1) _____ can be defined as a set of activities directed at an organization's resources, with

the aim of achieving organizational goals in an efficient and effective manner.

A) Economics
B) Job de-skilling
C) Management
D) Self-dealing
E) Divestment
C

2) Which of the following helps make the management process efficient?

A) Increasing overhead production costs
B) Using resources in a cost-effective manner
C) Making management decisions independently of the organization's external environment
D) Using the majority of resources for sales promotion activities
E) Using micromanagement techniques
B

00:02
01:36

3) A management process is considered to be effective when:

A) overhead production costs are increased.
B) the right decisions are made and implemented.
C) decisions are made independently of the organization's external environment.
D) the same amount of resources are allocated to all the functions of the organization.
E) the organization is highly centralized.
B

4) One of the titles found in the group of middle managers is _____.

A) director
B) vice president
C) supervisor
D) office manager
E) plant manager
E

5) Which of the following statements is true about top managers?

A) They are the largest group of managers in most organizations.
B) They officially represent their organization to the external environment.
C) They primarily oversee the day-to-day operations of an organization.
D) They supervise and coordinate the activities of first-line managers.
E) They supervise and coordinate the activities of operating employees.
B

6) Which of the following is the role of top managers in an organization?

A) Overseeing day-to-day operations
B) Performing routine administrative tasks
C) Implementing plans of first-line managers
D) Creating organizational goals and overall strategy
E) Coordinating the work of first-line managers
d

7) _____ make decisions about activities such as investing in research and development
(R&D) and entering or abandoning various markets.
A) Division heads
B) Limited partners
C) First-line managers
D) Middle managers
E) Top managers
e

8) A common middle-management title is:

A) chief executive officer.
B) division head.
C) supervisor.
D) office manager.
E) coordinator.
b

9) _____ are probably the largest group of managers in most organizations, and are
primarily responsible for implementing the policies and plans of an organization.
A) Middle managers
B) Top managers
C) The members of board of directors
D) First-line managers
E) Floor supervisors
a

10) First-line managers:

A) are primarily responsible for implementing the policies and plans developed by top
managers.
B) make decisions about activities such as acquiring other companies.
C) officially represent their organization to the external environment.
D) create organizational goals.
E) handle administrative duties.
e

11) Which of the following statements is true about first-line managers?

A) They are primarily responsible for implementing policies made by top managers.
B) They are typically involved in creating overall organizational strategies and goals.
C) They officially represent their organization to the external environment.
D) They typically spend a large proportion of their time supervising the work of their
subordinates.
E) They make decisions about activities such as acquiring other companies.
d

12) _____ involves selecting a course of action from a set of alternatives.

A) Divesting
B) Controlling
C) Leading
D) Decision making
E) Job deskilling
d

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01:36

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13) One of the titles found in the group of first-line managers is _____.
A) chief executive officer
B) coordinator
C) division head
D) general manager
E) plant superintendent
b

14) Determining how a company's activities and resources are to be grouped is called
_____.
A) leading
B) controlling
C) deskilling
D) planning
E) organizing
e

15) yler works with Alpha Pharmaceuticals Inc. He is primarily responsible for overseeing
production activities. Tyler is concerned with decisions such as the number of product units
that need to be manufactured, the overall functioning of the production plants, and the
quality of products. Tyler is most likely to be a(n)_____.
A) operations manager
B) marketing manager
C) human resource manager
D) sales manager
E) public relations manager
a

16) Typical responsibilities of operations managers include:

A) inventory control.
B) sales promotion.
C) accounting.
D) employee development.
E) benefit systems development.
a

17) In its simplest form, _____ means setting an organization's goals and deciding how best
to achieve them.
A) coordinating
B) deskilling
C) organizing
D) controlling
E) planning
e

18) Which of the following would be included in the management function of planning?
A) Selecting the course of action most likely to lead to success
B) Monitoring progress toward the achievement of goals
C) Motivating others to higher levels of achievement
D) Communicating company policies to subordinates
E) Organizing people and resources
a

19) _____ work in areas like new product development, promotion, and distribution.
A) Human resource managers
B) Marketing managers
C) Plant managers
D) Operations managers
E) Finance managers
b

20) _____ are typically involved in recruiting and selecting employees, training and
development, designing compensation and benefit systems, formulating performance
appraisal systems, and discharging low-performing and problem employees.
A) Operations managers
B) Human resource managers
C) Plant managers
D) Marketing managers
E) Finance managers
b

21) _____ work at getting consumers and clients to buy the organization's products or
services.
A) Operations managers
B) Marketing managers
C) Regional managers
D) Financial managers
E) Human resources managers
b

22) _____ are concerned with creating and managing the systems that create an
organization's products and services.
A) Marketing managers
B) Human resources managers
C) Financial managers
D) Operations managers
E) First-line managers
d

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23) _____ are not associated with any particular management specialty.
A) Office managers
B) Floor supervisors
C) Public relations managers
D) Operations managers
E) Administrative managers
e

24) _____ is the set of processes used to get members of an organization to work together
to further the interests of the organization.
A) Planning
B) Organizing
C) Controlling
D) Leading
E) Deskilling
d

25) The final phase of the management process is _____ that involves monitoring the
organization's progress toward its goals.
A) planning
B) organizing
C) leading
D) controlling
E) deskilling
d

26) The management function of leading involves:

A) setting an organization's goals.
B) motivating and influencing others.
C) grouping activities and resources.
D) interacting with the external business environment.
E) creating organizational strategies.
b
27) The management at Beta Corp. has introduced new employment policies. The mangers
are now tracking and monitoring the implementation of the new policies. Which of the
following management functions is illustrated in the scenario?
A) Deskilling
B) Controlling
C) Organizing
D) Leading
E) Planning
b

28) The skills necessary to accomplish or understand the specific kind of work done in an
organization are called _____ skills.
A) diagnostic
B) time management
C) conceptual
D) technical
E) spatial
d

29) ____ skills refer to the abilities of managers to think in the abstract, understand the
overall workings of the organization and its environment, to grasp how all the parts of the
organization fit together, and to view the organization in a holistic manner.
A) Time management
B) Technical
C) Conceptual
D) Interpersonal
E) Communication
c

30) Technical skills:

A) are crucial for top managers more than any other managers.
B) are nonspecific and broad.
C) depend on a manager's ability to think in the abstract.
D) are especially important for first-line managers.
E) are used the most when making organizational policies.
d

31) When a manager answers a subordinate's question regarding the process of creating a
report from raw data, he is relying on his _____ skills.
A) abstract
B) technical
C) time management
D) decision-making
E) spatial
b

32) The ability to motivate others is a(n) _____ skill.

A) conceptual
B) technical
C) communication
D) interpersonal
E) diagnostic
d

33) Winston is often intimidated and uncomfortable with his superiors. Winston needs to
develop his _____ skills to be able to communicate easily with his superiors.
A) time management
B) spatial
C) interpersonal
D) conceptual
E) diagnostic
c

34) Maria, a manager, studied the performances of the various business units of her
organization. After making an assessment, Maria came to the conclusion that the overall
costs of the organization can be reduced by integrating the functions of two of the business
units. This scenario illustrates Maria's _____ skills.
A) technical
B) time management
C) social
D) interpersonal
E) conceptual
e

35) _____ skills refer to the abilities of managers to visualize the most appropriate response
to a situation.
A) Social
B) Interpersonal
C) Technical
D) Diagnositc
E) Communication
d

36) _____ skills refer to a manager's abilities to both effectively convey ideas and
information to others and effectively receive ideas and information from others.
A) Technical
B) Abstract
C) Communication
D) Diagnostic
E) Conceptual
c

37) When a manager writes a mail to a supplier apologizing for a delay in payment, he is
most likely to be using his _____ skills.
A) conceptual
B) technical
C) communication
D) abstract
E) spatial
c

38) Sarah, a manager, has postponed the task of preparing a report as she has realized that
she needs to meet a supplier immediately. This scenario illustrates Sarah's _____ skills.
A) conceptual
B) spatial
C) time management
D) technical
E) abstract
c

39) Jordon, a manager, realizes that many employees are leaving the organization. He
identifies inconvenient work timings and some of the new employment policies as the
causes. Jordon decides to introduce better policies and flexible work timings to reduce
employee turnover. This scenario illustrates Jordon's _____ skills.
A) mechanical
B) technical
C) diagnostic
D) spatial
E) time management
c

40) _____ refer to a manager's ability to prioritize work, to work efficiently, and to delegate
work appropriately.
A) Diagnostic skills
B) Commanding skills
C) Decision-making skills
D) Time-management skills
E) Conceptual skills
d

41) A manager who uses the scientific approach to management when making decisions is
most likely rely on:
A) instincts.
B) stereotypes.
C) personal experience.
D) intuition.
E) Logic.
e

42) A _____ is a conceptual framework for organizing knowledge and providing a blueprint
for action.
A) classic
B) mnemonic
C) prediction
D) theory
E) doctrine
d

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43) When employees deliberately work at a slower pace than their capabilities, it is called
_____.
A) Soldiering
B) persevering
C) controlling
D) planning
E) deceiving
a

44) Scientific management focuses on:

A) improving the efficiency of individual workers.
B) increasing employee turnover.
C) analyzing the external rather than the internal environment of an organization.
D) encouraging soldiering among employees.
E) increasing overhead costs.
a

45) Lillian Gilbreth was one of the earliest advocates of:

A) the contingency theory.
B) scientific management.
C) administrative management.
D) theory X and Y.
E) the Hawthorne studies.
b

46) The first person to identify the managerial functions of planning, organizing, leading, and
controlling was:
A) Elton Mayo.
B) Lillian Gilbreth.
C) Henri Fayol.
D) Hugo Munsterberg.
E) Mary Parker Follett.
c

47) Which of the following focuses on the management of the entire firm as opposed to the
jobs of individual workers?
A) The Contingency theory
B) Scientific management
C) Administrative management
D) Theory X
E) The Hawthorne studies
c

48) Which of the following statements is true of administrative management?

A) It deals with the jobs of individual employees.
B) It was first introduced by Frank and Lillian Gilbreth.
C) It focuses solely on combating soldiering.
D) It encompasses the concepts of planning, organizing, and controlling.
E) It exclusively focuses on individual attitudes and behaviors and group processes.
d

49) The scientific management perspective:

A) assumed that workers liked their work.
B) focused on the overall management of an organization rather than individual employees.
C) emphasized the importance of supervising workers.
D) was based on the assumption that workers are internally motivated to achieve
organizational goals.
E) placed maximum emphasis on individual attitudes and behaviors.
c

50) Which of the following statements is true about the behavioral management perspective?
A) It was first introduced by Max Weber.
B) It viewed jobs and organizations from a mechanistic point of view.
C) It was influenced by the industrial psychology movement.
D) It essentially dealt with job specialization techniques.
E) It slighted the role of the individual in organizations.
c

51) The concept of _____, suggested by Weber, is based on a rational set of guidelines for
structuring organizations in the most efficient manner.
A) adhocracy
B) bureaucracy
C) technocracy
D) meritocracy
E) scientocracy
b

52) Early advocates of the classical management perspective viewed organizations and jobs
from an essentially _____ point of view.
A) Mechanistic
B) behavioral
C) humanistic
D) systematic
E) contingent
a

53) _____ is recognized as the father of industrial psychology.

A) Douglas McGregor
B) Elton Mayo
C) Abraham Maslow
D) Hugo Munsterberg
E) Henri Fayol
d

54) The management pioneer who performed the Hawthorne studies at Western Electric
was:
A) Lillian Gilbreth.
B) Elton Mayo.
C) Henry Gantt.
D) Frank Gilbreth.
E) Frederick Taylor.
b

55) in the Hawthorne Studies, workers who overproduced were branded as _____.
A) operators
B) squealers
C) rate busters
D) chiselers
E) producers
c

56) Which of the following was one of the findings of the Hawthorne studies?
A) Workers tend to underperform when they are given special attention or supervision.
B) Higher pay and incentives are more important to workers than social acceptance.
C) All the workers in a group work toward achieving productivity targets set by supervisors.
D) Both individual and social processes play a major role in shaping worker behavior.
E) Workers in all groups tend to encourage and support members who are over productive.
d

57) Which of the following is a Theory Y assumption?

A) Social processes do not influence the performance of workers.
B) People are not internally motivated to achieve their goals.
C) People do not naturally dislike work.
D) People like to be directed as they want security.
E) People perform better when they are threatened by the manager.
c

58) Which of the following assumptions is represented by Theory Y?

A) People prefer to be directed, to avoid responsibility, and to want security.
B) People are bright, but under most organizational conditions, their potential is
underutilized.
C) People do not like work and try to avoid it.
D) The productivity of workers is not affected by social processes at the workplace.
E) Managers need to be coercive to get work done from their workers.
b
59) A difference between Theory X and Theory Y is that:
A) Theory X makes positive assumptions.
B) Theory Y is consistent with the views of scientific management.
C) Theory Y assumes that people lack ambition.
D) Theory Y represents the assumptions made by human relations advocates.
E) Theory Y assumes that people naturally dislike work.
d

60) A Theory Y assumption is that:

A) incentives rather than social processes influence workers.
B) managers have to control, direct, coerce, and threaten employees to get them to work
toward organizational goals.
C) people prefer to be directed, to avoid responsibility, and to want security; they have little
ambition.
D) people are committed to goals to the degree that they receive personal rewards when
they reach their objectives.
E) people naturally dislike work and try to avoid it.
d

61) The _____ proposed that workers respond primarily to the social context of the
workplace, including social conditioning, group norms, and interpersonal dynamics.
A) classical management perspective
B) human relations movement
C) systems theory
D) management science perspective
E) organizational theory
b

62) Which of the following is a Theory X assumption?

A) People will both seek and accept responsibility.
B) Managers are harsh on their employees.
C) People have little ambition.
D) People are internally motivated.
E) People do not naturally dislike work.
c

63) Which of the following draws from psychology, sociology, anthropology, economics, and
medicine?
A) Organizational behavior
B) Scientific management
C) Administrative management
D) Systems perspective
E) Contingency perspective
a

64) When a manufacturing plant uses mathematical models to plan production and schedule
equipment maintenance, it is drawing upon:
A) scientific management.
B) administrative management.
C) management science.
D) behavioral perspective.
E) Theory X assumptions.
c

65) Which of the following represent the two branches of the quantitative management
theory?
A) Scientific management and administrative management
B) Human relations movement and organizational behavior
C) Contingency theory and systems theory
D) Theory X and Theory Y
E) Management science and operations management
e

66) The _____ perspective focuses on decision making, cost-effectiveness, mathematical

models, and the use of computers.
A) systems management
B) behavioral management
C) scientific management
D) administrative management
E) quantitative management
e

67) Which of the following statements is true about management science?

A) It is part of the classical management perspective.
B) It relies on bureaucratic techniques proposed by Max Weber.
C) It focuses on mathematical representations of reality.
D) It is concerned with improving the performance of individual workers.
E) It introduced the piecework pay system.
c

68) Which of the following statements is true about operations management?

A) It is more statistically sophisticated than management science.
B) It exclusively focuses on improving employee attitudes and behavior.
C) It can be applied more directly to managerial situations than management science.
D) It relies more on mathematical models than management science.
E) It cannot be applied to inventory control and production operations of an organization.
c

69) _____ is considered to be a form of applied management science.

A) Scientific management
B) Lean manufacturing
C) Behavioral management
D) Human relations movement
E) Operations management
e
70) In the context of the systems perspective, an output would be:
A) technological processes.
B) labor skills.
C) services.
D) raw materials.
E) human resources.
c

71) In the context of the systems perspective, an input would be:

A) human resources.
B) losses.
C) feedback loops.
D) products.
E) services.
a

72) Relatively new management concepts such as supply chain management and new
techniques such as enterprise resource planning have evolved from the _____ perspective.
A) quantitative management
B) systems
C) contingency
D) classical management
,E) behavioral management
a

73) In the systems perspective, outputs include _____.

A) raw materials
B) controls
C) funds
D) human resources
E) employee attitudes
e

74) Which of the following statements is true in the context of the systems perspective?
A) Entropy is a process that leads to system progress.
B) Products and services can be considered as system inputs.
C) A closed system is closely connected with and interacts with its environment.
D) The performance of one subsystem does not affect the performance of another
subsystem.
E) Organizations essentially should be open systems.
e

75) _____ is a normal process that leads to system decline.

