Chapter-1: Management Self Assessment Questions 1. Management is the process of designing and maintaining an environment in which individuals, working together in groups, accomplish efficiently selected aims. This basic definition needs to be expanded: a. As managers, people carry out the managerial functions of planning, organizing, b. staffing, leading, and controlling. c. Management applies to any kind of organization. d. All of these 2. The purposes of management by exception are as follows: a. To economies the time spent by busy managers in looking after day to day problems. b. To concentrate attention and effort on correcting weak links. c. In the field of production can be applied for the following operations: d. All of these 3. There are many aspects to management in work organizations, but the one essential ingredient of any successful manager is: a. the ability to adapt to technological change. b. the ability to deal with people effectively. c. the ability to make calculated decisions. d. the ability to implement the policies of the organization. 4. The style of management adopted by managers can be seen as a function of the manager’s: a. attitudes towards people. b. assumptions about human nature and behavior. c. both of the above. d. neither of the above.
Transcript
Chapter-1: Management
Self Assessment Questions
1. Management is the process of designing and maintaining an environment in which
individuals, working together in groups, accomplish efficiently selected aims. This basic
definition needs to be expanded:
a. As managers, people carry out the managerial functions of planning, organizing,
b. staffing, leading, and controlling.
c. Management applies to any kind of organization.
d. All of these
2. The purposes of management by exception are as follows:
a. To economies the time spent by busy managers in looking after day to day problems.
b. To concentrate attention and effort on correcting weak links.
c. In the field of production can be applied for the following operations:
d. All of these
3. There are many aspects to management in work organizations, but the one essential
ingredient of any successful manager is:
a. the ability to adapt to technological change.
b. the ability to deal with people effectively.
c. the ability to make calculated decisions.
d. the ability to implement the policies of the organization.
4. The style of management adopted by managers can be seen as a function of the manager’s:
a. attitudes towards people.
b. assumptions about human nature and behavior.
c. both of the above.
d. neither of the above.
5. The psychological contract is:
a. a signed document stating mutual explicit needs.
b. a listing of statutory requirements.
c. a formal contract of employment.
d. a series of implicit mutual expectations.
6. According to patching .................. is organization development.
a. Strategic thinking
b. Business strategy
c. Participative management
d. Management development
7. A number of approaches may be used to bring about effective change within an organisation,
often called intervention strategies, these include:
a. T-groups
b. grid training
c. team building
d. all of the above
8. A definition of organizational culture is that it is “the collection of ........................... and
attitudes that constitute a pervasive context for everything we think and do in an organization”.
a. Traditions, values
b. Policies, practices, behaviors
c. Traditions, values, policies, beliefs
d. Values, styles, processes, activities
9. Schein suggested three levels of culture in order from shallowest to deepest. In this order,
they are:
a. History, artefacts, beliefs
b. Assumptions, artefacts, values
c. History, values, activities
d. Artefacts, values, assumptions
10. Harrison and Handy describe a project oriented organization which is structured like a
matrix and based on expert power as a ……………… culture.
a. Power
b. Person
c. Task
d. Role
11. According to Deal and Kennedy, an organization of individualists who take high risks and
receive quick feedback, and where internal competition and conflict are normal, the type of
culture can be described as:
a. bet-your-company culture
b. work-hard/play-hard culture
c. process culture
d. tough-guy, macho culture
12. The pervasive nature of culture means that it will significantly affect:
a. group behavior
b. decision-making
c. motivation and job satisfaction
d. all three of these
13. The Peters and Waterman study revealed that there was a particular factor that led to these
organizations effectiveness. What was that factor?
a. Having a clear and rigidly defined organizational structure
b. Dominance and coherence of culture
c. Being decentralized and organic
d. Being a large multinational organization
14. Organizational climate is based on the ........................... of members towards the organization.
a. commitment
b. perceptions
c. loyalty
d. none of the above
15. Galunic and Weeks suggest that with the demise of WHAT, companies need other strategies
to encourage commitment?
a. Job security
b. Career paths
c. Pension plans
d. Promotion opportunities
16. Resistance to change can be caused by:
a. Selective perception
b. Inconvenience
c. Habit
d. All three of the above
17. It is Cunningham’s belief that, despite the popular myth to the contrary, people generally
a. Prefer stability
b. Love change
c. Dislike change
d. Like being controlled
18. Which of the following is NOT one of Kotter and Cohen’s series of steps for successful
management of large-scale change?
a. Unfreezing
b. Empowering action
c. Creating visions
d. Producing short-term wins
19. Emotions which can cause a negative attitude and resistance to change include:
a. Over-excitement
b. Frustration
c. Both of these
d. Neither of these
20. According to Hooper and Potter’s study of 25 chief executives, which of the following were
crucial to the successful management of organizational change?
a. Effective communication
b. Self-pacing
c. Setting a good personal example
d. All three of the above
Answers for Self Assessment Questions
1. (d) 2.(b) 3.(d) 4.(a) 5.(c)
6. (a) 7.(a) 8.(b) 9.(c) 10.(a)
11. (c) 12.(a) 13.(a) 14.(d) 15.(b)
16. (c) 17.(a) 18.(d) 19.(c) 20.(d)
Chapter-2 Evolution of Management Thought
Self Assessment Questions
1. The following four different approaches to management thinking were developed in the first
half of the 20th century:
a. Scientific management, general administrative, quantitative, and contingency approach.
b. Scientific management, general administrative, quantitative, and organisational
behaviour.
c. Scientific management, Hawthorne Studies, quantitative, and organisational behaviour.
d. Systems approach, scientific management, general administrative, and organisational
behaviour.
2. Frederick Taylor and Frank and Lillian Gilbreth were advocates of an approach to
management involving the use of scientific method, known as:
a. Scientific management.
b. The contingency approach.
c. Management science.
d. The quantitative approach.
