Introduction to Management – I (MB111): April 2007

Question Paper
Introduction to Management – I (MB111): April 2007

• Answer all questions.
• Each question carries one mark.
1. Which of the following approaches to management draws together concepts, principles, techniques, and knowledge
from other fields and managerial approaches and develops classification system built around the managerial
functions of planning, organizing, staffing, leading, and controlling?
(a) Systems
(b) Management Science
(c) Empirical
(d) Contingency
(e) Operational.
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2. Power is the ability of individuals or groups to induce or influence the beliefs or actions of other persons and groups.
Power can be derived from many sources. The manager’s source of power that comes directly from his formal
position within the organization is called
(a) Legitimate power
(b) Expert power
(c) Referent power
(d) Reward power
(e) Coercive power.
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3. Every organization has certain goals and objectives, and one of the important factors affecting their achievement is
the structure of the organization. In which of the following organizational structures are activities grouped by
workflow?
(a) Functional departmentation
(b) Process departmentation
(c) Customer departmentation
(d) Geographic departmentation
(e) Product departmentation.
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4. Which of the following is a limitation of the socio-technical systems approach to management?
(a) It ignores planning, organizing and controlling
(b) Emphasis only on blue-collar and lower level office work
(c) Too broad a field for study of management
(d) Studies experiences through cases
(e) There is no one best way to do things.
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5. Which of the following is a course of action selected as a way to deal with a specific problem?
(a) Downsizing
(b) Leadership
(c) Organizing
(d) Decision-making
(e) Structuring.
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6. Assessment of arguments 'for' and 'against' involvement in social welfare is necessary for organizations to implement
social initiatives. Which of the following arguments against' social responsibility of business points out that, since the
cost of social initiatives would be added to the price of products, multinational companies selling in domestic markets
would be at a disadvantage when competing with domestic companies not involved in social activities?
(a) Opposing the profit maximization principle
(b) Excessive costs
(c) Weakened international balance of payments
(d) Increase in firm's power and influence
(e) Lack of accountability.
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7. The key result areas in business suggested by Peter Drucker include
I. Physical and financial resources.
II. Profitability.
III. Innovation.
IV. Worker performance and attitude.
(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.
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8. Complex interactions between the manager's stage of moral development and the various moderating variables
determine whether he will act in an ethical or unethical manner. Moderating variables include individual
characteristics, structural design of the organization, the organizational culture and the intensity of the ethical issue.
The strength of a person's convictions refers to which of the following individual characteristics?
(a) Value
(b) Ego strength
(c) Attitude
(d) Perception
(e) Locus of control.
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9. Strategies can be formulated at various levels in an organization. Which of the following strategies is a rational and
analytical approach and involves the evaluation of the various business units of an organization by its top
management?
(a) Values based approach
(b) BCG matrix
(c) Business level strategies
(d) Functional level strategies
(e) Corporate portfolio approach.
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10. Which of the following is not true about the differences between authority and power?
(a) Authority is the right to do something; power is the ability to do something
(b) Authority is the legitimate power given by an organization to a member holding a position; power
requires no formal position
(c) Authority is derived only through position; power is derived through many sources
(d) Authority is a broader concept; power is a narrow concept
(e) Authority can be delegated; power cannot be delegated.
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11. Which of the following is/are common forms of group decision-making?
I. Decision trees.
II. Preference theory.
III. Delphi technique.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (II) above
(e) All (I), (II) and (III) above.
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12. Strategy implementation involves (i) carrying out strategic plans and (ii) maintaining strategic control. Which of
the following is not a major internal element of the organization that may need to be synchronized to convert a
chosen strategy into action?
(a) Technology
(b) Human resources
(c) Rewards system
(d) Analyzing the affect of strategic actions on the organization
(e) Decision processes.
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13. Which of the following is a method that can be used to overcome the tendency towards conformity in group
decision-making?
(a) Interactive Groups
(b) Nominal group technique
(c) Groupthink
(d) Electronic meetings
(e) Sensitivity training.