A) Economy of scale
B) Synergy
C) Entropy
D) Contingency
E) Symbiosis
c

76) _____ suggests that organizational units (or subsystems) may often be more successful
working together than working alone.
A) Divestiture
B) Operations management
C) Synergy
D) Entropy
E) Soldiering
c

77) The _____ suggests that appropriate managerial behavior in a given situation depends
on unique elements in a that situation.
A) behavioral management perspective
B) quantitative management perspective
C) systems perspective
D) contingency perspective
E) universal perspective
d

78) Emilio says, "Employees and situations are unique. Sometimes I get good results by
trying one approach, sometimes I decide to do something completely different." Emilio's
statement is best aligned with which of the following management views?
A) The classical theory
B) Administrative management
C) The generalist perspective
D) Theory X
E) The contingency perspective
e

79) In the systems perspective, _____ emphasizes the importance of working together in a
cooperative and coordinated fashion.
A) synergy
B) entropy
C) contingency
D) diversity
E) uniformity
a

80) A primary objective of management, from a systems perspective, is to continually

reenergize the organization to avoid _____.
A) reciprocity
B) collaboration
C) diversity
D) entropy
E) synergy
d
81) The _____ perspective states that effective managerial behavior in one situation cannot
always be generalized to other situations.
A) behavioral
B) scientific management
C) contingency
D) administrative management
E) systems
c

82) Which of the following statements is true about the contingency perspective?
A) It states that the organizations which are not influenced by their external environments
tend to be more successful than others.
B) It states that effective managerial behavior in one situation cannot always be generalized
to other situations.
C) It states that all employees tend to perform better when they are promised higher
incentives.
D) It states that the behavior of employees at work is not influenced by social processes.
E) It is a part of the classical perspective of management.
b

83) Which of the following statements is true in the context of contemporary management
trends?
A) More and more organizations are using quality as a basis for competition.
B) The service sector of the economy has steadily declined.
C) Younger people entering the workforce over the past 20 to 30 years are more devoted to
work and more willing to adapt.
D) The emphasis on business ethics has declined.
E) The emphasis on management of diversity has declined.
a

84) Improving the quality of products and services tends to increase _____.
A) inertia
B) entropy
C) latency
D) productivity
E) divestment
d

85) The _____ perspective places emphasis on individual attitudes.

A) contingency
B) systems
C) quantitative management
D) administrative management
E) behavioral management
e

1. Which of the following is a part of an organization's external environment?

a.
Board of directors

b.
Physical work environment

c.
Inflation

d.
Organization's culture

e.
Employees
c

2. In Asia, consumers have historically had an aversion to debt. However, in recent years
credit card use has grown significantly, supported by aggressive marketing to promote
growth in the region. This example comprises the _____ dimension of an organization's
general environment.

a.
economic

b.
technological

c.
sociocultural

d.
political-legal

e.
task
a

3. A business manufactures top-of-the-line cabinets. The _____ dimension of its general

environment includes computer-assisted design software that helps to convert wood and
people's idea into lovely, functional cabinets.

a.
legal

b.
sociocultural

c.
technological

d.
political

e.
economic
c

4. Alex, one of the proprietors of Atlas Corp. is worried. The stock market was not doing well,
unemployment was 10 percent, inflation was on the rise again, and government debt was
still increasing. These concerns of Alex are related to the _____ dimension of the general
environment of Atlas Corp.

a.
legal

b.
sociocultural

c.
technological

d.
political

e.
economic
e

5. The set of broad dimensions and forces in an organization's surroundings that determines
its overall context is called the _____ environment.

a.
task

b.
general

c.
physical work

d.
regulatory

e.
ethical
b
6. Which of the following is a concern of the technological dimension of an organization's
general environment?

a.
Organization's policies and practices

b.
Inflation, interest rates, and unemployment

c.
Tools, methods, and technology

d.
Government regulations

e.
Offices, production facilities, and cafeteria
c

7. A company would begin to do business in another country only if the trade relationships
with that country are relatively well defined and stable. In the context of general environment,
which of the following does this point of view reflect?

a.
Task

b.
Economic

c.
Technological

d.
Political-legal

e.
Competitive
d

8. The _____ dimension of the general environment consists of government regulation of

business and the relationship between business and government.

a.
technological

b.
task
c.
political-legal

d.
competitive

e.
socio-economic
c

9. Competitors, customers, suppliers, strategic partners, and regulators make up the _____
environment of an organization.

a.
technological

b.
general

c.
economic

d.
political-legal

e.
task
e

10. Eastlawn Pharmacy is a local drugstore that has been serving the neighborhood for over
25 years. Recently, a national pharmacy chain opened one of its stores two blocks from
Eastlawn. Eastlawn is experiencing a change in its

a.
task environment.

b.
internal environment.

c.
physical work environment.

d.
government regulations.

e.
organizational culture.
a

11. Which of the following is an accurate difference between the task environment and the
general environment?

a.
The general environment is quite complex, whereas the task environment is very simple.

b.
The task environment provides useful information more readily than the general
environment.

c.
The task environment deals with more abstract dimensions than the general environment.

d.
The general environment's impact is short term, whereas that of the task environment is long
term.

e.
The general environment includes competitors and regulators, whereas that of the task
environment includes customers, suppliers, and strategic partners.
b

12. Laney's and MarketPlace are both grocery stores. They stock similar products, and
customers switch between the stores based on convenience, sale items, and other
promotions. Laney's and MarketPlace are

a.
strategic allies.

b.
competitors.

c.
associates.

d.
regulators.

e.
suppliers.
b

13. Nonstop is a free instant messaging and voice chat service that allows users to
communicate with each other, using a microphone and/or a webcam, over the Internet. Its
popularity is increasing and, as a result, the number of people using Chatterbox, another
instant texting service, has decreased. Nonstop is a _____ to Chatterbox.
a.
competitor

b.
supplier

c.
customer

d.
strategic partner

e.
regulator
a

14. Organizations that provide resources to other organizations are known as:

a.
suppliers.

b.
competitors.

c.
regulators.

d.
interest groups.

e.
importers.
a

15. For a private college, parents of students may be considered part of the _____
dimension of the task environment.

a.
supplier

b.
competitor

c.
regulator

d.
strategic partner

e.
customer
e

16. Two or more companies that work together in joint ventures or other partnerships are
called what?

a.
Strategic partners

b.
Competitors

c.
Customers

d.
Suppliers

e.
Regulators
a

17. _____ are elements of the task environment that have the potential to control, legislate,
or otherwise influence an organization's policies and practices.

a.
Board members

b.
Owners

c.
Strategic partners

d.
Employees

e.
Regulators
e

18. Ralph Corp. and Swan Inc. have entered into an arrangement in which Ralph sells
Swan's merchandise in its stores, and Swan promotes Ralph stores in its advertisements. In
this context, which of the following best describes the relationship between Ralph Corp. and
Swan Inc.?
a.
They are competitors.

b.
Ralph is Swan's supplier.

c.
Swan is Ralph's supplier.

d.
They are strategic partners.

e.
They are each customers of the other.
d

19. A diner received many warnings from the local Board of Health regarding the quality of
its food. The Board of Health objected to the trans-fats used for frying and the freshness of
bread and meat used at the diner. The Board is playing the role of a(n) _____ in the
restaurant's environment.

a.
competitor

b.
customer

c.
supplier

d.
regulator

e.
investor
d

20. Canyon LLC, a television manufacturing company, is about to launch its smart TV. The
television will come with a built-in web browser by a company called Wayfarer Inc. to access
Internet. Canyon is Wayfarer's _____.

a.
strategic partner

b.
business rival
c.
franchisee

d.
supplier

e.
owner
a

21. Which of the following would supply capital to a business?

a.
Employment agencies

b.
Regulators

c.
Banks

d.
Board of directors

e.
Employees
c

22. A group organized by its members to attempt to influence organizations is known as a(n)

a.
interest group.

b.
board of directors.

c.
strategic ally.

d.
competitor.

e.
ethics committee.

a
23. _____ are created by the government to protect the public from certain business
practices or to protect organizations from one another.

a.
Interest groups

b.
Boards of directors

c.
Strategic partner

d.
Economic councils

e.
Regulatory agencies
e

24. A person who purchases stock in a company becomes a(n) _____ of the company.

a.
member of the board of directors

b.
customer

c.
strategic partner

d.
owner

e.
regulator
d

25. In a business, which of the following people have legal property rights to that business?

a.
Employees

b.
Suppliers

c.
Customers
d.
Owners

e.
Regulators
d

26. A corporate _____ that is relatively passive performs a general oversight function without
getting actively involved in how the company is run.

a.
council of strategic partners

b.
board of directors

c.
regulators directorate

d.
whistle-blowing committee

e.
economic community

27. _____ are hired for short periods of time and provide greater flexibility, earn lower
wages, and often do not participate in benefits programs.

a.
Temporary workers

b.
Regulatory agencies

c.
Interest groups

d.
Strategic allies

e.
Suppliers
a

28. Which of the following is an element of an organization's internal environment?

a.
Government regulations

b.
Competitors

c.
Facilities

d.
Strategic allies

e.
Technology suppliers
c

29. Which of the following accurately describes the responsibility of a corporate board of
directors?

a.
Exerting considerable influence by using the media to call attention to their positions

b.
Helping the company get the expertise they lack from other companies

c.
Ensuring the firm is run to best serve the stockholders' interests

d.
Gaining legal property rights to the business by buying stock

e.
Protecting the public from certain business practices or to protect organizations from one
another
c

30. The term _____ refers to an individual's personal beliefs about whether a behavior,
action, or decision is right or wrong.

a.
justice

b.
culture

c.
ethics
d.
aesthetics

e.
regulations
c

31. Which of the following is true of ethics or ethical behavior?

a.
Ethics is the same for all individuals.

b.
Organizations define ethics in the context of the individual.

c.
Organizations themselves have ethics.

d.
Ethical behavior is controlled and directed according to rules made by federal agencies.

e.
Ethical behavior is behavior that conforms to generally accepted social norms.
e

32. The management of a company prevents its employees from meeting in groups of three
or more. Which of the following would best describe these restrictions imposed by the
management?

a.
Legal

b.
Unethical

c.
Illegal

d.
Ethical

e.
Racist
b

33. A(n) _____ occurs when an employee's decision potentially benefits the individual to the
possible detriment of the organization.
a.
loss of confidence

b.
security breach

c.
conflict of interest

d.
violation of organizational culture

e.
act of incitement
c

34. Which of the following terms represents a formal, written statement of the values and
ethical standards that guide a firm's action?

a.
Codes of ethics

b.
Business plan

c.
Standard operating procedures

d.
Strategic plan

e.
Licensing agreement
a

35. Myrtle Wines, a chain of wine retailers, has prepared guidelines that clearly specify how
employees should interact with suppliers, customers, competitors, and other people
associated with their business. These guidelines are documented and distributed at all
Myrtle outlets. The guidelines prepared by Myrtle forms its

a.
business plan.

b.
code of ethics.

c.
strategic plan.
d.
fair trade standards.

e.
licensing agreement.
b

36. Ethical issues in corporate governance are primarily the responsibility of

a.
interest groups.

b.
employees.

c.
strategic partners.

d.
the board of directors.

e.
federal regulatory agencies.
d

37. _____ is a law that requires CEOs and CFOs to vouch personally for the truthfulness
and fairness of their firms' financial disclosures and imposes tough new measures to deter
and punish corporate and accounting fraud and corruption.

a.
Sarbanes-Oxley Act of 2002

b.
Glass-Steagall Act of 1933

c.
Gramm-Leach-Bliley Act of 1999

d.
Commodity Futures Modernization Act of 2000

e.
Investment Company Act of 1940
a
38. When organizations relate to their environments in ways that involve ethical dilemmas
and decisions, these situations are said to fall within the context of the organization's _____
responsibility.

a.
legal

b.
ethical

c.
social

d.
cultural

e.
financial
c

39. Some people who argue in favor of social responsibility for businesses claim that

a.
the purpose of business in U.S. society is to generate profit for owners.

b.
involvement in social programs gives businesses too much power.

c.
businesses do not create problems and should not therefore help solve them.

d.
businesses often have the resources necessary to solve problems.

e.
there is potential for conflicts of interest among businesses.
d

40. Which of the following is an accurate argument against social responsibility for
organizations?

a.
Business is not a partner in our society, unlike the government and the general population.

b.
Corporations are citizens in our society.

c.
Profit generation, for the owners, is the purpose of business in U.S. society.

d.
Business does not create problems and should therefore not try to solve them.

e.
Business lacks the resources needed to solve social programs.
c

41. _____ is the extent to which the organization conforms to local, state, federal, and
international laws.

a.
Technological compliance

b.
Philanthropic giving

c.
Ethical compliance

d.
Legal compliance

e.
Risk management
d

42. Which of the following actions represents an attempt to manage social responsibility
through ethical compliance?

a.
Requiring top financial managers to ensure compliance with securities and banking
regulations

b.
Donating money to fund the performing arts

c.
Creating a committee to review policies concerning selection of new hires and promotion of
employees

d.
Consulting the legal department regarding the requirements of a particular law

e.
Making human resource managers responsible for complying with the Equal Employment
Opportunity Commission (EEOC) standards
c

43. Which of the following about the ethical compliance of an organization is true?

a.
It is a formal dimension of managing social responsibility.

b.
It cannot be enhanced by providing training.

c.
It includes awarding of funds or gifts to charities or other worthy causes.

d.
It is used to circumvent their legal obligations.

e.
It cannot be imposed by developing guidelines and codes of conduct.
a

44. Development of guidelines and codes of conduct is one of the most common ways
through which an organization ensures

a.
risk management.

b.
technological specification.

c.
philanthropic giving.

d.
ethical compliance.

e.
export restraint agreements.
d

45. Which of the following is an informal organizational dimension of managing social

responsibility?

a.
Licensing

b.
Philanthropic giving
c.
Legal compliance

d.
Ethical compliance

e.
Organizational culture
e

46. Soft Bites, a factory that makes breads, has asked all its retailers to return the loaves
that have not been sold till the last date of expiry. It then donates all these loaves to shelters
for the poor and the homeless. This act of Soft Bites can be termed as

a.
corporate gifting.

b.
legal compliance.

c.
ethical compliance.

d.
philanthropic giving.

e.
apprentice sponsoring.
d

47. _____ is an employee's disclosure of illegal or unethical conduct by others within the
organization.

a.
Lobbying

b.
Influence peddling

c.
Whistleblowing

d.
Source criticizing

e.
Reconnaissance
c
48. Which of the following is an advantage of licensing as an approach to
internationalization?

a.
Lack of competition

b.
Extended profitability

c.
Lesser uncertainty

d.
Flexibility

e.
Shared ownership
b

49. A(n) _____ strategy requires small cash outlay, is heavily regulated by government, and
does not require modification to products for local conditions.

a.
importing

b.
licensing

c.
joint venture

d.
direct investment

e.
offshoring
a

50. Atlantia is a German company that manufactures dishwashers in Germany. Its products
are sold in the United States. Which of the following statements is most accurate?

a.
Atlantia is exporting its products to the United States.

b.
Atlantia has a license agreement with the United States.
c.
Atlantia is importing its products from the United States.

d.
Atlantia wholly owns subsidiaries of the firm in the United States.

e.
Atlantia is outsourcing to the United States.
a

51. A potential disadvantage of licensing agreements is

a.
decreased profits.

b.
limited profitability.

c.
inflexibility.

d.
home production costs.

e.
excessive transportation costs.
c

52. Which of the following is true of a quota in trade?

a.
It is used most commonly to restrict trade.

b.
It is used to encourage strategic alliance.

c.
It is used to increase domestic competition.

d.
It is the tax breaks given by the host government.

e.
It is a form of tax collected on imported goods.
a

53. An advantage of importing and exporting is

a.
shared ownership.

b.
the lack of government restrictions.

c.
low transportation costs.

d.
the lack of tariffs and taxes.

e.
small cash outlay.

