BUSINESS MANAGEMENT

MULTIPLE CHOICE QUESTIONS

1: Consider the following statements:

Planning involves
1. Forecasting
2. Choice among alternative courses of action.
3. Wishful thinking
4. Decision only by production manager
Of these statements:
A. 1, 2, 3 and 4 are correct

B. 1, 3 and 4 are correct

C. 1 and 2 are correct

D.2 and 3 are correct

2: Overall and strategic planning is done by the

A. Top management

B. Middle level management

C. Supervisory level management

D.All of the above

3: If a general manager asks the sales manager to recruit some salesman

on his behalf, it is an instance of
A. Division of authority

B. Decentralisation of authority

C. Delegation of authority

D.Delegation of responsibility
4: Consider the following basic steps involved in the process of control:
1. Identifying the strategic control points
2. Establishment of the standards
3. Measuring performance against standards
4. Correcting deviations from the standards
A. 1,4,3,2

B. 1,2,3,4

C. 2,1,3,4

D.2,3,1,4

5: An organisation structure is effective if it enables individuals to

contribute to the objectives of the enterprise. This is known as
A. Scalar principle

B. Principle of functional definition

C. Principle of unity of objectives

D.None of the above

6: While delegating, a superior delegates

A. Only authority

B. Authority and responsibility

C. Authority, responsibility and accountability

D.Authority and responsibility but not accountability

7:
Match the following

List I List II
(a) Fayol 1. Grapevine
(b) Simon 2. Cybernetics
(c) Shannon 3. Gang plank
(d) Weiner 4. Noise
A. a-3, b-4, c-2, d-1

B. a-3, b-2, c-4, d-1

C. a-3, b-1, c-4, d-2

D.a-3,b-4,c-1,d-2
8: Directing function of management implies
1. Planning 2. Staffing
3. Leadership 4. Motivation

Choose the correct answer using the codes given below:

A. 1 and 2

B. 3 and 4

C. 2 and 4

D.2,3 and 4

9: Whlch of the following is true with respect to planning function?

A. To make a blue print of ideas and work

B. To tell the work allocation to all

C. Monitoring whether the things allocated are done properly

D.None of the above

10: Which of the following pairs are correctly matched ?

1. 3D Theory V.J. Peddin
2. Life Cycle Theory Paul Hersey and Blandard
3. Continuum Approval Tannenbaum and Schmidt
4. Managerial Grid Mountain & Black
Select the correct answer using the codes given below?
A. 1, 2, 3 and 4

B. 3 and 4

C. 2 and 4

D.1 and 2

11: Each subordinate should have only one superior whose command he
has to obey. This is known as
A. Division of work

B. Exception principle

C. Unity of Command principle

D.Authority - responsibility principle

12: In line and staff organisation the staff performs the function of
A. Management

B. Advising the management

C. Assigning responsibility

D.None of the above

13: Planning function is mainly performed at

A. Top management level

B. Middle management level

C. Lower management level

D.None of the above

14: Which one of the following may not necessarily be an advantage of

coordination?
A. Effective supervision

B. Unity of direction

C. Creative force

D.Summarisation of all management functions

15: Leadership is a function of all the following factors except

A. Work group

B. Product or service

C. Leader

D.Situation

16: Which of the following is not true in respect of planning?

A. Planning is an intellectual activity

B. Planning function is not performed by the top management

C. Planning is related to objectives

D.Planning is forward-looking
17: Which one of the following orders indicates the correct logical order
of managerial functions?
A. Organising, Planning, Directing, Staffing, Coordination and Control
B. Planning, Organising, Staffing,Directing, Control and Coordination
C. Planning, Directing, Organising, Staffing, Control and Coordination
D.Organising, Planning, Staffing,Directing, Control and Coordination

18: Which of the following skills is equally important at all levels of

management?
A. Technical skill

B. Human relation skill

C. Conceptual skill

D.All of the above

19: Consider the following statements:

