Model Question Paper

Introduction to Management - II (MB1A2)

• Answer all 100 questions.
• Each question carries one mark.

1. To make the process of identifying the potential candidates easy, an organization has a manager inventory chart.
Which of the following elements is not shown in the manager inventory chart?
(a) Managerial positions
(b) Current incumbents
(c) Potential replacements for each position
(d) Age of each person
(e) Compensation.
2. External recruitment involves attracting people from outside the organization to apply for vacant positions in the
organization. In which of the following sources of recruitment, the existing employees can be asked to furnish the
names and details of people who they think are suitable for a particular vacancy in the organization?
(a) Advertising
(b) Educational institutions
(c) Employment agencies
(d) Voluntary applicants
(e) Referrals by current employees.
3. Application blank is one of the steps in a typical selection process. Which of the following is not true with regard
to application blank?
(a) Application blank is an efficient method of gathering information about the applicant’s previous work
history and education background
(b) The data provided in the application blank is used formally to decide whether a candidate merits further
evaluation
(c) Interviewers use application blank to familiarize themselves with candidates before interviewing them
(d) The application blank can also include reasons for applying, expected salary and positions last held
(e) Candidates who pass the preliminary screening are required to complete a formal application form
specially designed to obtain the required information about the candidate.
4. Several kinds of tests are used in the employee selection process. Which of the following selection tests explores
alertness, comprehension and reasoning abilities of applicants?
(a) Work sampling tests
(b) Knowledge tests
(c) Personality tests
(d) Intelligence tests
(e) Performance tests.
5. Human Resource planning can be logically divided into forecasting manpower demand, forecasting manpower or
resource supply and human resource actions. Which of the following is not an element of resource supply
forecasting?
(a) Turnover rate
(b) Current inventory
(c) Absenteeism rate
(d) Productivity program
(e) Movement among jobs rate.
6. Interview is an important step in the selection process of an organization. Which of the following types of
interviews allows a candidate to talk freely on general questions and helps to find out about the kind of person the
candidate is?
I. Structured.
II. Unstructured.
III. Semi-structured.
 (a) Only (I) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (I) and (III) above
(e) Both (II) and (III) above.
7. Which of the following is defined as “systematic, detailed study of jobs, consisting of identifying and examining
what is required of the person assigned to the job, and the elements and characteristics of the job”?
(a) Job description
(b) Job specification
(c) Job rotation
(d) Job enlargement
(e) Job analysis.
8. Which of the following processes has the objective of matching individual characteristics (ability, experience and
so on) with requirements of the job?
(a) Recruitment
(b) Selection
(c) Training
(d) Socialization
(e) Career planning.
9. In internal recruitment a disadvantage is that when an employee is promoted to another job, it becomes essential to
find someone to fill the position vacated by him/her in the organization. This is referred to as
(a) Ripple effect
(b) Domino effect
(c) Replacement planning
(d) Extinction
(e) Halo effect.
10. Different kinds of tests are used in the selection process. Which of the following statements is/are true with regard
to physical examination?
I. This is the last step before taking a final decision on whether to select an applicant or not.
II. This is conducted to verify information on application blanks and sometimes, to collect additional data that
will facilitate the selection decision.
III. This is designed to ensure that the candidate can perform effectively in the position for which he or she is
applying to protect the organization against unjust compensation claims.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (III) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
11. Formulating a career strategy, involves various steps. In this context, which of the following is/are true regarding
the preparation of a personal profile?
I. It is the first step in formulating a career strategy.
II. It is an easy task as it requires an insight into oneself.
III. Managers should take up introspection in order to assess whether they are introverts or extroverts.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (III) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
12. Formal appraisals are usually conducted annually or semi annually or on a systematic basis. Which of the
following is a mix of all the four approaches to formal performance appraisal?
(a) Peer assessment
(b) Superior’s rating of subordinates
(c) 360-degree appraisal
(d) Subordinates’ ratings of superiors
 (e) Comprehensive review.
13. Under formal appraisal system, which of the following is directed towards changing employees’ knowledge and
skills, as well as job performance, activities and behaviors?
(a) Staffing
(b) Standards
(c) Succession planning
(d) Corrective action
(e) Recruitment.
14. As performance is multi-dimensional, performance appraisal methods must also consider the various aspects of a
job. In which of the following types of appraisals, the output generated or the service rendered are taken into
consideration in appraising the individual?
(a) Continuous monitoring
(b) Graphic rating scales
(c) Progressive review
(d) Behavior oriented
(e) Results-oriented.
15. Which of the following statements is/are true regarding performance rating methods?

I. Performance rating can be either behavior oriented or result oriented.

II. General behavior and characteristics are the factors used in graphic rating scales.
III. The flexibility and the generality of the rating factors make it possible to evaluate employees in a number of
different jobs.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
16. In which of the following types of appraisals, employees need not wait for the next periodic review to correct
deviations of performance from plans as supervisors immediately discusses the problem with the subordinates and
a corrective action is taken immediately?
(a) Comprehensive review
(b) Progressive review
(c) Continuous monitoring
(d) Behavior-oriented
(e) Managerial review.
17. In which of the following appraisal methods, personal commitment of employees increases because of their
participation in the performance appraisal process?
(a) Superior’s ratings
(b) Subordinate’s ratings
(c) Peer assessment
(d) Self appraisal
(e) Informal appraisal.
18. The employee performance rating method ‘BARS’ stands for