54. Making a product in the firm's domestic marketplace and selling it in another country is
known as

a.
direct investment.

b.
exporting.

c.
joint venture.

d.
competing.

e.
franchising.
b

55. Once a licensing agreement is agreed to, the licensee pays a(n) _____ in return.

a.
interest

b.
royalty

c.
remuneration

d.
tariff

e.
reward
b

56. Which of the following is an advantage of direct investment?

a.
New infrastructure

b.
Simplicity

c.
Enhanced control

d.
Greater political support

e.
Greater certainty
c

57. Which of the following approaches to internationalization of business has the

disadvantage of shared ownership?

a.
Importing

b.
Licensing

c.
Exporting

d.
Joint ventures

e.
Direct investment
d

58. What are maquiladoras?

a.
Strategic alliances between U.S. and Mexican companies
b.
Licensing agreements made between U.S. and Mexican companies

c.
Light assembly plants built in northern Mexico close to the U.S. border

d.
Convenience stores in northern Mexico to serve the workers in the area

e.
Light assembly plants in the U.S. near the Mexican border where day workers come for daily
work
c

59. Basco Electric Inc., is an American company. It built two factories in Mexico, which are
wholly owned subsidies of Basco. Basco chose to build in Mexico to get special concessions
from the Mexican government for providing employment to the local population. The
factories are an example of

a.
licensing agreements.

b.
franchises.

c.
leases.

d.
mergers.

e.
direct investments.
e

60. Sam's Big Bites, an American chain of burger stands, operates on all military bases in
the United States. The agreement between Sam's Big Bites and the Department of Defense
is a(n)

a.
maquiladora.

b.
licensing agreement.

c.
exporting agreement.
d.
importing agreement.

e.
strategic alliance.
e

61. In a(n) _____, two or more firms jointly cooperate for mutual gain.

a.
direct investment

b.
technology transfer

c.
strategic alliance

d.
interest group

e.
economic community
c

62. Greater economic and political risks are among the disadvantages associated with

a.
importing.

b.
exporting.

c.
licensing.

d.
direct investment.

e.
joint ventures.
d

63. The _____ environment of an organization includes all the values, symbols, beliefs, and
language that guide behavior.

a.
task
b.
general

c.
physical work

d.
regulatory

e.
cultural
e

64. Which of the following statements about cultural environment is true?

a.
An employee's cultural environment is personal, therefore, does not affect his profession.

b.
In international business, cultural factors always cause problems for managers.

c.
Cultural differences between countries can have a direct impact on business practice.

d.
Difficulties can arise when there is complete overlap between a manager's home culture and
the culture of the country in which business is to be conducted.

e.
Subtle cultural differences between countries do not have a major impact on business
activities.
c

65. The French government charges a 25 percent tax on all American fruits and vegetables
that are sold in France. This tax collected by French authorities is a(n)

a.
direct investment.

b.
license.

c.
export tariff.

d.
import tariff.
e.
strategic alliance.
d

66. Accords reached by governments in which countries voluntarily limit the volume or value
of goods they export to or import from one another are known as _____ agreements.

a.
service-level

b.
licensing

c.
export restraint

d.
strategic alliance

e.
operational-level
c

67. Almonds United Inc., a company that produces almonds, is based in California, United
States. Almonds United ensures that most of its produce is sold in the local market and not
more than 20 percent is sold in the Indian markets each year. This is in accordance with the
U.S. government's voluntary limit on trade with India. Almonds United is following the _____
exercised by the U.S. government.

a.
franchising agreement

b.
direct investment

c.
strategic alliance

d.
licensing agreement

e.
export restraint agreement
e
68. The government of Westeria has made it mandatory that all local publishers must use
paper made in Westeria itself. This restriction imposed by Westeria on its publishers is a
form of

a.
"ban maquiladoras" policy.

b.
import tariff.

c.
export restraint agreement.

d.
"go global" strategy.

e.
"buy national" legislation.
e

69. Which of the following statements about organizational culture is true?

a.
Organizational culture shapes the behavior of employees, and thus impacts organizational
effectiveness.

b.
Organizational culture of an overseas franchisee is always the same as the culture of the
nation in which the organization's headquarters are located.

c.
Organizational culture will necessarily be the same throughout an organization's subunits.

d.
Organizational culture refers to the cultural and artistic charities that an organization
supports.

e.
Organizational culture is frequently and easily changed by most organizations.
a

70. An American company is in a joint venture with an overseas Middle East company. The
U.S. managers are particular about time management and appointments for conference calls
and meetings. However, their overseas Middle Eastern counterparts are not conditioned the
same way and don't necessarily adhere to schedules. This variation in time management is
an aspect of their _____ environment.

a.
legal

b.
cultural

c.
technological

d.
political

e.
economic
b

71. A(n) _____ is a limit on the number or value of goods that can be traded.

a.
royalty

b.
tariff

c.
quota

d.
threshold

e.
allowance
c

72. A(n) _____ is a tax collected on goods shipped across national boundaries.

a.
quota

b.
tariff

c.
allowance

d.
remuneration

e.
commission
b

73. In international trade, the _____ amount is typically designed to ensure that domestic
competitors will be able to maintain a certain market share.

a.
benefaction

b.
royalty

c.
tariff

d.
quota

e.
minimum hourly wage
d

74. _____ are, in effect, export quotas.

a.
Export restraint agreements

b.
Export licensing agreements

c.
Service-level agreements

d.
Export tariffs

e.
Strategic alliance agreements

75. _____ gives preference to domestic producers through content or price restrictions.

a.
"Buy national" legislation

b.
"Go local" strategy
c.
Federal acquisition regulation

d.
Trade agreements legislation

e.
"Ban maquiladoras" policy
a

76. Which of the following statements about the European Union is true?

a.
It dictates the internal organizational culture.

b.
It is a union of observer countries that monitor the open markets to ensure that WTO rules
are followed.

c.
It is the strategic alliance between a European company and an American company.

d.
It a form of labor union across Europe.

e.
It is an economic community.
e

77. Which of the following is an agreement among the United States, Canada, and Mexico to
promote trade with one another?

a.
North American Free Trade Agreement

b.
North Atlantic Treaty Organization

c.
General Agreement on Tariffs and Trade

d.
Transatlantic Free Trade Agreement

e.
World Trade Organization
a

78. An international _____ is a set of countries that agree to markedly reduce or eliminate
trade barriers among member nations.

a.
commonwealth

b.
trade bloc

c.
economic community

d.
customs union

e.
free trade area
c

79. Which of the following is a determinate of an organization's culture?

a.
The extended benefits provided by an organization

b.
Corporate success and shared experiences

c.
The regulations for work performance set by an organization

d.
The strategic partners of an organization

e.
The products and services available for the functioning of an organization
b

80. Unicorn designs Inc., a software company, requires its employees to wear a specific
color every day of the week. The colors for the weekdays are presently orange, red, green,
yellow, and blue, respectively. The colors are changed from time to time and the employees
are informed about it. The colors should be visible and could be on anything, like scarves,
bags, ties, or socks. According to the management, the color coding system makes the
company a vibrant and fun place to work. This decision of the management affects the

a.
company's economic dimension.
b.
task environment.

c.
technological dimension.

d.
organizational culture.

e.
political-legal atmosphere.
d

81. The _____ is a trade agreement intended to promote international trade by reducing
trade barriers and making it easier for all nations to compete in international markets.

a.
Agreement on the Application of Sanitary and Phytosanitary Measures (SPS)

b.
Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS)

c.
North American Free Trade Agreement (NAFTA)

d.
General Agreement on Tariffs and Trade (GATT)

e.
Agreement on Technical Barriers to Trade (TBT)
d

82. The _____ replaced the General Agreement on Tariffs and Trade (GATT) and absorbed
its mission in 1995.

a.
European Union (EU)

b.
International Trade Centre (ITC)

c.
World Trade Organization (WTO)

d.
United Nations Conference on Trade and Development (UNCTAD)
e.
Global System of Trade Preferences among Developing Countries (GSTP)
c

83. Where does an organization's culture originate?

a.
Societal norms and expectations

b.
Pressure applied through mergers

c.
With the organization's founder

d.
Resolution of disputes between rival factions

e.
Government regulation of the specific industry
c

84. Which of the following is true of the World Trade Organization (WTO)?

a.
The WTO establishes impartial procedures for resolving trade disputes among its members.

b.
The WTO requires members to limit their markets in international trade.

c.
The WTO replaced the GATT and dismissed its mission.

d.
The WTO focuses too narrowly on human rights and the environment.

e.
The WTO promotes trade flows by encouraging nations to adopt preferential and flexible
trade policies.
a

85. Which of the following is true of organizational culture?

a.
Managers are advised to maintain an organization's culture even if it has become
dysfunctional.

b.
Corporate success and shared experiences have limited effect on organizational culture.

c.
Organizational culture is always consistent throughout each of the divisions of an
organization.

d.
An organization's culture is not necessarily affected by the growth of rival factions within the
organization.

e.
Organizational culture can be maintained by rewarding people whose behaviors are
consistent with the existing culture.

1) An organization's _____ is a statement of its fundamental, unique purpose that sets a

business apart from other firms of its type and identifies the scope of the business's
operations in product and market terms.
A) mission
B) statement of qualification
C) article of incorporation
D) operational goal
E) tactical plan
a

2) Nutrimax Inc. identifies its purpose as "to produce the finest cookies in the world while
upholding our principles of promoting good health and maintaining environmental
sustainability." This purpose is most likely to be the _____ of Nutrimax.
A) strategic goal
B) distinctive competence
C) mission statement
D) operational goal
E) tactical goal
c

1) Which of the following statements is true about strategic goals?

A) They are set by an organization's middle managers.
B) They are set by first-line managers.
C) They provide plans for the day-to-day operations of an organization.
D) They focus on broad and general issues.
E) Their focus is on short-term issues
d

1) Strategic goals are set by:

A) first-line managers.
B) middle managers.
C) top managers.
D) stockholders.
E) consumers.
c

1) Goals set for and by line-managers are called _____ goals.

A) strategic
B) tactical
C) developmental
D) organizational
E) operational
e

1) Samantha is responsible for building the day-to-day work schedules for her subordinates.
She assigns specific tasks to her subordinates and designs activities according to the
objectives that she receives from her seniors. Samantha works on _____ plans.
A) Operational
B) organizational
C) strategic
D) divestiture
E) tactical
a

1) Which of the following statements is true about tactical goals?

A) Their focus is on how to operationalize actions necessary to achieve strategic goals.
B) Their focus is on broad and long-term issues such as increasing the profitability of the
organization over a period of time.
C) They are set for and by top managers.
D) They are set for and by the board of directors.
E) They are broad and nonspecific.
a

1) The top managers at Redd Inc. are developing a plan to reduce the production costs of
the company. By reducing costs, Redd wants to gain a competitive advantage of cost
leadership. The plan being developed in this scenario is a(n) _____ plan.
A) strategic
B) tactical
C) operational
D) contingency
E) recovery
a

1) A(n) ____ goal for a waste management plant could be "to develop a recycling campaign
for rural communities of less than 1000 customers." It would develop naturally out of a
strategic goal "to increase recycling by 10% everywhere."
A) strategic B) departmental
C) functional
D) divestiture
E) tactical
e

1) The top managers of Dietizza, a large low-fat pizza chain, plan to increase the profitability
of all its outlets by 15 percent in a period of two years. This is a(n) _____ goal.
A) tactical
B) operational
C) nonspecific
D) divestiture
E) strategic
e

1) A(n) _____ plan is a general plan outlining decisions about resource allocation, priorities,
and action steps necessary to reach the goals set by the top managers.
A) recovery
B) contingency
C) operational
D) tactical
E) strategic
e

1) _____ plans generally have an extended time horizon, and address questions of scope,
resource deployment, competitive advantage, and synergy.
A) Operational
B) Contingency
C) Recovery
D) Tactical
E) Strategic
e

1) Venus Corp. is a large corporation with many strategic business units. The top managers
and board of directors are reviewing the performance of the business units to estimate the
amount of resources that each unit will require in the next few years. The plan created for
allocation of resources among the business units of Venus would be a(n) _____ plan.
A) strategic
B) tactical
C) operational
D) contingency
E) recovery
c

1) A difference between tactical and strategic plans is that:

A) tactical plans have a more concrete focus.
B) tactical plans are set for and by the board of directors.
C) tactical plans have broader time horizons.
D) strategic plans are developed by first-line managers.
E) strategic plans deal with the day-to-day operations of an organization.
a
1) _____ plans have a short-term focus and are relatively narrow in scope.
A) Corporate
B) Tactical
C) Operational
D) Contingency
E) Strategic
c

1) Tactical goals are set by:

A) first-line managers.
B) middle managers.
C) assembly-line managers.
D) stockholders.
E) investors.
b

1) Operational goals are set by:

A) first-line managers.
B) top-level managers.
C) the board of directors.
D) shareholders.
E) investors.
a

1) The _____ is the component of a strategy that specifies the range of markets in which an
organization will compete.
A) divestiture
B) competency
C) scope
D) resource deployment
E) deskilling
c

1) Gadgetbug Inc. is known for its extremely efficient after-purchase service. None of
Gadgetbug's competitors provide the same kind of customer service. Gadgetbug's _____ is
described in the scenario.
A) scope
B) divestiture strategy
C) strategic limitation
D) process loss
E) distinctive competence
e

1) _____ is a way of approaching business opportunities and challenges.

A) Supply-chain management
B) Value migration
C) Self-dealing
D) Strategic management
E) Greenwashing
d

1) Zing Inc. is a large fashion brand that manufactures clothing and shoes. The top
managers of Zing have decided to use the profits from its clothing outlets to invest in the
shoes business. This scenario illustrates the _____ component of a strategy.
A) resource deployment
B) scope
C) distinctive competence
D) process loss
E) divestiture
a

1) A(n) _____ is a comprehensive plan for accomplishing an organization's goals.

A) scope
B) competence
C) strategy
D) article of incorporation
E) statement of qualification
c

1) _____ is the set of strategic alternatives that helps an organization focus its competitive
efforts for each industry or market in a targeted and focused manner.
A) Anti-competitive strategy
B) Divestiture strategy
C) Corporate-level strategy
D) Business-level strategy
E) Operational-level strategy
d

1) Alba Motorbikes is known for its heavyweight motorcycles. The company places emphasis
on the quality of the bikes and after-sale service. The brand also enjoys customer loyalty.
This scenario described Alba Motorbikes':
A) distinctive competence.
B) scope.
C) process gain.
D) competitive disadvantage.
E) related diversification.
a

1) The choices a firm makes as to where and how much to invest reflect issues of _____.
A) value migration
B) distinctive competencies
C) resource deployment
D) deskilling
E) industrial symbiosis
c
1) Which of the following questions that companies consider is most closely related to the
resource deployment component of a strategy?
A) How much money should we invest in our business units overseas?
B) What are the markets in which we can compete?
C) What are the preferences of our customers?
D) Who are our competitors?
E) How can we make our products more unique in a way that they stand out?
a

1) _____ strategy is the set of strategic alternatives from which an organization chooses as it
manages its operations simultaneously across several industries and several markets.
A) Corporate-level
B) Business-level
C) Operational-level
D) Divestiture
E) Anti-competitive
a

1) _____ strategy is the set of strategic alternatives from which an organization chooses as it
operates in a particular industry or market.
A) Business-level
B) Corporate-level
C) Operational-level
D) Divestiture
E) Anti-competitive
a

1) The set of processes for determining the strategies that will be used by an organization is
known as:
A) strategy implementation.
B) environmental scanning.
C) strategy formulation.
D) divesting.
E) deskilling.
c

1) _____ refers to the methods by which strategies are operationalized or executed within
the organization; it focuses on the processes through which strategies are achieved.
A) Strategy implementation
B) Strategy mapping
C) Strategy formulation
D) Strategy visualization
E) Strategy conceptualization
a

1) The starting point in formulating strategies is usually:

A) SWOT analysis.
B) resource deployment.
C) divesting.
D) deskilling.
E) contingency analysis.
a

1) In the context of SWOT analysis, which of the following would be considered as an

organization's strength?
A) Exiting competitors
B) High overhead costs
C) Favorable government policies
D) Motivated employees
E) High employee turnover rate
c

e turnover rate
1) Which of the following will be considered as an organizational strength in the context of
SWOT analysis?
A) Organizational opportunities
B) New competitors
C) Surplus capital
D) High overhead costs
E) New government policies
c

1) _____ include things like a deep pool of managerial talent, surplus capital, a unique
reputation and/or brand name.
A) Market opportunities
B) Organizational opportunities
C) Market strengths
D) Environmental strengths
E) Organizational strengths
e

1) Which of the following is an organizational strength?

A) High employee turnover
B) High production costs
C) Well-established distribution channels
D) High purchasing power of customers
E) New competitors
c

1) A(n) _____ is an internal skill or capability that does not enable a company to choose and
implement strategies that support its mission.
A) organizational weakness
B) organizational threat
C) market threat
D) process gain
E) economic downswing
a

1) A(n) _____ is an area in an organization's environment that, if exploited, may generate

higher performance.
A) organizational opportunity
B) economic downswing
C) organizational strength
D) process gain
E) process loss
a

1) Hydraliscious is a juice brand that sells a wide range of fruit juices that only uses organic
ingredients, which is its uniqueness when compared with other brands. Even though
Hydraliscious juices are highly priced, a lot of customers buy them because of the quality of
the juices. Hydraliscious is most likely to be using a(n)_____ strategy.
A) Differentiation
B) cost-leadership
C) divesting
D) bundle pricing
E) anti-competitive
a

1) An organization that pursues a(n) _____ strategy seeks to stand out among competitors
through the quality (broadly defined) of its products or services.
A) differentiation
B) divesting
C) anti-competitive
D) focus
E) cost-leadership
a

1) Which of the following statements is true about the differentiation strategy?

A) It enables a firm to sell products at lower prices and still make profits. B) It enables a firm
to charge more for its products.
C) It is aimed at reducing production costs by using inexpensive raw materials.
D) It involves making simple, low-priced products for the mass market.
E) It cannot be used by companies that only offer services.
a

1) Which of the following is most closely associated with an overall cost leadership strategy?
A) Manufacturing highly-customized products
B) Manufacturing products in bulk
C) Providing highly efficient customer service that is better than any other competitor
D) Selling products at high prices
E) Using expensive raw materials
b
1) Alpha Inc. is a large shoe manufacturer that caters to a large customer base. In addition
to the high volume of shoes it manufactures, the company sells simple-designed sneakers
for low prices. Many customers buy Alpha shoes because they are durable and inexpensive.
Which of the following strategies is illustrated in the scenario?
A) Overall cost leadership strategy
B) Market diversification strategy
C) Differentiation strategy
D) Divesting strategy
E) Market development strategy
a

1) Which of the following will help a company achieve an overall cost leadership?
A) Manufacturing customized products in small quantities
B) Increasing after-purchase services
C) Using simple inexpensive product packaging
D) Selling products at very high prices
E) Increasing overhead costs
a

1) A firm pursuing a(n) _____ strategy concentrates on a specific regional market, product
line, or group of buyers.
A) overall cost leadership
B) divesting
C) restraint of trade
D) anti-competitive
E) focus
e

1) Supertech Inc. is a large firm that manufactures gadgets and mobile phones. The
company sells a line of inexpensive mobile phones exclusively targeted at youth and
teenagers in Selenasia. Which of the following strategies is illustrated in the scenario?
A) Differentiation strategy
B) Focus strategy
C) Restraint of trade strategy
D) Anti-competitive strategy
E) Divesting strategy
b

1) During the introduction phase of the product life cycle _____.