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14. In a functional structure, as managers specialize in a certain area, their lack of knowledge of other functions disables
them to handle complex problems. Thus they rarely reach the top of the hierarchy and this leads to shortage of
managers with general management skills, a condition referred to as
(a) Managerial vacuum
(b) Managerial conflict
(c) Monotony
(d) Training lacuna
(e) Myopia.
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15. The span of management has a direct effect on the number of hierarchical levels in an organization. A flat structure
has a wide span of control and fewer hierarchical levels. As the structure becomes flat and span of control grows
wider the disadvantage is that
(a) Superiors are forced to delegate
(b) There is excessive distance between lowest level and top level
(c) There is a danger of superior’s loss of control
(d) There are many levels of management
(e) Overhead costs are high.
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16. The management function of influencing, motivating, and directing human resources toward the achievement of
organizational goals is
(a) Leading
(b) Controlling
(c) Planning
(d) Staffing
(e) Organizing.
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17. The management function of organizing involves determining
I. Tasks to be performed.
II. How tasks can best be combined into specific jobs.
III. Authority and reporting relationships within the corporate hierarchy.
IV. Promotions and career planning.
(a) Both (I) and (III) above
(b) Both (II) and (IV) above
(c) (I), (II) and (III) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
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18. Two major types of decision-making models are the rational model and the non-rational model. Rational decision
makers use an intelligent and systematic approach to solve problems they face. Which of the following is not an
implication of rational model of decision-making?
(a) Decision makers select the alternative that most effectively facilitates goal achievement
(b) Rational decision makers do not face any limitations of information, time and certainty
(c) Decision-makers have a clear understanding of alternative courses of action to accomplish a goal
(d) Decision makers can come up with high quality solutions
(e) Decision-making is based on the decision-makers’ ability to evaluate alternatives.
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19. The first major step in the planning process is
(a) Developing premises
(b) Listing alternative ways of reaching organizational objectives
(c) Stating organizational objectives
(d) Developing plans to pursue chosen alternatives
(e) Putting plans into action.
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20. Management is best understood as
I. A process.
II. Reaching organizational goals.
III. Utilizing people and other resources.
(a) Only (I) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (I) and (III) above
(e) All (I), (II) and (III) above.
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21. According to the BCG matrix, which of the following business units do not hold out much economic purpose and as
such the organization must either not invest in them or should consider selling them as soon as possible?
(a) Question marks
(b) Stars
(c) Cash cows
(d) Dogs
(e) Bulls.
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22. The process of assessing the organization's strategy and environmental demands and then determining the
appropriate organizational structure is called
(a) Organizational development
(b) Organizational design
(c) Organizational chart
(d) Organizational theory
(e) Organizational culture.
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23. In which stage of the ‘Management by objectives (MBO)’ process are subordinates given autonomy to carry out their
activities and the ability to evaluate their performance?
(a) Establishing specific goals for various departments, subunits and individuals
(b) Formulating action plans
(c) Implementing and maintaining self-control
(d) Periodic review
(e) Performance appraisal.
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24. A firm's external environment usually consists of customers, competitors and suppliers. It is necessary to carry out an
analysis of the external environment, in order to find out the opportunities and threats that can positively or negatively
influence an organization's ability to reach its goals. Analyzing the external environment and the organization’s
resources are usually part of
(a) Functional level planning process
(b) Financial planning process
(c) Determining the mission of the business
(d) Strategic planning process
(e) Shop floor control.
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25. The three major forms of divisional structure include product division, geographic division and customer division.
Which of the following statements is not true about ‘customer departmentation’?
(a) It is set up to service particular types of clients or customers
(b) It can address the special and widely varied needs of customers for clearly defined services
(c) It is accompanied by the benefits of specialization
(d) Coordination between sales and other functions becomes easier
(e) Facilities and manpower, specialized for certain customer groups may be under -employed.
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26. Which of the following is not an important factor in building trust?
(a) Maintain confidence
(b) Develop a culture of secrecy
(c) Develop a culture of transparency
(d) Express your feelings
(e) Fulfill your promises.
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27. Which of the following is not a problem associated with a poor ‘span of control’?