(a) Behaviorally Assisted Rating Scales

(b) Behaviorally Aided Rating Scales
(c) Behaviorally Anchored Rating Scales
(d) Benchmark Anchored Rating Scales
(e) Benchmark Assisted Rating Scales.
19. A widely used approach to managerial appraisal is to evaluate their performance in setting and accomplishing
verifiable objectives. Which of the following is not a weakness of appraisal against verifiable objectives?
(a) Luck plays an important role in the performance of an individual
(b) In reality uncontrollable factors are rarely taken into consideration
(c) It is difficult to measure performance of non-performers
(d) It does not take into consideration managerial abilities of an individual
 (e) It does not form a separate component from the job.
20. A career strategy should be so designed that it helps an individual to utilize his strengths to the maximum extent
and overcome weaknesses. In which of the following steps in formulating a career strategy, personal goals and
ambitions can be considered in designing training and development programs?
(a) Development of contingency plans
(b) Implementation of a career plan
(c) Consistency testing and strategic choices
(d) Analysis of personal strengths and weaknesses
(e) Development of strategic career alternatives.
21. Several factors lead to organizational change. Which of the following is not a factor that leads to organizational
change?
(a) Nature of workforce
(b) Technology
(c) Economic factor
(d) Habit
(e) Competition.
22. Employees who dislike the introduction of computers may ignore the arguments put forward by their superiors
regarding the importance of learning how to use computers and the potential benefits that it will bring them. The
above situation is referred to which of the following sources of resistance to change?
(a) Selective information processing
(b) Economic factors
(c) Fear of the unknown
(d) Security
(e) Limited focus of change.
23. Managers can overcome the initial resistance to change in six ways. Which of the following statements is/are true
regarding facilitation and support to individuals?
I. This method is used when people are resisting change because of adjustment problems.
II. Resistance tends to be less pronounced when the individuals who will be affected by a change are allowed to
participate in planning and implementing it.
III. This method is time consuming.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (III) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
24. According to Kurt Lewin, in which of the following stages, the new behavior pattern is locked in by means of
supporting or reinforcing mechanism, so that it becomes the new norm?
(a) Benchmarking
(b) Refreezing
(c) Moving
(d) Unfreezing
(e) Changing.
25. Which of the following Organization Development (OD) intervention techniques is aimed at helping work groups
to become effective at task accomplishment?
(a) Process consultation
(b) Third-party intervention
(c) Survey feedback
(d) Skill development
(e) Team building.
26. Which of the following internal and external training techniques is a self development technique that aims at
increasing knowledge of managers through exposure to current and relevant management literature?
(a) Sensitivity training
(b) Conference programs
 (c) University management programs
(d) Readings
(e) Expert systems.
27. Conflicts can be addressed by adopting various conflict resolution techniques or methods. Which of the following
methods involves modification and integration of the objectives of groups with differing viewpoints?
(a) Structural change
(b) Problem solving
(c) Forcing
(d) Smoothing
(e) Avoidance.
28. Edgar H. Schein’s study of human behavior is based on various concepts. Which of the following concepts
highlights the ‘intrinsic’ satisfaction that an individual derives from the tasks and responsibilities associated with
his or her job?
(a) Rational-economic
(b) Social
(c) Self-actualization
(d) Complex
(e) Phenomenological.
29. According to Raymond E. Miles, which of the following models of management advocates that managers should
act as developers and facilitators to help their subordinates to achieve performance targets?
(a) Traditional
(b) Economic
(c) Rational
(d) Human resources
(e) Human relations.
30. The creative process is rarely simple and linear, and usually comprises of various overlapping and interacting
phases. In which of the following creative process phases, the manager figures out the aspects of the problem at
the back of his mind, even though the problem is not well-defined?
(a) Intuition
(b) Insight
(c) Logical formulation
(d) Emotion
(e) Unconscious scanning.
31. A manager has to perform various tasks in an organization i.e., he has to take decisions which may affect an
organization’s well-being, has to negotiate with other units or parties. Which of the following types of managers
are usually very curious and come up with new and unusual ideas. They are not only intelligent and rational, but
also use the emotional aspects of their personalities in problem solving?
(a) Theory X
(b) Creative
(c) Bureaucratic
(d) Theory Y
(e) Theory Z.
32. Creative thoughts are a result of hard work and there are various techniques, especially in the decision-making
process, to nurture creative thoughts in individuals. Some techniques focus on individual actions, while some
focus on group interactions. Which of the following techniques aim at multiplication of ideas through group
thinking?
(a) Brainstorming
(b) Synectics
(c) Delphi
(d) Nominal group
(e) Interacting groups.
33. Abraham Maslow’s hierarchy of human needs theory is classified into various groups. An organization satisfies
which of the following needs of its employees by providing a well-furnished office, a car, a personal assistant and
other benefits such as stock options, club memberships, etc.?
 (a) Physiological
(b) Safety and security
(c) Social
(d) Esteem
(e) Self-actualization.
34. Which of the following theories proposes that the factors that help prevent dissatisfaction on the job do not
necessarily lead to satisfaction?
(a) Vroom’s expectancy theory
(b) Adam’s equity theory
(c) Herzberg’s motivation-hygiene theory
(d) McClelland’s needs theory
(e) McGregor’s theory X.
35. David C. McClelland has contributed to the theories of motivation by highlighting the importance of various basic
needs to understand motivation. According to McClelland, an employee having which of the following needs can
be motivated by setting challenging, but reachable goals and providing immediate feedback about his/her
performance?
(a) Achievement
(b) Affiliation
(c) Power
(d) Existence
(e) Relatedness.
36. Process theories of motivation attempt to explain thought processes of individuals when they decide whether or
not to behave in a certain way. Which of the following theories highlights the importance of social comparison
processes, and goes beyond the expectancy theory as a cognitive explanation of work motivation?
(a) Alderfer’s ERG theory
(b) Adam’s equity theory
(c) Herzberg’s two-factor theory
(d) Maslow’s needs hierarchy theory
(e) McClelland’s needs theory.
37. Which of the following is a combination of several fields which include industrial and organization psychology
and sociology, industrial engineering, organization theory and development, motivation and leadership theory, and
industrial relations?
(a) Quality circles
(b) Job enrichment
(c) Total quality management
(d) Quality control
(e) Quality of work life.
38. Rewards may be defined as material or psychological payoffs for the accomplishment of tasks. Which of the
following is an intrinsic reward?
(a) Money
(b) Perks and amenities
(c) Status symbols
(d) Satisfaction
(e) Praise.
39. Abraham Maslow proposed the Needs Hierarchy theory. According to Maslow, a physiological need stops
motivating when
(a) It is substantially satisfied
(b) The next level of needs is achieved
(c) An individual returns to a lower level need
(d) Self-actualization need is satisfied
(e) An individual learns that his/her needs cannot be satisfied.
40. Which of the following theories/model states that satisfaction does not lead to performance, rather, performance
(but does not always) can lead to satisfaction through the reward process?
 (a) Expectancy theory
(b) Porter-Lawler model
(c) Equity theory
(d) ERG theory
(e) Two-factor theory.
41. On the basis of equity theory, when employees perceive an inequity, they might do all of the following except

