Class 11 Business Studies Notes

The syllabus moves in a deliberate order. It opens with what a business is and why it exists, moves through the forms the business can take and the parties that own it, then describes the services and the modern modes that carry it, and closes with the responsibility of the business, the finance it needs, and the trade it does inside the country and outside it.

• Chapter 1, nature and purpose of business: the meaning of business, the essentials of a business enterprise, the nature of business and the objectives of business.
• Chapter 2, forms of business organisations: sole proprietorship, partnership, joint stock company, one person company, HUF and the cooperative society, and the choice between them.
• Chapter 3, public private and global enterprises: the ownership of the enterprise, the three forms of the public sector, the private sector, and the joint venture and the public private partnership.
• Chapter 4, business services: the types of bank accounts, the banking services of the draft, the overdraft and the cash credit, the e-banking in the NEFT, the RTGS, the IMPS and the UPI, the concept and the six principles of the insurance, the types of the insurance, and the postal services.
• Chapter 5, emerging modes of business: the concept of the e-business, its scope and its benefits, and its comparison with the traditional business, which is now the whole of the unit after the rationalisation.
• Chapter 6, social responsibility of business and business ethics: the meaning of social responsibility, the arguments on both sides, the areas of unethical practice and the ethical dilemma.
• Chapter 7, sources of business finance: the internal and the external sources, the short, the medium and the long term finance, and the factors that decide the choice.
• Chapter 8, small business and enterprises: the entrepreneurship development with its concept, its characteristics and its need, the small enterprise as defined by the MSMED Act 2006, the role of the small business in the rural India, and the schemes of the support like the Start-up India, the NSIC and the DIC.
• Chapter 9, internal trade: the meaning and the types of the internal trade, the services of the wholesaler and of the retailer, the forms of the retail trade from the itinerant trader to the departmental store, the chain store and the mail order house, and the concept, the features and the gains of the GST.
• Chapter 10, international trade: the concept, the scope and the benefits of the international trade, the meaning and the procedure of the export and of the import trade, the documents used in the foreign trade from the indent to the mate receipt, and the meaning and the objectives of the World Trade Organisation.

The Business Studies paper is built out of a small number of question types, and once the types are recognised the syllabus becomes much easier. Almost every mark in the paper comes from one of the four kinds of question below.

• The definition question, which asks for the meaning of a term. There is more than one way to define a term, and the answer should give the definition and then add a sentence of explanation, because the definition alone is rarely complete.
• The difference question, which asks for the distinction between two things, such as the difference between the wholesale and the retail trade or between the social responsibility and the business ethics. The answer must be arranged in a fixed order and it must be in two columns, or the comparison will not be visible to the examiner.
• The merits and the demerits question, which asks for the advantages and the disadvantages of a practice. The answer must be in two columns, and the merits and the demerits must be paired, because a merit with no matching demerit shows that the two sides were not understood together.
• The term in different contexts question, which asks what a single term means in two different places, such as what the cooperation means in a cooperative society and in a cooperative bank, or what the investment means to the shareholder and to the mutual fund. This is the most frequent type in the paper, and it is the easiest mark to lose.

A comparison is not two separate lists written one after the other. A comparison is a single table, and the examiner has to be able to see the difference in a glance. Write the two columns and keep them parallel, so that every line in the first column has a line opposite to it in the second.

• Always write the two headings at the top, and then the points under each, in the same order. If the first column has three points, the second must also have three.
• Begin each point with the same word where you can, so that the difference appears at the start of the line and not at the end of it. This is the single technique that most reliably makes a comparison look like a comparison.
• For example, in the comparison of the wholesale and the retail trade, begin with wholesale buys in large lots and retail buys in small lots, wholesale sells to the retailer and retail sells to the final consumer, wholesale has a low margin and retail has a high margin, wholesale serves a few customers and retail serves many customers.
• The comparisons most often asked in this class are the wholesale and the retail trade, the sole proprietorship and the partnership, the partnership and the company, the departmental undertaking and the statutory corporation, the internal and the external source of the finance, the life insurance and the general insurance, the e-business and the e-commerce, and the export and the import procedure.
• A five-mark comparison is three pairs of points plus a concluding sentence, and the concluding sentence states which one is used in which situation and why. The conclusion is a separate mark, and it is the one that is most often left out.