(a) Problems in structuring the organization
(b) Delay in decisions
(c) Decreased levels of initiative and morale
(d) Over-supervision
(e) Less opportunity for responsibility and development.
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28. Meeta is the only direct supervisor for all fourteen employees within her department. The practices of her company
stipulate that employees only have to report to one immediate supervisor. This concept is referred to as
(a) Unity of command
(b) Span of control
(c) Departmentalization
(d) Decentralization
(e) Formalization.
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29. The number of subordinates a manager has to supervise, has a direct bearing on the degree to which managers can
interact with and supervise subordinates. The concept that defines the number of subordinates that report to a manager
and that indirectly specifies the number of levels of management in an organization is called
(a) Authorized line of responsibility
(b) Unity of command
(c) Unity of direction
(d) Span of control
(e) Responsibility factor.
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30. Which of the following organizes employees into units based on common products, services, or markets?
(a) Divisional structure
(b) Matrix structure
(c) Functional structure
(d) Hybrid structure
(e) Geographical structure.
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31. No single planning process is applicable to all organizations. However, all plans contain some basic steps. In the
process of planning, once a plan has been implemented, it has to be reviewed. A review helps a manager to
I. Identify deviations and take necessary corrective actions.
II. Compare outcomes with expected results.
III. Examine advantages and disadvantages of alternative plans.
IV. Lay down the limitations within which the plans are to be carried out.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (I), (II) and (III) above
(e) (II), (III) and (IV) above.
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32. From the viewpoint of line personnel, major reason/s for line-staff conflict is/are that staff personnel
I. Encroach line authority.
II. Dilute the authority of line managers.
III. Are not accountable for their actions.
IV. Lack a first-hand experience of operations.
(a) Only (I) above
(b) Only (IV) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
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33. Techniques to improve the quality of decision-making under conditions of uncertainty include risk analysis, decision
trees and preference theory. Risk analysis includes
I. Risk assessment.
II. Risk management.
III. Risk communication.
IV. Risk elimination.
(a) Both (I) and (IV) above
(b) Both (II) and (III) above
(c) (I), (II) and (III) above
(d) (I), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
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34. Centralization is the systematic and consistent reservation of authority at central points within an organization. Which
of the following characteristics makes centralization more appropriate?
(a) The environment is complex and uncertain
(b) Decisions are relatively minor
(c) Lower level managers are capable and experienced decision-makers
(d) The company is geographically dispersed
(e) Lower level managers are reluctant to be involved in decision-making.
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35. Goals are statements of what organizations need to accomplish. Goals are important for an organization because they
I. Direct the activities of the organization.
II. Encourage focused work.
III. Act as the motivational force for employees.
IV. Emphasize individual work and responsibility over team-work.
(a) Only (I) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (I), (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
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36. Which of the following is not true about why an organization adopts a strategic business unit (SBU) structure?
(a) To ensure that a product is not ignored among others that generate high profits
(b) To integrate goals and plans of the SBU with goals and plans of other SBUs
(c) It aids in concentrating energies on promoting a product or product line
(d) It conserves entrepreneurial attention and initiative
(e) To manage resources efficiently in key areas.
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37. Which of the following is not an area of managerial decision-making to which the linear programming technique can
be applied?
(a) Product mix decisions
(b) Pricing decisions
(c) Determining optimal scale of operations
(d) Allocation of scarce resources
(e) Scheduling production facilities and maintenance.
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38. The general type of managerial role identified by Mintzberg that includes the specific roles of entrepreneur,
disturbance handler, resource allocator, and negotiator is
(a) Decisional
(b) Interpersonal
(c) Informational
(d) Administrative
(e) Organizational.
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39. Which of the following is/are pre-judgement(s) of the 'Hawthorne Studies'?
I. Perceived meaning and importance of the work determine the output.
II. Job performance depends on the individual worker.
III. Workplace culture sets its own production standards.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
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40. Competitive advantage implies the creation of a system that has a unique advantage over competitors. The idea is to
create customer value in an efficient and sustainable way. Strategy “Guru” Michael E. Porter has outlined certain
strategies to gain competitive advantage over other firms operating in the same industry. Which of the following
is/are the generic strategies suggested by Porter that might adopt to make their organizations more competitive?
