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May 2022 term · Business Data Management · BSMS2001

Business Data Management Quiz 2: 10 July 2022 (May 2022 term)

The IIT Madras BS Business Data Management (BDM) Quiz 2 paper sat on 10 Jul 2022, in the May 2022 term: 20 questions for 20 marks in 120 minutes. Every question is below with its answer. Take it as a timed mock test to be marked, or read it through first.

Questions
20
Marks
20
Duration
120 min
MCQ
13
MSQ
6
Numerical
1
Take as mock testPractise with answers

Updated

Official paper: IIT M DIPLOMA QUIZ2 EXAM QPE1 10 July 2022 · No negative marking.

Question 1

+1 markOne correct option

Which of these situations is likely to cause high bargaining power of suppliers?

  1. A

    Many customers with low brand loyalty

  2. B

    A few large suppliers dominate the market

  3. C

    Many alternative sources of supply

  4. D

    None of these

Show answer

Correct answer

  • B

    A few large suppliers dominate the market

Question 1 on its own page

Question 2

+1 markOne correct option

What is the main purpose of Porter’s Five Forces Model?

  1. A

    Manage product portfolios

  2. B

    Inform investment appraisal decisions

  3. C

    Decide which product to launch

  4. D

    Analyse competition in a market

Show answer

Correct answer

  • D

    Analyse competition in a market

Question 2 on its own page

Question 3

+1 markOne correct option

In Porter's five forces model, what is meant by the term 'substitute'?

  1. A

    A substitute is an alternative product or service that performs the same function for the consumer

  2. B

    A substitute refers to an alternative manufacturing process

  3. C

    A substitute is a rival firm offering the same products

  4. D

    A substitute is something else consumers would rather spend their money on

Show answer

Correct answer

  • A

    A substitute is an alternative product or service that performs the same function for the consumer

Question 3 on its own page

Question 4

+1 markOne correct option

Given the information in the following table, what is the current ratio?

  1. A

    3.75:1

  2. B

    3:1

  3. C

    1:3

  4. D

    1:3.75

Show answer

Correct answer

  • B

    3:1

Question 4 on its own page

Question 5

+1 markOne correct option

When a company launched a product, its price was Rs.10,000 per unit. After a couple of months, the price of the product was set to Rs. 8,000 per unit. Currently, the product sells at Rs. 5,000 per unit. Then what pricing strategy has the company adopted?

  1. A

    Skimming

  2. B

    Penetration pricing

  3. C

    Peak-load pricing

  4. D

    Psychological pricing

Show answer

Correct answer

  • A

    Skimming

Question 5 on its own page

Question 6

+1 markOne correct option

Milo has some new competition in the sales of dresses for Diwali. To prevent the competition from being sustainable, Milo puts a notice in the window advertising a half-price sale. What tactic is Milo using here?

  1. A

    None of these

  2. B

    Psychological pricing

  3. C

    Destroyer pricing

  4. D

    Bundle pricing

Show answer

Correct answer

  • C

    Destroyer pricing

Question 6 on its own page

Question 7

+1 markOne correct option

Which of the following is not a fixed cost?

  1. A

    Monthly rent of Rs. 1000 contractually specified in a one-year lease

  2. B

    An insurance premium of Rs. 50 per year paid last month

  3. C

    A lawyer’s retainer of Rs. 500 per year

  4. D

    None of these

Show answer

Correct answer

  • D

    None of these

Question 7 on its own page

Question 8

+1 markOne correct option

Demand is inelastic when

  1. A

    A leftward shift of the supply curve raises the total revenue

  2. B

    The good in question has close substitutes

  3. C

    The smaller angle between the vertical axis and the demand curve is less than 45 degrees

  4. D

    Large shifts in the supply curve lead to only small changes in price

Show answer

Correct answer

  • A

    A leftward shift of the supply curve raises the total revenue

Question 8 on its own page

Question 9

+1 markOne correct option

Producers’ total revenue will decrease if

  1. A

    The price rises and demand is inelastic

  2. B

    Income increases and the good is a normal good

  3. C

    The price rises and demand is elastic

  4. D

    Income falls and the good is an inferior good

Show answer

Correct answer

  • C

    The price rises and demand is elastic

Question 9 on its own page

Question 10

+1 markOne correct option

If a fall in the price of item-A increases the quantity demanded of item-B, then which of the following statements is correct

  1. A

    A and B are substitutes

  2. B

    A and B are complements

  3. C

    B is a substitute for A, but A is a complement to B

  4. D

    A is a substitute for B, but B is a complement to A

Show answer

Correct answer

  • B

    A and B are complements

Question 10 on its own page

Question 11

+1 markOne correct option

Last year, Mr. X achieved the title “Richest Man in Asia” for the first time and his happiness was Z utils. This year, Mr. X retained the title of “Richest Man in Asia” and his happiness is Y utils. If Z>Y, then this is an example of what?