3. Authority, discipline, unity of command, and unity of direction are:
a. Elements of Weber's ideal bureaucratic structure.
b. Four of Fayol's fourteen principles of management.
c. Key features of learning organisations.
d. Taylor's four principles of management.
e. Principles of the human relations movement.
4. Some of the other fields of study that affect management theory or practice include:
a. Anthropology, astrology, political science and psychology.
b. Political science, philosophy, anthropology and sociology.
c. Economics, psychology, anthropology and physics.
d. Political science, sociology, typography and economics.
e. Zoology, psychology, sociology and philosophy.
5. The philosophy of management known as total quality management developed primarily out
of the work of:
a. W. Edwards Deming
b. Henri Fayol
c. Frederick Taylor
d. Elton Mayo
e. Robert McNamara
6. Possibly the most important pre-20th century influence on management was:
a. The division of labour.
b. Scientific management.
c. Therbligs.
d. The industrial revolution.
7. Division of labour, authority hierarchy, formal selection, formal rules and regulations,
impersonality, and career orientation are all features of:
a. Fayol's principles of management.
b. Taylor's principles of management.
c. General administrative theory.
d. Weber's ideal type bureaucracy.
8. The main influence on the behavioural science theories were:
a. Sociology and science.
b. Bureaucracy and psychology.
c. Psychology and sociology.
d. Sociology and bureaucracy.
9. The difference between an e-business enhanced organisation and an e-business enabled
organisation is:
a. Only an e-business enhanced organisation relies on an intranet.
b. Only e-business enhanced organisations use e-business tools and applications.
c. Only an e-business enhanced organisation uses the Internet.
d. Only e-business enhanced organisations have e-business units within their organisation.
10. Which of the following is NOT associated with learning organisations or knowledge
management?:
a. Systematic gathering and sharing of useful information.
b. COIN
c. PSTN
d. A recommended response to a rapidly changing world.
11. The statements below list some of the benefits of having an accurate model of management,
with one exception. Which is the exception?
a. A model helps to understand how past events may affect future ones
b. A model helps us to understand complex situations, by focusing on essential elements
c. A model helps to predict possible effects of actions
d. A model helps managers to plan a precise course of action that will definitely produce
the results they want
12. The competing values framework is based on two axes, one reflecting an organisation's
attitude to…………., and the other its degree of focus on …………………. matters.
a. Profits; concern for the environment
b. Short-term events; long-term issues
c. Control; external
d. People; tasks
13. Which of the following is considered as the founder of the scientific management school of
thought?
a. Elton Mayo
b. Henry Gantt
c. Mary Parker Follett
d. Frederick Taylor
14. Frederick Taylor's idea that the best method for performing each task needs to be
determined is based on which principle of management thought?
a. Development of scientific analysis to inform management
b. Scientific selection of workers
c. Friendly co-operation between management and labour
d. Scientific development of the worker
15. Frederick Taylor was mostly concerned with……………, while Henri Fayol was mostly
concerned with……………..
a. The contingency approach; Theory X and Theory Y
b. Production systems; broader management functions
c. Management; organisational functions
d. The Hawthorne studies; organisational effectiveness
16. According to Fayol, the idea that each worker should have one, and only one, supervisor is
based on which principle of management?
a. Division of labour
b. Unity of command
c. Centralisation
d. Order
17. Fayol believed that every department of the organisation should be working on the same
plan to achieve the organisation's objectives. He expressed this in which principle of
management?
a. Order
b. Centralisation
c. Authority
d. Unity of direction
18. Which of these schools of thought stressed the idea that managers need to deal effectively
with the human aspects of organisation if they are to be successful?
a. Human relations
b. Operational research
c. Rational goal
d. Internal process
19. The idea that activities within one department can spill over and affect other departments is
based on what approach to management?
a. Open systems
b. Theory X and Theory Y
c. Rational goal
d. Contingency
20. The idea that different management techniques produce different results depending on the
situation to which they are applied is a fundamental assumption in which of the following
perspectives?
a. Rational goal
b. Internal process
c. Contingency
d. Scientific management
Answers for Self Assessment Questions
1. (b) 2.(a) 3.(b) 4.(b) 5.(a)
6. (d) 7.(d) 8.(c) 9.(d) 10.(c)
11. (d) 12.(c) 13.(d) 14.(a) 15.(b)
16. (b) 17.(d) 18.(a) 19.(a) 20.(c)
Chapter-3: Planning
Self Assessment Questions
1. Identify the best definition of planning.
a. The core activity of planners and planning departments.
b. Setting an organization’s objectives and the means of reaching them.
c. An integrated process, in which plans are formulated, carried out and controlled.
d. Devising ways of achieving the objectives of an organization.
2. Which of these statements best summarizes the meanings of management?
a. Only people in formal organizations act as managers
b. Only a few experienced people in an organization are managers
c. Management is both a general human activity and a specialized occupation
d. Management is a job conducted by those with special training
3. The head of a division in a company who is responsible for the production, marketing and
finance of this division and for generally ensuring its profitability is known as what type of
manager?
a. First-line manager
b. Functional manager
c. Supervisor
d. General manager
4. A staff manager is someone who performs which of these functions?
a. Is responsible for recruiting and selecting new staff
b. Manages the staff of the organization
c. Deals with customer complaints
d. Is in charge of support functions such as finance, personnel or legal matters
5. A supervisor in a car production plant is an example of what kind of manager?
a. Support manager
b. Middle manager
c. Top manager
d. First-line manager
6. The function of arranging the work to be done and assigning tasks, authority and resources to
people so that they can work to support the purposes of the organization is known as:
a. Planning
b. Controlling
c. Leading
d. Organizing
7. When a marketing manager tells a subordinate that she did an excellent job when she made a
presentation to senior management, what function is that manager performing?
a. Organizing
b. Leading
c. Controlling
d. Planning
8. Rosemary Stewart studied the pattern of managers' work. Which of these statements best
represents the main conclusion of her research?