I. Divestiture.
II. Focus.
III. Cost leadership.
IV. Differentiation.
(a) Only (II) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
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41. Dina works in an organization where a large amount of collaboration occurs and decision-making authority is
decentralized. There are few rules, and duties are adaptable. This is an example of which of the following?
(a) Strategic organization
(b) Mechanistic organization
(c) Organic organization
(d) Bureaucracy
(e) Matrix organization.
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42. Departmentation can be done through various structural alternatives: Of these, functional departmentation groups jobs
by
(a) Tasks they perform
(b) Territory they serve
(c) Type of customer they serve
(d) Products they manufacture
(e) Services they provide.
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43. A learning organization is typically least characterized by
(a) Systems thinking
(b) Shared vision
(c) Rigid job procedures
(d) Team learning
(e) Training and development programs for employees to acquire new skills.
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44. Charles Babbage was one of the prominent contributors to preclassical management thought. Which of the following
did Charles Babbage advocate/propose?
(a) Legislative reforms
(b) The philosophy of manufacturing
(c) Division of labor
(d) Time and motion studies
(e) Profit-sharing plan.
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45. Conflicts often arise between line and staff personnel. These conflicts need to be resolved so that line and staff
personnel support each other and work harmoniously to achieve organizational goals and objectives. Which of the
following is not an appropriate technique for staff personnel to reduce or avoid line-staff conflict?
(a) Be passive and wait for line managers to ask for advice rather than providing advice when they feel it is
necessary
(b) Let line personnel know how to make optimum use of the expertise and capabilities of staff personnel
(c) Be accountable for their suggestions
(d) Keep line managers informed about the latest developments in their field and point out potential problem
areas
(e) Completed staff work, leading to clear recommendations based on the facts compiled.
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46. The most important factor that affects a manager's ethical behavior is the intensity of the ethical issue itself. The
intensity of an ethical issue is greater when
I. The number of people harmed is large.
II. Everyone agrees that the action is wrong.
III. The consequences of the action are felt later on.
IV. The person feels close to the victims.
(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.
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47. When managers engage in production planning and control, which of the following techniques do they use to
determine what activities have to be done, the order in which they are to be done, who is to do each, and when they
are to be completed?
(a) MIS system
(b) ABC system
(c) Gantt chart
(d) EOQ model
(e) Break-even analysis.
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48. Managerial positions at various levels require different types and extent of authority for decision-making. The
authority relationship between functions which have a direct bearing on the accomplishment of organizational
objectives and functions which facilitate or assist the work of those who have a direct bearing on the achievement of
organizational objectives is referred to as
(a) Function-goal relationship
(b) Authority-power relationship
(c) Centralization-decentralization continuum
(d) Delegation-accountability relationship
(e) Line-staff relationship.
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49. Single-use plans are aimed at achieving a specific goal and designed to meet the needs of a unique, non-recurring
situation. Programs, budgets and projects are single-use plans. Which of the following can be stated about projects?
I. It helps in precise allocation of duties and effective control and easy implementation of the plan.
II. A project may be similar to a program, but is larger in scale and more complex.
III. A project may be a component of a program, or it may be a self-contained, single-use plan.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (II) above
(e) Both (I) and (III) above.
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50. Which of the following decision making models states that managers put in the least possible effort – only enough to
reduce the problem to a tolerable level?
(a) Satisficing
(b) Garbage-can
(c) Incremental
(d) Rational
(e) Optimal.
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51. Shah Industries conducts its business in various industries, the hotel industry being one of them. Hetal Shah, who
heads the hotel venture, is concerned about how her business in going to effectively combat the increasing
competition. At this point, Ms. Shah has decided to identify ways and means to achieve a competitive advantage and
respond to the changing environment and competitive situation. At which organizational level is Ms. Shah currently
addressing her planning efforts?
(a) Corporate level
(b) Business level
(c) Functional level
(d) Operational level
(e) Departmental level.