(a) Distort either their own or others’ inputs or outcomes

(b) Behave so as to induce others to change their inputs or outcomes
(c) Behave so as to change their personal inputs or outcomes
(d) Work harder on their job
(e) Quit the job.
42. Theories of motivation can be classified as content theories of motivation and process theories of motivation.
Which of the following statements is/are true with respect to content theories of motivation?
I. Maslow’s self-actualization and esteem needs correspond to Herzberg’s motivators.
II. McClelland’s need for achievement corresponds to Alderfer’s relatedness needs.
III. Maslow’s esteem needs correspond to McClelland’s need for power.
IV. Herzberg’s hygiene factors correspond to McClelland’s need for achievement, Maslow’s social needs and
Alderfer’s growth needs.
(a) Only (I) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
43. Professor Rensis Likert and his associates at the University of Michigan studied the patterns and styles of leaders
and suggested certain systems of management. In which of the following Likert’s systems of management, a
manager allows subordinates to participate to some extent in decision-making but retain close policy control?
(a) Instrumental style
(b) Exploitive-authoritative style
(c) Benevolent-authoritative style
(d) Consultative style
(e) Participative style.
44. The managerial grid, developed by Robert Blake and Jane Srygley Mouton, is a popular approach for defining
leadership styles. Which of the following leadership styles does not provide leadership in a positive sense but
believes in a “laissez-faire” approach, relying on previous practice to keep the organization going?
(a) Impoverished
(b) Country club
(c) Authority-compliance
(d) Organization-man
(e) Team.
45. The Vroom-Yetton model identifies five styles of leadership based on the degree to which subordinates participate
in the decision-making process. The ‘Autocratic I (AI)’ style suggests that
(a) Managers solve the problem or make the decision themselves, using information available at the time it is
required
(b) Managers obtain the necessary information from subordinates, then make the decision themselves
(c) Managers discuss the problem with relevant subordinates individually, getting their ideas and suggestions
without bringing them together as a group
(d) Managers share the problem with subordinates as a group, collectively obtaining their ideas and
suggestions
(e) Managers share a problem with subordinates as a group and attempt to reach a consensus.
46. Mr. Arakulam, a manager at Sindhuri information systems, has a high degree of confidence in his subordinates and
sets formidable goals for them so that they perform to their best possible levels. Which of the following leadership
behaviors suggested by Robert J. House is demonstrated by Mr. Arakulam?
(a) Supportive
(b) Participative
 (c) Achievement-oriented
(d) Instrumental
(e) Benevolent-authoritative.
47. The theory which postulates that effective group performance depends on the proper match between the leader’s
style of interacting with employees, and the degree to which the situation gives control and influence to the leader
is
(a) Fiedler’s contingency model
(b) Path-goal theory
(c) Hersey and Blanchard’s model
(d) The Ohio State studies
(e) Vroom-Yetton model.
48. Robert Tannenbaum and Warren H. Schmidt devised a continuum of leader behaviors. According to this
continuum, the manager should attempt to move towards which of the following behavior pattern in the long run?
(a) Job centered
(b) Boss centered
(c) Subordinate centered
(d) Autocratic
(e) Impoverished.
49. The leaders who pay attention to the concerns and developmental needs of individual followers, help followers to
look at old problems in new ways, and are able to inspire followers to put extra effort into the group goals are
(a) Visionary leaders
(b) Transformational leaders
(c) Transactional leaders
(d) Autocratic leaders
(e) Consultative leaders.
50. Effective leadership calls for various traits – physical, intelligence and ability, personality, task-related, and social.
Which of the following is not a personality trait required for effective leadership?
(a) Adaptability
(b) Enthusiasm
(c) Aggressiveness
(d) Cooperativeness
(e) Self-confidence.
51. According to the Ohio State Studies, a leader with an orientation towards which of the following dimensions of
leadership would believe in mutual trust and respect for employees’ ideas and feelings, while also expressing
concern for employees’ comfort, well-being, and satisfaction?
(a) Boss-centered
(b) Initiating structure
(c) Consideration
(d) Job-centered
(e) Production-centered.
52. Fiedler’s Least Preferred Coworker (LPC) scale is used to measure the leader’s behavioral orientation as either

(a) Initiating structure or consideration

(b) Self centered or peer centered
(c) Task-oriented or employee-oriented
(d) Boss centered or subordinate centered
(e) Performance centered or reward centered.
53. The leadership styles suggested by path-goal theory are used by the same leader in different situations. The various
situational factors that contribute to effective leadership include characteristics of subordinates and the work
environment. Which of the following can be categorized as a characteristic of subordinates?
(a) Tasks
(b) Relationship with co-workers
(c) Appraisal systems
 (d) Self confidence
(e) Reward systems.
54. Which of the following approaches to leadership is based on the two variables, ‘concern for people’ and ‘concern
for production’?
(a) University of Michigan studies
(b) Managerial grid
(c) University of Iowa studies
(d) Path-goal theory
(e) Ohio State studies.
55. The use of gestures, eye-contact, facial expressions and body posture in communication, constitutes