A) companies must sacrifice product quality
B) most companies tend to downsize
C) demand may be very high
D) competition is at its peak
E) sales volume is the highest
c

1) During the growth stage of the product life cycle,:

A) most companies downsize.
B) the demand is the lowest.
C) competitors start exiting the industry.
D) more firms begin producing the product.
E) sales rapidly decline.
d

1) During the maturity stage of the product life cycle,:

A) most companies start hiring more employees.
B) managers need to focus their efforts on "getting product the out the door" without
sacrificing quality.
C) the sales volume is the highest.
D) more competitors enter the industry.
E) the overall demand growth for a product begins to slow down.
c

1) In the maturity stage of the product life cycle,:

A) the demand is extremely high.
B) product sales rapidly increase.
C) compeition is at its peak.
D) managers need to focus their efforts on "getting the product out the door" without
sacrificing quality.
E) the number of new firms producing the product begins to decline.
b

1) During the decline stage of the product life cycle:

A) demand peaks.
B) new competitors enter the industry.
C) sales drop.
D) managers need to focus their efforts on "getting the product out the door" without
sacrificing quality.
E) managers must increase production costs.
c

1) Which of the following strategies can help companies survive during the decline stage of
the product life cycle?
A) Increasing production costs
B) Manufacturing the products frequently and in smaller quantities
C) Avoiding differentiation strategies
D) Developing new products or services
E) Focusing on strategies to slow the entry of competitors
d

1) Which of the following strategies can help companies during the maturity stage of a
product life cycle?
A) Manufacturing products in small quantities intermittently than in bulk
B) Drastically increasing product prices
C) Focusing on keeping costs low
D) Sacrificing the quality of products
E) Focusing more on strategies to slow the entry of competitors
c

1) Strategies to slow the entry of competitors are important if an organization is entering an

industry during the _____ stage of the product life cycle.
A) growth
B) introduction
C) decline
D) maturity
E) recovery
d

1) Which of the following strategies will help companies succeed during the growth stage of
a product cycle?
A) Increasing overhead costs
B) Focusing on developing new products or services
C) Sacrificing product quality
D) Focusing on creating product differentiation
E) Increasing product prices significantly
d

1) During the growth stage of a product life cycle, companies should focus on:
A) creating product differentiation.
B) increasing overhead costs.
C) sacrificing product quality.
D) using anti-competitive strategies.
E) divesting.
a

1) During the maturity stage of a product life cycle:

A) demand is maximum.
B) companies must sacrifice product quality.
C) sales are the highest.
D) demand comes to a halt.
E) product differentiation concerns are still important.
e

1) _____ describes the number of different businesses that an organization is engaged in

and the extent to which these businesses are related to one another.
A) Entropy
B) Diversification
C) Divestiture
D) Competency
E) Economy of scale
b

1) An organization that pursues a single-product strategy:

A) clusters relayed products in a single strategic business unit.
B) manufactures a range of products that are related to each other in some way.
C) uses a single marketing strategy for all its products.
D) operates in a single geographic market.
E) creates a separate business unit for each product it sells.
d

1) Virtually all larger businesses in the United States use a(n) _____ strategy.
A) related-diversification
B) single-product
C) divestiture
D) unrelated diversification
E) single-service
a

1) Aries Inc. manufactures dairy products and detergents.This is an example of _____

diversification.
A) horizontal
B) unrelated
C) single-product
D) concentric
E) related
b

1) ____ techniques are methods that diversified organizations use to determine in which
businesses to engage and how to manage these businesses to maximize corporate
performance.
A) Divestiture
B) Portfolio management
C) Process gain
D) Deskilling
E) Entropy
b

1) In a Boston Consulting Group (BCG) matrix, _____ are businesses that have only a small
share of a quickly growing market.
A) stars
B) question marks
C) entropies
D) dogs
E) cash cows
b

1) In a BCG matrix, _____ are businesses that have a very small share of a market that is
not expected to grow.
A) question marks
B) cows
C) stars
D) dogs
E) rate busters
d

1) In the context of the BCG matrix, _____ are businesses that have the largest share of a
rapidly growing market.
A) question marks
B) stars
C) cows
D) dogs
E) entropies
b

1) In a BCG matrix, _____ are businesses that have a large share of a market that is not
expected to grow substantially.
A) stars
B) cash cows
C) entropies
D) question marks
E) dogs
b

1) The _____ is a portfolio management technique that considers industry attractiveness and
competitive position rather than focusing solely on market growth and market share.
A) Black-Litterman model
B) modern portfolio theory
C) growth-share matrix
D) BCG matrix
E) GE Business Screen
e

1) In the GE Business Screen portfolio management technique, businesses that have good
competitive position in an attractive industry are known as:
A) losers.
B) winners.
C) profit producers.
D) question marks.
E) cash cows.
b

1) In the GE Business Screen matrix, which of the following is a determinant of industry

attractiveness?
A) Market share
B) Market size
C) Product quality
D) Operating costs
E) Service network
c
1) In the GE Business Screen matrix, which of the following determines the competitive
position of the company?
A) Market size
B) Market growth
C) Price competitiveness
D) Capital requirements
E) Competitive intensity
a

1) In the context of the GE Business Screen, a determinant of an organization's competitive

position is:
A) capital requirements.
B) market growth.
C) government policies.
D) market size.
E) product quality.
d

1) Pursuing a strategy of _____ reduces an organization's dependence on any one of its

business activities and thus reduces economic risk.
A) single-product
B) single-service
C) divestiture
D) related diversification
E) trade restraint
d

1) Firms that implement a strategy of _____ operate multiple businesses that are not
logically associated with one another.
A) single-business unit
B) unrelated diversification
C) entropy
D) nondiversification
E) synergy
b

1) In the context of the GE Business Screen, a determinant of industry attractiveness would

be:
A) capital requirements.
B) product quality.
C) service network.
D) price competitiveness.
E) market share.
a

1) Which of the following is a determinant of an organization's competitive position in the

context of the GE Business Screen?
A) Government policies
B) Market size
C) Technological know-how
D) Capital requirements
E) Market growth
c

1) In the context of the GE Business Screen matrix, _____ is a determinant of the

competitive position of a company.
A) intensity of competition
B) government policies
C) market size
D) market growth
E) market share
a

1) In contrast to strategic plans, tactical plans must:

A) specify resources and time frames.
B) be developed independently of the internal business environment.
C) be developed independently of the external business environment.
D) be more general and broadly based.
E) focus on resources, environment, and mission.
a

1) Which of the following statements is true about a tactical plan?

A) It is an organized sequence of steps designed to execute strategic plans.
B) It is exclusively developed by the board of directors.
C) It is more broad and nonspecific when compared to a strategic plan.
D) It is developed independently of the external business environment.
E) It does not specify time frames and resources.
a

1) A(n) _____ is a single-use plan for a large set of activities. It might consist of identifying
procedures for introducing a new product line, opening a new facility, or changing the
organization's mission.
A) policy
B) entropy
C) regulation
D) project
E) program
e

1) _____ planning refers to the determination of alternative courses of action to be taken if

an intended plan is unexpectedly disrupted or rendered inappropriate.
A) Divestiture
B) Deskilling
C) Synergy
D) Contingency
E) Entropy
d

1) A _____ is the most general form of standing plan that specifies the organization's
general response to a designated problem or situation.
A) project
B) standard operating procedure
C) policy
D) program
E) single-use plan
c

1) The narrowest of the standing plans, _____ describe exactly how specific activities are to
be carried out.
A) standard operating procedures
B) projects and programs
C) rules and regulations
D) contingency theories
E) crisis management procedures
c

1) Venus Corp. prohibits its employees from smoking in its premises. This is an example of
a(n):
A) standard operating procedure
B) rule
C) program
D) entropy
E) project
b

1) Relish has a chain of outlets that sells baked products. Relish requires all its employees to
complete a month's training before they could work in the kitchen. This is an example of a:
A) standard operating procedure.
B) contingency plan.
C) regulation
D) policy.
E) standing plans.
c

1) Libra Travels LLC. has a few back-up buses at key locations where the business
operates. This is to be prepared in case any of its day-tour buses break down. This is an
example of a:
A) project.
B) program.
C) regulation.
D) single-use plan.
E) contingency plan.
e
1) The process of choosing one alternative from among a set of alternatives is called _____.
A) rational ignorance
B) altruism
C) bounded rationality
D) decision making
E) groupthink
d

1) Which of the following statements is true about the decision-making process?

A) It exclusively applies to problem situations.
B) It requires that the nature of a particular situation be defined.
C) It seldom applies to situations that are positive
. D) It typically involves only one individual and seldom applies to groups.
E) It results in the generation of only one alternative.
b

1) Ryan, the production manager at the Tan Shoes Company, chose the cheapest leather-
cutting machine from a set of five machines from different manufacturers. Ryan was
engaged in _____.
A) decision making
B) optimizing
C) rationalizing
D) brainstorming
E) social loafing
a

1) Which of the following statements is true about the process of decision making?
A) It ends when the decision situation has been defined.
B) It includes putting the chosen alternative to practice.
C) The first step in the process is to identify alternatives to a problem.
D) The process is said to be complete when a set of alternatives to a problem has been
created.
E) In a business scenario, the decision-making process is always aimed at finding a way to
increase profits.
b

1) A(n) _____ decision is a decision that is relatively structured or recurs with some
frequency (or both).
A) custom-made
B) novel
C) unstructured
D) intuitive
E) programmed
e

1) Decisions regarding standard organizational transactions are most likely to be _____

decisions.
A) unstructured
B) infrequent
C) programmed
D) intuitive
E) irrational
c

1) Nutrimax Inc. sponsors a football championship in Oriel in August every year. The
championship is organized by the Oriel Football Association (OFA) to encourage new talent,
and Nutrimax bears all the expenses incurred during the championship. The Oriel regional
manager of Nutrimax sends across a check to the OFA in July of each year in order for them
to prepare for the championship. The regional manager's decision about when to send the
check to OFA is a(n) _____ decision.
A) programmed decision
B) unstructured decision
C) intuitive decision
D) contingency decision
E) satisficing decision
a

1) When the inventory manager of Cuisine Royale, a restaurant, decides to order a batch of
brown bread because the stock is almost empty, she's making a(n) _____ decision.
A) programmed
B) unstructured
C) intuitive
D) irrational
E) strategic
e

1) A nonprogrammed decision:
A) is relatively more frequent that programmed decisions.
B) is highly structured.
C) requires more time and resources than programmed decisions.
D) is typically regarding daily organizational transactions.
E) typically applies to basic operating systems and procedures.
c

1) Decisions made by top managers involving strategy, such as signing mergers or making
acquisitions, are examples of _____ decisions.
A) frequent
B) nonprogrammed
C) structured
D) operational
E) programmed
b

1) Programmed decisions:
A) can only be made by the top management.
B) generally deal with long-term matters such as expanding business in another country.
C) lack structure.
D) recur more frequently than nonprogrammed decisions.
E) are typically made by shareholders.
d

1) Venus Electronics Inc. decided to explore markets in different countries. It has now set up
a branch in Selenasia. This is an example of a(n) _____ decision.
A) structured
B) nonprogrammed
C) standard
D) programmed
E) operational
b

1) Which of the following illustrates a programmed decision?

A) A cafe owner buys a hundred cartons of coffee every month.
B) A fast food chain decides to enter into a new franchise agreement.
C) A content development company decides to sue a competitor for copyright infringement.
D) A health drink manufacturing company decides to launch a new product in the market.
E) An IT company decides to lay off a hundred employees.
a

1) Which of the following statements is true in the context of decision making under a state
of risk?
A) The decision maker clearly knows the alternatives.
B) The decision maker uses probability estimates to assess alternatives.
C) The decision maker is least likely to choose a bad alternative.
D) The decision maker has an accurate understanding of payoffs of all the alternatives.
E) The decision maker seldom considers his or her past experience while making the
decision.
b

1) In decision making, a condition of _____ exists when a decision maker knows what the
alternatives are and what conditions are associated with each alternative.
A) risk
B) uncertainty
C) certainty
D) imperfect information
E) ambivalence
c

1) When Irene wants to buy new laptops for her marketing executives and she has to pick
them up from a single brand that is preinstalled with the marketing software that her
company needs, she's making a decision under a condition of _____.
A) imperfect information
B) ambiguity
C) risk
D) certainty
E) unclear alternatives
d

1) When decision making is under a condition of uncertainty:

A) the alternatives are not known.
B) no ambiguity is involved.
C) errors are least likely to occur.
D) the consequences of solutions are known.
E) the decision situation is simple.
a

1) Which of the following statements is true in the context of decision making under a
condition of uncertainty?
A) A decision maker greatly relies on intuition, judgment, and experience.
B) A decision maker clearly knows all the risks associated with alternatives to a problem.
C) A decision maker puts in least effort and uses a pre-determined structure for decision
making.
D) A decision maker is able to estimate the payoffs and risks associated with alternatives.
E) A decision maker identifies only two alternatives to the decision situation.
a

1) Professor Campbell needs to recommend a biology textbook for his senior class. Only two
well-known publishers, Educate and WordTree, publish biology textbooks in the state, and
both publishers are known for the clarity and extensiveness of their content. When Campbell
chooses a textbook from one of the two publishers, he is making a decision in a state of
_____.
A) certainty
B) irrationality
C) risk
D) imperfect information
E) ambiguity
a

1) Managers are most prone to error in a condition of _____.

A) certainty
B) uncertainty
C) risk
D) rationality
E) perfect information
b

1) The _____ decision model is a prescriptive approach that tells managers how they should
make decisions; it assumes that managers are logical and rational and that their decisions
will be in the organization's best interests.
A) behavioral
B) classical
C) administrative
D) bureaucratic
E) probabilistic
b

1) According to the classical decision model, managers:

A) evaluate all aspects of a decision situation logically and rationally.
B) are inefficient at eliminating uncertainty.
C) never have adequate information about decision situations.
D) never make errors even under uncertain conditions.
E) can never assess alternatives appropriately.
a

1) The first step in rational decision making is _____.

A) identifying alternatives
B) implementing an alternative
C) selecting the best alternative
D) recognizing and defining the decision situation
E) evaluating alternatives
d

1) Tina works at a coffee shop. One of the four coffee machines at the coffee shop has not
been functioning well; the same machine has broken down thrice in two weeks. Now, Tina is
looking at the machine and trying to decide if the problem is a bad machine or if people are
just using the machine wrong. Tina is currently _____.
A) implementing an alternative
B) evaluating the results of a chosen alternative
C) consulting with other decision makers
D) recognizing and defining the decision situation
E) eliminating feasible alternatives
e

1) Libra Inc. chose to settle a lawsuit for $75 million. In the context of the rational decision-
making model, when executives of the company begin to compare the cost of the settlement
to those of other financial institutions, they will be _____.
A) developing a set of rational alternatives
B) evaluating the possible alternatives
C) consulting with other decision makers
D) recognizing and defining the decision situation
E) following up and evaluating the results of a chosen alternative
e

1) After being laid off by their companies, many individuals recognized three options they
could choose from before they could secure new jobs: to spend less, to use savings, or to
use credit. In the context of the steps involved in the rational decision-making model, they
were _____.
A) monitoring implementation
B) selecting the best alternative
C) identifying alternatives
D) implementing alternatives
E) evaluating decision effectiveness
b

1) In general, while identifying alternatives, the more important the decision, _____.
A) the more alternatives should be generated
B) the lesser the time needed to make the decision
C) the lesser the chances of managers making the right decision
D) the more the tendency of managers to ignore intuitions
E) the lesser the chances of managers using expert opinion to make the decision
a

1) Christine, a teacher, notices that the performances of her students at class tests have
been declining. While attempting to find a solution to the problem, she thinks of three
choices: rewarding students who get good grades, holding class tests more often, or
punishing students when they perform poorly in the tests. Which step of the rational
decision-making process is Christine in?
A) Identifying alternatives
B) Implementing an alternative
C) Defining the decision situation
D) Selecting the best alternative
E) Evaluating the decision effectiveness
a

1) The rational decision-making process:

A) begins when a decision maker chooses the best solution.
B) involves the evaluation of different alternatives.
C) ends when alternatives have been identified.
D) does not include the implementation of an alternative.
E) ends when a decision situation has been defined.
c

1) Delta Corp. introduced a new set of policies, giving its employees more flexibility in work
timings. This decision was made in response to complaints from employees about fatigue.
Which step of the rational decision-making process is illustrated in the scenario?
A) Defining the situation
B) Evaluating the possible alternatives
C) Selecting the alternative
D) Implementing an alternative
E) Evaluating decision effectiveness
d

1) When the prices of oil came down, the demand for sport utility vehicles (SUVs) increased.
Automakers chose to increase production of full-size SUVs as the profit from large vehicles
is greater than that from small vehicles. Which step in the rational decision-making model is
illustrated in the scenario?
A) Developing a set of rational alternatives
B) Evaluating the possible alternatives
C) Selecting the best alternative and implementing it
D) Recognizing and defining the decision situation
E) Evaluating decision effectiveness
c

1) In which step of the rational decision-making model does the decision maker test the
feasibility and satisfactoriness of alternatives before choosing one?
A) Identifying alternatives
B) Implementing the chosen alternative
C) Defining the situation
D) Following up the implementation
E) Evaluating alternatives
e

1) Peter was looking for alternatives to double his plant's production capacity, and he
considered acquiring the production plant of a rival company. The engineers in Peter's
company advised him against it because acquiring the new plant would only increase their
company's production by 15 percent. Therefore, Peter's idea failed the test for _____ in the
context of the rational decision-making process
. A) feasibility
B) satisfactoriness
C) bounded rationality
D) satisficing
E) escalation of commitment
b

1) In the rational decision-making model, once the alternatives have been evaluated, the
next step is to _____.
A) select the best alternative
B) implement the chosen alternative
C) evaluate the results of the chosen alternative
D) identify the available alternatives
E) define the decision situation
a

1) An alternative should be eliminated during evaluation if:

A) it is supported by the most number of individuals.
B) it involves minimal costs.
C) it is found to have passed the satisfactoriness test.
D) it has several unaffordable consequences.
E) it requires minimal resources.
d

1) Which of the following statements is true in the context of selecting the best alternative?
A) The decision maker can only select one best alternative.
B) The decision maker can develop subjective estimates and weights for choosing an
alternative.
C) The decision maker must choose the alternative that involves the most costs.
D) The decision maker must only stick to completely rational, mathematical analysis while
selecting an alternative.
E) The decision maker can choose an alternative that does not pass the consequence,
satisfactoriness, and feasibility test.
a

1) In the rational decision-making process, optimization means:

A) identifying obvious, standard alternatives.
B) choosing the alternative with the best overall expected outcomes.
C) gathering the most complete information before making the decision.
D) developing the maximum number of creative, innovative alternatives.
E) choosing an alternative that is feasible even if it is not satisfactory or has undesirable
consequences.
b

1) The final step in the decision-making process requires that managers _____.
A) evaluate the results of the chosen alternative
B) select the best alternative
C) implement the chosen alternative
D) identify the available alternatives
E) define the decision situation
a

1) A plant manager had taken a few measures to try to reduce worker turnover. For four
months he monitored the implementation of the measures. He now finds that the turnover
rate is reduced by 10 percent. Which step of the rational decision-making model is illustrated
in the scenario?
A) Evaluating the results
B) Identifying alternatives
C) Recognizing the decision situation
D) Selecting the best alternative
E) Developing a set of alternatives
a

1) _____ is one of the factors that makes an alternative infeasible.

