Chapter- 1

Nature & Significance of Management

Multiple Choice Questions
1. ‘Doing the task with minimum cost” name the term associated with
management?
(a) Efficiency (b) Effective
(c) Both (d) Management
2. The objective of the Marketing Department of ‘KOTEX Ltd.’ is to increase
sales by 10 per cent by offering discounts. But, the finance department may not
approve of such discounts as it means loss of revenue. These kinds of conflict
arise in organizations because each department performing activities in isolation
from others and barriers between departments are becoming more rigid. Identify
the point of importance of coordination to which this case is related:
(a) Growth in size (b) Functional differentiation
(c) Specialization (d) None of these
3. Policy formulation is the function of
(a) Top level Managers (b) Middle level Managers
(c) Operational Management (d) None of the above
4. Goal setting is the function of
(a) CEO (b) Foreman
(c) Supervisor (d) Superintendent
5. How does a manager want to achieve his objectives?
(a) Efficiently (b) Effectively
(c) Efficiently and effectively (d) None of the above
6. Successful organizations do not achieve goals by chance but by following a
deliberate process known as
(a) Planning (b) Co-ordination
(c) Controlling (d) Management
7. Which one of the following sequences of process of management is correct:
(a) Planning, Directing ,Controlling, Organising, Staffing
(b) Directing, Staffing, Planning, Organising, Controlling
(c) Planning, Organising, Staffing, Directing, Controlling
(d) Organising, Planning, Staffing, Controlling, Directing
8. Which degree is compulsory to become a manager?
(a) B.B.A. (b) M.Com.
(c) M.B.A. (d) No compulsion of degree.
9.In which of the following occupation, no minimum qualification is prescribed?
(a) Manager (b) Doctor
(c) Lawyer (d) Chartered Accountant
10. Managing Director will be considered under which level of management?
(a) Top-level (b) Middle-level
(c) Lower-level (d) None of these
11. Foreman will be considered under which level of management?
(a) Lower-level (b) Middle - level
(c) Top-level (d) None of these
12. Management is essential for the organizations which are
(a) Non-profit organizations (b) Service organizations
(c) Social organizations (d) All of the above
13. Successful management ensures that
(a) Goals are achieved with least cost (b) Timely achievement of goals
(c) Both of the above (d) None of the above
14. Ravi works as a production manager in Rosy private Limited. He has been
given the task of getting 10000 units of hand woven table mats manufactured at
the cost of ₹150 per unit, within 100 days. In order to be acknowledged as an
effective manager, he must ensure that
(a) The cost of production does not exceed ₹150 per unit
(b) The work is completed within 100 days even at higher cost per unit
(c) The cost of production is less than ₹150 per unit
(d) All of the above
15. Management is said to be poor if it is
(a) Efficient but ineffective (b) Effective but inefficient
(c) Both inefficient and ineffective (d) All of the above
16. Suzy Enterprises Limited is planning to increase its sales by 25% in the next
year. Identify the feature of management being highlighted in the given
statement.
(a) Management is all pervasive (b) Management is a goal oriented process
(c) Management is a continuous process (d) All of the above
17. Keeping in view ,the changes in the consumer demands and
preferences,Royal Bakery‘ has reduced the sugar and fat content in its products.
This approach of business shows that management is
(a) An intangible force
(b) A group activity
(c) A dynamic function
(d) A multidimensional activity
18. Management is considered to be an art because
(a) The principles of management have universal validity
(b) The principles of management have universal application
(c) Different principles of management are brought into effect differently by
different managers
(d) It is not important for the practicing managers to be a member of a
professional association.
19. ‘Corrective action’ comes under which function of management?
(a) Planning (b) Organising
(c) Directing (d) Controlling
20. Match the concept of management in Column I with their respective meaning
in II;
a) i), ii), iii) b) ii), i), iii)
c) iii), ii), i) d) i), iii), ii)
21. Match the objective of management in Column I with the irrespective
definition in Column II:

a) i), ii), iii) b) ii),i), iii)