(a) Listening
(b) Counseling
(c) Noise
(d) Verbal communication
(e) Non-verbal communication.
56. Which of the following key elements of communication confirms whether there has been any change in the
behavior of the individual or in the organization as a result of communication?
(a) Sender
(b) Feedback
(c) Noise
(d) Transmission
(e) Receiver.
57. Communication flow in an organization can be upward, downward and lateral (crosswise). Which of the following
does not constitute upward communication?
(a) Cost accounting report
(b) Purchase order summary
(c) Production report
(d) Corporate policy statement
(e) Sales report.
58. Noise may occur at the sender’s end, during transmission, or at the receiver’s end. Which of the following is not
an example of noise in the communication process?
(a) Poor telephone connection
(b) Ambiguous symbols leading to faulty encoding
(c) Inattentive receiver
(d) Prejudices in understanding the message
(e) Improper feedback.
59. According to Newman and Summer, “an exchange of facts, ideas, opinions or emotions by two or more persons”
is defined as
(a) Information
(b) Communication
(c) Transmission
(d) Encoding
(e) Decoding.
60. Information overload is a barrier to communication. Employees may react to information overload by
I. Incorporating all information.
II. Making errors in information processing.
III. Disregarding certain information.
IV. Delaying information processing.
(a) Both (I) and (II) above
(b) Both (I) and (IV) above
(c) Both (III) and (IV) above
(d) (I), (II) and (III) above
(e) (II), (III) and (IV) above.
61. Which of the following is referred to as ‘a person’s outlook or mental predisposition regarding a fact or a state’?
(a) Motivation
(b) Need
(c) Attitude
(d) Want
(e) Drive.
62. Which of the following is a control principle that suggests that managers should be informed about a problematic
situation only when the data shows a significant deviation from the established standards?
(a) Management control system
(b) Management by exception
(c) Management by objectives
(d) Management information system
(e) Management by walking around.
63. In which of the following controls, the cause of unsatisfactory outcome is traced back to the individuals
responsible for it and they are made to correct their practices?
(a) Yes-no control
(b) Direct control
(c) Concurrent control
(d) Steering control
(e) Preventive control.
64. Goal incongruence takes place when the goals of the employee and those of the organization fail to match. Which
of the following is/are the reasons for the occurrence of goal incongruence during the control process?
I. Lack of support of employees for organizational activities.
II. Lack of clarity in organizational goals.
III. Lack of experience by employees.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (II) above
(d) Both (I) and (III) above
(e) All (I), (II) and (III) above.
65. Organizations implement control in a number of different ways and at different levels. Managers need to consider
the types of control that they wish to use. Based on the degree of human discretion required, control systems can
be classified as
I. Multiple.
II. Cybernetic.
III. Concurrent.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (II) above
(d) Both (I) and (III) above
(e) All (I), (II) and (III) above.
66. Guidelines established by management to be used as a basis for evaluating or measurement of performance are
called
(a) Objectives
(b) Premises
(c) Standards
(d) Deviations
(e) Corrective actions.
67. Managers should recognize and acknowledge good or positive performance by subordinates when their
performance meets or exceeds the established standards. Which of the following is/are the form(s) of recognition?
I. Oral remark.
II. Substantial rewards.
III. Training opportunities.
 IV. Reimbursements.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (I), (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
68. Even though control systems need to be tailored to suit specific situations, they all involve the same basic process
which in turn, involves various steps. Which of the following steps immediately follows measuring performance?
(a) Determining areas to control
(b) Establishing standards
(c) Comparing performance against standards
(d) Recognizing good or positive performance
(e) Taking corrective action when necessary.
69. Which of the following is a stock of materials that are used to facilitate production or to satisfy customer demand?
(a) Quality
(b) Inventory
(c) Asset
(d) Organizing
(e) Simulation.
70. Assets are the resources that an organization controls and are of two types, current and fixed. Which of the
following is not an example of fixed assets?
(a) Money in the bank
(b) Buildings
(c) Machinery
(d) Patents
(e) Land.
71. Which of the following is a brief presentation of the financial results of a company’s operations over a specified
time period, such as a quarter or a year?
(a) Balance sheet
(b) Ratio analysis
(c) Revenue center
(d) Cash flow statement
(e) Income statement.
72. An index that measures one variable relative to another and is generally expressed as a percentage or a rate is
called
(a) Balance sheet
(b) Ratio
(c) Budget
(d) Equity
(e) Liability.
73. Which of the following statements is/are true with respect to asset management ratio?

I. It is a test of relationship between sales and various assets of a firm.

II. It is also called activity ratio.
III. A higher percentage indicates that a higher investment is needed in assets and the profitability is lower.
(a) Only (I) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
74. A responsibility center is a sub-unit headed by a manager who is responsible for achieving one or more goals.
Which of the following is not a responsibility center?
(a) Standard selling
(b) Discretionary expense
 (c) Revenue
(d) Profit
(e) Investment.
75. Which of the following ratios measure the efficiency of operations of a business and also indicate the
organization’s ability to pay debt and the scope for internal financing?
(a) Current
(b) Activity
(c) Leverage
(d) Profitability
(e) Liquidity.
76. Which of the following is the totality of features and characteristics of a product or service that bear on its ability
to satisfy stated and implied needs?
(a) Inventory
(b) Kanban
(c) Simulation
(d) Production
(e) Quality.
77. Which of the following statements is/are true with respect to discretionary expense centers?