a. Most managers spent a lot of time thinking and carefully analyzing problems
b. Most managers spent a lot of time working alone
c. Managers typically work in a fragmented way, with many interruptions
d. There was little variation between managers in their working patterns
9. According to Mintzberg, all of the following are examples of the interpersonal roles of a
manager, except:
a. Leading
b. Acting as a liaison
c. Acting as a symbol
d. Negotiating
10. According to Mintzberg, which of the following is an example of the decisional roles which
a manager plays?
a. Monitoring progress
b. Acting as a spokesperson for the organization
c. Leading
d. Allocating some of the resources of the organization
11. Which of these statements best describes the idea of the context within which managers
work?
a. It represents factors both inside and outside the organization which influence the
manager, and which the manager can also try to influence
b. It is outside the organization, and therefore beyond the manager's control
c. Managers can easily act without referring to vague external things like the context
d. The context determines what the manager can do
12. We identify three levels of planning. What are they?
a. Strategic, administrative and functional
b. Top, middle and bottom
c. Operational, intermediate and strategic
d. Headquarters, divisional and local
13. What is the planning horizon?
a. The time period within which uncertainty is very low.
b. The maximum time for which managers can make plans.
c. The time ahead for which there is no information.
d. The time between making a plan and putting it into effect.
14. We identified several internal benefits of objectives, goals and a sense of mission. Which is
not included?
a. Basis of control
b. Motivation
c. Basis of plans and decisions
d. Basis to resolve disputes
15. A good objective should clarify the desired result; i) enable achievement to be measured;
and iii) need not specify a time scale. Which of these statements is true?
a. (ii) only
b. (ii) and (iii)
c. (iii) only
d. and (ii)
16. Power is the ability to influence the behavior of others
a. True
b. False
17. Referent power refers to a person's capacity to influence others owing to specific skills and
abilities.
a. True
b. False
18. Expert power refers to a person’s capacity to influence others owing to specific skills and
abilities. If you can influence behavior simply because you are liked or admired, you have
referent power.
Knowledge power is a type of situational and structural power.
a. True
b. False
19. When used effectively, empowerment strategies can lead to increased employee motivation
and job satisfaction.
a. True
b. False
20. Interpersonal conflict occurs when a person is confronted with several mutually exclusive
options and has difficulty making a decision.
a. True
b. False
Answers for Self Assessment Questions
1. (b) 2.(c) 3.(d) 4.(d) 5.(d)
6. (d) 7.(b) 8.(c) 9.(d) 10.(d)
11. (a) 12.(c) 13.(d) 14.(d) 15.(d)
16. (a) 17.(b) 18.(a) 19.(a) 20.(b)
Chapter-4: Leadership
Self Assessment Questions
1. Kets de Vries (1996) identified that most successful leaders perform two roles. What are these
roles?
a. Charismatic and architectural
b. Tough and supportive
c. Directive and mentoring
d. Intellectual and coaching
2. The Action Centred Leadership model was put forward and developed in 1973 by whom?
a. Beer
b. Taylor
c. Adair
d. Fiedler
3. It has been identified that there are 6 Pillars of Character that are important to adopting and
ethical perspective in leadership development. Can you name four of the six?
a. Trustworthiness, Respect, Responsibility, Fairness, Caring and Citizenship
b. Ruthlessness, Drive, Determination, Toughness, Supportive, Action orientated
c. Supportive, intelligent, insightful, good communicator, toughness, Fair
d. Caring, softness, intelligent, decisive, team player, communicator
4. Berg and Chyung use an analogy to distinguish formal and informal learning. In this analogy,
formal learning is represented as a journey by bus, whereas informal learning is characterized
as what?
a. Like flying an aeroplane
b. Like riding a bicycle
c. Like driving a car
d. Like being on a train
5. Barner and Higgins identify four theory models of coaching to which all coaches will
subscribe, consciously or otherwise, in varying degrees. Which of these models aims primarily
to help the individual to gain insights into themselves (as a person and as a manager) and to
effect changes based on those insights?
a. Systems model
b. Social constructionist model
c. Behavioural model
d. Clinical model
6. The authors suggest the idea of wrappers for a series of related and overlapping concepts that
writers and organizations use to define and delineate practices in areas related to leadership
and management development. Which three concepts make up these wrappers?
a. Alignment, human resource planning, and skills analysis
b. Career planning, talent pipeline, and retention strategies
c. Talent management, succession management, and career management
d. Career ladders, talent pools, and engagement practices
7. The authors take a broad view of leadership and management (L&M) development, including
all activities aimed at building ongoing L&M capacity, enabling the organization to meet its
objectives, to sustain itself and to what else?
a. Transform itself
b. Develop talent
c. Agree strategy
d. Make money
8. Holton (1996) criticised Kirkpatrick's model of levels of evaluation in learning, stating that
only three of these levels were causally related to learning and development. Which were the
three levels Holton identified?
a. Reactions, learning, organizational results
b. Learning, individual performance, organizational results
c. Reactions, individual performance, learning
d. Learning, Reactions, organizational results
9. Stein et al (2008) found that top executives differed significantly from the remainder of the
general population in terms of a certain personal characteristic. This difference was also found
to be linked to effective leadership and organizational effectiveness. What was the identified
personal characteristic?
a. Greater emotional intelligence
b. More ambition
c. Greater IQ
d. More personality
10. What is the Human Capital Perspective argument for diversity management in leadership
and management?
a. Using human resource planning to identify leaders and managers
b. Assessing all employees in terms of the money they make
c. Taking advantage of the talents available in the whole of the workforce
d. Telling employees that their knowledge and skills will be assessed and used by
managers
11. Research in the styles of leadership preferred by different generations was completed by
Arsenault (2004). What was the style of leadership that Generation X was found to prefer?