  1. A

    Positive marginal utility

  2. B

    Diminishing marginal utility

  3. C

    Diminishing marginal return

  4. D

    None of these

Show answer

Correct answer

  • B

    Diminishing marginal utility

Question 11 on its own page

Question 12

+1 markOne correct option

If total utility increases, marginal utility _________

  1. A

    Must increase

  2. B

    Must decrease

  3. C

    Must be increasing at an increasing rate

  4. D

    None of these

Show answer

Correct answer

  • D

    None of these

Question 12 on its own page

Question 13

+1 markOne or more correct options

Which of the following transactions will improve the quick ratio (choose all that are applicable)?

Select all that apply.

  1. A

    Sale of goods for cash

  2. B

    Issue of new shares for cash

  3. C

    Storage of goods in inventory

  4. D

    None of these

Show answer

Correct answers

  • A

    Sale of goods for cash

  • B

    Issue of new shares for cash

Question 13 on its own page

Question 14

+1 markOne or more correct options

Which of the following are Implicit costs for a firm (choose all that is applicable)?

Select all that apply.

  1. A

    The cost of worker wages and salaries

  2. B

    The cost paid for leasing a building for production

  3. C

    The cost paid for production supplies

  4. D

    The cost of wages foregone by the owner of the firm

Show answer

Correct answer

  • D

    The cost of wages foregone by the owner of the firm

Question 14 on its own page

Question 15

+1 markOne or more correct options

Economies and diseconomies of scale explain why the

Select all that apply.

  1. A

    Short-run average fixed cost curve declines so long as output increases

  2. B

    Marginal cost curve must intersect the minimum point of the firm’s average total cost curve

  3. C

    Long-run average total cost curve is typically U-shaped

  4. D

    Short-run average variable cost curve is U-Shaped

Show answer

Correct answer

  • C

    Long-run average total cost curve is typically U-shaped

Question 15 on its own page

Question 16

+1 markOne or more correct options

Suppose a customer who purchases only two goods is making a utility-maximizing choice and the price of one of the goods increases. What will happen (choose all that are applicable)?

Select all that apply.

  1. A

    The consumer’s purchasing power will decrease

  2. B

    The consumer’s total utility will increase

  3. C

    The consumer’s money income will increase

  4. D

    None of these

Show answer

Correct answer

  • A

    The consumer’s purchasing power will decrease

Question 16 on its own page

Question 17

+1 markNumerical answer

Kumbak is hungry and has decided to eat roti at his mess. His total joy after eating the first roti is 20 happiness points. He is still hungry and so he eats another roti, and the total happiness increases to 25 happiness points. Kumbak is still hungry and eats two more roties. His third roti makes his total happiness points as 27. His fourth roti makes it 29 points. Then, suddenly his friend Lakshman enters the mess and decides to join him. So Kumbak decides to eat a fifth and sixth roti which makes his happiness points become 23. Then what is the marginal utility at Kumbak’s ideal number of roties?

Show answer

Correct answer: 2

Question 17 on its own page

Question 18

+2 marksOne or more correct options

The consumption basket of a person for Month-1 and Month-2 is provided in the table below. Given this information, if the income for the person has changed from Rs. 8000 in Month-1 to Rs. 10000 in Month-2, then which of the following statements are true with respect to income elasticity (choose all those that are applicable)?

Item% Of Income Spent for Item in Month-1% Of Income Spent for Item in Month-2
A1220
B810
C108
D916
E52
F1310
G3219
H1114

Select all that apply.

  1. A

    Item A is a “normal good”

  2. B

    Item A is a “necessity good”

  3. C

    Item A is a “luxury good”

  4. D

    Item A is an “inferior good”

  5. E

    Item G is a “normal good”

  6. F

    Item G is a “necessity good”

  7. G

    Item G is a “luxury good”

  8. H

    Item G is an “inferior good”

Show answer

Correct answers

  • A

    Item A is a “normal good”

  • C

    Item A is a “luxury good”

  • H

    Item G is an “inferior good”

Question 18 on its own page

Question 19

+0.5 marksOne or more correct options

If gross profit = net profit + x, which of the following statements is/ are true? (select all that is applicable)

Select all that apply.

  1. A

    “X” includes variable cost

  2. B

    “X” includes cost of goods sold (e.g.: building, equipment, etc.)

  3. C

    “X” includes cost of expenses (e.g.: operating, interest, taxes, etc.)

  4. D

    None of these

Show answer

Correct answer

  • C

    “X” includes cost of expenses (e.g.: operating, interest, taxes, etc.)

Question 19 on its own page

Question 20

+0.5 marksOne correct option

When the Marginal Utility is 0

  1. A

    Total utility is maximum

  2. B

    Total utility is minimum

  3. C

    Total utility continues to rise

  4. D

    None of these

Show answer

Correct answer

  • A

    Total utility is maximum

Question 20 on its own page