I. The output of a discretionary expense center can be directly used to produce revenues.
II. Budgets for discretionary expense centers are developed only in terms of maximum resources that can be
consumed by them in a particular period.
III. For assessing the budgetary performance, the expense constraints are established at the discretion of the
manager.
(a) Only (I) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
78. Operations management is a tool by which management can create and improve its operations. Which of the
following statements is true regarding ‘operations management’?
(a) It does not exist in the service sector
(b) It is concerned only with the input stage of product development
(c) The outputs of the operations system include both goods and services
(d) Labor is part of the transformation stage and is not considered an input
(e) The techniques of operations management are not applicable to other disciplines such as finance,
marketing and human resource management.
79. Just-In-Time (JIT) inventory control is an approach to inventory control that stresses on having materials arrive
just when they are required in the production process. Which of the following does not apply to a JIT system?
(a) Suppliers need to be located in close proximity
(b) Organization must have ISO 9001 certification
(c) Reliable transportation facilities should be available
(d) Suppliers need to be capable of providing high quality materials
(e) Long-term relationships should be maintained with the suppliers.
80. Inventory is vital to organizations, as it represents considerable costs. So, various methods have been developed to
control inventory related costs. Which of the following is the inventory control method developed to minimize
ordering and holding costs, while avoiding stockout costs?
(a) Economic order quantity
(b) Mathematical model
(c) Linear programming
(d) Value engineering
(e) Distribution logistics.
81. Productivity can be measured in two ways, total productivity and partial productivity. In both the cases it is
expressed as a ratio of outputs to inputs. Which of the following is considered as the specific input by these
productivity ratios?
 (a) Capital
(b) Energy
(c) Materials
(d) Labor
(e) Technology.
82. Which of the following is the amount of inventory that is to be used during a given period of time as specified by a
particular system?
(a) Annual demand
(b) Safety stock
(c) Reorder point
(d) Kanban
(e) Cycle stock.
83. Inventory serves different purposes in an organization. To maintain it, organizations incur several costs. The
expense associated with keeping an inventory item in the shelf or warehouse is called
(a) Ordering cost
(b) Cost of capital
(c) Carrying cost
(d) Superfluous cost
(e) Item cost.
84. Which of the following are the reasons why productivity of knowledge workers is more difficult to measure than
productivity of industrial workers?
I. The quality of a knowledge worker’s output cannot be determined immediately.
II. The output of a knowledge worker often contributes only indirectly to the achievement of the end-result.
III. Upgraded skills of knowledge workers due to rapid technological advances make output measurement
difficult.
IV. Knowledge workers often assist other organizational units and this contribution is difficult to measure.
(a) Both (I) and (II) above
(b) Both (III) and (IV) above
(c) (I), (II) and (IV) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
85. In the operations research methodology, which of the following steps precedes the others steps mentioned?
(a) Testing the model
(b) Deriving a solution from the model
(c) Putting the solution into effect
(d) Mathematical model construction
(e) Providing controls for the model.
86. Which of the following combinations of managerial efficiency and effectiveness would be most likely to lead to
an organization reaching it goals but wasting resources?
(a) High efficiency and low effectiveness
(b) Low efficiency and low effectiveness
(c) Low efficiency and high effectiveness
(d) High efficiency and high effectiveness
(e) Focus only on effectiveness and total lack of efficiency.
87. Which of the following techniques helps in finding out the point to which the project duration could be crashed
without incurring additional cost?
(a) Work simplification
(b) Program evaluation and review technique
(c) Quality circle
(d) Value engineering
(e) Dynamic programming.
88. Which of the following does not constitute a set of decisions that are included in an operations management
program?
 (a) Capacity decisions
(b) Facilities decisions
(c) Quality decisions
(d) Technology decisions
(e) Budgeting decisions.
89. Different information systems use different data inputs and produce different information output patterns. Which
of the following information systems has low-volume data and analytical models as data inputs?
(a) Management Information System
(b) Decision Support System
(c) Executive Support System
(d) Transaction Processing System
(e) Office Automation System.
90. All managers require information to perform their managerial functions and make effective decisions. For
information to be useful to managers, it must possess certain attributes. The information attribute which tells
whether the information pertains to the situation at hand or not, is known as
(a) Information accuracy
(b) Information timeliness
(c) Information relevance
(d) Information completeness
(e) Information frequency.
91. Unanalyzed and unorganized facts and figures describing entities can be referred to as
(a) Data
(b) Communication
(c) Hardware
(d) Feedback
(e) Noise.
92. A Transaction Processing System (TPS) is one of the five major information systems organizations use. A TPS
assists in the operations of an organization by performing which of the following procedures?
I. Automation of document and message processing.
II. Sorting, sequencing, arranging, or updating transaction records.
III. Merging the contents of two or more files.
IV. Performing calculations on file data.
(a) Both (I) and (II) above
(b) Both (I) and (III) above
(c) Both (III) and (IV) above
(d) (I), (II) and (IV) above
(e) (II), (III) and (IV) above.
93. The standards and procedures for the storage and preservation of data in a form that ensures access across a variety
of applications and uses is referred to as
(a) Data validation
(b) Data management
(c) Data security
(d) Data integrity
(e) Data entry.
94. Which of the following refers to a set of programs, documents, procedures and routines associated with the
operations of a computer system?
(a) Hardware
(b) Transaction
(c) Automation
(d) Software
(e) Data.
95. In Japanese management style, the staffing function is characteristic of