a. Directive
b. Authoritarian
c. Participative
d. Egalitarian
12. Which of the four theorists added a Chinese dimension to Hofsted's cultural dimensions?
a. Schein
b. Bond
c. Trompenaars
d. Adler
13. Earley and Mosakowski (2004) developed the concept of cultural intelligence in the context
of attitudes and skills. Which of the following did they identify which related to learning
strategies whereby people acquire and develop coping strategies?
a. Mind
b. Knowledge
c. Heart
d. Body
14. Which of the following aspects do not have an impact on Employment Law?
a. Recruitment and selection.
b. Dismissal
c. Education qualifications
d. Finance
15. Whilst there is no consensus as to what global leadership competencies are there is
agreement as to what according to Neary and O'Grady?
a. Lead change
b. Internal and external networking
c. Management style
d. The need to develop managers through such an approach
16. Which of Mabey and Salaman's (1995) four management agendas assumed an
unproblematic link between management development and performance?
a. Political reinforcement
b. Functional performance
c. Compensation
d. Psychic defence
17. Planning to learn from experience is in keeping with which of Mumford's four approaches
to learning?
a. Prospective approach
b. Intuitive approach
c. Incidental approach
d. Retrospective approach
18. Which of the following is an advantage of informal learning opportunities?
a. Idealisation: whereby past experiences are valued to the exclusion of other learning
opportunities.
b. Narrowness: where a manager's work experience is specific and blinkers the desire to
widen the managerial perspective.
c. Obsolescence: previously acquired experience may have become out of date. This may
be exemplified by a manager from the public sector moving into the private sector.
d. Job change within the same function.
19. Which of Carnall's (2003) four core managerial components essential for the effective
management of change involves team building?
a. Decision making
b. Coalition building
c. Achieving action
d. Maintaining momentum
20. International management development involves the CEO and the senior team and other
key elements. Which of the following is not one of the key elements?
a. The global strategy
b. Human resource and line capabilities
c. Senior Management involvement
d. Performance management
Answers for Self Assessment Questions
1. (a) 2.(c) 3.(a) 4.(b) 5.(d)
6. (c) 7.(a) 8.(b) 9.(a) 10.(c)
11. (d) 12.(b) 13.(a) 14.(d) 15.(d)
16. (b) 17.(a) 18.(d) 19.(d) 20.(d)
Chapter-5 Staffing
Self Assessment Questions
1. Which staffing policy is the most consistent with an international multidomestic strategy?
a. Ethnocentric.
b. Geocentric.
c. Regiocentric.
d. Polycentric.
2. A strategy of ..................... pricing involves using price as a competitive weapon in order to
push competitors out of a national market.
a. incremental
b. premium
c. predatory
d. psychological
3. ..................... is the process of ensuring that global marketing activities are carried out as
intended.
a. Auditing
b. Control
c. Feedback
d. Planning
4. In the global chewing gum market, dominated by American manufacturers, Dandy's core
competencies are:
a. the coating process of the chewing gum.
b. global manufacturing bases.
c. value for money.
d. high-impact advertising.
5. The global market leader in the chewing gum industry, with 35% market share is:
a. Nabisco.
b. Kraft Jacobs Suchard.
c. Wrigley.
d. Cadbury Schweppes.
6. In which of the following situations do geographical structures best serve firms wishing to
internationalize?
a. When firms have diversified product lines and extensive R&D activities.
b. When companies are more experienced with international markets and business.
c. When firms have a homogeneous range of products that need fast and efficient world-
wide distribution.
d. None of the above are valid answers.
7. Which of the following should human resource (HR) planning be related to?
a. The nature of the organisational culture and climate
b. The structure of the organisation
c. Corporate objectives
d. All of the above
8. A document which contains information on the total requirements of the job: what it is; its
purpose; the duties, activities and responsibilities attached; and its position within the formal
structure of the organisation is called:
a. a person specification
b. a job analysis
c. a job description
d. none of the above
9. A study which monitored the effects of informing applicants about the difficulties and
distastes of jobs for which they were applying revealed that:
a. if applicants are informed of the difficulties and distastes of the job, the number of
applications is likely to reduce
b. if applicants are informed of the difficulties and distastes of the job, the six month staff
turnover rate is likely to decrease
c. if applicants are informed of the difficulties and distastes of the job, there is likely to be
no effect on the level of applications or staff turnover
d. if applicants are informed of the difficulties and distastes of the job, the six month staff
turnover rate is likely to increase
10. The manner in which the selection process is conducted is important. It should be efficient
as:
a. managers, generally, advocate that the process should take as shorter time as possible
b. candidates will judge the organisation by the manner in which the selection process is
conducted
c. both of the above
d. neither of the above
11. Peer rating is sometimes used as a method of selection. It involves the candidates
nominating other candidates, usually on the basis of a ................... rating.
a. motivation
b. sociability
c. knowledge
d. intelligence
12. What method of selection is usually a central and indispensable element of the selection
process, and still a widely used method of selection?
a. The selection test
b. The group exercise
c. The interview
d. The application form
13. During an interview, candidates should be encouraged to:
a. do most of the talking
b. reply and comment only when prompted
c. stick to the specific question being asked, without describing experiences or developing
ideas
d. do most of the listening
14. Which of the following should a skilled interviewer be able to do during the interview
process?
a. Be responsive to both verbal and non-verbal cues
b. Show respect and good manners to candidates
c. Change their interview style according to the different behaviour of candidates
d. All of the above
15. Effective ..................... is a continuous process covering the first few months at work and can
be viewed as an extension of the recruitment and selection procedure.
a. management
b. development
c. reduction
d. induction
16. ..................... are the resources that provide utility value to all other resources.