A) Decrease in expenditure
B) Increase in production capacity
C) Low costs
D) Increased satisfactoriness
E) Legal barriers
e

1) According to the evidence-based management approach, managers must _____.

A) discourage employees from telling the unpleasant truth
B) be committed to fact-based decision making
C) avoid experimentation
D) completely rely on the recommendations made by others
E) base decisions on untested but strongly held beliefs
b

1) Which of the following statements is true about the administrative model of decision
making?
A) It suggests that most managers make decisions rationally and logically.
B) It suggests that decisions that are based on instincts are better than the ones based on
logic.
C) It suggests that managers tend to satisfice when making decisions.
D) It suggests that managers have the most accurate information about decision situations.
E) It suggests that managers should not make decisions based on mathematical analysis.
c

1) Political forces, intuition and escalation of commitment, risk propensity, and ethics
constitute the _____ aspects of decision making.
A) rational
B) administrative
C) classical
D) behavioral
E) sequential
d

1) _____ was one of the first experts to develop the administrative model of decision making.
A) Elton Mayo
B) George Bennett
C) Martin Johnson
D) Jack Welch
E) Herbert Simon
e

1) The administrative model of decision making argues that decision makers _____ while
making decisions.
A) use complete and perfect information
B) do not use intuition while making decisions
C) are constrained by bounded rationality
D) completely avoid escalation of commitment
E) use only instincts
c

1) According to the administrative model, decision makers:

A) use incomplete and imperfect information.
B) are never constrained by bounded rationality.
C) tend to avoid satisficing when making decisions.
D) are not limited by their values and unconscious reflexes while making decisions.
E) always act in the best interests of their organizations.
a

1) ____ is a concept suggesting that decision makers are limited by their values and
unconscious reflexes, skills, and habits.
A) Satisficing
B) Escalation of commitment
C) Risk propensity
D) Groupthink
E) Bounded rationality
e

1) Bounded rationality is assumed in the _____ model of decision making.

A) administrative
B) rational
C) classical
D) groupthink
E) irrational
a

1) Which of the following statements is true about the administrative model of decision
making?
A) It suggests that political forces do not exist in business scenarios.
B) It suggests that managers may not always make decisions that best serve the interests of
their organizations.
C) It suggests that managers use a blend of subjective knowledge and analysis to choose
the best alternative.
D) It suggests that decisions should only be made individually and not in groups.
E) It suggests that decisions made by groups are better than decisions made by individuals.
b

1) For his work in developing the administrative model to describe how managers make
decisions in the real world, Herbert Simon won the Nobel Prize in _____.
A) Medicine
B) Economics
C) Peace
D) Psychology
E) Management
b

1) _____ is the tendency to search for alternatives only until one is found that meets some
minimum standard of sufficiency.
A) Satisficing
B) Groupthink
C) Optimization
D) Bounded rationality
E) Escalation of commitment
a

1) Lucy needs to buy a new laptop for her business, and she buys a particular brand even
though it does not support the software that is required for her business. She does this
because all her family members have used computers of the same brand all their lives. This
is an example of how decision makers are constrained by _____.
A) political forces
B) bounded rationality
C) Lucy's high risk propensity
D) logic
E) organizational strategies
b

1) Tim is the production manager at a steel factory. One of the steel processing machines in
the factory has broken down and has to be replaced. Tim decides to buy a new machine
from a company that he has read reviews of in industry magazines, even though there are
other companies offering a discount on machines with better functionality. This is an
example of how managers are constrained by _____.
A) bounded rationality
B) escalation of commitment
C) risk propensity
D) groupthink
E) political forces
a

1) Mike is in a hurry to appoint a personal assistant to help him with scheduling his meetings
with clients. He posts an advertisement on a job website, and picks the first person who
sends in her resume for the job. He only checks for the candidate's qualification and does
not consider her work experience. This is an example of _____.
A) rational decision making
B) classical decision making
C) satisficing
D) evidence-based management
E) optimizing
c

1) Keisha is the vice president of accounting, and she has to decide which computer
software to purchase for her department. She has looked at all of the possible alternatives
and is leaning toward the system with which she is most familiar. This is an example of
_____.
A) optimizing
B) bounded rationality
C) satisficing
D) synergy
E) escalation of commitment
b

1) _____ is one major element of organizational politics that is especially relevant to decision
making.
A) Coalitions
B) Intuition
C) Escalation of commitment
D) Satisficing
E) Risk propensity
a

E) Risk propensity
1) Chelsea has been contemplating buying a red car. When she visits the used cars
dealership, she looks at a red Ford Hatchback and buys it even before checking for its
technical specifications. Chelsea's decision is an example of _____.
A) optimization
B) escalation of commitment
C) an evidence-based decision
D) satisficing
E) a decision under uncertainty
c

1) _____ is an innate belief about something without conscious consideration.

A) Optimization
B) Intuition
C) Logic
D) Ethics
E) Risk propensity
b

1) A marketing manager decides to launch a new product because it is the first product that
came to his mind, even if there are several better products to be explored. Which of the
following is illustrated in the scenario?
A) Escalation of commitment
B) Rational decision making
C) Bounded rationality
D) Satisficing
E) Optimization
d

1) Eric is a manager who recently introduced a new process for screening potential
employees. Eric has noticed that the new screening process is not very efficient and is not
helping recruiters find the best candidates. However, Eric continues to use the same process
because it was so expensive to set up the initial system. Which of the following concepts is
illustrated in the scenario?
A) Evidence-based decision making
B) Escalation of commitment
C) Rational decision making
D) Optimization
E) Satisficing
b

1) Ryan Tools Company just acquired Coney Tools. The purchase came about because the
employees in both the research and development and the production departments at Ryan
Tools joined forces to lobby for the purchase of Coney Tools as opposed to other
companies. Both departments wanted Coney Tools because of its state-of-the-art research
and production facilities. This is an example of _____.
A) satisficing
B) intuitive decision making
C) a dissection
D) escalation of commitment
E) a coalition
e

1) William had invested in an initial public offering. He kept incurring losses due to
unfavorable market conditions. However, he decided to keep the investment because he had
spent so much money on it. This scenario best exemplifies _____.
A) evidence-based management
B) rational decision making
C) escalation of commitment
D) rationality
E) satisficing
c

1) _____ is a behavioral process in which a decision maker stays with a decision even when
it appears to be wrong.
A) Bounded optimization
B) Escalation of commitment
C) Risk propensity
D) Strategic maximization
E) Intuitive rationality
b

1) Managers sometimes decide to do something because it feels right or they have a hunch.
This is an example of using _____ in decision making.
A) satisficing
B) rationality
C) intuition
D) optimization
E) logic
c

1) _____ is the extent to which a decision maker is willing to gamble when making a
decision.
A) Risk propensity
B) Intuition
C) Optimization
D) Satisficing
E) Bounded rationality
a

1) Managers with higher levels of risk propensity are more likely than their conservative
counterparts to:
A) adhere to the rational model and be extremely cautious about their decisions.
B) avoid mistakes and infrequently make decisions that lead to big losses.
C) rely heavily on intuition and gamble big investments on their decisions.
D) reach decisions slowly after a great amount of analysis.
E) display no aggression in decision making.
c

1) A manager who has a high level of risk propensity is likely to:

A) make decisions quickly.
B) avoid risks.
C) spend a lot of time evaluating alternatives.
D) be wary of making a wrong choice.
E) rely heavily on mathematical analysis.
a

1) The nominal group decision-making technique:

A) involves maximum interaction among group members.
B) is used to generate creative and innovative ideas.
C) is a technique in which members are not brought together in a face-to-face setting.
D) always results in groupthink.

E) is a technique in which the manager lacks the authority to reject an alternative.

b

1) The Delphi group technique is a group decision-making technique in which:

A) the members are involved in extensive discussions with each other.
B) the opinions of group member are combined and averaged.
C) the daily operational problems of an organization are addressed.
D) the members are most likely to indulge in groupthink.

E) the members are most likely to be first-line employees belonging to the same department.
a

1) One advantage of group decision making is:

A) groupthink.
B) saved time.
C) more acceptance of the final decision.
D) lowered cost of decision making.
E) elimination of political forces.
c

1) A disadvantage of using interacting groups to make decisions is that:

A) it fosters political forces.
B) it discourages creativity.
C) it generates very few alternatives.
D) it involves more costs than all other group decision techniques.
E) it does not foster understanding between members.
a

1) Which of the following is true of interacting groups?

A) They are the least common decision-making groups.
B) They effectively eliminate the possibility of groupthink.
C) They can be regular work teams.
D) They provide little scope for new ideas.
E) They do not involve political forces.
c

1) A(n) _____ is a form of group decision making in which a group arrives at a consensus of
expert opinion.
A) interacting group
B) Delphi group
C) inactive group
D) unconventional group
E) unstructured group
b

1) Macy Computers Inc. faced a major software error that brought all work in the company to
a standstill. Roger, the CEO, arranged for a panel of well-known engineers in the state to
estimate the time that it would take for the error to be set right. Each engineer made an
estimate and sent it to the group's leader, Dr. Rajesh. Dr. Rajesh averaged the estimates
and sent the average back out to the group. People who had submitted unusual estimates
were asked to say why those estimates were chosen. Roger used a(n) _____to help his
company get rid of the software crisis.
A) interacting group
B) Delphi group
C) standing committee
D) work group
E) unstructured group
b

1) When managers want to be sure to get innovative and creative ideas, they will often
create a(n) ____ group..
A) judge-advisor system
B) coalition
C) advocacy group
D) nominal group
E) political group
d

1) A disadvantage of group decision making is that:

A) groupthink may occur.
B) generation of different opinions does not occur.
C) communication may be curbed.
D) knowledge available is always limited.
E) only a few alternatives are likely to be generated.
a
1) _____ is a situation that occurs when a group or team's desire for consensus and
cohesiveness overwhelms its desire to reach the best possible decision.
A) Groupthink
B) Groupshift
C) Brainstorming
D) Condorcet's paradox
E) Group polarization
a

1) Which of the following is true of nominal groups?

A) Innovative ideas are not generated in nominal groups.
B) Members of nominal groups are brought together in a face-to-face setting.
C) Members of nominal groups talk freely among themselves, argue, agree, form internal
coalitions, and so forth.
D) Only one individual dominates a nominal group.
E) Nominal groups are most often used for forecasting technological breakthroughs.
d

1) Which of the following disadvantages of group decisions typically results from the group
being very cohesive?
A) Disagreement
B) Groupthink
C) Lower acceptance of the final decision
D) Minimal participation of members
E) Conflicts
b

1) Omega Inc., a large appliances company, went bankrupt because of a series of poor
managerial decisions and a downturn in the economy. In retrospect, it would seem that there
was too much emphasis on the group reaching a consensus decision whenever the
managers were involved in decision making. As a result, many decisions by the managers at
Omega were made to avoid conflict. What disadvantage of group decision making does this
scenario represent?
A) Domination
B) Groupthink
C) Irrationality
D) Satisficing
E) Coalitions
b

1) Which of the following is an advantage of group decision making when compared to

individual decision making?
A) The group process is less expensive.
B) Groupthink is avoided.
C) Less time is consumed.
D) More alternatives are likely to be generated.
E) Political forces are completely eliminated.
d
1) Groupthink:
A) results in more conflicts.
B) is most likely to occur in non-cohesive groups.
C) often leads to choosing a wrong alternative
. D) results in extensive brainstorming.
E) results in polarization.
d

1) One disadvantage of group decision making is that:

A) very little information and knowledge are available.
B) one person may dominate the group.
C) fewer alternatives are generated.
D) it reduces the chances of acceptance of the final decision.
E) it prevents groupthink from developing.
c

1) Which of the following helps a manager avoid groupthink during group decision making?
A) Assigning one person to act as devil's advocate
B) Making his or her preferences known to the group as early as possible
C) Instructing members to avoid expressing divergent viewpoints
D) Giving the group as much time as they need to make a decision, without enforcing a
deadline
E) Encouraging group cohesiveness
a

1) _____ is the degree to which the overall task of the organization is broken down and
divided into smaller component parts.
A) Job specialization
B) Job enrichment
C) Job rotation
D) Job enlargement
E) Task identity
a

1) One of the benefits of job specialization is that:

A) it makes employees proficient at a task.
B) it significantly increases employee satisfaction.
C) it offers new challenges and stimulation to the workers.
D) it decreases boredom and absenteeism among workers.
E) it eliminates job monotony and fatigue.
a

1) One of the disadvantages of job specialization is that:

A) it increases the transfer time between tasks.
B) it makes it difficult to develop specialized equipment to assist with a job.
C) it does not help a worker become proficient at a task.
D) it does not offer challenges or stimulation to workers.
E) it requires workers to handle different tasks at a time.
d

1) Which of the following is an advantage of job specialization?

A) It decreases transfer time between tasks.
B) It increases the level of employee satisfaction.
C) It eliminates monotony and boredom.
D) It provides stimulation and challenges to employees.
E) It significantly reduces employee turnover rates.
a

1) Jimmy owns an ice cream parlor. He designs a schedule for the different tasks the
employees have to perform in order to prevent monotony at work. According to the schedule,
if an employee makes waffle cones on a day, he serves ice creams the next day and clears
the tables on the day after that. Jimmy is using the _____ approach at his ice cream parlor.
A) job enrichment
B) job enlargement
C) job rotation
D) job deskilling
E) job specialization
c

1) _____ involves systematically moving employees from one job to another.

A) Job enlargement
B) Job rotation
C) Job deskilling
D) Job specialization
E) Job enrichment
b

1) In _____, the jobs do not change, but instead workers move from job to job.
A) job rotation
B) job specialization
C) job enrichment
D) job deskilling
E) job enlargement
a

1) _____ was developed to increase the total number of tasks workers perform. As a result,
all workers perform a wide variety of tasks, which presumably reduces the level of job
dissatisfaction.
A) Job enlargement
B) Job rotation
C) Job enrichment
D) Job specialization
E) Job deskilling
a
1) Which of the following would require continually adding new tasks and challenges as part
of the job design?
A) Job enlargement
B) Job specialization
C) Job rotation
D) Job enrichment
E) Job deskilling
d

1) _____ attempts to increase both the number of tasks a worker does and the control the
worker has over the job.
A) Job deskilling
B) Job enrichment
C) Job specialization
D) Job rotation
E) Job entropy
b

1) Job enrichment:
A) does not increase the number of tasks that workers perform.
B) requires the organization to be highly centralized.
C) requires delegation of authority.
D) requires workers to perform a single task.
E) involves workers moving from job to job in a predetermined manner.
b

1) According to the job characteristics approach, task identity is _____.