I. Young people hired out of school.

 II. Rapid advancement desired.
III. Slow promotion through ranks.
IV. Promotions based on multiple criteria.
V. Appraisal of short-term results.
(a) (I), (II) and (III) above
(b) (I), (III) and (IV) above
(c) (I), (III) and (V) above
(d) (II), (III) and (IV) above
(e) (II), (IV) and (V) above.
96. In many foreign countries, the organizational planning activities are dominated by staff specialists, such as
engineers and budget analysts, who hold influential positions in the bureaucracy and specialize in economic
planning, such staff specialists are called
(a) Technocrats
(b) Senators
(c) Expatriates
(d) Outlaws
(e) Emigres.
97. Which of the following Japanese management practices implies that promotion and increase in wage are based on
an employee’s length of service, not job performance?
(a) Shushin koyo
(b) Kaisha
(c) Henko
(d) Kacho
(e) Ringi.
98. Which of the following approaches towards international business is the most practical of all because it takes into
consideration both global competition and local rivalry in establishing prices?
(a) Ethnocentric
(b) Polycentric
(c) Unicentric
(d) Regiocentric
(e) Geocentric.
99. Firms with international business have several advantages over firms that operate only within the home country.
Which of the following is not an advantage to a multinational corporation?
(a) Business opportunity in various countries and ability to raise funds for their operations throughout the
world
(b) Ability to establish production facilities in countries where their products can be produced most
efficiently, effectively and economically
(c) Access to natural resources and materials that may not be available to domestic firms
(d) Recruitment from a worldwide labor pool enables MNCs to select the most suitable candidates for filling
key positions in their firms
(e) Developing countries have become more adept in international negotiations and have become aware of
their resources.
100. Which of the following are the characteristics of the ‘controlling function’ adopted in US Management style?
I. Control by peers.
II. Focus on group performance.
III. Fixing blame.
IV. Limited use of quality control circles.
(a) Both (I) and (II) above
(b) Both (III) and (IV) above
(c) (I), (II) and (IV) above
(d) (I), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
END OF QUESTION PAPER
 Suggested Answers
Introduction to Management - II (MB1A2)
ANSWER REASON
1. E Compensation is not shown in the manager inventory chart. All the other options are
shown in the manager inventory chart.
2. E Referrals by current employees- Existing employees can be asked to furnish the
names and details of people who they think are suitable for a particular vacancy in
the organization. The employees may suggest the names of friends who work for
another firm, or for relatives. This type of external recruitment can prove to be
effective as the employees can provide information on the applicant’s ability to
perform on the job and how well he or she can get along with others.
3. B Option (b) is not true with regard to application blank. The data provided in the
application blank is used informally to decide whether a candidate merits further
evaluation but not formally as given in the question.
4. D Intelligence tests explore alertness, comprehension and reasoning abilities of
applicants. (a) Work sampling tests are a means of measuring practical ability of the
candidate on a specific job. (b) Knowledge tests evaluate the applicant’s knowledge
about the company, its competitors and customers, its products, the target market
and the like. (c)Personality tests are means of measuring characteristics such as
patterns of thoughts, feelings etc., of an individual. (e) Performance tests are same as
work sampling tests.
5. D Productivity program is not an element in ‘resource supply forecasting.’
6. E In unstructured interview a candidate is allowed to talk freely on general questions
and helps to find out about the kind of person the candidate is. As semi-structured is
a combination of structured and unstructured interviews, it allots time for interaction
and discussion. So option (e) is the correct answer.
7. E Job analysis is defined as “systematic, detailed study of jobs, consisting of
identifying and examining what is required of the person assigned to the job, and the
elements and characteristics of the job”.
8. B The objective of effective selection is to match individual characteristics (ability,
experience and so on) with requirements of the job.
9. A When an employee is promoted to another job, it becomes essential to find someone
to fill his/her position in the organization. This is referred to as the ripple effect.
10. C Statements (I) and (III) are true regarding physical examination. Statement (II) is
relating to reference checks but not physical examination. Therefore option (c ) is
the correct answer.
11. C Statements (I) and (III) are true regarding the step of ‘preparation of a personal
profile’. Statement (II) is not true as the preparation of personal profile is a difficult
task but not an easy task.
12. C In “360 degree appraisal,” an individual is evaluated using all the four approaches to
formal appraisal. To be successful, these appraisals must be carefully designed and
skillfully implemented.
13. D Corrective action is directed towards changing employees’ knowledge and skills, as
well as job performance, activities and behaviors.
14. E In results-oriented appraisals, the output generated or the service rendered are taken
into consideration in appraising the individual.
15. E All the statements regarding performance rating methods are true:
• Performance rating can be either behavior oriented or result oriented.
• General behavior and characteristics are the factors used in graphic rating
scales.
• The flexibility and the generality of the rating factors make it possible to
evaluate employees in a number of different jobs.
16. C In continuous monitoring, employees does not have to wait for the next periodic
 review to correct deviations of performance from plans as supervisors immediately
discusses the problem with the subordinates and a corrective action is taken
immediately.
17. D In self appraisal method, personal commitment of employees increases because of
their participation in the performance appraisal process.
18. C BARS’ stands for Behaviorally Anchored Rating Scales.
19. E It does not form a separate component from the job is not a weakness of appraisal
against verifiable objectives.
20. B In implementation of a career plan step, personal goals and ambitions can be
considered in designing training and development programs.
21. D Habit is not a factor that leads to organizational change. It is a source of resistance
to change. Therefore option (d) is the answer.
22. A The situation i.e., employees who dislike the introduction of computers may ignore
the arguments put forward by their superior regarding the importance of learning
how to use computers and the potential benefits that it will bring them is referred to
selective information processing.
23. C Statements (I) and (III) are true regarding facilitation and support. Statement (II)
relates to participation and involvement. Therefore option(c) is the correct answer.
24. B In the refreezing stage, the new behavior pattern is locked in by means of supporting
or reinforcing mechanism, so that it becomes the new norm.
25. E Team building is aimed at helping work groups to become effective at task
accomplishment.
26. D Readings is a self development technique that aims at increasing knowledge of
managers through exposure to current and relevant management literature.
27. A Structural change involves modification and integration of the objectives of groups