a. Men
b. Material
c. Money
d. Machinery
17. The term procurement stands for
a. recruitment and selection
b. training and development
c. pay and benefits
d. health and safety
18. The characteristics of human resources are ..................... in nature
a. homogeneous
b. heterogeneous
c. ductility
d. None of the above
19. Identify the managerial function out of the following functions of HR managers.
a. procurement
b. development
c. organizing
d. performance appraisal
20. Which of the following is an example of operative function of HR managers?
a. planning
b. organizing
c. procurement
d. controlling
Answers for Self Assessment Questions
1. (d) 2.(c) 3.(b) 4.(a) 5.(c)
6. (c) 7.(d) 8.(c) 9.(b) 10.(b)
11. (b) 12.(c) 13.(a) 14.(d) 15.(d)
16. (a) 17.(a) 18.(b) 19.(c) 20.(c)
Chapter-6: Directing
Self Assessment Questions
1. ………………means giving instructions, guiding, and counseling, motivating and leading the
staff in an organization in doing work to achieve Organizational goals.
a. Staffing
b. Directing
c. Planning
d. None of these
2. Directing is a continuous process initiated at top level and flows to the bottom
through…………...
a. organizational function
b. organizational hierarchy
c. organizational goals
d. None of these
3. Communication is a basic organizational function.
a. True
b. False
4. ……………….refers to the direction and flow of official communication amongst members of
an organization.
a. Informal communication
b. Formal communication
c. Communication
d. None of these
5. Informal flow of communication takes place on the basis of friendship, likes and dislikes, and
social interaction amongst the members of an organization.
a. True b. False
6. ……………is supported by non verbal communication such as facial expressions and body
gestures.
a. Communication
b. Non verbal communication
c. Verbal communication
d. None of these
7. Directing involves ……………that essentially helps in creating appropriate work
environment and build up team spirit.
a. Staffing
b. Leadership
c. Planning
d. None of these
8. Directing is a key managerial function to be performed by the manager along with planning,
organizing, staffing and……………..
a. Controlling
b. Leadership
c. Planning
d. None of these
9. Which of the following is not a test of the semistrong form of the EMT?
a. Tests of serial correlation in stock returns
b. Stock price reactions to the announcement of stock dividends
c. Tests of the performance of mutual funds
d. Stock reaction to merger announcements
e. Tests of the performance of money managers
10. Which of the following statements represents implications of EMT to investors?
a. Prior returns on an equally weighted portfolio of gold stocks predict gold returns.
b. Changes in variance are somewhat predictable from past data.
c. If the price-to-book value ratio is low, then the stock tends to outperform.
d. Fundamental analysis can be used to earn abnormal profit.
11. The evidence that stocks with low price-to-earnings ratios tend to have higher returns is an
example of:
a. firm anomalies
b. event anomalies
c. seasonal anomalies
d. accounting anomalies
12. Which of the following is not an anomaly?
a. Closed-end mutual fund discounts
b. Volatility effect
c. Value Line rating changes
d. January effect
13. The weak form of the efficient market hypothesis asserts that:
a. corporate insiders should have no better investment performance than other investors
b. future changes in stock prices cannot be predicted from past prices
c. firms that are owned by few institutions tend to have higher returns
d. security prices tend to be up in January, especially the first few days
14. Which of the following statements represents an example of firm anomalies?
a. If the dividend yield is high, then the stock tends to outperform.
b. Stocks with low P/E ratios tend to have higher returns.
c. Returns tend to be positive on the last trading day before a holiday.
d. Returns on closed-end funds that trade at a discount tend to be higher.
15. The weak form of the EMT contradicts:
a. both fundamental analysis and technical analysis
b. technical analysis, but supports technical analysis as valid
c. fundamental analysis, but supports technical analysis as valid
d. technical analysis, but is silent on the possibility of successful fundamental analysis
16. In an efficient market:
a. security prices are seldom far above or below their justified level
b. returns tend to be positive on the last trading day before a holiday
c. firms that are not followed by many analysts tend to yield higher returns
d. stocks with low P/E ratios tend to have higher returns
17. A random walk occurs when:
a. stock price changes are random but predictable
b. future price changes are uncorrelated with past price changes
c. the stock price level is random
d. past information is useful in predicting future prices
18. A finding that ………………would provide evidence against the semistrong form of the
EMT.
a. The price decline of large secondary offerings is permanent when outsiders are selling.
b. Technical analysis is worthless in determining stock prices.
c. Earnings announcement reactions take considerable time.
d. Investors do not earn abnormal profits after merger announcement.
19. A finding that …………….. would provide evidence against the weak form of the EMT.
a. About 50% of pension funds outperform the market in any year.
b. Changes in stock prices are random and unpredictable.
c. Insiders can profit from public information about insider trading.
d. Changes in variance are somewhat predictable from past data.
20. When financial markets are described as ‘efficient’, this usually refers to their:
a. predictability
b. reliability
c. allocation of resources
d. use of information
Answers for Self Assessment Questions
1. (b) 2.(b) 3.(a) 4.(b) 5.(a)
6. (c) 7.(b) 8.(a) 9(a) 10(b)
11. (d) 12.(b) 13.(c) 14(d) 15.(d)
16(a) 17.(b) 18.(c) 19.(d) 20.(d)
Chapter-7: Decision-making
Self Assessment Questions
1. After a preferred course of action has been implemented, the next step in the decision-making
process is to............................
a. recycle the process
b. look for additional problems or opportunities
c. evaluate results
d. document the reasons
2. The ...........................decision model views individuals as making optimizing decisions,
whereas the ...........................decision model views them as making satisficing decisions.
a. behavioral/judgmental heuristics
b. classical/behavioral
c. judgmental heuristics/ethical
d. crisis/routine
3. A common mistake by managers facing crisis situations is ............................
a. trying to get too much information before responding
b. relying too much on team decision making
c. isolating themselves to make the decision alone
d. forgetting to use their crisis management plan
4. Which model views the main components of the choice process—problems, solutions,
participants, and choice situations—as all mixed up together in a dynamic and shifting field of
organizational forces?
