Management Introduction Questions and Answers 11 to 20

Management Introduction 

Questions 11 to 20

11.	Information that originates outside the organization is known as external information. Which of the following is/are example(s) of external information in an organization? (a)   Daily receipts and expenditures (b)   Salesperson Quotas (c)   Descriptions of customer satisfaction with products and services (d)   Quantity of an item in hand or in inventory (e)   Cost and selling price of the company’s item.
12.	Which of the following decision-making models emphasizes short-run solution of a problem rather than long-term goal accomplishment? (a) Rational model                         (b) Satisficing model                      (c) Incremental model   (d) Garbage-can model                  (e) Decision tree.
13.	Sofia works in one of seven research and development departments at General Automobile Corporation. This would suggest that General Automobiles has a  (a)  Functional structure                              (b)  Divisional structure         (c)  Flat structure (d)  High degree of centralization                (e)  Tall structure.
14.	Which of the following information processing systems gives the output in the form of summary and exception reports that are useful to the managers? (a)  Decision support system                  (b)  Management information system (c)  Office automation system                (d)  Transaction processing system (e)  Executive support system.
15.	In which of Likert’s four systems of leadership, managers do not have complete confidence and trust in subordinates but nevertheless, solicit advice from subordinates while retaining the right to make final decision? (a)  Participative leadership style            (b)  Benevolent-authoritative leadership style (c)  Consultative leadership style            (d)  Exploitative-authoritative leadership style (e)  Trait theory of leadership style.
16.	Performance appraisals are important in an organization because they I.     Provide systematic judgments to support promotions. II.     Provide a basis for coaching. III.    Provide a basis for counseling. IV.   Let subordinates know where they stand with the boss. (a)  Only (I) above                                  (b)  Only (II) above                                                               (c)  Both (I) and (IV) above                     (d)  (I), (III) and (IV) above                       (e)  All (I), (II), (III) and (IV) above.
17.	Ratio analysis helps a manager to compare the performance of the organization with its previous performance or the performance of its competitors. Which of the following is a ratio of creditors’ contribution to that of the owners? (a)  Current ratio                                     (b)  Debt-equity ratio (c)  Return on investment (ROI)               (d)  Net profit margin                  (e)  Inventory turnover.
18.	Which of the following inventory techniques uses cards to monitor inventory movement? (a)  ABC Analysis                                   (b)  JIT Approach                                   (c)  Kanban (d)  Kaizen                                             (e)  Economic Order Quantity.
19.	A decision support system (DSS) is an interactive computer system used to plan and make decisions. Which of the following is/are true with regard to Decision Support System (DSS)? I.     Executive decisions are the focal points in DSS. II.     DSS specializes in easy-to-use software. III.    DSS employs interactive processing. IV.   The control and use of DSS rests with the central information management department. (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.
20.	Which of the following is/are postulates of the path – goal theory? I.     The leader clearly defines the path to goal attainment for subordinates. II.     The leader motivates subordinates to participate in decision-making. III.    The leader sets clear and specific goals for subordinates. IV.  The leader suitably rewards employees as per their performance. (a)  Only (II) above                                 (b)  Only (IV) above (c)  Both (II) and (IV) above                     (d)  (I), (II) and (IV) above                        (e)  All (I), (II), (III) and (IV) above.

Answers

11.	Answer : (c)Reason : Descriptions of customer satisfaction with products and services are examples of external information in an organization. Hence from above discussion, we can infer that option (c) is correct.                   Options (a), (b), (d) and (e) are all examples of internal information in an organization.
12.	Answer : (c)Reason :    Incremental model emphasizes short-run solution of a problem rather than long-term goal accomplishment. (a) Rational model is a model of managerial decision-making, which suggests that managers engage in completely rational decision process, ultimately make optimal decisions and process, and understand all information relevant to their decisions at the time they make them. (b) Satisficing model describe the way modern managers must, of necessity, make decisions with incomplete information by choosing from among the few most likely alternatives. (d) Garbage can model is a non-rational model of management decision-making stating that mangers behave in virtually a random pattern in making non-programmed decisions. (e) Decision tree is a quantitative decision-making tool based on a graphic model that displays the structure of a sequence of alternative courses of action and usually shows the payoff associated with various paths and the probabilities associated with future conditions.
13.	Answer : (b)Reason :    Sofia works in one of seven research and development departments at General Automobile Corporation and this suggests  that General Automobile has a divisional structure. i.e. to say divisional structure is a type of departmentation in which positions are grouped according to similarity of products, services or markets. (a) Functional structure is a type of departmentation in which positions are grouped according to their main functional or specialized area. (c) Flat structure is a structure that has few hierarchical levels and wide spans of control. (d) High degree of centralization is the tendency to restrict delegation of decision-making in an organization structure, usually by holding authority at or near the top of the organization structure. (e) Tall structure is a structure that has many hierarchical levels and narrow spans of control.
14.	Answer : (b)Reason :    MIS (Management Information System) gives the output in the form of summary and exception reports that are useful to the manager.
15.	Answer : (c)Reason :    When managers have substantial but not complete confidence and trust in subordinates and solicit advice from subordinates while retaining the right to make final decision, Likert’s four systems of management describes it as consultative leadership style. (a) In Participative leadership style the manager has complete trust and confidence in the subordinates in all the matters. (b) In Benevolent leadership style the managers have a patronizing confidence and trust in subordinates, solicit some ideas and opinions from subordinates, motivate with rewards and some fear and punishment, permit some upward communication and allow some delegation of decision-making but with close policy control. (d) In exploitative-authoritative leadership style the managers represents doctorial leadership behavior with all decisions made by the manager. (e) Trait theory of leadership style assumes that leaders share certain inborn personality traits.
16.	Answer : (e)Reason :    Performance appraisals are important in an organization because they provide systematic judgements to support promotions; provide a basis for coaching; provide a basis for counseling; and let subordinates know where they stand with the boss.
17.	Answer : (b)Reason :    Debt-equity ratio indicates what percentage of the organization’s assets creditors furnish. (a) Current ratio is the ratio of current assets to current liabilities. (c) Return on investment (ROI) is the ratio of net income to total assets. (d) Net profit margin is the ratio of net income to net sales. (e) Inventory turnover is the ratio of cost of goods sold to inventory.
18.	Answer : (c)Reason : Kanban is a subsystem of the JIT approach involving a simple parts movement system that depends on cards and containers to pull parts from one work center to another. (a)ABC analysis is a technique of inventory management, in which the inventory is distributed based on price & usage of the inventory. (b) A JIT is an approach to inventory control that emphasizes having materials arrive just as they are needed in the production process. (d)  Kaizen is a Japanese term implying continuous improvement.                 (e)  EOQ is an inventory control method developed to minimize ordering plus holding        costs, while avoiding stock out costs.
19.	Answer : (d)Reason :                                                      The following are the characteristics of DSS:               (I)    Executive decisions are the focal points in DSS.               (II)    DSS specializes in easy-to-use software               (III)   DSS employs interactive processing.               (1V) The control and use of DSS rests with the users and not the central information management department                       Statement given in (IV) is incorrect; hence option (d) is the correct answer.
20.	Answer : (e) Reason :   According to Path-Goal theory, the leader clearly defines the path to goal attainment for subordinates, when leader motivates subordinates to participate in decision-making and sets clear and specific goals to the organization and a leader should suitably reward employees as per their performance. So, all the statements mentioned are true for path-goal theory.

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