Thursday, 26 December 2013

XAT Decision making Questions 2010

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Read the following case and choose the best
alternative (Question No. 19 to 22):
Guruji’s guidance
Bhola, an avid nature lover, wanted to be an entrepreneur. He dreamt of establishing a chain of huts in
Chatpur region to cater to tourists, who came attracted by the beauty and splendour of the Himalayas.
However, he was appalled by current degradation of the Himalayan environment. He remembered the early times when everything was so green, clean and peaceful. Now, greenery was replaced by buildings. Peace was shattered by honking of vehicles and flocking of tourists, and cleanliness was replaced by heaps of plastics.

Bhola had a strong sense of right and wrong. On speaking to few locals about the issue, he realized that
the locals were aware of these issues. However, they pointed out the benefits of development: Pucca houses for locals, higher disposable income and with that, ability to send their children to better schools and colleges, better road connectivity, and access to latest technology in agriculture. Most locals wanted the development to continue. Saddened by the lack of support from the locals, Bhola took up the issue with the government. He met the chief minister of the state to find out if government could regulate the developmental activities to prevent environmental degradation. However, the chief minister told
Bhola that such and action would slow down the economic progress. That also meant loss of substantial tax revenues for the government. Bhola needed to resolve the dilemma. Bhola always
wanted to be an entrepreneur, who could contribute to the society and earn money as well. However, his business would also be responsible for destroying the environment. If he did not set up his business, he would not be able to earn money and contribute to the society. After mulling over the issues, he went to his mentor
“Guruji”. Guruji realized that it was really a difficult puzzle:
if one saves the environment, there seems to be no development and if the people and the government sought development, the environment and hence future of this planet and human beings was at stake. After careful thought, he felt that dilemma could be resolved. He fixed up a meeting with Bhola to answer Bhola’s queries.

19. Should Bhola still think of doing business?
A. Yes, where there is a will, there is a way.
B. No, saving the Earth for our children is more important than earning money.
C. Yes, Bhola should do business while ensuring no environmental damage is done.
D. Yes, but only if the government puts strict environmental regulations in place.
E. Bhola should stop thinking about such a dilemma.

20. Bhola wanted to advise the government about the new tourism policy. Bhola had developed a few alternatives as given below. Choose the best alternative.
A. Stop environmental degradation by stopping the developmental activities.
B. Forget about the environment; think about the people as they are the vote banks for politicians to come back to power.
C. Suggest that the government should try to promote eco-tourism, which would be controlled and regulated by the government, as the government could think about welfare of majority of stakeholders.
D. Suggest that the government should promote eco-tourism with public-private partnership with the involvement of NGOs, So that there are checks and balances for inefficiencies and promotion for synergetic efforts between the government and private entrepreneurs.
E. Involvement of impartial entities like NGOS who would provide a fair assessment of the policies.

21. Bhola wished he was heading the government. He had listed down five concrete measures he would take if he were to head the government. Choose the best alternative.
A. Charge environmental cess from all businesses operating out of Himalayas.
B. Charge cess from anyone who pollutes the environment, it be citizens or industries and reward those who have contributed to afforestation the most.
C. All profit making organizations have to take responsibility of afforestation proportionate to
their profitability.
D. Think about maximizing the revenues and forget about the environment.
E. Institute a Green Valley Reward, which would be given to businesses highly active in
afforestation efforts.

22. Visualising he was heading the state government, Bhola thought of a likely problematic situation. Five years have passed. In these five years, Bhola has initiated a lot of pro-environment steps, including making people aware of the fact that it was this pristine environment which brought in tourists in the first place. Now he faced state elections. The opposition accused him of stopping development and causing unemployment under the guise of environment protection. If Bhola were to consider this accusation as a short-term battle, which option would Guruji suggest to Bhola to score a quick win?
A. Accuse the opposition of having vested interests as the opposition leaders were denied licences for opening new hotels.
B. Point out the improvement in environment since the implementation of pro-environment policies.
C. Compare the unemployment levels since the implementation of the pro-environment polices
and if they are less, accuse the opposition of making baseless charges.
D. Point out that this government had initiated a regular cleaning-up drive and the opposition did not consider the data regarding the people who were employed in that drive.
E. Call the charges as baseless accusations being used to malign the good work he had done.

Question No. 23 to 25: Read the following passage
and answer the questions that follow.
In calendar year 2008, there was turbulence in the air as Jet Airway’s Chairman pondered what course of
action the airline should take. Air India was also struggling with the same dilemma. Two of India’s largest airlines, Air India and Jet Airways, had sounded caution on their fiscal health due to mounting operational costs. A daily operational loss of $2 million (Rs.8.6 crore) had in fact forced Jet Airways to put its employees on alert. Jet’s senior General Manager had termed the situation as grave, Jet’s current losses were $2 million a day (including Jet- Lite ). The current rate of Jet Airways’ domestic losses was $0.5 million (Rs2.15 crore) and that of JetLite was another $0.5 million. International business was losing
over $1 million (Rs 4.30 crore) a day. The situation was equally grave for other national carriers. Driven by mounting losses of almost Rs 10 crore a day, Air India, in its merged avatar, was considering
severe cost-cutting measures like slashing employee allowances, reducing in-flight catering expenses on shorthaul flights and restructuring functional arms. The airline also considered other options like cutting maintenance costs by stationing officers at hubs, instead of allowing them to travel at regular intervals.
Jet Airways, Air India and other domestic airlines had reasons to get worried, as 24 airlines across the world had gone bankrupt in the year on account of rising fuel costs. In India, operating costs had gone up 30-40%. Fuel prices had doubled in the past one year to Rs 70.000 per kilolitre, forcing airlines to increase fares. Consequently, passenger load had fallen to an average 55-60% per flight
from previous year’s peak of 70-75%. Other airlines faced a similar situation; some were even looking for buyers. Domestic carriers had lost about Rs 4,000 crore in 2007-bill globally, our wage bill is 22% of total input costs. Even then we are at a loss,” an Air India official said. Civil aviation
ministry, however, had a different take. “Air India engineers go to Dubai every fortnight to work for 15 days and stay in five star hotels. If they are stationed there, the airline would save Rs 8 crore a year. This is just the tip of the iceberg. There are several things we can do to reduce operational inefficiency”. According to analysts, Jet Airways could be looking at a combined annual loss of around Rs 3,000 crore, if there were no improvements in operational efficiencies and ATF prices. Against this backdrop, the

