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Term 1 - Assertion &
Reasoning Session
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 DIRECTIONS

In the following questions, the

Assertions (A) and Reason (R)
have been put forward.

Read both the statements carefully

and choose the correct alternative
from the following
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
Assertion: Music is soothing to
everybody.

Reason: The rhythmic sounds

stimulate the brain and produce a
soothing effect.
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : D
QUESTION 1
Assertion: Business is considered
as an economic activity.

Reason: Any activity is called an

economic activity when it is done
with a view of earning money and
the motive of business is to earn
profit primarily.
 BUSINESS

The activity of being busy in

creating utility by producing
goods and services
 BUSINESS

for exchange of money

(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : A
QUESTION 2
Assertion:Commerce refers to
all those activities which are
concerned with the transfer of
goods and services from the
producers to the consumers

Reason:Commerce embraces all

those activities which are
necessary for maintaining a free
flow of goods and services . It
includes trade and auxiliary to
trade
 Commerce
Commerce is defined as activities
necessary to facilitate trade including the
entire process of delivering products
from manufacturers to consumers.
 Activities Included In
Commerce

Auxiliaries to
Trade
Trade
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER :A
QUESTION 3
Assertion: Under Secondary Industry, new
products are manufactured by using the
previously produced things e.g. producing
cotton is primary industry and manufacturing
cloth out of cotton is secondary industry. Also
construction of roads, bridges,buildings etc
are covered

Reason:Secondary industry includes

manufacturing as to convert raw materials or
semi finished products into finished products.
 Primary Industry
Industries which are concerned with
obtaining or providing natural raw
materials

Forestry Mining
 Secondary Industry
Industries which uses materials which have already
been extracted from primary industry and
processed to produce goods for final consumption.

Paper Mill
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER :B
QUESTION 4
Assertion: Profit play a vital role in
any business.

Reason:Earning of profits is essential

for any business because of the many
reasons like means of livelihood,
rewards for taking risks, funds for
growth symbolic of efficiency and
efficacy etc
Involves exchange of goods
and services
Aims of earning profit
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : A
QUESTION 5
Assertion:Business risks are of
two types:speculative and pure

Reason:Business risk not only

includes possibility of both profit
or loss but also of loss happening
because of ceratin event
 Business Risk
★ Possibility of inadequate profits or even losses
due to uncertainties or unexpected events.
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER :A
QUESTION 6
Assertion: Business does not need
any specific qualifications

Reason: There is no code of conduct in

business that has to be precisely
followed
 ECONOMIC ACTIVITY

BUSINESS PROFESSION

EMPLOYMENT
 Qualification

BUSINESS PROFESSION EMPLOMENT

No minimum Qualification Qualification

Qualification as prescribed in particular
is required by the field is
employer is required..
required
 Code of Conduct

BUSINESS PROFESSION EMPLOMENT

No code of Employee has There is

conduct is to follow the professional
followed. organisation’s code of
code of conduct of
conduct. professional
body
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER :B
QUESTION 7
Assertion:Primary Industry includes
all activities which are connected
with extraction and production of
natural resources and reproduction
and development

Reason:Only one things are

manufactured out of one thing
e.g.petrol, diesel, gasoline out of crude
oil
 Primary Industry
Industries which are concerned
with obtaining or providing natural
raw materials

Forestry Mining
 Primary Industry

Extractive Genetic Industry

Industry
Engaged in animal and
Extract products from plants breeding for
natural resources their use in further
production
Eg Eg:
● Farming ● Poultry farms
● Mining ● Fish hatchery
● Hunting
● Fishing operations
etc.
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : C
QUESTION 8
Assertion:Assembling is included in
Secondary industry

Reason:The parts manufactured by

different industries are assembled to
produce new and useful products e.g
computers, watches etc
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : A
QUESTION 9
Assertion:Trade refers to buying
and selling of goods and services with
the objective of earning profit

Reason:Trade is classified into two

categories Internal and External
 Trade

Trade is the exchange of goods

or services between parties.
 Types of Trade

Trade

Internal External
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : B
QUESTION 10
Assertion:Auxiliaries to trade is
included in commerce

Reason:Auxiliaries to trade are those

activities which help in removing
various hindrances which arises in
connection with the production and
distribution of goods
 Activities Included In
Commerce

Auxiliaries to
Trade
Trade
 Auxiliaries to trade
Activities which are meant for assisting trade.
Example :
Warehousing, Banking, Finance, Insurance etc
(A) Both Assertion(A) and the Reason(R)
are True and Reason(R) is the correct
explanation of Assertion(A)

(B) Both Assertion(A) and the Reason(R)

are True but Reason(R) is not the correct
explanation of Assertion(A)

(C) Assertion(A) is True but the Reason(R)

is False.

(D) Assertion(A) is false but Reason(R) is

true
ANSWER : A
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Lecture 3
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