a. the garbage can model
b. the behavioral model
c. the turbulence model
d. the classical model
5. The ...........................bases a decision on similarities between the situation at hand and
stereotypes of similar occurrences.
a. representativeness heuristic
b. anchoring and adjustment heuristic
c. confirmation trap
d. hindsight trap
6. The ...........................bases a decision on incremental adjustments to an initial value
determined by historical precedent or some reference point.
a. representativeness heuristic
b. anchoring and adjustment heuristic
c. confirmation trap
d. hindsight
7. The ...........................is the tendency to seek confirmation for what is already thought to be true
and not to search for disconfirming information.
a. representativeness heuristic
b. anchoring and adjustment heuristic
c. confirmation trap
d. hindsight trap
8. Which of the factors listed below is not a reason for decision making in organizations being a
complex process?
a. Several stakeholders will have an interest in the decision
b. People have to make decisions in a historical context
c. Modern information systems enable people to evaluate a range of possible outcomes
d. Factors in the current context of the organization affect the decision
9. The overall process of decision making in, for example, staff selection includes which of these
stages?
a. Deciding which candidate to appoint
b. Identifying the need for a new member of staff
c. Agreeing the job specification
d. All of the above
10. A manager who is helping a customer return some shoes they purchased last week is
dealing with what type of decision?
a. Uncertainty
b. Bounded rationality
c. Programmed decision
d. Non-programmed decision
11. A solution to a problem that is arrived at through an unstructured process of decision
making is called a:
a. Non-programmed decision
b. Bounded rationality
c. Uncertainty
d. Programmed decision
12. As a manager moves to higher positions in an organisation the ability to make .....................
becomes ..................... important.
a. Non-programmed; more
b. Non-programmed; less
c. Programmed; more
d. Programmed; much more
13. Decision making situations can be categorized along a scale which ranges from:
a. Certainty to uncertainty to risk
b. Uncertainty to certainty to risk
c. Certainty to risk to uncertainty
d. Certainty to risk to uncertainty to ambiguity
14. When a manager knows little about the intended goals of a decision and the outcomes of the
options are unclear, what type of situation are they in?
a. Risk
b. Uncertainty
c. Certainty
d. Ambiguity
15. If a manager at Wipro wants to award a contract for printing the company's promotional
literature and has obtained quotations from several printers, the manager can select a printer
and know with ..................... what the printing should cost.
a. Risk
b. Ambiguity
c. Certainty
d. Uncertainty
16. In Herbert Simon's theory, a manager who accepts the first satisfactory solution to a problem
has made a ..................... decision, while a manager who continues to search for the best possible
solution is seeking to find a ..................... decision
a. Maximizing; minimizing
b. Minimizing; maximizing
c. Maximizing; satisficing
d. Satisfying; maximizing
17. The decision making model which emphasizes that organizations contain diverse interest
groups who will bargain about goals and alternative actions, often with incomplete information
is known as the:
a. Computational or rational model
b. Inspirational or garbage can model
c. Political model
d. Administrative or incremental model
18. …………….involves the selection of a course of action from among two or more possible
alternatives in order to arrive at a solution for a given problem.
a. Decision-making
b. Programmed Decisions
c. Operational Decisions
d. Strategic Decisions
19. …………..are decisions that were already identified but are set aside until the conditions are
approved and met.
a. Decisions Whether
b. Contingent Decisions
c. Decisions Which
d. None of these
20. ……………………are short-term decisions (also called administrative decisions) about how
to implement the tactics e.g. which firm to use to make deliveries.
a. Tactical Decisions
b. Programmed Decisions
c. Operational Decisions
d. Strategic Decisions
Answers for Self Assessment Questions
1. (c) 2.(a) 3.(c) 4.(b) 5.(a)
6. (b) 7.(c) 8.(c) 9. (d) 10.(c)
11. (a) 12.(a) 13.(d) 14.(d) 15.(c)
16.(d) 17.(c) 18. (a) 19.(b) 20.(c)
Chapter-8: Organizing
Self Assessment Questions
1. Which approach recognizes that there is no optimal organizational design?
a. Contingency
b. Boundless organizations
c. Flexible organizations
d. Virtual organizations
2. According to Burns and Stalker, which of the following is a feature of organic organizations?
a. A specific hierarchical structure
b. Prestige drawn from personal contribution
c. Emphasis on vertical communication channels
d. Knowledge requirement based on job
3. How did Lawrence and Lorsch refer to problems of trying to cope with varied environmental
demands from the same department or the same demands from different departments?
a. Integration failure
b. Differentiation errors
c. Insufficient collaboration
d. Cognitive and emotional conflict
4. Which key skill was not mentioned by Kanter as needed by managers of innovative
organizations?
a. Communicating
b. Team leading
c. Political
d. Coping
5. Which of the following is not true of span of control?
a. The technical content of jobs has little effect on the required span of control of
supervisors.
b. High spans of control were found in supervision of line production.
c. It is the number of subordinates who report directly to a supervisor
d. The average span of control affects the number of managers.
6. How did Woodward come to suggest a normative theory about production organization?
a. Because different groups of firms had different organizational characteristics.
b. Because those with leaner, shorter hierarchies performed best.
c. Because the best-performing firms in each technological group had organizational
characteristics that were similar to each other.
d. Because it became clear that firms should adapt their organization to match process
technology.
7. Structure is the pattern of relationships among positions in the organization and among
members of the organization. Which of the following does structure make possible?
a. The planning, organizing, directing and controlling of the activities of the organization.
b. The application of the process of management.
c. The creation of a framework of order and command.
d. All of the above.
8. Which of the following functions may be described as 'task' functions?
a. Production.
b. Quality control.
c. Personnel.
d. All of the above.
9. Which of the following might be classified as functions of the ‘staff organization’ as opposed
to functions of the ‘line organization?
a. Computer support services.
b. Public relations.
c. Personnel.
d. All of the above.