1. Decentralisation and delegation are closely interrelated
2. Delegation and decentralisation both are desirable
3. Decentralisation is not suitable for large organisation
4. Delegation is not possible in the case of small organisations
Of these statements:
A. 1 and 2 are correct

B. 2 and 3 are correct

C. 1 and 4 are correct

D.1,3 and 4 are correct

20: Consider the following office equipments used in various offices:

1. Fax
3. Dictaphone
2. Typewriter
4. Letter opener
The correct order in which they are used is
A. 1 2 3 4

B. 4 3 2 1

C. 2 4 3 1

D.3 2 4 1
21: Which one of the following formulae is used to calculate "Cross
Relationship" under span of control?
A. n (n - 1)

B. n (2n/2 - 1)

C. n (2n/2 + n -1)

D.None of the above

22: Which of the following is not an advantage of MBO?

A. Success without planning

B. Employee commitment

C. Better appraisal

D.Self control

23: Motivational process and not the motivators as such is associated

with the
A. Need hierarchy theory

B. Two-factor theory

C. ERG Theory

D.Expectancy theory

24: Which one of the following is the oldest form of organization?

A. Functional organization

B. Staff organization

C. Line and Staff organization

D.Departmentation
25: The potential disadvantage of MBO is
A. Its inability to control progress of work and achievement of results
B. Its over-emphasis on production and productivity
C. The additional commitment to the organisation
D.The absence of short-term and long-term planning

26: Delegation of authority is linked to

A. Managerial planning

B. Management coordination

C. Management control

D.Scientific management

27: Organisation Theory deals with

A. Forms of business organisation

B. Structure of an organisation

C. Industrial relations

D.Incentives and wage policy

28: Consider the following steps:

1. Analysis of variances
2. Initiating corrective action
3. Measurement of Actual performance
4. Establishment of standards
What is the sequence of steps?
A. 1,2,3,4

B. 2,3,1,4

C. 3,1,2,4

D.4,3,1,2
29: The following steps are involved in managing by objectives
1. Preliminary setting of objectives at the top
2. Setting subordinates objectives
3. Tying resources with the goals
4. Clarifying the organisational roles
The correct sequence of these steps is
A. 1,2,3,4

B. 1,2,4,3

C. 1,3,2,4

D.1,4,2,3

30: The main advantage of functional organisation is

A. Specialisation

B. Simplicity

C. Expert advice

D.Experience

31: In a Functional organization

A. There are no advisers, the executive alone having the authority and
competence
B. There are specialist advisers having no authority
C. The entire organization is divided into functions with specific role for
specialists.
D.The organization is divided into functions with specialists having
authority.

32: TQM's major emphasis is on

A. Company profitability

B. Product quality

C. Customer delight

D.Employee training
33: Which of the following functions is known as the essence of
management?
A. Planning

B. Organising

C. Co-ordinating

D.Control

34: The following steps are involved in the process of organising

1. Forming supportive objectives
2. Delegating to the head of each group the authority necessary to
perform the activities
3. Establishing enterprise objectives
4. Identifying and classifying activities
The correct sequence of steps is :
A. 3,1,2,4

B. 3,1,4,2

C. 1,3,4,2

D.1,3,2,4

35: In line and staff organisation, the authority lies in

A. Line

B. Staff

C. Both line and staff

D.None of the above

36: 'Matrix organisation' refers to a term of

A. Organisation where authority and responsibility coexist
B. Organisation in which two or more basic types of departmentation are
combined.
C. Mathematical arrangement of events in columns and rows.
D.None of the above
37: Decentralisation of an organization is commanded on account of
which of the following advantages?
1. Reduced burden on top executives
2. Executive development
3. Improvement of morale
4. Solves problems of coordination
Select the correct answer from the codes given below and mark your
answer accordingly.
A. 2 and 3

