader’s percentage share is declining over time.

Show answer

Correct answer

  • B

    Whether the total smartphone market grew from Year 1 to Year 3.

Question 49

+1 markOne correct option

A chain of gyms analyzes member data and finds:
● Strong positive correlation between “Number of Personal Training (PT) Sessions purchased per month” and “Likelihood of renewing annual membership”. ● Members who buy ≥4 PT sessions per month have a 90% renewal rate. ● Members who buy 0 PT sessions per month have a 50% renewal rate.
The sales director concludes: “If we push every member to buy at least 4 PT sessions per month, our renewal rate will jump to 90%.”
What is the most important concern you should raise about this conclusion?

  1. A

    The observed relationship may be driven by underlying member motivation or fitness commitment, not PT sessions themselves, so forcing PT on everyone may not cause a 90% renewal rate.

  2. B

    The renewal rate is too low to be meaningful, regardless of PT sessions.

  3. C

    The correlation is negative, not positive; the director is reading the numbers backwards.

  4. D

    PT sessions are a cost center, so increasing them will automatically reduce renewal rates.

Show answer

Correct answer

  • A

    The observed relationship may be driven by underlying member motivation or fitness commitment, not PT sessions themselves, so forcing PT on everyone may not cause a 90% renewal rate.

Question 50

+1.5 marksOne correct option

In a "Churn Prediction" model, you include a variable "Customer calls to support line". You find a positive correlation (More calls = Higher Churn). However, for a subset of high-value customers, More calls = Lower Churn. This phenomenon is known as:

  1. A

    Simpson’s Paradox

  2. B

    The Pareto Principle

  3. C

    Regression to the Mean

  4. D

    The Law of Large Numbers

Show answer

Correct answer

  • A

    Simpson’s Paradox