10. Which three of the following terms best describe the three levels in a hierarchical structure?
a. Missionary level.
b. Co-ordination level, Objective level.
c. Technical level, Community level.
d. Managerial level, Community level, Technical level.
11. Organizational structure is made up of key elements. Which of the following is not one of
these elements?
a. co-ordination
b. chain of command
c. decentralization
d. centralization
12. When jobs are grouped together based on a particular type of customer, this is known as:
a. centralization.
b. departmentalization.
c. work specialization.
d. job structuring.
13. Centralization refers to:
a. the decision-making process.
b. team decision-making.
c. the geographic dispersion of an organization.
d. the degree to which decision-making is concentrated at a single point in the
organization.
14. In an organization that has high centralization:
a. all top-level officials are located within the same geographic area.
b. problems can be quickly and efficiently solved.
c. decision discretion is widely dispersed throughout the organization.
d. top managers make all the decisions-lower-level managers merely carry out directions.
15. The degree to which jobs within an organization are standardized is referred to as:
a. centralization.
b. job variation.
c. job classification.
d. formalization.
16. In a highly formalized organization, job behaviors are relatively:
a. programmed.
b. non-existent.
c. nonprogramed.
d. discretionary.
17. Employee discretion is inversely related to:
a. complexity.
b. standardization.
c. technology.
d. centralization.
18. Which of the following structures is characterized by centralization, high formalization,
extensive departmentalization, and a limited information network?
a. mechanistic model
b. organic model
c. job structure model
d. job satisfaction model
19. If there is low formalization, a comprehensive information network and high participation
in decision-making, one would expect:
a. a typical government organization.
b. an organic structure.
c. a stable structure.
d. a bureaucracy.
20. Which of the following is characterized by wide spans of control, little formalization, a low
degree of departmentalization, and authority centralized in a single person?
a. bureaucracy
b. simple structure
c. matrix organization
d. team structure
Answers for Self Assessment Questions
1. (a) 2.(b) 3.(b) 4.(a) 5.(a)
6. (c) 7.(d) 8.(a) 9.(d) 10.(d)
11. (a) 12.(c) 13.(d) 14.(d) 15.(d)
16. (a) 17.(b) 18.(a) 19.(a) 20.(a)
Chapter-9: Coordination
Self Assessment Questions
1. Flatter structures generally enhance
a. decision making and coordination.
b. vertical communication and coordination.
c. horizontal and vertical communication.
d. vertical communication and coordination.
2. Co-ordination is not a function of management.
a. True
b. False
3. Mutual adjustment relies on ....................._ to coordinate tasks.
a. downward communication
b. formal communication
c. horizontal communication
d. informal communication
4. Co-ordination is the “Plus value of the group”.
a. True
b. False
5. Which method of coordination provides the most amount of worker discretion?
a. Standardization of work processes
b. Mutual adjustment
c. Standardization of outputs
d. Standardization of skills
6. Coordination can be achieved more easily in early stages of planning and policy-making.
a. True
b. False
7. When a large and established firm gets into a new line of business, the new innovative unit
often requires
a. a more mechanistic structure.
b. coordination.
c. a more organic structure.
d. mutual influence.
8. Coordination must start at an early stage in the management process.
a. True
b. False
9. All of the following are disadvantages of functional departmentation except
a. poor communication within departments.
b. slow responses to organizational problems.
c. over-specialization.
d. poor coordination.
10. Integration is an activity by companies that specialize in bringing different manufacturers’
products together into a smoothly working system.
a. companies
b. task
c. organization
d. None of these
11. Functional departmentation works best in
a. medium to large sized firms that offer relatively few product lines or services.
b. small to medium sized firms that offer many product lines or services.
c. medium to large sized firms that offer many product lines or services.
d. small to medium sized firms that offer relatively few product lines or services.
12. Which of the following is most accurate about the effects of downsizing?
a. It does not result in cost reductions in the long-run or improvements in productivity.
b. It does result in cost reductions in the long-run and improvements in productivity.
c. It does result in cost reductions in the long-run but not improvements in productivity.
d. It does not result in cost reductions in the short-run or improvements in productivity.
13. A price-skimming strategy involves charging high prices for a product, particularly during
the introductory phase.
a. True
b. False
14. When faced with serious decline, organizations have a tendency to become
a. less organic.
b. more mechanistic.
c. more organic.
d. less mechanistic.
15. A question for business level strategy would be:
a. Which industries do we want to be in?
b. How should the businesses be related?
c. How should the business compete in its market?
d. How should resources be shared amongst the businesses?
16. Which of Porter's generic strategies is Easyjet following?
a. Differentiation
b. Cost leadership
c. Cost focus
d. Hybrid
17. A differentiation strategy offers:
a. A broad segment something unique
b. A narrow segment something unique
c. A broad segment something more expensive
d. A narrow segment something more expensive
18. Kim and Mauborgne (2005) argue that organizations should try to capture uncontested
market space. These uncontested markets are known as:
a. Blue skies
b. Blue oceans
c. White skies
d. Fresh snows
19. ………………is the process in which several steps in the production and/or distribution of a
product or service are controlled by a single company or entity, in order to increase that
company’s or entity’s power in the marketplace.
a. Horizontal integration
b. Vertical integration
c. Organization
d. None of these
20. …………………… simply means a strategy to increase your market share by taking over a
similar company.