B. 1,2, and 4

C. 1,2 and 3

D.3 and 4

38: In Taylor's functional organisation, gang boss

A. lnspects the quality of work done

B. Issues instructions to workers

C. Sets up tools and machines for work

D.Compiles cost of production

39: MBO is a technique which requires that the objectives of the

enterprise
A. Be written and defined in broad terms

B. Lay down the time period for achieving the desired results
C. Include a plan of action for achieving the desired result
D.Be defined in terms of measurable results

40: When management pays attention to more important areas and when
the day to day routine problems are looked after by lower level
management, it is known as
A. Management by objectives

B. Management by Exception

C. Participative Management

D.Critical path method

41: Staffing includes
1. Training 2. Appraisal
3. Placement 4. Directing
Choose the correct answer using the codes given below:
A. 1 and 3

B. 2 and 3

C. 1,2 and 3

D.1,2,3 and 4

42: Repeated use plans or standing plans include

A. Objectives and policies

B. Procedures and methods

C. Rules

D.All of the above

43: Span of controls means that

A. An organization consists of various departments
B. Each person's authority is clearly defined.
C. Every subordinate has one superior

D.A manager can supervise only a limited number of subordinates

44: If the span of control is narrow, a number of managers would be

required in each unit of the organization and there would be many
managerial levels or layers, such an organizational structure is referred to
as
A. Flat structure

B. Tall structure

C. Matrix structure

D.Project structure
45: The famous book 'General and Industrial Management' was written by
A. Oliver Sheldon

B. Henri Fayol

C. Elton Mayo

D.Maslow

46: Consider the following elements:

1. Indicators
2. Objectives
3. Controls
4. Key Result Areas
5. Roles and Missions
6. Action plans
Their correct sequence in management by objectives and results is
A. 5 4 2 1 3 6

B. 4 5 2 1 3 6

C. 5 4 1 2 6 3

D.4 5 1 2 6 3

47: Who wrote Management & Moral?

A. Taylor

B. Riggs

C. Dimock

D.Roethliberger

48: The following steps are involved in the process of organizing

1. Forming supportive objectives
2. Delegating to the head of each group the authority
3. Necessary to perform the activities
4. Establishing enterprise objectives
The correct sequence of these steps is
A. 3,1,2,4

B. 4,1,2,3

C. 1,3,4,2

D.1,3,2,4
49: According to the principle of "Span of control" there is
A. A tendency of overload supervisors with too much of work
B. A limit to the number of subordinates a supervisor can effectively
supervise.
C. No limit to the number of subordinates a supervisor can supervise.
D.A limit to delegation of authority to the subordinate.

50: Which one of the following statement is correct?

A. Planning and controlling are essentially one and the same.
B. Controlling is a part of the planning process.
C. Controlling is a substitute for planning

D.A control process is meaningless without pre-set goals.

51: In the process of controlling office management certain steps are

normally taken.
These include
1. Analysing the actual performance.
2. Finding out the reasons for discrepancies.
3. Evaluating the performance.
4. Establishing the standards of work performance.
The correct sequence in which these steps are usually taken is
A. 4,1,2,3

B. 1,4,2,3

C. 1,4,3,2

D.4,1,3,2

52: What is the correct sequence of the following functions of a manager

in an organisation?
1. Motivation 2. Controlling
3. Organising 4. Planning
Select the correct answer using the codes given below.
A. 4,3,2,1

B. 4,3,1,2

C. 3,4,2,1

D.3,4,1,2
 MULTIPLE CHOICE ANSWERS
1.C 12.B 23.D 34.B 45.B
2.A 13.A 24.B 35.A 46.A
3.C 14.A 25.B 36.C 47.D
4.B 15.B 26.C 37.C 48.B
5.C 16.B 27.B 38.C 49.B
6.A 17.B 28.D 39.D 50.D
7.C 18.B 29.B 40.B 51.D
8.D 19.A 30.A 41.C 52.B
9.A 20.B 31.D 42.D
10.A 21.C 32.B 43.D
11.C 22.A 33.C 44.B