Business and Commerce mcqs

✅ The correct answer is C.
Insurance business is based on the theory of probability and law of large numbers. As the number of exposure units, or policyholders, increases, the probability is higher that the actual loss per exposure unit will equal the expected loss per exposure unit.

✅ The correct answer is A.
Equity shareholders are the owners of the company. Equity shares represent the ownership of a company and capital raised by the issue of such shares is known as ownership capital or owner’s funds.

✅ The correct answer is A.
A farmer in the field is an economic activity. Any action that involves producing, distributing, or consuming products or services is an economic activity.

✅ The correct answer is B.
Addressing machine is used to point addresses of the customers or clients on outgoing mail. It is a business machine that automatically imprints names, addresses, or other information on successive envelopes or forms.

✅ The correct answer is A.
A large scale firm would be able to reduce its risk by diversifying its products and markets.

✅ The correct answer is C.
Insurance is a social device for eliminating or reducing the loss of society from certain risk. Insurance is a social device for division of financial losses which may fall on an individual or his family on the happening of some unforeseen events. When insured, the loss arising out of the events are shared by all the insured in the form of premium. Therefore the risk is transferred from one individual to a group.

✅ The correct answer is B.
The purpose of an office is to furnish essential services to the management. Office provides information to the management on the basis of which it formulates its policies.

✅ The correct answer is D.
The person whose risk is insured is called Insured and Assured.

✅ The correct answer is D.
The authority is decentralized in democratic style. Decentralization also aims at an economic and political system that responds more closely to people’s preferences and requirements.

✅ The correct answer is B.
A firm which outsources its works requires less employees. Outsourcing is the business practice of hiring a party outside a company to perform services and create goods that traditionally were performed in-house by the company’s own employees and staff.