a. Horizontal integration
b. Vertical integration
c. Organization
d. None of these
Answers for Self Assessment Questions
1. (a) 2.(b) 3.(d) 4.(a) 5.(b)
6. (a) 7.(c) 8.(a) 9.(a) 10.(a)
11. (a) 12.(d) 13.(a) 14.(b) 15.(c)
16. (b) 17.(a) 18.(b) 19.(b) 20.(a)
Chapter-10: Motivation
Self Assessment Questions
1. Motivation is defined as the level and persistence of............................
a. effort
b. performance
c. need satisfaction
d. performance instrumentalities
2. A content theory of motivation is most likely to focus on ............................
a. organizational justice
b. instrumentalities
c. equities
d. individual needs
3. A process theory of motivation is most likely to focus on ............................
a. frustration-regression
b. expectancies regarding work outcomes
c. lower-order needs
d. higher-order needs
4. According to McClelland, a person high in need achievement will be ............................
a. guaranteed success in top management
b. motivated to control and influence other people
c. motivated by teamwork and collective responsibility
d. motivated by challenging but achievable goals
5. In Alderfer’s ERG theory, the ........................... needs best correspond with Maslow’s higher-
order needs of esteem and self-actualization.
a. existence
b. relatedness
c. recognition
d. growth
6. Improvements in job satisfaction are most likely under Herzberg’s two-factor theory when
........................... are improved.
a. working conditions
b. base salary
c. co-worker relationships
d. opportunities for responsibility
7. In Herzberg’s two-factor theory ........................... factors are found in job context.
a. motivator
b. satisfier
c. hygiene
d. enrichment
8. In equity theory, the ........................... is a key issue.
a. social comparison of rewards and efforts
b. equality of rewards
c. equality of efforts
d. absolute value of rewards
9. In equity motivation theory, felt negative inequity ............................
a. is not a motivating state
b. is a stronger motivating state than felt positive inequity
c. can be as strong a motivating state as felt positive inequity
d. does not operate as a motivating state
10.A manager’s failure to enforce a late-to-work policy the same way for all employees is a
violation of ........................... justice.
a. interactional
b. moral
c. distributive
d. procedural
11. In expectancy theory, ........................... is the probability that a given level of performance will
lead to a particular work outcome.
expectancy
instrumentality
motivation
valence
12. In expectancy theory, ........................... is the perceived value of a reward.
a. expectancy
b. instrumentality
c. motivation
d. valence
13.Expectancy theory posits that ............................
a. motivation is a result of rational calculation
b. work expectancies are irrelevant
c. need satisfaction is critical
d. valence is the probability that a given level of task performance will lead to various
work outcomes.
14.Which goals tend to be more motivating?
a. challenging goals
b. easy goals
c. general goals
d. no goals
15.The MBO process emphasizes ........................... as a way of building worker commitment to
goal accomplishment.
a. authority
b. joint goal setting
c. infrequent feedback
d. rewards
16. Theory X suggests that employees:
a. Dislike work
b. Like their manager
c. Dislike their manager
d. None of the above
17. What three words define motivation?
a. Desire, persistence, fairness
b. Ambition, direction, intensity
c. Persistence, fairness, ambition
d. Intensity, direction, persistence
18. The theory that individuals act depending upon their evaluation of whether their effort will
lead to good performance, whether good performance will be followed by a reward, and
whether that reward is attractive to them, is called:
a. Expectancy Theory
b. Motivational Theory
c. Equity Theory
d. Empirical Theory
19. Which answer corresponds to a person's internal desire to do something, due to such things
as interest, challenge and personal satisfaction?
a. Theory Z
b. Extrinsic motivators
c. Theory X
d. Intrinsic motivators
20. Equity theory of motivation focuses on:
a. The fact that people are influenced by the expected results of their actions.
b. People’s perception of how they should perform in a given situation at work
c. The motivational force involved in a person’s actions at work
d. People’s expectation of the different outcomes for a given action
Answers for Self Assessment Questions
1. (a) 2. (d) 3. (b) 4. (d) 5. (d)
6. (d) 7. (c) 8. (a) 9. (c) 10. (c)
11. (b) 12. (d) 13. (a) 14. (a) 15. B
16. (a) 17.(d) 18.(a) 19.(d) 20.(a)
Chapter-11 Management Control
Self Assessment Questions
1. When a perfectly competitive market exists and the firm uses market-based transfer pricing,
the firm can achieve all of the following except for:
a. goal congruence.
b. subunit performance evaluation.
c. management effort.
d. price monopoly.
2. Bob is the manager of the Beta division. He is accountable for only the sales generated by the
division. Beta is a(n):
a. cost centre.
b. profit centre.
c. investment centre.
d. revenue centre.
3. A company that uses a separate transfer price for each division in a single transaction is
employing:
a. negotiated pricing.
b. dual pricing.
c. full cost pricing.
d. market-based pricing.
4. If the selling subunit is operating at full capacity and can sell everything produced either
internally or externally, it will only be willing to use a transfer price set by:
a. variable costing.
b. cost plus a mark-up.
c. negotiation.
d. the market.
5. ......................... is concerned with the acquisition, financing, and management of assets with
some overall goal in mind.
a. Financial management
b. Profit maximization
c. Agency theory
d. Social responsibility
6. Jensen and Meckling showed that ......................... can assure themselves that the
......................... will make optimal decisions only if appropriate incentives are given and only if
the ......................... are monitored.
a. principals; agents; agents
b. agents; principals; principals
c. principals; agents; principals
d. agents; principals; agents
7. ......................... is concerned with the maximization of a firm's earnings after taxes.
a. Shareholder wealth maximization
b. Profit maximization
c. Stakeholder maximization
d. EPS maximization
8. What is the most appropriate goal of the firm?
a. Shareholder wealth maximization.
b. Profit maximization.
c. Stakeholder maximization.
d. EPS maximization.
9. Which of the following statements is correct regarding profit maximization as the primary
goal of the firm?
a. Profit maximization considers the firm's risk level.
b. Profit maximization will not lead to increasing short-term profits at the expense of
lowering expected future profits.
c. Profit maximization does consider the impact on individual shareholder's EPS.
d. Profit maximization is concerned more with maximizing net income than the stock price.
10. ......................... is concerned with the branch of economics relating the behavior of principals
and their agents.
a. Financial management
b. Profit maximization
c. Agency theory
d. Social responsibility
11. A concept that implies that the firm should consider issues such as protecting the consumer,