Some terms in the syllabus are examined in almost every paper, and they are worth a disproportionate share of the marks given the little time they take to learn. If only ten definitions are revised before the examination, these are the ten.

• Business: the rendering of services to the human beings at large, and the two limbs are the satisfaction of the human wants and the provision of the human wants.
• Enterprise: the entity that owns and controls the factors of production and sells the goods or the services that are produced with them.
• Sole proprietorship against partnership against company: the decision turns on the capital, the liability and the continuity.
• Separately legal person: the test that separates a departmental undertaking from a statutory corporation and a government company, and a company from a firm.
• Unlimited liability: the weakness of the sole proprietorship and the partnership, and limited liability is the answer that the company provides.
• The letter of credit: the only method of the international payment that protects both the buyer and the seller, because the bank pays against the documents.
• Retained profit: the most important internal source of the finance, self-generated and costless but unavailable in the year of a loss.
• MSMED Act, 2006: the law that defines the small and the medium enterprise, and after the revision of 2020 by the investment and the turnover both.
• Global Depository Receipt: the instrument by which the shares of an Indian company are traded on an overseas exchange, and a source of the foreign capital.
• The ethical dilemma: a situation in which every available choice violates one of the values the individual holds.

Most of the marks lost in this paper are lost to a small number of avoidable errors, and each of them is a habit that can be corrected in a week of practice.

• Do not confuse the social responsibility with the social obligation, and remember that obeying the law is the minimum and not the whole of the responsibility.
• Do not confuse the departmental undertaking with the statutory corporation. Only the statutory corporation and the government company are a separate legal person.
• Do not call the debenture a share, because a debenture holder is a creditor and a shareholder is an owner.
• Do not write that the international marketing is a part of the international trade. The marketing is the wider of the two, because it covers the whole process and not only the transaction.
• Do not leave the concluding sentence out of a comparison question, because the conclusion is a separate mark and it is the mark that shows the examiner the comparison was understood.
• Do not write the merits without the demerits, and do not write the demerits without the merits, because the two are always awarded together.
• Do not define a term in only one sentence. Give the definition, and then give one sentence of explanation with an example, because the second sentence is where the second mark is.
• Do not leave a blank. A rough line naming the two columns of the comparison is better than an empty space, because a blank earns nothing while a rough line can earn the mark for the heading.

There is a method of revision for this syllabus that works because of the way the chapters are built. Each chapter is a list, and the list is a set of pairs, so the revision consists of writing the pairs rather than reading the prose.

• For each chapter, write out the headings as they appear in the syllabus, and beside each heading write the two or three terms that the chapter defines. This gives the skeleton of the chapter on a single sheet of paper.
• Under each of those terms write the single test that distinguishes it from the term it is most often confused with, such as the indemnity for the general insurance and the promise for the life insurance, or the separate legal person for the statutory corporation.
• Under each heading write the three points the examiner is most likely to ask, which are the merit, the demerit and the example. Most of the three-mark questions in the paper are answered by these three.
• Then close the chapter and write the definitions from memory, and check them against the chapter. The writing is the revision, and the reading is not, because the reading gives the feeling of knowing it without the ability to produce it.
• For the chapters that are purely lists, such as the sources of finance and the modes of transport, the revision is the list itself, and it should be written out in full twice, because a list that is read is not learned and a list that is written is learned.
• Finish by attempting three previous year questions on each chapter, and mark them against the model answer. The number of marks that are lost to the format rather than to the content is usually the first thing the practice reveals.