CBSE Class 12 Business Studies Principles of Management MCQs Set I

ASSERTION-REASONING QUESTIONS

Question. Assertion (A) The principles of management are yet to be evolved.
Reason (R) Principles of Management are said to be evolutionary in nature as these principles have evolved over a long period of time with continuous practice and experimentation.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (d) Correct assertion - The principles of management are in the continuous process of evolution.

Question. Assertion (A) Principles of pure science are different from Management principles.
Reason (R) Principles of pure science are to be rigid in nature whereas management principles are flexible in nature.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (a)

Question. Assertion (A) The application of the principle of Division of work leads to higher production and better work for the same effort.
Reason (R) It does not lead to specialisation.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (c)

Question. Assertion (A) If two employees at the same level are not treated at par by their superior, it would lead to job dissatisfaction.
Reason (R) Principle of Equity
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (a)

Question. Assertion (A) Personnel should be selected and appointed after due and rigorous procedure. But once selected they should be given reasonable time to show results.
Reason (R) According to Fayol’s ‘Remuneration of employees’ Principle.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (c)

Question. Assertion (A) Principle of Equity says that we should treat male and females equal.
Reason (R) Everyone is equal in the eyes of law.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (a)

Question. Assertion (A) Employees should be paid fair wages, which should give them at least a reasonable standard of living.
Reason (R) Remuneration of employees should be just and equitable.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (b)

Question. Assertion (A) Workers and management both should honour their commitments towards one another without prejudice.
Reason (R) Principle of Subordination of individual interest to general interest.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (c)

Question. Assertion (A) Unity of command resembles military organisation.
Reason (R) It prevents dual subordination.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (b)

Question. Assertion (A) Gang plank is a shorter route.
Reason (R) It helps in a communication to reduce not delayed in an emergency.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (b)

Question. Assertion (A) The interests of the group will supersede the interest of any one individual.
Reason (R) Principle of Subordination of Individual Interest to General interest.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (a)

Question. Assertion (A) Each group of activities having the same objective must have ‘one head and one plan’.
Reason (R) Principle of “unity of command”.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (c)

Question. Assertion (A) “There is a need to balance subordinate involvement through decentralisation with managers’ retention of final authority through authority and responsibility."
Reason (R) Fayol’s Principle- centralisation and decentralisation
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (d)

Question. Assertion (A) Manager requires authority commensurate with their responsibility.
Reason (R) There should be a balance between authority and responsibility.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (a)

Question. Assertion (A) “Workers should be encouraged to develop and carry out their plans for improvements, within the prescribed limits of authority.”
Reason (R) As per Fayol’s Principle-Initiative.
(a) Both A and R are true. R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is correct, but R is incorrect
(d) A is incorrect, but R is correct
Answer: (c)

Question. Assertion (A): A tenet of scientific management is cooperation and harmony between workers and managers.
Reason (R): Taylor believed in participative management.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (c) A is true but R is false

Question. Assertion (A): Functional foremanship technique divide the work of factory manager into two sub departments
Reason (R): Functional foremanship develop specialisation
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (a) A and R are true and R is the correct explanation of A

Question. Assertion (A): Standardisation means setting standards for one type of activity
Reason (R): To ensure quality standards
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (d) A is false but R is true

Question. Assertion (A): Time study refers to determining the standard time required to complete a particular activity.
Reason (R): Time study is done to get the estimated figure of labour costs
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (a) A and R are true and R is the correct explanation of A

Question. Assertion (A): the movie camera is used to conduct the motion study.
Reason (R): Motion study is to study the movements those are necessary for doing a well-defined job/work
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (b) A and R are true and R is not the correct explanation of A

Question. Assertion (A): Differential piece wage system is a technique which does not differentiate between efficient and less efficient workers.
Reason (R): Differential piece wage system acts as an incentive for less efficient workers to be motivated to perform better.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (d) A is false but R is true

Question. Assertion (A): The principle of Science, Not rule of thumb says that we should not get stuck in a set routine
Reason (R): The principle of science, not rule of thumb, makes the work much simpler, easier and quicker.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (a) A and R are true and R is the correct explanation of A

Question. Assertion (A): The principle of Harmony, Not Discord states that there should be complete harmony between the management and the workers.
Reason (R): There is no need for a mental revolution.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (c) A is true but R is false

Question. Assertion (A): The route clerk specifies the sequence of completing a particular work.
Reason (R): The route clerk specifies the stages through which the work shall have to pass before being finalised.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (b) A and R are true and R is not the correct explanation of A

Question. Assertion (A): According to the principle of cooperation, not individualism all the activities done by different people must be carried on with a spirit of mutual cooperation.
Reason (R): Workers and managers should separately determine the standards.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (c) A is true but R is false

Question. Assertion (A): The instruction card clerk only prepare the instruction card for the workers
Reason (R): The card prepares by the Instruction card clerk contain the information about the nature of work, procedure of doing work, material to be used and details about machinery
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (d) A is false but R is true

Question. Assertion (A): The method study identifies the most suitable way to do a particular activity.
Reason (R): To conduct method study process chart and operation research techniques are used.
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (a) A and R are true and R is the correct explanation of A