with differing viewpoints.
28. C Self-actualization concept highlights the 'intrinsic' satisfaction that an individual
derives from the tasks and responsibilities associated with his or her job.
29. D The human resources model advocates that managers should act as developers and
facilitators to help their subordinates to achieve performance targets.
30. E In unconscious scanning phase, the manager figures out the aspects of the problem at
the back of his mind, even though the problem is not well-defined.
31. B Creative managers are usually very curious and come up with new and unusual
ideas, are not only intelligent and rational, but also use the emotional aspects of their
personalities in problem solving.
32. A Brainstorming technique aims at multiplication of ideas through group thinking.
33. D An organization satisfies esteem needs of its employees by providing a well-
furnished office, a car, a personal assistant and other benefits such as stock options,
club memberships, etc.
34. C Herzberg's motivation-hygiene theory proposes that the factors that help prevent
dissatisfaction on the job do not necessarily lead to satisfaction.
35. A According to McClelland, an employee having achievement need are motivated by
setting challenging, but reachable goals and providing immediate feedback about
his/her performance.
36. B Adam’s equity theory highlights the importance of social comparison processes, and
goes beyond the expectancy theory as a cognitive explanation of work motivation.
37. E Quality of work life is a combination of several fields which include industrial and
organization psychology and sociology, industrial engineering, organization theory
and development, motivation and leadership theory, and industrial relations.
38. D Rewards may be defined as material or psychological payoffs for the
accomplishment of tasks. Rewards can be broadly categorized into extrinsic and
intrinsic rewards. Extrinsic rewards are pay-offs granted by others. They include
money, perks and amenities, promotion, recognition, status symbols, and praise.
Intrinsic (job content) rewards are self-granted and internally experienced payoffs.
Individuals prefer intrinsic rewards such as satisfaction from performing challenging
 and interesting jobs.
39. A According to Maslow, a physiological need stops motivating when it is substantially
satisfied.
40. B According to Porter and Lawler, satisfaction does not lead to performance, rather,
the reverse is true: performance can (but does not always) lead to satisfaction
through the reward process.
41. D With respect to the equity theory, when employees perceive an inequity, they may
resign from the organization, induce others to change their inputs or outcomes,
change their own inputs or outcomes or reduce quantity or quality of output.
Employees work harder on their job when the rewards are more than equitable.
Therefore, option (d) is the answer.
42. B The following statements are true with respect to content theories of motivation:
• Maslow’s self-actualization and esteem needs correspond to Herzberg’s
motivators.
• Maslow’s esteem needs correspond to McClelland’s need for power.
Statement II is not true since McClelland’s need for achievement corresponds to
Alderfer’s growth needs.
Statement IV is not true as Herzberg’s hygiene factors correspond to McClelland’s
affiliation needs, Maslow’s safety and physiological needs and Alderfer’s existence
needs.
43. C In benevolent-authoritative style, a manager allows subordinates to participate to
some extent in decision-making but retain close policy control as all major decisions
are made centrally.
44. A Impoverished leadership styles do not provide leadership in a positive sense but
believes in a “laissez-faire” approach, relying on previous practice to keep the
organization going.
45. A Autocratic I (AI) style suggests that managers solve the problem or make the
decision themselves, using information available at the time it is required.
46. C Leadership behavior exhibited by Mr. Arakulam is achievement-oriented has he is
involved in setting formidable goals in order to help the subordinates perform to
their best possible levels and also have high degree of confidence in his
subordinates.
47. A Fiedler's contingency model postulates that effective group performance depends on
the proper match between the leader's style of interacting with employees and the
degree to which the situation gives control and influence to the leader.
48. C According to Tannenbaum and Schmidt, in the long run, managers should move
toward subordinate-centered end of the continuum, as such leader behavior has the
potential to improve decision quality, teamwork, employee motivation, morale, and
employee development.
49. B Leaders who pay attention to the concerns and developmental needs of individual
followers, help followers to look at old problems in new ways, and are able to
inspire followers to put extra effort into the group goals are transformational leaders.
50. D Cooperativeness is a social trait, not a personality trait.
51. C According to the Ohio State Studies, a leader who is high in consideration is
characterized by mutual trust and respect for employees' ideas and feelings. He/she
also shows concern for employees' comfort, well-being, and satisfaction.
52. C Fiedler's least preferred coworker (LPC) questionnaire purports to measure the
leader's behavioral orientation as either task-oriented or employee-oriented.
53. D Self-confidence is an employee contingency factor identified by the path-goal
theory, while all the other options given are environmental contingency variables.
54. B The managerial grid is based on “concern for people” and “concern for production.”
55. E The use of gestures, eye-contact, facial expression and body posture in
communication, constitute non-verbal communication.
56. B Feedback confirms whether there has been any change in the behavior of the
individual or in the organization as a result of communication.
57. D Except corporate policy statements, all the options given are examples of upward
communication.
58. E Improper feedback is not an example of noise. Noise occurs while sending the
message, during transmission or while receiving the message. As feedback takes
place after the message is delivered and decoded, improper feedback cannot be
considered as noise.
59. B According to Newman and Summer, “an exchange of facts, ideas, opinions or
emotions by two or more persons” is defined as communication.
60. E Employees may react to information overload by
• Filtering information
• Making processing errors
• Disregarding certain information
• Delaying information processing
• Ignoring communication.
61. C Attitude refers to a person’s outlook or mental predisposition regarding a fact or a
state.
62. B Management by exception is a control principle that suggests managers should be
informed about a problematic situation only when the data shows a significant
deviation from the established standards. Hence option (b) is the answer.
63. B In direct control, the cause of unsatisfactory outcome is traced back to the
individuals responsible for it and they are made to correct their practices. Hence
option (b) is the answer.
64. E Lack of support of employees for organizational activities and lack of clarity in
organizational goals and lack of experience by the employees are the reasons for the
occurrence of goal incongruence. Hence option (e) is the answer.
65. B Based on the degree of human discretion required, control systems can be classified
as
Cybernetic and non-cybernetic control systems.
On the basis of timing or stage in the production process, controls can be classified
as feedforward control, concurrent control, feedback control and Multiple controls.