c) ii), iii), i) d) i), iii), ii)
Assertion-Reasoning Based questions;
Read the following statements-Assertion (A) and Reason (R), and select the
correct alternative in each case:
(a) Both Assertion (A) and Reason (R) are true.
(b) Both Assertion (A) and Reason (R) are false.
(c) Assertion (A) is true and Reason (R) is false.
(d) Assertion (A) is false and Reason(R) is true.
22. Assertion (A): There is a kind of cost-benefit analysis involved and the
relationship between inputs and outputs.
Reason (R): If by using less resources (i.e., the inputs) more benefits are derived
(ie., the outputs) then effectiveness has increased.
23. Assertion (A), Coordination is not an exclusive function of the top
management.
Reason (R), Coordination is the responsibility of all managers-top, middle and
operational levels.
24. Assertion (A), Management is a full-fledged profession.
Reason (R), Management meets the exact criteria of a profession.
25. Assertion (A). Management is a series of continuous interrelated functions.
Reason (R). The process of management is a series of continuous, interrelated,
but separate functions (planning, organising, directing, staffing and controlling).
These functions are simultaneously performed by all managers all the time.
26. Assertion (A). Planning cannot prevent problems.
Reason (R).Planning can only predict the problems and prepare contingency
plans to deal with then
if and when they occur.
27. Assertion (A). Management is a dynamic function.
Reason (R). An organisation interacts with ins external environment which
consists of various social, economic and political factors. In order to be
successful, an organisation must change itself and Its goals according to the
needs of the environment.
28. Assertion (A), Management is a tangible force and its presence can be felt in
the way the
organization functions.
Reason (R). The effect of management is noticeable in an organisation where
targets are met
according to plan, employees are happy and satisfied, and there is orderliness
instead of chaos.
29. Assertion (A), Coordination is an all pervasive function.
Reason(R). Coordination is required at all levels of management due to the
interdependent nature of activities
30. Assertion(A):Social objective of management involve creation of benefits or
economic
values to the society.
Reason(R):Now a days, profit maximization is the only objective of management
alternatives:
A)Both Assertion(A) and Reason (R) are True and Reason(R) is the correct
explanation of
Assertion (A).
B) Both Assertion(A) and Reason( R) are True, but Reason ( R) is not the correct
explanation of Assertion (A).
C) Assertion(A) is True, but Reason(R) is False.
D)Assertion(A) is False, but Reason(R) is true.
31. Assertion(A):Management is an exact science.
Reason(R): It is based on human behavior .It is neither precise nor as
comprehensive as the pure science like physics or chemistry.
Alternatives:
A) Both Assertion(A) and Reason( R) are True and Reason ( R)is the correct
explanation
Of Assertion(A).
B) Both Assertion(A) and Reason( R) are True, but Reason( R)is not the correct
explanation of Assertion(A).
C) Assertion (A) is True, but Reason(R) is False.
D)Assertion(A ) is False, but Reason(R) is true.
32.
Assertion(A):Satisfactionofpersonnelobjectivesisveryimportantinanorganisation..
Reason(R): Employees are one of the most valuable resources for an
organization, Alternatives:
A) Both Assertion(A)and Reason(R) are True and Reason( R)is the correct
explanation of Assertion(A).
B) Both Assertion(A)and Reason(R) are True, but Reason (R)Is not the correct
explanation of Assertion(A).
C) Assertion(A) is True ,but Reason( R ) is False.
D) Assertion(A) is False, but Reason( R) is true.
33.Assertion(A):Management principles are developed through observation and
repeated
experimentation.
Reason(R):Outcomes of management principles can be predicted accurately
.Alternatives:
A) Both Assertion(A) and Reason(R) are True and Reason( R) is the correct
explanation of
Assertion(A).
B) Both Assertion(A) and Reason( R) are True, but Reason( R)is not the correct
explanation of Assertion(A).
C) Assertion(A) is True, but Reason( R) is False.
D)Assertion (A) is False, but Reason( R) is true.
Q. Nos 34-37 are based on the following CASE.
Anu is a well-known face in the field of publishing. She owes the success of her
business to her own education in business management and her team of certified
management consultants. Therefore, she decides to send both her children Shreya
and Darshal abroad to acquire degrees in the field of business management in
their individual areas of expertise. She feels that all over the world there is
marked growth in management as a discipline, but still it is not considered to be a
full-fledged profession for certain reasons.
On the basis of the above case;
34. If Anu considers management as a discipline, identify the reason
(a) a lot of literature is available (b) it is a skilful activity
(c) requires regular practice (d) has a code of conduct
35. Identify the concept of management in the above case
(a) science (b) both Art & Science
(c) profession (d) art
36. Every manager applies his personal skill and knowledge in the day-to-day
functioning of an enterprise. It is proved because
(a) management is an art (b) management is a science
(c) management is a profession (d) none of these
37. Identify the features of management as a profession
(a) systematic body of knowledge (b) restricted entry
(c) service motive (d) all of the above
Read the following and answer questions from 38 to 42 on the basis of the
same:
Alcargo Ltd is a operating its business on large scale. Co. realizes that human
resources are the most important assets of its business, So HRM Department is
set up to show a developmental path to the employees through proper training
modules and job enrichment. Time to time incentives and awards are given to
employees which was based on their performance, which keeps the employees
highly motivated. Ravi , just a graduate inhumanities is appointed as the Plant
superintendent in the company. Ravi knew that there are certain theories and
principles of management based on deep observation and experimentation. So, he
studied various theories and principles of management before joining the
Company. Ravi is very energetic and he likes to deal with severe situations.
OnAugust20th, He informed his boss that the goal he had been assigned had been
achieved and the quality was also very good. The best part is that there is one day
left for the deadline ,which is August 21.However,his boss was dissatisfied
because the expenses incurred by his team to complete the project exceeded the
upper limit (norms).
38 Which objective of management is pursued by management of Alcargo Ltd.:
a) Organizational objectives b) Social objectives
c) Personal objectives d) None of these
39. Identify the feature of profession which is not applicable here - “Ravi, just a
graduate in humanities is appointed as the Plant superintendent in the company.’
a) Well defined body of knowledge b)Restricted Entry
c)Ethical code of conduct d)Service Motive
40. Which aspect of management is violated by Ravi in above case?
a) Planning b) Efficiency
c) Effectiveness d) Controlling
41. Identify the nature of management highlighted in this line-“Ravi knew that
there are certain theories and principles of management based on deep
observation and experimentation.”
a) Management as Profession b)Management as Science
c )Management as an Art d)None of the above
42. Which aspect of management is followed by Ravi in above case?
a) Planning b) Efficiency
c) Effectiveness d) Controlling