Question. Assertion (A): The development of each and every person to his or her greatest efficiency principle concerned with efficiency of employee which could be built in right from the process of employee selection
Reason (R): The work assigned to employees should suit their capabilities
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (a) A and R are true and R is the correct explanation of A

Question. Assertion (A): Simplification putting an end to the unnecessary types, qualities, sizes etc.
Reason (R): Simplification effects economy in the use of machine
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (a) A and R are true and R is the correct explanation of A

Question. Assertion (A): The discipline officer ensure presence of staff everyday
Reason (R): the discipline officer ensure that every work is being performed in a disciplined manner
(a) A and R are true and R is the correct explanation of A
(b) A and R are true and R is not the correct explanation of A
(c) A is true but R is false
(d) A is false but R is true
Answer: (d) A is false but R is true

CASE BASED QUESTIONS

After completing her Bachelors in Fashion Designing from a well-known college in France, Aditi has opened a boutique in a posh market in Kolkata. She has divided the work in smaller units and each employee is well trained to perform his/her task efficiently. The sales persons are allowed to close a deal with a buyer by giving a maximum of 5 percent discount, whereas the decision to give any further discount rests with Aditi as the final authority. In the earlier period of her business venture, employees were asked to put in extra hours of work. In return she had promised to give them a special incentive within a year. Therefore, when the business was doing well, she honoured her commitment by giving a bonus to her employees. She also instructed her employees that communication from top to bottom should follow the official lines of command. However, she tends to be more biased towards her female employees, when it comes to solving the conflicts among employees.

Question. Aditi has divided the work in smaller units and each employee is well trained to perform his/ her task efficiently. Which principle of management is being followed here?
(a) Centralization and Decentralization
(b) Discipline
(c) Division of work
(d) Order
Answer: (c) Division of work

Question. "The sales persons are allowed to close a deal with a buyer by giving a maximum of 5 percent discount, whereas the decision to give any further discount rests with Aditi as the final authority." Identify the principle of Management being followed here:
(a) Centralization and Decentralisation
(b) Authority and Responsibility
(c) Unity of Command
(d) Unity of Direction
Answer: (a) Centralization and Decentralisation

Question. “Therefore, when the business was doing well, she honoured her commitment by giving a bonus to her employees.” Which principle of management is being highlighted here?
(a) Discipline
(b) Order
(c) Remuneration to Employees
(d) Unity of Direction
Answer: (a) Discipline

Question. Aditi tends to be more biased towards her female employees, when it comes to solving the conflicts among employees. Which principle is being violated here?
(a) Discipline
(b) Order
(c) Equity
(d) None of these
Answer: (c) Equity

Satyam Ltd manufactures curtain clothes. Noticing its popularity in the market, the company decided to manufacture bed sheets also. The decision was executed with immediate effect. But the company did not increase the workforce to the desired extent. The company wanted the existing staff to manage the work for some time, by working overtime. The result was that on the one hand the new product of the company failed to keep its hold on the market and on the other hand due to overwork the efficiency of the employees declined. On several occasions it was discovered that a subordinate was getting instructions from two or more managers. Managers had started giving simple and easy work to their known employees and complex and difficult work to other employees. The company was now ignoring the rules completely.

Question. On several occasions it was discovered that a subordinate was getting instructions from two or more managers. Which principle is being violated here?
(a) Equity
(b) Unity of command
(c) Unity of Direction
(d) Order
Answer: (b) Unity of Command

Question. The company was now ignoring the rules completely. Which principle is being violated here?
(a) Equity
(b) Unity of command
(c) Unity of DIrection
(d) Discipline
Answer: (d) Discipline

Question. The company ignored one more Fayol’s principle in the above case study? Name them.
(a) Equity
(b) Unity of Command
(c) Esprit de corps
(d) Discipline
Answer: (a) Equity

Anuj Gupta and Mangala Sharma are both qualified dentists and good friends. After obtaining a certificate of practice, they decided to pursue a career of their own choice. Anuj Gupta starts a dental care centre in the city whereas Mangala Sharma joins a government hospital. They meet after a long time at a party. Anuj Gupta invites Mangala Sharma to visit his dental care centre and she accepts his invitation. She observes at his clinic that there is a fixed place for everything and everyone and tools and equipment are lying in an organised manner. Also, Anuj Gupta always tends to replace ‘I’ with ‘We’ while having a conversation with the staff members. Later on Anuj Gupta also shares with her that he always deals with lazy staff sternly to send the message that everyone is equal in his eyes.