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52. Which of the following is/are approaches for selecting among alternatives, in the decision-making process?
I. Experience.
II. Experimentation.
III. Research and analysis.
IV. Brainstorming.
(a) Only (III) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (I), (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
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53. Which of the following is the primary strength of the matrix structure?
(a) Economies of scale and the ability to coordinate interdependent projects
(b) Propensity to foster power struggles
(c) Employee satisfaction
(d) Duplication of activities and resources
(e) Local market expertise.
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54. Major social responsibility areas in which business can become involved include all of the following except
(a) Urban affairs
(b) Consumer affairs
(c) Pollution control
(d) Natural resource conservation
(e) Achieving organizational goals.
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55. An organization where decisions are made by those employees closest to the problems is using which type of
decision-making authority?
(a) Centralization
(b) Staff authority
(c) Span of control
(d) Line authority
(e) Decentralization.
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56. Many decisions fail after the final choice has been made because which of the following occurs?
(a) It was the wrong choice
(b) The decision criteria weights were incorrect
(c) People affected failed to accept the solution
(d) Satisficing occurred
(e) Too much time was spent on analysis of alternatives.
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57. Arjun holds a management position at XYZ Corporation. He is excellent at time management and does not hesitate to
delegate tasks to subordinates. Arjun feels the most challenged and performs at his best level when unique problems
arise at his company. He is most often one of the first managers to come up with an effective solution for the problem.
Which of these can be stated of Arjun?
(a) Arjun is excellent with programmed decisions
(b) Arjun relies too heavily on the work of others
(c) Arjun is apparently risk averse
(d) Arjun excels at deriving non-programmed decisions
(e) Arjun is an excellent resource allocation manager.
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58. In the early 1930s, the famous Western Electric studies concluded that the network of personal and social relationships,
not established by the formal organization, gave rise to informal organizations within an enterprise. Which of the
following are characteristics of an informal organization?
I. It is unofficial by nature.
II. Sources of control include rewards and penalties.
III. Source of leader power is delegated by the management.
IV. Norms serve as guidelines for behavior.
(a) Both (I) and (II) above
(b) Both (I) and (IV) above
(c) Both (II) and (III) above
(d) Both (II) and (IV) above
(e) Both (III) and (IV) above.
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59. According to Henri Fayol’s principles, Espirit de Corps means
(a) Discipline
(b) Equity
(c) Sense of union
(d) Unity of command
(e) Unity of direction.
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60. Managers making ethical decisions may belong to any of the three levels of moral development. Which of the
following stages describes the 'principled level' of moral development?
I. Following rules only when it is in one's immediate interest.
II. Valuing and upholding absolute values and rights regardless of the majority's opinion.
III. Sticking to rules to avoid physical punishment.
IV. Living up to what is expected by people who are close to oneself.
V. Following self-chosen ethical principles even if they violate the law.
(a) Both (I) and (II) above
(b) Both (II) and (V) above
(c) Both (III) and (IV) above
(d) (I), (III) and (IV) above
(e) (II), (III) and (V) above.
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61. Authority is vital for a manager. Without authority, a manager cannot get the tasks accomplished by others
(subordinates). The authority to control the functions of other departments, related to specific tasks is known as
(a) Functional authority
(b) Formal authority
(c) Informal authority
(d) Managerial authority
(e) Operational authority.
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62. Which of the following is not a generally accepted advantage of division of labor in an organization?
(a) Workers skills in performing their jobs tend to increase
(b) Workers need to know only how to perform their specific work tasks
(c) Workers do not waste time in moving from one task to another
(d) Workers try to make their individual tasks easier and more efficient
(e) Workers obtain cross-functional expertise.
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63. From the delegator’s aspect, which of the following is not a factor that affects delegation of authority?
(a) Love for authority
(b) Fear of exposure
(c) Personality traits of the superior
(d) Lack of self confidence
(e) Experiences of the superior.
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64. Which of the following are characteristics of a closed system?
