NTA UGC NET/JRF Exam, January 2025 (Commerce)

Total Questions: 100

11. A proposal requires a cash outflow of ₹18,500 and is expected to generate cash inflows of ₹ 8,000, ₹ 6,000, ₹4,000 ₹2,000 and 2,000 over next 5 years respectively. The payback period is:

Correct Answer: B. 3.25 years
Solution:The payback period is calculated as the time taken to recover the initial investment of 18,500 from cumulative cash inflows.
Given cash inflows:
Year 1: ₹ 8,000
Year 2:6,000
Year 3:₹4,000
Year 4: ₹ 2,000
Year 5:2,000
Cumulative cash inflows:
End of Year 1:₹ 8,000
End of Year 2: ₹ 14,000 ₹ 8,000 +
₹ 6,000)
End of Year 3: ₹ 18,000 ₹ 14,000 +
₹ 4,000)
End of Year 3.25: ₹ 18,500 ₹ 18,000
+₹500 from Year 4's 2,000)
Since the remaining 500 is recovered in
0.25 years (500/2000), the payback period is
3.25 years.

12. The Securities Exchange Board of India (SEBI) regulates and supervises the securities through:

(a) Regulations
(b) Rules
(c) Guidelines
(d) Scheme
(e) Orders
Choose the correct answer from the options given below:

Correct Answer: C. (a), (b), (c), (d), (e)
Solution:SEBI regulates and supervises securities markets through:
(a) Regulations: SEBI issues regulations to govern various aspects of securities markets, such as insider trading and mutual funds.
(b) Rules: It sets rules to ensure the proper functioning of securities exchanges. (c) Guidelines: SEBI provides guidelines to ensure transparency and investor protection.
(d) Schemes: It introduces schemes to develop financial markets, such as mutual fund schemes.
(e) Orders: SEBI issues orders to take enforcement actions against violators.

13. In which one of the following the effectiveness of brainstorming as group decision making technique is high?

Correct Answer: B. Task Orientation
Solution:The effectiveness of brainstorming is high in a task-oriented environment because:
• It focuses on generating multiple ideas and solutions without immediate criticism.
• Task-oriented groups prioritize achieving objectives over personal conflicts.
• A structured brainstorming approach enhances creativity and problem-solving capabilities.

14. Match the List-I with List-II.

List-I (Accounting Concept & Convention)List-II (Meaning)
(a) ConservatismI. Use of same accounting policies by a firm from period to period
(b) Dual aspectII. Enterprise is treated as separate from owner and other persons associated with it
(c) Separate Business entityIII. Every transaction has a two - fold effect
(d) ConsistencyIV. Anticipate no profit, but provide for all possible losses

Choose the correct answer from the options given below:

Correct Answer: A.
Solution:(a) Conservatism - IV. Anticipate no profit, but provide for all possible losses: This principle ensures financial prudence by recognizing expenses and liabilities early while deferring the recognition of revenues until they are realized.
(b) Dual Aspect - III. Every transaction has a two-fold effect: This concept states that every financial transaction affects two accounts, maintaining the balance in the accounting equation.
(c) Separate Business Entity II.  Enterprise is treated as separate from the owner and other persons associated with it: The business is considered an independent entity, distinct from its owners.
(d) Consistency - I. Use of the same accounting policies by a firm from period to period: Firms should maintain consistency in their accounting methods to ensure comparability of financial statements over time.

15. Match the List-I with List-II.

List-I (Theory)List-II (Author(s))
($a$) Theory of Comparative Cost AdvantageI. Hecksher & Ohlin
($b$) Theory of Opportunity CostII. David Ricardo
($c$) Theory of Factor EndowmentIII. Haberler
($d$) Theory of Absolute AdvantageIV. Adam Smith

Choose the correct answer from the options given below:

Correct Answer: A.
Solution:(a) Theory of Comparative Cost Advantage -II. David Ricardo: Ricardo's theory explains how countries benefit from trade by specializing in goods with a comparative cost advantage.
(b) Theory of Opportunity Cost - III. Haberler: Haberler refined Ricardo's concept by introducing opportunity cost, showing how nations allocate resources efficiently.
(c) Theory of Factor Cost - I. Heckseher & Ohlin: This theory states that countries export goods that intensively use their abundant production factors
(d) Theory of Absolute Advantage - IV. Adam Smith: Smith's theory states that a country should produce and export goods in which it has an absolute production advantage over other nations.

16. Match the List-I with List-II.

List-I (Concept)List-II (Meaning)
($a$) Exchange RateI. It refers to the price of one unit of foreign currency in terms of some units of home currency
($b$) Forward marketII. It is the process of making risk less profits by exploiting price differences of assets in different market.
($c$) ArbitrageIII. Where transactions are entered into for settlement on a future date
($d$) Direct QuotationIV. It is a price of one unit of a currency in terms of some units of another currency

Choose the correct answer from the options given below:

Correct Answer: A.
Solution:(a) Exchange Rate - IV. It is a price of one unit of a currency in terms of some units of another currency: Exchange rate refers to the value of one currency in terms of another, such as 1 USD = 83 INR.
(b) Forward Market - III. Where transactions are entered into for settlement on a future date: The forward market involves contracts to buy or sell an asset at a predetermined price at a future date, commonly used in forex trading.
(c) Arbitrage - II. It is the process of making risk-less profits by exploiting price differences of assets in different markets: Arbitrage involves taking advantage of price differences of the same asset in different markets to earn a profit.
(d) Direct Quotation - I. It refers to the price of one unit of foreign currency in terms of some units of home currency: In direct quotation,he exchange rate expresses the foreign currency's value per unit in domestic currency (e.g., 1 USD = 83 INR).

17. Which one of the following conditions is not true in case of marketing skimming as the pricing objective?

Correct Answer: A. The market is highly price sensitive
Solution:Market skimming involves setting a high initial price for a new product to maximize revenue from early adopters. It works best when demand is inelastic, meaning consumers are willing to pay a premium. If the market is highly price-sensitive, skimming is ineffective because consumers will not accept the high price.

18. Which one of the following is the developmental role of RBI?

Correct Answer: D. Performs a wide range of promotional functions to support national objectives
Solution:The Reserve Bank of India (RBI) has a developmental role, including:
• Promoting financial inclusion by encouraging banking in rural areas.
• Supporting economic growth by facilitating credit flow to priority sectors.
• Developing payment and settlement systems.
It also regulates monetary policy and banking operations, but those are regulatory rather than developmental roles.

19. Which one of the following consists of comparing entries in the books of account with documentary evidence in support thereof.

Correct Answer: C. Vouching
Solution:Vouching is the process of verifying accounting records by checking supporting documents like invoices, bills and receipts. It ensures that all transactions are valid, authorized, and supported by proper evidence. Internal check and internal control are broader frameworks, while verification is related to checking assets and liabilities.

20. Bret Lee, an Australian cricket player visits India for 100 days in every financial year. This has been his practice for the past 10 financial Years. Find out his residential Direct status for the assessment Year 2023-24.

Correct Answer: C. Resident but not ordinarily resident in India
Solution:As per the Income Tax Act, 1961, an individual's residential status depends on their stay in India:
• If a person stays in India for 182 days or more in a financial year, they are a Resident.
• If a person stays for less than 182 days, they are a Non-Resident.
• A person is Resident but Not Ordinarily Resident (RNOR) if they were a NonResident in 9 out of the last 10 years or stayed in India for less than 729 days in the last 7 years.
Since Brett Lee visits only for 100 days per year for 10 years, he qualifies as RNOR for the assessment year 2023-24.