Question. Mangala Sharma observes at his clinic that there is a fixed place for everything and everyone and tools and equipment are lying in an organised manner. Which principle of management is being overlooked?
(a) Equity
(b) Order
(c) Esprit de corps
(d) None of these
Answer: (b) Order

Question. Anuj Gupta also shares with her that he always deals with lazy staff sternly to send the message that everyone is equal in his eyes. Which principle of management is being overlooked?
(a) Equity
(b) Order
(c) Discipline
(d) Initiative
Answer: (a) Equity

Question. Anuj Gupta always tends to replace ‘I’ with ‘We’ while having a conversation with the staff members. Which principle of management is being overlooked?
(a) Equity
(b) Esprit de corps
(c) Discipline
(d) Initiative
Answer: (b) Esprit De Corps

One of the techniques of scientific management calls for using the best method of each activity in the organisation. The best method must be selected through application of scientific analysis and not by intuition or hit and trial methods, says one of the scientific managements. Moreover, one other principle of scientific management emphasizes that” to make the employees learn, the best method” of production, training of workers is essential. It further emphasizes that each person should be scientifically selected and the work assigned to the employees should suit their physical, mental and intellectual capabilities. If physical, mental and intellectual capabilities of employees are to be harnessed to the maximum, then they must be given adequate breaks and rest in between their work as well.

Question. Name the technique of scientific management highlighted in the given line of the extract, “one of the techniques…………. organisation.
(a) Method study
(b) Time study
(c) Fatigue study
(d) Motion study
Answer: (a) Method study

Question. Name the principle of scientific management highlighted in the given line of extract, this best method ………………scientific management.
(a) Science, not rule of thumb
(b) Harmony, not discord
(c) Cooperation not individualism
(d) None of the above
Answer: (a) Science, not rule of thumb

Question. Which principle of scientific management is highlighted in the given line of extract, “moreover, one other …………… intellectual capabilities.”?
(a) Science, not rule of thumb
(b) Harmony, not discord
(c) Cooperation not individualism
(d) Development of each and every personnel to their greatest efficiency and prosperity.
Answer: (d) Development of each and every personnel to their greatest efficiency and prosperity.

Question. Which techniques of scientific management are highlighted in the given line of extract, ‘if physical, mental…………as well’?
(a) Time study
(b) Method study
(c) Fatigue study
(d) Motion study.
Answer: (c) Fatigue study

Mona, a student of management at IIM, Ahmedabad, likes to relate what she has learnt in her classes during study to real life situations around her. She observed many situations while watching educational programmes on television that remind her of concepts of scientific management. In one such programme, factory manufacturing parts of products like automobiles, computers and mobile phones were being telecast. These factories had defined benchmarks during production and were continuously aiming at eliminating superfluous verities, sizes and dimensions and devising new verities instead of the existing ones, while watching the programme. Mona realised that these companies could adopt one best way of doing the job in order to be more productive. She also felt that the employees of these companies were working for long hours continuously and needed to adopt certain strategies in order to improve their efficiency. The programme also showed a few interviews where some workers were found to be highly efficient as compared with a few others.

Question. Name the technique of scientific management that these factories are adhering to while manufacturing parts of such products.
(a) Method study
(b) Motion study
(c) Standardisation and simplification of work
(d) Time study
Answer: (c) Standardisation and simplification of work

Question. Which scientific management technique would Mona suggest for these factories if they have to find out one best way of doing the job?
(a) Motion study
(b) Method study
(c) Time study
(d) Fatigue study
Answer: (b) Method study

Question. Which scientific management technique would Mona suggest for these factories if they have to help the workers regain their stamina and enable them to work again with the same capacity?
(a) Motion study
(b) Time study
(c) Fatigue study
(d) Method study
Answer: (c) Fatigue study

Question. Which scientific management technique would Mona suggest for these factories to implement in order to motivate the inefficient workers to perform better?
(a) Functional foremanship
(b) Method study
(c) Time study
(d) Differential piece wage system.
Answer: (d) Differential piece wage system.

Cool ice cream Ltd. Is a very famous company in Bombay and has many branches in different parts of the city. They also have major expansion plans as they expect that their customers will increase in number in the next two years. Cool Ice cream Ltd. Produces a variety of ice creams which are extremely popular in the city and one brand of ice cream’ Thunder’ sells the most. Thus, the company undertakes the maximum production for’ Thunder’ and it contributes to their revenue to the extent of 25% and has the largest market share. The company has undertaken different strategies to ensure that they remain the market leader in Bombay. One of the methods it follows is a differential piece wage system to differentiate between efficient and inefficient workers. It is so because the company believes that in this way inefficient workers would be encouraged to perform better and improve their productivity. This will motivate them to be at par with the efficient workers. Thus, Cool ice creams Ltd. Has determined the standard time and other parameters on the basis of the work study techniques of scientific management. It has been determined that the standard output per worker per day is 10 units and those who made standard or more than standard will get ₹ 50 per unit and those below will get ₹ 40 per unit.

Question. What will be the earning of a worker producing 15 units?
(a) ₹ 600
(b) ₹ 750
(c) ₹ 400
(d) ₹ 500
Answer: (b) ₹ 750

Question. Such a worker producing 15 units is termed as………...
(a) Efficient
(b) Inefficient
(c) Neither a nor b
(d) Both a and b
Answer: (a) Efficient

Question. What will be the earning of a worker producing 7 units?
(a) ₹ 350
(b) ₹ 400
(c) ₹ 280
(d) ₹ 500
Answer: (c) ₹ 280

Question. Such a worker producing 7 units is termed as………
(a) Efficient
(b) Inefficient
(c) Neither a nor b
(d) Both a and b
Answer: (b) Inefficient