I. It is perfectly deterministic and predictable.
II. There is no exchange between the system and the external environment.
III. It is a realistic view.
IV. It is flexible and adaptable.
(a) Both (I) and (II) above
(b) Both (I) and (IV) above
(c) Both (II) and (III) above
(d) Both (III) and (IV) above
(e) (I), (II) and (III) above.
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65. Fayol and Taylor considered ‘organizing’ to be a part of management. Their theories gave rise to certain principles
of organizing. With respect to these traditional perspectives of organizing, the aim of which principle is to ensure the
pursuit of organizational goals by the employees in a coordinated manner?
(a) Unity of direction
(b) Unity of command
(c) Hierarchy of authority
(d) Authority on Par
(e) Downward delegation.
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66. The Buy It & Sell It Company of Baltimore, in the process of expanding its operations, has undertaken two major
projects. The company has raised funds by partly borrowing from the Bank of Baltimore and partly through sales of
its stock. Further, based on an assessment of expected profitability management has earmarked $30 million for project
A and $20 million for Project B. This apportioning is indicative of
(a) Objective setting
(b) Implementation
(c) Action planning
(d) Strategic planning
(e) Resource allocation.
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67. Which condition of decision-making exists when decisions must be made with limited information because full
knowledge of the problem is unavailable and the probability of outcomes is unknown?
(a) Uncertainty
(b) Certainty
(c) Risk
(d) Bounded rationality
(e) Satisficing.
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68. After all factors have been determined, weights have been assigned, and alternatives have been identified, the next
step in decision making is to
(a) Identify the problem
(b) Identify the decision criteria
(c) Analyze the alternatives
(d) Implement the alternative
(e) Obtain the needed resources.
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69. Rate of change is one of the factors that determines effective span of management. Changes occur more rapidly in
certain organizations than in others. This rate of change
(a) Determines how efficient subordinates are without guidance from their superiors
(b) Enables subordinates to clearly understand what is expected of them
(c) Determines the degree to which policies can be formulated and the stability that can be achieved in the
policies
(d) Helps identify deviation in plans
(e) Determines effectives of communication techniques.
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70. Plans may be updated, modified or replaced by new ones as the demand of the situation may be. Plans can be
modified or changed, but never abandoned. This best reflects which of the following aspects of the nature of
planning?
(a) Planning is all-pervasive
(b) Planning is a perpetual process
(c) Planning is an integrated process
(d) Planning is forward looking
(e) Planning involves choice.
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71. Subhir is associated with a committee that is given the responsibility to review and institute a process, which
employees can use when requesting upgrades in computer equipment. Which type of objectives is Subhir most likely
accomplishing?
(a) Intermediate-term objectives
(b) Long-term objectives
(c) Short-term objectives
(d) Organizational objectives
(e) Division objectives.
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72. Generation of alternatives should be followed by a thorough analysis of the pros and cons of each alternative. In other
words, alternatives must be evaluated in order to see how effective each would be. Systematic evaluation of
alternatives in the decision-making process is usually done on the basis of five general criteria. They are feasibility,
quality, acceptability, costs and
(a) Reliability
(b) Durability
(c) Serviceability
(d) Ethics
(e) Aesthetics.
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73. Which of the following occurs when demand for service exceeds the service facilities?
(a) Linear programming
(b) Financial analysis
(c) Waiting line
(d) Decision tree
(e) Simulation.
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74. Organizational planning is a very important managerial activity in any organization. The art of successful
organizational planning has several key factors. Which of the following is not considered a key factor?
(a) Utilization of judgmental methodologies
(b) Viewing the process as a continuous concentration of efforts on a manageable set of issues
(c) Involving different organizational levels
(d) Viewing the process as a continuous process
(e) Utilization of only numerical methodologies.
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75. One of the important factors that affect the attainment of an organization’s goals and objectives is its structure.
Organizational structure can, thus, be defined as
(a) A set of managerial decisions and actions
(b) A formal framework by which job tasks are divided, grouped, and coordinated
(c) A process that is done best if it is done quickly
(d) A specification of the broad parameters within which organization members are expected to operate in
pursuit of organizational goals
(e) A chronological sequence of steps to be undertaken to enforce a policy and to achieve an objective.