A) the number of things a person does in a job
B) the extent to which a worker does a complete portion of the total job
C) the extent to which a worker knows how well the job is being performed
D) the perceived importance of the task
E) the degree of control a worker has over how the work is performed
b

1) In the context of the job characteristics approach, skill variety refers to:
A) the extent to which a worker knows how well the job is being performed.
B) the degree of control a worker has over how the work is performed.
C) the perceived importance of a task.
D) the extent to which a worker does a complete or identifiable portion of the total job.
E) the number of things a person does in a job.
e

1) In the context of the job characteristics approach, _____ refers to the extent to which a
worker knows how well the job is being performed.
A) feedback
B) task identity
C) task significance
D) autonomy
E) skill variety
e

1) _____ is the process of grouping jobs according to some logical arrangement.

A) Job rotation
B) Job enrichment
C) Departmentalization
D) Centralization
E) Industrialization
c

1) _____ departmentalization groups together those jobs involving the same or similar
activities.
A) Product
B) Functional
C) Location
D) Customer
E) Sequential
b

1) Creating different teams for finance, production, and marketing is consistent with _____
departmentalization.
A) location
B) product
C) functional
D) sequential
E) customer
b

1) At Gamma Inc., there are separate departments of employees who specialize in sales,
service maintenance, customer service, and accounting. What form of departmentalization
does Gamma use?
A) Functional departmentalization
B) Product departmentalization
C) Location departmentalization
D) Customer departmentalization
E) Sequential departmentalization
a

1) Which of the following is a disadvantage of functional departmentalization?

A) Supervision becomes difficult as managers will need to have skills in several areas.
B) Coordinating activities inside each department becomes difficult.
C) Decision making may tend to become slower as the organization grows.
D) Employees tend to focus on the overall organization rather than their specific jobs.
E) Functional departmentalization cannot be implemented for smaller organizations.
b
1) Relish Inc. is a large corporation in the food industry that manufactures canned foods,
confectionery, and baked?foods. The organization has a separate department for each of
these types of food manufactured. Each department integrates all the activities required to
manage their respective line of food. Which of the following types of departmentalization is
illustrated in the scenario?
A) Sequential departmentalization
B) Customer departmentalization
C) Product departmentalization
D) Location departmentalization
E) Functional departmentalization
c

1) Janice owns a bakery that has only ten employees, out of which three are bakers, four are
waiters, and the rest belong to the housekeeping staff. Which of the following approaches to
departmentalization would work best for the bakery?
A) Functional departmentalization
B) Product departmentalization
C) Customer departmentalization
D) Location departmentalization
E) Sequential departmentalization
a

1) The advantage of using the functional departmentalization approach is that:

A) supervision is facilitated because an individual manager needs to be familiar with only a
small set of skills.
B) the speed and effectiveness of decision making increase as the organization grows.
C) accountability and performance become easier to monitor.
D) employees get a better view of the total organization.
E) decision making becomes less bureaucratic as the organization grows.
a

1) One disadvantage of using product departmentalization is that:

A) decision making tends to become slower and more bureaucratic.
B) the performance of individual products or product groups becomes difficult to assess.
C) administrative costs rise because each department must have its own functional
specialists.
D) all activities associated with one product or product group cannot be easily integrated and
coordinated. E) accountability of departments becomes very difficult to monitor.
c

1) _____ is defined as a clear and distinct line of authority among the positions in an
organization.
A) Chain of command
B) Span of management
C) Job deskilling
D) Flat structure
E) Synergy
a
1) The term span of management refers to the:
A) extent to which authority is delegated at the individual level.
B) extent to which authority is systematically delegated to middle and lower levels of
management.
C) number of people reporting to a particular manager.
D) process of grouping jobs according to some logical pattern.
E) number of managers assigned to a department.
c

1) _____ suggests that each person within an organization must have a clear reporting
relationship to one and only one boss.
A) Span of management
B) Entropy
C) Flat hierarchy
D) Unity of command
E) Scalar principle
d

1) Which of the following concepts suggests that there must be a clear and unbroken line of
authority that extends from the lowest to the highest position in the organization?
A) The scalar principle
B) Unity of command
C) Entropy
D) Synergy
E) Decentralization
a

1) Which of the following is an accurate comparison between tall organizations and flat
organizations?
A) Tall organizations foster employee morale better than flat organizations.
B) Tall organizations have fewer managers than flat organizations.
C) Tall organizations foster more communication problems than flat organizations.
D) Tall organizations place excessive administrative responsibilities on managers than flat
organizations.
E) Tall organizations foster more productivity than flat organizations.
c

1) When compared to tall organizations, flat organizations:

A) are more expensive.
B) place more supervisory responsibilities on managers.
C) have more layers of managers.
D) place minimal administrative responsibilities on managers.
E) have lower levels of employee morale and productivity.
b

1) When compared to flat organizations, tall organizations:

A) foster fewer communication problems.
B) foster more employee productivity.
C) are more expensive.
D) place excessive responsibilities on managers.
E) are less bureaucratic.
c

1) A wide span of management in a flat organization may result in a manager having _____.
A) less authority over subordinates
B) more administrative responsibility
C) less accountability to a higher-up
D) less supervisory responsibility
E) more officers at different levels to report to
b

1) Tall organizations:
A) have more managers than flat organizations.
B) foster employee morale better than flat organizations.
C) place excessive supervisory responsibilities on managers.
D) have very few communication problems.
E) have less managerial expenses than flat organizations.
a

1) Researchers have found that a flat organization structure _____.

A) fosters more communication problems
B) is more expensive to maintain than a tall structure
C) leads to higher levels of employee morale
D) fosters bureaucracy
E) leads to lower levels of employee productivity
c

1) _____ is power that has been legitimized by the organization.

A) Entropy
B) Process gain
C) Synergy
D) Authority
E) Process loss
d

1) _____ is the process by which a manager assigns a portion of his or her total workload to
others.
A) Micromanagement
B) Delegation
C) Entropy
D) Synergy
E) Centralization
b
1) _____ is the process of systematically delegating power and authority throughout the
organization to middle- and lower-level managers.
A) Deskilling
B) Decentralization
C) Self-dealing
D) Divesting
E) Specialization
b

1) _____ is the process of systematically retaining power and authority in the hands of
higher-level managers.
A) Specialization
B) Delegation
C) Centralization
D) Self-dealing
E) Deskilling
c

1) Gadgetbug Inc. manufactures home appliances. All the decisions are made by the top
managers at the company. The middle and lower managers follow the instructions given by
top managers rather than making decisions by themselves. Which of the following concepts
is illustrated in the scenario?
A) Self-dealing
B) Synergy
C) Centralization
D) Specialization
E) Delegation
c

1) At Supertech Inc., a technology company, employees are given more authority and are
allowed to make their own decisions. Supertech operates in a business environment that is
not predictable. The middle managers, supervisors, and employees have a degree of
autonomy and are encouraged to make decisions. Which of the following concepts is
illustrated in the scenario?
A) Deskilling
B) High power distance
C) Micromanagement
D) Decentralization
E) Job specialization
d

1) _____ is defined as the process of linking the activities of the various departments of an
organization.
A) Centralization
B) Specialization
C) Decentralization
D) Coordination
E) Delegation
d

1) At Delta Corp. the manufacturing and design department frequently consults with the
research and development department and the marketing and sales department regularly
interacts with the manufacturing and design department. This scenario illustrates _____ at
Delta.
A) coordination
B) delegation
C) job rotation
D) job specialization
E) centralization
a

1) _____ represents the lowest level of interdependence.

A) Pooled interdependence
B) Reciprocal interdependence
C) Sequential interdependence
D) Synergetic interdependence
E) Structural interdependence
a

1) Units with _____ operate with little interaction-the output of the units is put together at the
organizational level.
A) pooled interdependence
B) total interdependence
C) reciprocal interdependence
D) sequential interdependence
E) structural interdependence
a

1) In _____, the output of one unit becomes the input for another in a serial fashion.
A) pooled interdependence
B) sequential interdependence
C) structural interdependence
D) total interdependence
E) reciprocal interdependence\
b

1) _____ exists when activities flow both ways between units.

A) Sequential interdependence
B) Pooled interdependence
C) Structural interdependence
D) Reciprocal interdependence
E) Total interdependence
d

1) Reciprocal interdependence:
A) is found in product and not service-based companies.
B) involves one-way interdependence.
C) represents the lowest level of interdependence.
D) involves minimal communication among departments.
E) is the most complex form of interdependence.
e

1) At Heritage Chocolates, the raw materials are processed at a plant and then sent to the
manufacturing plant. The manufactured chocolates are finally sent to the packaging plant.
This scenario illustrates _____ at Heritage Chocolates.
A) pooled interdependence
B) two-way interdependence
C) reciprocal interdependence
D) sequential interdependence
E) structural interdependence
d

1) At Libra Motors Inc. operations managers give availability information to the dealerships
department. When the dealerships department has a specific order, it is sent to the
operations department. Which of the following concepts is illustrated in the scenario?
A) Sequential interdependence
B) Product departmentalization
C) Pooled interdependence
D) Reciprocal interdependence
E) One-way interdependence
d

1) At Synergy School, Math, English, Science and Social Studies departments operate
separately. Student test scores in each area are gathered to evaluate the effectiveness of
the school. What level of interdependence does this represent?
A) Pooled interdependence
B) Complex interdependence
C) Reciprocal interdependence
D) Sequential interdependence
E) Absolute interdependence
a

1) Cuisine Royale is a restaurant chain that has many outlets. Each outlet has a separate
budget and a set of staff. To determine the success of the entire chain, the profits made by
all the outlets are put together. Which of the following concepts is illustrated in the scenario?
A) Pooled interdependence B) Reciprocal interdependence C) Job rotation D) Sequential
interdependence E) Specialization
a

1) Sequential interdependence:
A) typically involves no interaction among departments.
B) generally involves one-way interdependence.
C) is the most complex form of interdependence.
D) is a level of interdependence in which the performance of one department is not affected
by the performance of other departments.
E) represents the lowest level of interdependence.
b

1) A(n) _____ is a model of organization design based on a legitimate and formal system of
authority.
A) adhocracy
B) bureaucracy
C) entropy
D) autocracy
E) theocracy
b

1) Which of the following is one of the characteristics of Weber's bureaucracy?

A) Distinct division of labor
B) Close personal relationships between supervisors and subordinates
C) Absence of rules and regulations
D) Maximum level of decentralization
E) Presence of cross-departmental teams
a

1) Which of the following is a characteristic of Weber's bureaucracy

A) Promotions based on technical expertise
B) Absence of rules and regulations
C) Arbitrary dismissals
D) Random work assignment
E) A high level of decentralization
a

1) According to Weber, in a bureaucracy:

A) there should not be any arbitrary dismissals.
B) there should be no rules and regulations.
C) promotions should not be given based on technical expertise
. D) there should not be a social distance between supervisors and subordinates.
E) there should be a chain of command.
a

1) _____ encompasses the conversion processes used to transform inputs (such as

materials or information) into outputs (such as products or services).
A) Deskilling
B) Entropy
C) Synergy
D) Technology
E) Divestiture
d
1) Durban Cafe takes one order at a time and customizes the coffee as per the customer's
requirement . The cafe uses _____ technology.
A) small-batch
B) mass-production
C) continuous-process
D) standardized process
E) large-batch
a

1) Jeanne owns a boutique in Paris and is best known for the formal suits that she stitches
for working women. She makes customized suits for each of her customers, keeping their
age, body type, and their appearance in mind. Which of the following technologies is Jeanne
using in her boutique?
A) Standardized-process technology
B) Large-batch technology
C) Continuous-process technology
D) Small-batch technology
E) Mass-production technology
d

1) Alpha Electronics assembles different parts to make standardized laptops. Alpha

Electronics uses _____ technology.
A) job rotation
B) mass-production
C) unit
D) continuous-process
E) small-batch
b

1) In _____ technology, raw materials are transformed to a finished product by a series of

machine transformations in such a way that the composition of the materials themselves is
changed.
A) product-customization
B) large-batch
C) mass-production
D) continuous-process
E) small-batch
d

1) In organizations using _____, the product is manufactured in assembly-line fashion by

combining component parts into another part or finished product.
A) job rotation technology
B) large-batch technology
C) unit technology
D) continuous-process technology
E) small-batch technology
b
1) According to Woodward, which of the following is true about the relationship between
organization design and core technology?
A) Organizations using mass production technology tend to have the least level of
specialization.
B) Organizations using continuous-process technologies tend to be the most bureaucratic.
C) Organizations with large-batch technologies tend to be more bureaucratic.
D) Continuous-process technology is the least complex of all other technologies.
E) Organizations using unit or small-batch technology are the most bureaucratic.
c

1) According to Woodward's findings related to technology and organization design:

A) successful continuous-process organizations tended to have more bureaucracy.
B) unit-batch organizations had the highest level of specialization.
C) mass-production organizations tended to be the least bureaucratic.
D) unit-batch organizations tended to be the most bureaucratic.
E) mass-production organizations had a higher level of specialization.
e

1) A finding of Woodward's study about forms of technology was that:

A) mass-production organizations tended to have the lowest level of specialization.
B) small-batch organizations tended to have minimal bureaucracy.
C) mass-production organizations tended to be the least bureaucratic.
D) continuous-process technology was the simplest of all forms of technology.
E) continuous-process organizations tended to be the most bureaucratic.
b

1) Gemini Motors has an assembly-line structure. Workers combine separate parts into
standardized finished motorbikes. Gemini Motors is most likely to be using _____
technology.
A) small-batch
B) mass-production
C) continuous-process
D) unit
E) job enrichment
b

1) A(n) _____ organization is similar to the bureaucratic model.

A) mechanistic
B) organic
C) continuous process
D) large-batch
E) unit
a

1) Mechanistic organizations:
A) have the least level of specialization.
B) are least likely to have rules and regulations.
C) are most frequently found in stable environments.
D) are least likely to be bureaucratic.
E) are the most decentralized.
c

1) Which of the following statements is true about mechanistic organizations?

A) They have a very flexible and informal structure.
B) They have the lowest level of job specialization.
C) They are highly decentralized.
D) They are most frequently found in unpredictable and unstable environments.
E) They structure their activities in predictable ways.
e

1) A mechanistic organization is most likely to:

A) have the least level of job specialization.
B) have a flexible structure.
C) have centralized authority.
D) have an informal organizational design.
E) operate in an unstable environment.
c

1) Which of the following statements is true about organic organizations?

A) They are similar to bureaucracies.
B) They are formal and rigid.
C) They have centralized authority.
D) They operate in unstable environments.
E) They have an inflexible organizational design.
d

1) Which of the following statements is true about an organic organization?

A) It has a flexible and informal organizational design.
B) It is most likely to be operating in a very stable and predictable environment.
C) It has a structure that is similar to a bureaucracy.
D) It is most likely to have centralized authority.
E) It has higher levels of job specialization than a mechanistic organization.
a

1) _____ is the extent to which an organization is broken down into subunits.

A) Entropy
B) Differentiation
C) Integration
D) Synergy
E) Divestiture
b

1) _____ is the degree to which the various subunits must work together in a coordinated
fashion.
A) Integration
B) Differentiation
C) Departmentalization
D) Specialization
E) Entropy
a

1) Organizational size is defined as:

A) the total number of investors and stockholders in an organization. B) the total number of
departments in an organization.
C) the total number of full-time or full-time-equivalent employees in an organization.
D) the total number of customers of an organization.
E) the total number of middle and first-line managers in an organization.
c

1) The _____ of an organizational life cycle is characterized by growth and the expansion of
organizational resources.
A) youth
B) birth
C) senescence
D) decline
E) divestiture
a

1) _____ is a period of stability in an organizational lifecycle, eventually evolving into decline.

A) Maturity
B) Birth
C) Youth
D) Midlife
E) Synergy
a

1) As an organization passes from one stage of the organizational lifecycle to the next,
_____.
A) it becomes smaller
B) it's coordination demands increase
C) it becomes more centralized
D) it's structure becomes less mechanistic
E) it's control systems become more limited
b

1) Under the _____ arrangement, the members and units in an organization are grouped
into functional departments such as marketing and production.
A) division form
B) Z-form
C) H-form
D) U-form
E) M-form
d
1) The _____ design is based on multiple businesses in related areas operating within a
larger organizational framework.
A) conglomerate
B) divisional
C) H-form
D) matrix
E) functional
b

The _____ design is based on two overlapping bases of departmentalization.

A) H-form
B) matrix
C) functional
D) divisional
E) U-form
b

1) The _____ design is essentially a holding company that results from unrelated
diversification.
A) H-form
B) U-form
C) divisional
D) departmental
E) M-form
a

1) An organization that uses a team organization design:.

A) has a bureaucratic structure.
B) has an inflexible organizational structure.
C) has functional teams that perform specific functional tasks.
D) relies exclusively on project-type teams.
E) provides little scope for teams to develop adaptability.
d

1) A virtual organization:
A) typically has only a handful of permanent employees.
B) typically has a bureaucratic design.
C) has an inflexible formal structure.
D) typically has a very large staff and administrative headquarters facility.
E) has functional departmentalization.
a

1) A _____ organization works to facilitate the lifelong personal development of all of its
employees while continually transforming itself to respond to changing demands and needs.
A) bureaucratic
B) centralized
C) hybrid
D) learning
E) matrix
d

1) Enlightened Minds is a software services firm that uses routine training programs,
seminars by eminent developers, and discussion forums to keep employees updated on the
recent developments in the software field. Enlightened Minds is an example of a(n) _____.
A) learning organization
B) team organization
C) H-Form organization
D) matrix organization
E) virtual organization
a

1) Substantive modification to some part of an organization is known as _____.