had asked its employees to raise the service bar and arrest falling passenger load.

23. Which of the followings are the reasons for Jet Airways not doing well?
1. Rising ATF prices
2. Reduced passenger load
3. Declining service quality
4. Staff traveling to Dubai
A. 1 and 2 B. 2 and 3
C. 1, 2 and 3 D. 1, 2 and 4
E. 1, 2, 3 and 4

24. The total loss for the airline industry was likely to be Rs. 10,000 crore. Jet Airlines lost Rs. 3,000 crore, Air India lost Rs. “X” crore and “rest of the airlines” lost Rs. “Y” crore. What was the loss for the “rest of the airlines”, in 2008?
A. Cannot be determined
B. Rs. 3,350 crore C. Rs. 3,690 crore
D. Rs. 3,340 crore E. None of the above.

25. Suppose fuel constitutes 30% of the revenues, do you think airlines would be in a better situation by reducing prices?
A. Yes
B. Data insufficient to reach decision
C. No
D. It would not matter

E. None of the above

Ranjan Tuglak, the youngest cabinet minister of the newly elected coalition, glanced through the notes
prepared by his secretary regarding the recent controversies on racket, the popular game of the country.
While International Racket Association (IRC) has agreed to implement Drug Testing Code (DTC) promoted by World Athletic and Games Federation, Racket Club which controls the entire racket related activities (unlike any other sports and games of the country) had some reservations regarding the initiative. Majority of the citizens waited for the international competitions eagerly and were fanatical
about their country’s participation in them. As a result of the popularity of the game, 70% of the total revenue associated with the game originates from the country. Hence Racket Club’s high bargaining power with IRC can change any decision that is not aligned with its interests. The three most popular and senior players, including the captain, are against the application of DTC citing security reasons. A decision against the interests of these players may result in law and order problems throughout the
country. Other players support the decision of their seniorcolleagues and if the Racket Club refuses to agree, players may support Counter Racket Club, a new national level initiative. Counter Racket Club may threaten the monopoly of Racket Club, if it succeeds to attract some popular racket players. Ranjan’s father had been forced to resign from politics due to alleged corruption charges. Ranjan had completed his entire education abroad before returning to join politics. He is a great soccer player and has major
reservations against racket. According to him, racket has a negative influence on the country’s youth and diverts their attention from productive work. He also considers drug testing as an essential feature for any sports and games across the world. As the new cabinet minister for Youth and Sports he needs to take some important decisions on this controversial issue.

26. If the objective of Ranjan is to (i) create a good image of himself as a politician and (ii) create a long lasting positive impact, the best decision he should take is:
A. Force Racket Club to accept all modifications related to drug testing.
B. Provide adequate security protection to the satisfaction of players nominated by Racket
Club before enforcing drug testing.
C. Align with Counter Racket Club.
D. Popularise soccer in country through
endorsements by the popular players of racket.
E. Ban racket.

27. Identify the best rationale that may force Ranjan
as a politician to take decision in favour of IRC.
A. President of Racket Club and Ranjan belong to different political coalitions and he can use
Counter Racket Club against the opponent.
B. Next World cup is scheduled to be held in a country which has adopted DTC as the guiding principle.
C. Ranjan is interested in reducing the popularity of racket in country.
D. As the cabinet minister, Ranjan has the power to take such a decision.
E. Top three international teams (and respective national clubs) are keen to implement DTC.

28. According to DTC, each athlete/sportsperson needs to submit a schedule for three months (in advance) that specifies an hour each day when they can be randomly tested for drugs. DTC also assured the confidentiality of the submitted schedule by (i) limiting the access of player-supplied information to two senior officers, (ii) these officers will have the internet based access only to the schedule of those sports persons who are randomly selected for testing (and not of everyone) and (iii) introducing similar security features for DTC database as in case of financial institutions. The top three popular players realize that no reason other than security can help them to get a favourable decision from Ranjan. Hence during discussions they should focus on all options except:
A. Any clue related to their private schedules may also result in huge public gathering and it will make the job of security agencies very difficult.
B. Popular racket players are included in the hit list of terrorist organisations.
C. Recent report by World Bank rate their country among the top five nations with maximum
amount of internet based data stealing.
D. It is difficult to provide adequate security coverage in large stadiums where racket is
E. DTC is not willing to share the details of two senior officers involved in drug testing with the security agencies of the country for background study.


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