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76. In SWOT analysis, which of the following is an external environment condition that an organization can exploit to
improve its competitiveness and get ahead of its competitors?
(a) Strength
(b) Weakness
(c) Opportunity
(d) Threat
(e) Strategy.
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77. Strategies and policies are closely related terms. Which of the following statements are true with respect to the nature
of strategies and policies?
I. The key function of strategies and policies is to give a specific direction to plans.
II. Strategies and policies serve as a guide in furnishing a framework for planning.
III. If strategies are to be effective, they must be supported by effective tactics.
IV. Strategies and policies have an effect only on certain key areas of management.
(a) Both (I) and (II) above
(b) Both (III) and (IV) above
(c) (I), (II) and (III) above
(d) (I), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
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78. Departmentation by simple numbers was an important method of classifying tribes, clans, and armies in the past.
However, the use of this departmentation has decreased over time. The prominent reason/s for the decline of
departmentation by number is/are
I. It is useful only at the lowest level of the organization structure.
II. It is difficult to count the number of people as the organization expands.
III. It proves ineffective when any factor other than just the number of people performing similar duties gains
importance.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (II) above
(e) Both (I) and (III) above.
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79. In Porter’s five forces model of competitive advantage, which of the following refers to competition amongst
organizations in order to gain the top position in the industry?
(a) Intensity of rivalry
(b) Bargaining power of customers
(c) Bargaining power of suppliers
(d) Threat of new entrants
(e) Threat of substitutes.
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80. Which of the following are managers at the lowest level of the hierarchy who are directly responsible for the
performance of operational employees?
(a) Middle level
(b) First level
(c) Top level
(d) Trainee level
(e) Strategic level.
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81. Departmentation divides a large and complex organization into smaller and more flexible administrative units and
can be done through various structural alternatives. Which of the following is not a major structural alternative
which organizations can adopt?
(a) Functional structure
(b) Divisional structure
(c) Hybrid structure
(d) Matrix structure
(e) Cadre based structure.
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82. In a business situation things being complex require proper plans. Planning is a prerequisite not only for achieving
success but also for surviving in a complex and competitive world. It basically involves defining the organization's
goals, establishing an overall strategy for achieving those goals, and developing a comprehensive set of plans that
(a) Determine which shift will perform what work functions
(b) Establish the quality and quantity of work to be accomplished
(c) Determine which manager will head which department
(d) Integrate and coordinate organizational work
(e) Influence and motivate human resources toward achieving those goals.
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83 A single-use plan is aimed at achieving a specific goal and designed to meet the needs of a unique situation. Budget
is an example of a single-use plan and it is important because it forces financial discipline and structure
(a) Especially with start-up companies
(b) With the cash part of the organization
(c) With the asset part of the organization
(d) In the areas of the organization that need it the most
(e) Throughout the organization.
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84. Every organization structure, even a poor one, can be charted. Which of the following is false with respect to
’organization chart’?
(a) It is a vital tool for providing information about organizational relationships
(b) It provides a visual map of the chain of command
(c) Charting an organization structure can show up the complexities and inconsistencies, which can be
corrected
(d) It shows authority relationships as well as informal and informational relationships
(e) It helps managers and new personnel to know how and where they fit into the organization structure.
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85. A system comprises a set of interactive sub-systems. Which sub-system consists of jobs that require the interaction of
personnel with the general environment?
(a) Technical
(b) Boundary spanning
(c) Managerial
(d) Feedback
(e) Public relations.
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86. Which of the following strategies are designed to make customers aware of company’s products and services?
(a) Finance
(b) Personnel
(c) Marketing
(d) Organization
(e) Public relations.
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87. Which of the following is the most common feature in a highly centralized organization?
(a) Decisions are made very quickly
(b) The organization is multinational
(c) Decision-making authority is retained by top management
(d) Delegation is a common practice within the organization
(e) Managers are given more freedom and independence in decision-making.
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88. All of the following are characteristics of organizational culture except
(a) Member identity
(b) Distinctiveness
(c) Observed behavioral regularities
(d) Uniform strength
(e) Dominant and stable values.