ANSWER KEY
BUSINESS STUDIES
CLASS XII
UNIT 1 Chapter- 1 Nature & Significance of Management
Multiple Choice Questions; Answer;
1.Ans. (a)
2.Ans (b)
3.Ans. (a)
4. Ans. (a)
5. Ans. (c)
6. Ans.(d)
Explanation:
(d) Management is considered to be a deliberate process as it involves creating an
environment
which is conducive to efficient and effective performance ( achieving goals).
7. Ans. (c )
Explanation: Ans c; because all the functions must be performed in proper
sequence ( in
chronological order)
8. Ans (d)
EXPLANATION; Ans; d ; as there is no restricted entry in the field of
management like other
profession.
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9.Ans (a)
EXPLANATION; Ans; a ; as there is no restricted entry in the field of
management (manager)
like other profession.
10. Ans (a)
11. Ans (a)
12. Ans (d)
EXPLANATION; Ans; d; because management is all pervasive which is
required in every field
of life.
13. Ans (c)
EXPLANATION; Ans; c; as it is focusing on achieving goals effectively and
efficiently.
14.Ans (b)
EXPLANATION; Ans;b ; effectiveness is concerned with successful
achievement (completion)
of target within time frame irrespective of cost factor.
15.Ans (c)
EXPLANATION; Ans; c; because lack of efficiency and effectiveness leads to
mismanagement
which is considered as poor management.
16. Ans (b)
EXPLANATION; Ans;b; because management aims on achieving goals/target.
17. Ans (c)
EXPLANATION; Ans; c; as management keeps on changing according to
prevailing market
situations.
18. Ans (c)
EXPLANATION; Ans; c; because art is considered as application of acquired
knowledge by
using personalized skills.
19. Ans. (d)
20. Ans. (b)
21.Ans (C)
Assertion-ReasoningBasedquestions;
Read the following statements-Assertion (A) and Reason (R), and select the
correct alternative in
each case:
(a) Both Assertion (A) and Reason (R) are true.
(b) Both Assertion (A) and Reason (R) are false.
(c) Assertion (A) is true and Reason (R) is false.
(d) Assertion (A) is false and Reason(R) is true.
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22.Ans. (c)
EXPLANATION;because using less resources leads to efficiency and not
effectiveness as specified.
23. Ans (a)
EXPLANATION; as coordination is joint responsibility of all.
24. Ans(b)
EXPLANATION; because neither Management is a full-fledged profession nor
Management meets
the exact criteria of a profession.
25. Ans(a)
EXPLANATION; because managerial functions are performed in chronological
order to achieve
goals continuously.
26. Ans(a)
EXPLANATION;
27. Ans(a)
EXPLANATION; Ans; c; as management keeps on changing according to
prevailing market
situations.
28.Ans(d)
EXPLANATION; as management is invisible force.
29. Ans(a)
30. Ans. (c)
EXPLANATION; because various other objectives are also achieved through
management.
31. Ans (a)
EXPLANATION; because management is considered as social science and
doesn’t have exact
result always. It is affected by prevailing scenario.
32. Ans. (a)
EXPLANATION; as human resource is the only active source of production.
33. Ans. (c)
EXPLANATION; because neither Outcomes of management principles can be
predicted accurately
nor deliver same results always.
Q. Nos 34-37 are based on the following CASE.
34.Ans (a)
EXPLANATION; because it can be studied and learnt by going through its
available literature.
Page12
35. Ans(c)
EXPLANATION; because “certified management and acquiring degree” is
indicating it as a
profession in the above case.
36. Ans(a)
EXPLANATION; as every manager applies managerial knowledge /principles in
their own way
using their personalized skills.
37. Ans(a)
Readthefollowing andanswer questionsfrom 38to 42onthebasis ofthesame:
38. Ans( c)
EXPLANATION; as focus was given on achieving company’s goals.
39.Ans( b)
EXPLANATION; as “Ravi, who is just a graduate inhumanities, appointedasthe
Plant
superintendentin the company without having any managerial degree.
40. Ans( b)
EXPLANATION; as he achieved the assigned goals at higher cost by crossing
the upper limit
of the project.
41.Ans. (b)
EXPLANATION; as science is based on deep observation andexperimentation.
42. Ans( c)EXPLANATION; as Ravi achieved the goals with quality ,on 20th
august ,one day
before thedeadline,whichwasAugust 21.