A) organization synergy
B) organization maturity
C) organization implementation
D) organization change
E) organization entropy
d

1) _____ is an example of an external force that affects an organization.

A) Employee motivation
B) Production costs
C) New government regulations
D) Surplus capital
E) High employee turnover
c

1) An example of a force for change in the task environment of an organization is _____.

A) pricing strategies of competitors
B) employee turnover rates
C) capital availability
D) employee motivation
E) production costs
a

1) Which of the following forces for change is present in the task environment of an
organization?
A) Prices at which suppliers sell raw materials
B) The number of employees in the organization
C) Political changes in the country in which the organization operates
D) Overhead production costs of the organization
E) Availability of resources in the organization
a

1) Consumer tastes and preferences are _____ forces that influence an organization's
product line.
A) technical
B) internal
C) managerial
D) external
E) political
d

1) Alpha Motors Inc. was affected by the recession in 2008. The company had to make
extensive changes to its organizational structure and design. This scenario illustrates how
_____ forces affect organizations.
A) technical
B) external
C) managerial
D) legal
E) internal
b

1) ProDairy Inc. reduced the prices of its products to combat competitors that were selling
dairy products at lower prices. This scenario illustrates a force for change present in the
_____ of an organization.
A) task environment
B) supply chain
C) internal environment
D) legal-political environment
E) demographic environment
a

1) The top executives at Delta Inc. have decided to reorganize the corporation from product
divisions into geographic sectors. This is a(n) _____ force for change.
A) internal
B) technical
C) political
D) external
E) environmental
a

1) Unions negotiating for higher wages is an example of a(n) _____ force for change.
A) internal
B) technical
C) external
D) managerial
E) legal
c

1) _____ is change that is designed and implemented in an orderly and timely fashion in
anticipation of future events.
A) Planned change
B) Reactive change
C) Involuntary change
D) Organic change
E) Crisis change
a

1) Modifying the benefits system on a yearly basis to maintain employee satisfaction is most
likely to be a _____ change.
A) reactive
B) planned
C) contingency
D) legal
E) general environmental
b

1) _____ is a piecemeal response to circumstances as they develop.

A) Planned change
B) Programmed change
C) Premeditated change
D) Natural change
E) Reactive change
e

1) Reactive changes:
A) are made in anticipation of future events.
B) are generally more effective than planned changes.
C) have more potential for poorly conceived and executed change.
D) involve fewer risks than planned changes.
E) are preferred to planned changes by most successful organizations.
c

1) Which stage of the Lewin model of organization change involves managers letting people
who will be affected by an impending change know the reasons for the change?
A) Implementing
B) Recognizing
C) Refreezing
D) Transforming
E) Unfreezing
e

1) According to the Lewin model of organization change process, refreezing involves _____.
A) recognizing why the change is necessary
B) informing people about the change
C) the implementation of the change
D) reinforcing the change so that it becomes a part of the system
E) repeating the organization change process at frequent intervals
d
1) A company has set an objective to increase its product sales by 50 percent in the next two
years. Identify the step of the organization change process of the company.
A) Recognition of the need for change
B) Establishment of goals for the change
C) Selection of appropriate change technique
D) Planning for implementation of the change
E) Evaluation and follow-up
b

1) Beta LLC has decided to change its hiring criteria so that more people with technical
expertise can join the company. Which step of the change process is illustrated in the
scenario?
A) Establishment of goals for the change
B) Recognition of the need for change
C) Selection of appropriate change technique
D) Diagnosis of the relevant variables
E) Evaluation and follow-up
c

1) A company has built a new manufacturing plant to increase production. This scenario
illustrates which step in the Lewin model of organization change?
A) Unfreezing
B) Entropy
C) Reengineering
D) Implementation
E) Refreezing
d

1) _____ is the last step in the change process.

A) Diagnosis of relevant variables
B) Actual implementation
C) Evaluation and follow-up
D) Recognition of the need for change
E) Establishment of goals for the change
c

1) The first step of the change process involves:

A) recognizing the need for change.
B) implementing the change.
C) selecting a change technique.
D) choosing a change leader.
E) overcoming resistance to change.
a

1) Ron, a manager at a hardware components manufacturing unit, has recently learned from
a subordinate's report that the production rates in his firm have gone down immensely
because of poor employee morale. Ron has realized that he needs to implement a change in
the organization that will motivate employees. Which of the following steps in the
comprehensive approach to change is illustrated in the scenario?
A) Recognizing the need for change
B) Understanding how to implement the change
C) Setting goals for the change
D) Selecting a change technique
E) Implementing the change
a

1) Which of the following is an example of a goal for change for an organization?

A) Reacting to a forecast indicating new market potential
B) Recognizing that poor employee morale was caused by dangerous working conditions
C) Deciding to decrease employee turnover rates by 90 percent
D) Introducing a new reward system for employees
E) Arranging for training on interpersonal skills for managers
c

1) Which of the following exemplifies the first step in the comprehensive organization change
model?
A) Setting standards for a new absenteeism control procedure
B) Noticing that the pension fund has less cash than needed to provide the guaranteed
employee benefits
C) Determining the probable causes of a recently detected drop in the level of employee job
satisfaction
D) Investigating different techniques for enhancing employee job satisfaction
E) Planning meetings to help employees understand the procedures in the company's new
quality program
b

1) Jenny runs a small boutique in New Orleans and has five employees working under her.
Lately, she has noticed that her boutique has not been delivering customer orders on time,
and she has realized that it is because of the rise in the number of customers and insufficient
manpower. She has decided to employ another five employees. Which step of the change
process is illustrated in the scenario?
A) Implementing the change
B) Diagnosis of relevant variables
C) Selection of an appropriate change technique
D) Planning for implementation of change
E) Evaluation and follow-up
c

1) The top management at Omega Inc. recently initiated an employee motivation drive to
improve employee morale and in turn decrease turnover rates. It has now commissioned a
statistics firm to check the effect of its initiative on the employees' morale. Which step of the
comprehensive approach to change is illustrated in the scenario?
A) Evaluation and follow-up
B) Selection of appropriate change technique
C) Planning for implementation of change
D) Diagnosis of relevant variables
E) Actual implementation
a

1) In general, the biggest cause of worker resistance to change is _____.

A) satisfaction
B) uncertainty
C) regret
D) feelings of loss
E) different perceptions
b

1) When Beta Inc. acquired Redd Communications, there was a huge uproar by the staff of
Redd Communications as there were rumors of staff reductions and operations closures.
_____ was the cause for this reaction by the Redd Communications staff.
A) Synergy
B) Process gain
C) Uncertainty
D) Process loss
E) Facilitation
c

1) Wendy is reluctant to accept a new job offer because she's worried about her ability to
meet new job demands. The most likely reason for such employee resistance to change is
_____.
A) threatened self-interests
B) facilitation
D) participation
C) uncertainty
E) feelings of loss
c

1) When the top management at Venus Corp. sought to change the organization design,
form more work teams, and decrease the managers' span of management, it met with great
resistance from the managers. This was because the managers feared that their power
within the company would decrease. The managers' reaction to change was brought about
by _____.
A) facilitation
B) participation
C) threatened self-interests
D) low self-confidence
E) unfamiliarity with company procedures
c

1) Which of the following is an effective way of overcoming resistance to change?

A) Allowing employees to participate in the change process
B) Fostering an environment of uncertainty in the organization
C) Announcing the change only after it has been implemented
D) Minimizing communication among employees
E) Avoiding force-field analysis
a

1) Which of the following is a cause for the resistance to change that a worker might feel
because the worker disagrees with the management that the change will be best for the
organization in the long-run?
A) Threatened self-interests
B) Risk propensity
C) Participation
D) Different perceptions
E) Feelings of loss
d

1) Managers can overcome resistance to change by:

A) not letting employees know about the change.
B) letting employees know about the change only after it has been successfully
implemented.
C) limiting the involvement of employees in the change process.
D) minimizing communication during the change process.
E) announcing the change much in advance.
e

1) Which of the following is an effective way of overcoming resistance to change?

A) Using micromanagement techniques
B) Using facilitation techniques
C) Using deskilling techniques
D) Limiting employee involvement in the change process
E) Minimizing communication
b

1) To overcome resistance to change, the top management of a company discusses with its
employees the new employee policies and procedures that it proposes to bring in and also
seeks their involvement in the change process. This scenario illustrates the _____ technique
that helps reduce resistance to change.
A) participation
B) synergy
C) deskilling
D) greenwashing
E) risk propensity
a

1) Martin is trying to adopt more automated equipment in his soda bottling facility, and
workers are resisting the change. When Martin decides to hold a meeting to explain to
workers how the change will be beneficial to them, he is using _____ as a means of
overcoming resistance to change.
A) entropy
B) micromanagement
C) deskilling
D) education
E) specialization
d

1) The top management at Phoenix Inc. planned to shift their corporate office to a bigger and
better facility about four streets away from the current location. The top managers knew that
their decision would meet with considerable employee resistance, so they informed all the
employees well in advance of the advantages of moving to the new office. This minimized
the employees' resistance. Which of the following techniques of overcoming resistance is
illustrated in the scenario?
A) Risk propensity
B) Education
C) Specialization
D) Micromanagement
E) Deskilling
b

1) According to the results of a classic study, employee participation:

A) reduces the need for communication.
B) encourages employees to resist change.
C) increases productivity and satisfaction.
D) increases turnover rates.
E) creates a centralized structure.
c

1) In most change situations, there are factors that make the change process more difficult
and others that seem to ease the process. The process by which a manager identifies these
factors and then tries to tip the balance so that the factors facilitating the change outweigh
those hindering the change is called _____.
A) facilitation
B) implementation
C) force-field analysis
D) participative development
E) education
c

1) A force-field analysis identifies:

A) management potential in existing employees.
B) synergy in an organization.
C) the need for structural change in an organization.
D) factors that facilitate and hinder organization change.
E) the appropriate span of management for an organization.
d

1) Gamma Corp. is planning to bring in new internal standards for all the products it
manufactures. The new standards will ensure better quality and will also help the company
gain a competitive advantage. However, the factors that stand in the way of the change are
increased workload on employees and the need for skill development among employees. To
minimize these factors that hinder the change, Gamma has decided to motivate its
employees through a reward system. Which of the following concepts is illustrated in the
scenario?
A) Force-field analysis
B) Participation
C) Job deskilling
D) Specialization
E) Micromanagement
a

1) A change in an organization's culture is an example of change in the area of _____.

A) organization structure
B) organizational operations
C) work processes
D) information technology
E) organizational control systems
a

1) Alpha Corp. has divided its business into a number of sub units. This organization change
is an example of change in the area of _____.
A) people
B) operations
C) structure and design
D) social responsibility
E) organization mission
c

1) Richard Inc. has been receiving complaints from its customers about the inefficiency of its
customer service professionals. The company has now decided to change the recruitment
criteria for this role. The new criteria place more emphasis on technical expertise. Richard
Inc. is attempting to make a change in the area of _____.
A) information technology
B) work sequences
C) operations
D) enterprise resource planning
E) organization structure and design
e

1) A company has recently undergone a transformation from using a highly centralized

approach to a much more decentralized approach for managing its operations. This change
represents a change in the area of _____.
A) technology
B) work sequences
C) work processes
D) organization structure
E) enterprise resource planning
d
1) Image LLC, an advertising company, has recently received several long-term projects
from leading companies. Image has decided to switch from functional departmentalization to
cross-functional work teams to be able to perform better. This is an example of change in the
area of _____.
A) technology and operations
B) social structure
C) people
D) organization structure and design
E) task environment
d

1) When a firm decides to decrease the number of first-line managers it has, and thus
increase the span of management of first-line managers, it is making a change in the area of
_____.
A) organization structure and design
B) social structure
C) task environment
D) people
E) technology and operations
a

1) Robin Plastics Inc. recently set up a new strategic business unit. The company made
changes in the area of _____.
A) technology and operations
B) social structure
C) people
D) task environment
E) organization structure and design
e

1) Alba Inc. replaced old equipment with new and advanced production equipment in all its
plants. This is an example of a change in the area of _____.
A) job design
B) people
C) organization culture
D) line-staff structure
E) technology and operations
e

1) When a company changes its work processes, the change is in the area of _____.
A) people
B) technology and operations
C) job design
D) facilitation
E) task environment
b
1) Watches.com, an online watch store, recently adopted a new enterprise resource
planning (ERP) system to help keep track of the company's inventory and to deliver
customers' orders on time. The company's adoption of the new ERP system reflects a
change in the area of _____.
A) organization culture
B) job design
C) technology and operations
D) people
E) departmentalization
c

1) Which of the following is an example of an organization's change in technology and

operations?
A) Enhanced job design
B) Introduction of departmentalization
C) Adoption of new information systems
D) Introduction of a new compensation program
E) Introduction of new employment policies
c

1) When organizational change involves planned alteration of work sequence or work

activities, the change primarily occurs in the area of _____.
A) people
B) technology and operations
C) social responsibility
D) strategy
E) organizational structure and design
b

1) Which of the following represents organization change in the area of change in technology
and operations?
A) Changing line and staff relationships
B) Upgrading the management information system
C) Training people to give them new skills and abilities
D) Redesigning jobs
E) Changing the authority distribution in a company
b

1) _____ is the conversion process used by an organization to transform inputs into outputs.
A) Reengineering
B) Divestment
C) Technology
D) Entropy
E) Process gain
c

1) Blue Bells Inc. is a software services firm. Lately, the company's HR department noticed
that its employees' performance levels have plummeted, and a survey conducted by the firm
indicated that this was due to low employee satisfaction levels. This prompted the HR
department to introduce a new incentive system in the company. This is an example of
change in the area of _____.
A) people B) task environment
C) technology and operations
D) general environment
E) regulatory systems
a

1) Attempting to change the attitudes and values of a company's workforce indicates a

change in the area of _____.
A) people
B) work processes
C) organizational control systems
D) organization structure
E) task environment
A

1) A company has introduced new rules and regulations and appraisal criteria to promote
discipline and commitment among employees. This organization change is in the area of
_____.
A) work process
B) enterprise resource management
C) technology
D) operations
E) people
e

1) _____ is a common platform for changing business processes.

A) Enterprise resource planning
B) Entropy
C) Reverse engineering
D) Contingency planning
E) Synergy
a

1) The radical redesign of all aspects of an organization in order to achieve major gains in
cost reduction, service delivery, or reduction in order-processing time is known as _____.
A) entropy
B) process change
C) innovation
D) reengineering
E) system change
d

1) The normal process within an organization that leads to a system decline is known as
_____.
A) reengineering
B) synergy
C) process gain
D) innovation
E) entropy
e

1) Which of the following is true of business process changes?

A) Business process change should not be carried out during a phase of entropy.
B) Business process change requires a careful blend of top-down and bottom-up
involvement.
C) Centralization must be adopted by the top management for the business process change
to be successful.
D) Employee participation should be minimal during a business process change.
E) Successful business process change is not accompanied by a sense of urgency.
b

1) In the reengineering process, the first step involves:

A) setting goals and developing a strategy.
B) emphasizing top management's commitment to reengineering.
C) implementing the chosen strategy across the organization.
D) optimizing top-down and bottom-up perspectives.
E) creating a sense of urgency among managers.
a

1) Which of the following can help make the reengineering process more effective?
A) Limiting communication
B) Creating a sense of urgency in the organization
C) Adopting a highly centralized organizational structure
D) Refraining from making extensive changes
E) Limiting employee involvement in the process
b

1) Which of the following can help make the business change process more effective?
A) Limiting employee involvement in the process
B) Refraining from creating a sense of urgency in the organization
C) Starting the process with a new, clean slate
D) Limiting communication channels
E) Refraining from changing company strategies
c

1) The reengineering process can be made effective by:

A) adopting a hands-off leadership style.
B) extensively using micromanagement leadership techniques.
C) adopting a strong but not autocratic leadership style.
D) eliminating any sense of urgency in the organization.
E) limiting employee participation in the process.
e
1) Which of the following is one of the assumptions on which the theory and practice of
organization development (OD) are based?
A) Employees tend to perform well when micromanagement techniques are used.
B) The total organization and the way it is designed influence the way individuals behave
within the organization.
C) All employees have a strong need to control and influence their colleagues and the
organization's work processes.
D) Employees naturally dislike their work and lack ambition.
E) A successful corporate leader is one who adopts an autocratic style of leadership to
control his subordinates.
b

1) Libra Technologies Inc. frequently asks its employees to measure such things as
supervisor effectiveness. The company circulates various questionnaires among all its
employees to get their insights. Which organization development is illustrated in the
scenario?
A) Third-party peacemaking
B) Survey feedback
C) Team building
D) Process consultation
E) Force-field analysis
b

1) _____ are aimed at analyzing the current condition of an organization; this approach
involves using questionnaires, opinion surveys, interviews, archival data, and meetings to
assess the various characteristics of the organization.
A) Life and career planning activities
B) Technostructural activities
C) Third-party peacemaking activities
D) Diagnostic activities
E) Process consultation activities
d

1) Which of the following is a possible diagnostic activity in organization development?