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89. Companies identify their strengths, weaknesses, opportunities and threats in the business environment through SWOT
analysis. Which of the following constitutes ‘potential threats’ for an organization?
I. A shift in buyer needs and tastes away from the industry’s product.
II. Loss of sales to substitute products.
III. Sub par e-commerce systems and capabilities relative to rivals.
IV. Costly new regulatory requirements.
V. Higher overall unit costs relative to key competitors.
(a) Both (I) and (II) above
(b) Both (IV) and (V) above
(c) (I), (II) and (IV) above
(d) (I), (III) and (V) above
(e) (II), (III) and (V) above.
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90. The MBO process is characterized by an emphasis on the clarity and balance of objective and participation of
managers with accountability for results. The MBO process has many steps. Which of the following is a final step of a
typical MBO process?
(a) The organization’s overall objectives and strategies are formulated
(b) Successful achievement of objectives is reinforced by performance based rewards
(c) The action plans are implemented
(d) Progress towards objectives is periodically reviewed, and feedback is provided
(e) Major objectives are allocated among divisional and departmental units.
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91. Open systems can accomplish their tasks and meet their objectives through different courses of action. Open systems
do not need a single 'best' method to achieve their objectives and accomplish their goals. The repetitive process by
which an organization receives inputs from its environment, processes them and produces the output required by a
system is called
(a) Negative entropy
(b) Dynamic homeostasis
(c) Feedback
(d) Equifinality
(e) Cycle of events.
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92. When managers delegate authority, they must allocate commensurate
(a) Responsibility
(b) Power
(c) Money
(d) Influence
(e) Respect.
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93. Despite the many advantages of planning, there may be some obstacles and limitations in this process, since nothing is
perfect on this earth, as a general rule of law. Which of the following would not be considered a potential advantage
of planning?
(a) It helps mangers to be future oriented
(b) It enhances decision coordination
(c) It increases the amount of time available for other managerial functions
(d) It emphasizes organizational objectives
(e) It helps in offsetting uncertainty and risk.
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94. David is in the process of determining the extent to which the other departments of his company are helping or
hindering the plan's fit with the organizational structure. In terms of problem solving for effective planning, what is
David attempting to do?
(a) Intervening to create alignment
(b) Executing the plan
(c) Identifying performance gaps
(d) Checking for organizational congruence
(e) Identifying necessary processes.
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95. The major disadvantage of the divisional structure is
(a) Managers lack exposure to various functional activities in their divisions
(b) Coordination is complicated
(c) Managerial vacuum
(d) Duplication of activities and resources
(e) It is slow in responding to changes.
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96. Delegation includes the three stages of briefing, monitoring progress, and evaluation and feedback. Which of the
following is included in the briefing stage?
(a) Discuss the areas of the task that are sensitive to error or risk
(b) Allow the person to proceed with the task without interference
(c) Stand back from the process and retain a view of the bigger picture
(d) Encourage frequent informal discussions
(e) Assess if there were unforeseen problems.
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97. The informal communication network present throughout the organization is referred to as
(a) Grapevine
(b) Buzz
(c) Pipeline
(d) Noise
(e) Uproar.
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98. Which of the following is not a guideline for successful planning and implementation?
(a) Involve the right people in the planning process
(b) Communicating the plan throughout the organization
(c) Goals should be ‘SMARTER’
(d) There should be no deviations from the plan
(e) Evaluate the plan.
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99. Significant ways in which culture is transmitted to employees in an organization consist of
(a) Language, stories, rituals, and rewards
(b) Rituals, tales of woe, symbols, and language
(c) Stories, rituals, myths, and language
(d) Symbols, rituals, language, and systems
(e) Values, beliefs, stories and systems.
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100. Which of the following is a limitation of Weber's bureaucracy?
(a) It destroys individual creativity and the flexibility to respond to complex changes in the environment
(b) It does not focus on management of an organization from a manager’s point of view
(c) It overlooked social needs of workers
(d) It overemphasized economic and physical needs of workers
(e) It ignored the human desire for job satisfaction.
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