66. C A guideline established by management to be used as a basis for evaluating
performance is called as standard.
67. D Recognition can be in the form of oral remark, substantial rewards, training
opportunities and consistent good work. Hence option (d) is the answer.
68. C Comparing performance against standards immediately follows measuring
performance step in the control process.
69. B Inventory is a stock of materials that are used to facilitate production or to satisfy
customer demand. Hence option (b) is the answer.
70. A Money in the bank is not an example of fixed asset. All other options are examples
of fixed assets.
71. E Income statement is a brief presentation of the financial results of a company's
operations over a specified time period, such as a quarter or a year.
72. B An index that measures one variable relative to another and is generally expressed as
a percentage or a rate is called ratio.
73. C The following statements are true with respect to asset management ratios:
• They are a test of the relationship between sales and various assets of a firm.
• They are also called activity ratios.
A higher percentage indicates that a lesser investment is needed in assets and the
profitability is better. Hence statement (III) is not true.
74. A A responsibility center is a sub-unit headed by a manager who is responsible for
achieving one or more goals. The five types of responsibility centers are standard
cost centers, discretionary expense centers, revenue centers, profit centers and
investment centers.
From the above discussion it is clear that standard selling center is not a
 responsibility center.
75. D Profitability ratios measure the efficiency of operations of a business and also
indicate the organization’s ability to pay debt and the scope for internal financing.
76. E Quality is the totality of features and characteristics of a product or service that bear
on its ability to satisfy stated and implied needs.
77. D The following statements are true with respect to ‘discretionary expense centers’:
• Budgets for discretionary expense centers are developed only in terms of
maximum resources that can be consumed by them in a particular period.
• For assessing the budgetary performance, the expense constraints are
established at the discretion of the manager.
Statement (I) is not true since the output of a discretionary expense center cannot be
directly used to produce revenues.
78. C Operations Management oversees the transformation process that converts resources
such as labor and raw materials into finished goods and services.
Hence, option (c) is true regarding Operations Management.
Options (a), (b), (d) and (e) are all false regarding Operations Management.
79. B Having ISO 9001 certification is not a pre-requisite to adopt a Just-In-Time (JIT)
system.
Hence, option (b) is correct.
Options (a), (c), (d) and (e) are all characteristics of Just-In-Time (JIT) system.
80. A The Economic Order Quantity (EOQ) is an inventory control method developed to
minimize ordering and holding costs, while avoiding stock out costs.
81. D Labor is considered as a specific input by both the productivity ratios: total
productivity and partial productivity.
82. E Cycle stock is the amount of inventory that is to be used during a given period of
time as specified by a particular system.
83. C The expense associated with keeping an inventory item in the shelf or warehouse is
called carrying cost.
84. C The following are reasons why productivity of knowledge workers is more difficult
to measure than productivity of industrial workers”
• The quality of a knowledge worker’s output cannot be determined immediately.
• The output of a knowledge worker often contributes only indirectly to the
achievement of the end-result.
• Knowledge workers often assist other organizational units and this contribution
is difficult to measure.
85. D In the operations research methodology, mathematical model construction precedes
the other steps.
86. C Organizations aim at improving effectiveness and efficiency of performance. While
effectiveness relates to the extent to which performance meets organizational goals,
efficiency addresses the usage of inputs (resources) to produce certain outputs
(finished products or services).
Therefore, a combination of low efficiency and high effectiveness would lead to an
organization reaching it goals but wasting resources.
A combination of high efficiency and low effectiveness is most likely to lead to the
organization not reaching its goals and not wasting resources.
High efficiency and high effectiveness would most likely lead to the organization
reaching its goals and not wasting resources.
Low efficiency and low effectiveness would most likely lead to the organization not
reaching its goals and wasting resources.
87. B Program evaluation and review technique helps in finding out the point to which the
project duration could be crashed without incurring additional cost.
88. E Budgeting decisions do not constitute a set of decisions that are included in an
operations management program.
89. B Decision Support System (DSS) is an information system that helps the managers in
 decision-making. It uses low-volume data and analytical models as data inputs.
Hence, option (b) is correct.
90. C The information attribute which tells whether the information pertains to the
situation at hand or not, is known as Information Relevance.
Hence, option (c) is correct.
91. A Unanalyzed and unorganized facts and figures describing entities can be referred to
as data.
92. E A TPS assists in the operations of an organization by performing which the
following procedures:
• Sorting, sequencing, arranging, or updating transaction records.
• Merging the contents of two or more files.
• Performing calculations on file data.
Statement (I) – Automation of document and message processing – pertains to an
office automation system.
93. B Data management refers to the standards and procedures for the storage and
preservation of data in a form that ensures access across a variety of applications and
uses.
94. D Software refers to a set of programs, documents, procedures and routines associated
with the operations of a computer system.
95. B In Japanese Management style, the usual staffing position is
• Young people hired out of school.
• Slow promotion through ranks.
• Promotions based on multiple criteria.
Hence, (b) is the correct answer.
In US management style, the usual staffing position is
• Rapid advancement desired
• Appraisal of short-term results
96. A In many foreign countries, the organizational planning activities are dominated by
staff specialists, such as engineers and budget analysts, who hold influential
positions in the bureaucracy and specialize in economic planning, such staff
specialists are called Technocrats.
97. C The Japanese management practice Henko, implies that promotion and wage
increases are based on an employee’s length of service, not job performance.
98. E Geocentric approach towards international business is the most practical of all
because it takes into consideration both global competition and local rivalry in
establishing prices.
99. E Developing countries have become more adept in international negotiations and
have become aware of their resources is not an advantage to a multinational
corporation, instead is a challenge for them.
100. B In the American management style, the management function of controlling is
characterized by
• Fixing blame.
• Limited use of quality control circles.
Control by peers and focus on group performance are characteristics of Japanese
style. In the American style control is exercised by superiors and focus is on
individual performance.