A) Enterprise resource planning
B) Attitude surveys
C) Force-field analysis
D) Job shadowing
E) Reverse engineering
b

1) Leading Edge Software Inc. has introduced a new activity called "Group Farming" in
which the company's executive groups participate in farming activities for three hours every
month. This activity has been designed by the company to emphasize the importance of
interdependence and coordination among its employees. Which of the following organization
development techniques is the company using?
A) Third-party peacemaking
B) Process consultation
C) Team building
D) Survey feedback
E) Coaching and counseling
c

1) Zen Electricals Inc. has internal experts who help executives learn about how others see
them and improve their performance in the future. The company is using the organization
development technique called _____.
A) technostructural activities
B) process consultation
C) team building
D) coaching and counseling
E) third-party peacemaking
d

1) In the context of organization development techniques, coaching and counseling:

A) focus on how an individual is performing today.
B) provide nonevaluative feedback to individuals.
C) provide assistance to individuals with achieving non-work-related objectives.
D) are designed for managers and not executive employees.
E) focus exclusively on increasing productivity.
b

1) _____ is an organization development (OD) technique that helps employees formulate

their personal goals and evaluate strategies for integrating their goals with the goals of the
organization.
A) Process consultation
B) Third-party peacemaking
C) Team building
D) Life and career planning
E) Counseling
d

1) The first stage of the organizational innovation process is _____ of creative ideas.
A) growth
B) maturity
C) launch
D) development
E) application
d

1) _____ is the managed effort of an organization to develop new products or services or

new uses for existing products or services
A) Divestiture
B) Innovation
C) Reverse engineering
D) Job deskilling
E) Contingency management
b

1) _____ is the stage of the innovation process at which an organization introduces new
products or services to the marketplace.
A) Innovation development
B) Application launch
C) Innovation application
D) Application growth
E) Innovation maturity
b

1) During which phase of the organizational innovation process do most organizations have
access to an innovation and apply it in the same way?
A) Innovation development
B) Innovation maturity
C) Innovation launch
D) Innovation growth
E) Innovation application
b

1) _____ are new products, services, or technologies developed by an organization that

completely replace the existing products, services, or technologies in an industry.
A) Process innovations
B) Incremental innovations
C) Radical innovations
D) Mechanical innovations
E) Managerial innovations
c

1) _____ are changes in the way products or services are manufactured, created, or
distributed.
A) Process innovations
B) Operational innovations
C) Radical innovations
D) Mechanical innovations
E) Managerial innovations
a

1) A(n) _____ is a change in the appearance or performance of a product or service or of the

physical processes through which a product or service is manufactured.
A) technical innovation
B) incremental innovation
C) radical innovation
D) mechanical innovation
E) managerial innovation
a

1) _____ is one of the three specific ways for promoting innovation in organizations.
A) Organization culture
B) Organization development
C) Enterprise resource planning
D) Force-field analysis
E) Division of labor
a

1) A(n) _____ is a top-level manager who approves of and supports a project. This person
may fight for the budget needed to develop an idea, overcome arguments against a project,
and use organizational politics to ensure the project's survival.
A) product champion
B) inventor
C) innovation champion
D) investor
E) sponsor
e

1) A(n) _____ is a person who actually conceives of and develops the new idea, product, or
service by means of the creative process.
A) inventor
B) sponsor
C) product champion
D) angel investor
E) venture capitalist
a

1) A(n) _____ is usually a middle manager who learns about a new project and becomes
committed to it. He helps overcome organizational resistance to change and convinces
others to take the innovation seriously.
A) product champion
B) inventor
C) sponsor
D) venture capitalist
E) transformational leader
a

1) The set of activities directed at attracting, developing, and maintaining an effective

workforce is called _____.
A) operations management
B) organization development
C) relationship management
D) enterprise feedback management
E) human resource management
e

1) _____ reflects an organization's investment in attracting, retaining, and motivating an

effective workforce.
A) Financial capital
B) Human capital
C) Surplus capital
D) Enterprise capital
E) Production capital
b

1) _____forbids discrimination on the basis of sex, race, color, religion, or national origin in
all areas of the employment relationship.
A) The Citizen Rights Act of 1957
B) Title IV of the Sarbanes Oxley Act
C) Title VII of the Civil Rights Act of 1964
D) Section 1107 of the Sarbanes Oxley Act
E) Section 401 of the Public Company Accounting Reform and Investor Protection Act
c

1) A hospital refuses to employ male nurses. This illustrates _____.

A) confirmatory bias
B) affirmative action
C) a direct form of discrimination
D) equal employment opportunity
E) employment at will
c

1) A taxi company has a policy that it will never hire women drivers. This scenario
illustrates_____.
A) workforce diversity
B) source monitoring error
C) a direct form of discrimination
D) confirmatory bias
E) affirmative action
c

1) Which of the following is an example of a direct form of discrimination?

A) An organization intentionally seeking and hiring employees from groups that are
underrepresented in the organization
B) An organization refusing to promote employees belonging to an ethnic minority into
management
C) An organization hiring professionals based on their experience and skills
D) An organization using employment tests that men pass at a higher rate than women
E) An organization using realistic job previews to recruit employees
b

1) When an organization uses an employment test that the majority ethnic group is known to
pass at a higher rate than minority groups , it is exhibiting _____.
A) an indirect form of discrimination
B) equal employment opportunity
C) affirmative action
D) a direct form of discrimination
E) a realistic job preview
a

1) _____ is defined as intentionally seeking and hiring qualified or qualifiable employees

from racial, sexual, and ethnic groups that are underrepresented in an organization.
A) Affirmative action
B) Direct form of discrimination
C) Indirect form of discrimination
D) Adverse impact
E) Validation
a

1) A medical student belonging to a minority ethnic group was selected for an internship
program at a hospital even though he had lower grades and test scores than other
applicants. This scenario illustrates:
A) confirmatory bias.
B) employment at will.
C) affirmative action.
D) source monitoring error.
E) equal employment opportunity.
c

1) The Age Discrimination in Employment Act forbids discrimination against workers above
which of the following ages?
A) 40
B) 45
C) 50
D) 55
E) 65
a

1) Employment requirements such as test scores and other qualifications are legally defined
as having a(n) _____ on minorities and women when such individuals meet or pass the
requirement at a rate less than 80 percent of the rate of majority group members.
A) affirmative action
B) adverse impact
C) confirmatory action
D) lien
E) divergent impact
b

1) The Age Discrimination in Employment Act:

A) exclusively protects the elderly belonging to minority groups from discrimination.
B) sets a minimum wage for the elderly and requires overtime pay for work in excess of 40
hours per week.
C) protects individuals below the age of 25 years from discrimination.
D) requires affirmative action.
E) requires passive nondiscrimination.
e

1) The Civil Rights Act of 1991:

A) increases punitive damages in lawsuits.
B) makes it easier for employees to sue an organization for discrimination.
C) requires employers to provide up to 12 weeks of paid leave for family and medical
emergencies.
D) limits union powers.
E) sets standards for safe working conditions.
...

1) The Civil Rights Act of 1991:

A) limits union powers.
B) mandates affirmative action in all private business firms.
C) limits punitive damages in lawsuits.
D) allows passive discrimination.
E) sets standards for product packaging
D

1) The _____ sets up a procedure for employees to vote on whether to have a union.
A) National Labor Relations Act
B) Labor Management Relations Act
C) Taft-Hartley Act
D) Civil Rights Act of 1991
E) Fair Labor Standards Act
a

1) Which of the following laws limits union power and specifies management rights during
union-organizing campaign?
A) The National Labor Relations Act
B) The Employee Retirement Income Security Act of 1974
C) The Fair Labor Standards Act
D) The Labor Management Relations Act
E) The Occupational Safety and Health Act of 1970
d

1) The Family and Medical Leave Act of 1993 requires employers to provide up to _____ for
family and medical emergencies.
A) six months of paid leave
B) 12 weeks of unpaid leave
C) 15 weeks of paid leave
D) one year of unpaid leave
E) one year of paid leave
b

1) _____ also contains the National Emergency Strike provision, which allows the president
of the United States to prevent or end a strike that endangers national security.
A) The Civil Rights Act of 1991
B) Title IV of the Sarbanes Oxley Act
C) The Occupational Safety and Health Act of 1970
D) The Taft-Hartley Act
E) The Kennedy-Hawkins Act
d

1) The _____, passed in 1938 and amended frequently since then, sets a minimum wage
and requires the payment of overtime rates for work in excess of 40 hours per week.
A) National Labor Relations Act
B) Labor Management Relations Act
C) National Labor Relations Act
D) Occupational Safety and Health Act
E) Fair Labor Standards Act
e

1) _____ is a systematized procedure for collecting and recording information about jobs
within an organization.
A) Job analysis
B) Job evaluation
C) Job specialization
D) Job enrichment
E) Job enlargement
a

1) Which of the following is the first step in human resource planning?

A) Assessing external and internal trends
B) Predicting demand
C) Forecasting supply
D) Comparing future demand and internal supply
E) Planning a response to predicted shortfalls or overstaffing
a

1) The _____ lists the duties of a job, the job's working conditions, and the tools, materials,
and equipment used to perform it.
A) job specification
B) job description
C) replacement chart
D) statement of qualification
E) article of incorporation
b

1) The _____ lists the skills, abilities, and other credentials needed to do a job.
A) article of incorporation
B) replacement chart
C) job description
D) job specification
E) statement of qualification
d
1) A(n) _____ is usually computerized and contains information on each employee's
education, work experience, and career aspirations.
A) bona fide occupational qualification
B) article of incorporation
C) skills inventory
D) statement of qualification
E) job description
c

1) A job description is most likely to provide information about:

A) the skills of an existing employee.
B) the tools, materials, and equipment used to perform the job.
C) the educational background of an applicant.
D) the personal profile of a supervisor.
E) the kind of skills that a job demands.
b

1) You are reading a document that says that a job applicant must have good writing skills,
be a citizen of the United States, and have a degree in management. You are reading a(n)
_____.
A) article of incorporation
B) job analysis
C) job description
D) replacement chart
E) job specification
e

1) A(n) _____ lists each important managerial position in an organization, who occupies it,
how long he or she will probably remain in the position, and who is or will be a qualified fill-in.
A) skills inventory
B) employee information system
C) enterprise resource planning system
D) replacement chart
E) Gantt chart
d

1) The CEO of Redd Inc. needs to know the names of the line managers in the company
who will soon be ready to take up positions in middle management. The CEO can obtain this
information from the _____.
A) demand forecast
B) job analysis
C) supply forecast
D) job evaluation
E) replacement chart
e
1) Jennifer, the CEO of Phoenix Corp., is planning to build an internal design team for the
company. She is looking for employees within the company who have the expertise and an
interest in designing. Jennifer can find this information in the _____.
A) replacement chart
B) job specification
C) skills inventory
D) job description
E) article of incorporation
c

1) Jason, a manager, is working on a new project that involves a lot of statistics. Jason is
looking for employees with a background in statistics. He can find this information in the
_____ of his company.
A) article of incorporation
B) job description
C) job specification
D) skills inventory
E) replacement chart
d

1) While matching human resource supply and demand, managers can handle predicted
shortfalls by _____.
A) avoiding the employment of new employees
B) convincing individuals who are approaching retirement to stay on
C) not replacing people who have quit
D) laying off employees
E) reducing the benefits provided to employees
b

1) _____ is the process of attracting qualified persons to apply for jobs that are open.
A) Mentoring
B) Recruiting
C) Job analysis
D) Job evaluation
E) Validation
b

1) Advertising, campus interviews, employment agencies, and union hiring halls are all
_____ methods.
A) external recruiting
B) job analysis
C) validation
D) job evaluation
E) realistic job preview
a

1) _____ is defined as determining the extent to which a selection device is really predictive
of future job performance.
A) Realistic job preview
B) Internal recruitment
C) Job evaluation
D) Validation
E) Job analysis
d

1) Nelson recently attended an interview where the HR manager showed him a video of an
ordinary work day in the organization and explained in detail the expectations of the job. The
HR manager also explained about the criteria for promotions in the company. Although some
of the information did not appeal to Nelson, he was sure about what to expect from the job
and the company. The organization used the _____ method in the interview.
A) affirmative action
B) training and development
C) job enlargement
D) job specialization
E) realistic job preview
e

1) A job application blank should not contain questions about an applicant's_____.

A) previous work history
B) educational background
C) national origin
D) age
E) personal interests
c

1) Teresa, a recruiter, needs to know basic information such as the name, educational
background, and the work experience of a candidate she will be interviewing. Teresa can
find this information in the candidate's _____.
A) skills inventory
B) job description
C) job specification
D) application blank
E) replacement chart
d

1) The assessment center:

A) is used to select external candidates.
B) is a content-valid simulation of major parts of the managerial job.
C) is most likely to be biased against women and minority groups.
D) essentially involves conducting physical exams and drug tests on candidates.
E) essentially involves running credit checks on prospective employees.
b

1) A company has all of its candidates who are qualifiable for promotion attend a five-day
evaluation session during which they take a battery of tests, interviews, and perform in
simulated work scenarios. The _____ method is used for the selection process in this
scenario.
A) assessment center
B) structured orientation process
C) job analysis
D) job deskilling
E) attrition
a

1) _____ refers to teaching managers and professionals the skills needed for both present
and future jobs.
A) Development
B) Deskilling
C) Validation
D) Job evaluation
E) Performance appraisal
a

1) In human resource management, _____ usually refers to teaching operational or technical

employees how to do the job for which they were hired. .
A) job rotation
B) job specialization
C) development
D) training
E) deskilling
d

1) Sara is an efficient supervisor at a restaurant, which is part of a large national chain. She
was recently sent to a two-week educational course by her employer to help her get the
skills she needs for promotion to a higher management post. The human resource
management concept illustrated in the scenario is _____.
A) job specialization
B) job rotation
C) development
D) training
E) recruitment
c

1) Venus LLC has recently recruited a new batch of employees, and the HR manager
intends to apprise company rules to the employees. Which of the following training methods
is most preferable in this scenario?
A) Electronic-media-based training
B) The lecture method
C) Role-playing
D) Case discussion groups
E) On-the-job training
b
1) _____is an ideal method for training employees in group decision making.
A) Vestibule training
B) Programmed learning
C) Role-playing
D) Assigned reading
E) The lecture method
c

1) Ken is a newly hired police officer. He has been asked to spend a workday with a more
experienced officer to learn about paperwork, how to handle accident scenes, how to
interact with people, and other duties that he will be expected to perform. Which of the
following concepts is illustrated in the scenario?
A) Performance appraisal
B) The assessment center method
C) Training manuals
D) On-the-job training
E) The lecture method
d

1) _____ is an effective method to use for training employees about ethical dilemmas and
ethical decision making.
A) Job specialization
B) Case discussion groups
C) On-the-job training
D) The lecture method
E) Programmed instruction
b

1) _____ is used when employees must learn a physical skill, and this method also enables
participants to focus on safety, learning, and feedback rather than on productivity.
A) Job rotation
B) The lecture method
C) Case discussion groups
D) Vestibule training
E) Assigned reading
d

Which of the following is an advantage of Web-based training methods?

A) They can be easily updated and revised.
B) They facilitate interpersonal skills better than all other training methods.
C) They perfectly simulate real activities.
D) They effectively facilitate face-to-face interaction.
E) They can be easily used in place of vestibule training methods
a

1) _____ is a formal assessment of how well employees are doing their jobs
. A) Job specialization
B) Job analysis
C) Performance appraisal
D) Employment branding
E) Validation
c

1) Which of the following is an example of an objective measure of performance?

A) Dollar volume of sales
B) Interpersonal agreeability
C) Ranking
D) Ratings
E) Commitment
a

1) Ranking D) Ratings E) Commitment

2) Number of claims processed, total sales, and scrap rate are all examples of _____.
A) training methods
B) predictive validation methods
C) content validation methods
D) judgmental performance appraisal criteria
E) objective performance appraisal criteria
e

1) An example of judgmental performance measure is _____.

A) ranking
B) total sales
C) scrap rate
D) dollar volume of sales
E) number of units produced
a

1) _____ compares each employee with a fixed standard rather than comparison with other
employees.
A) An objective method
B) Rating
C) Ranking
D) Job specialization
E) Job enlargement
b

1) The Behaviorally Anchored Rating Scale (BARS) is _____.

A) a method used for the validation of a selection device
B) an objective method of performance appraisal
C) a judgmental method of performance appraisal
D) a job training technique
E) a job analysis technique
c
1) A(n) _____ occurs when a manager allows the assessment of an employee on one
dimension to spread to ratings of that employee on other dimensions.
A) recency error
B) average error
C) validation error
D) source monitoring error
E) halo error
e

1) Jan works as a salesperson. She generally achieves the expected targets but has also
failed several times. For the previous month, she performed better than all her team
members and achieved a huge sales volume. Even though Jan has not achieved her targets
on several occasions during the past one year, her supervisor ranked her as number one.
This is an example of how a(n) _____ can influence a performance appraisal.
A) recency error
B) halo error
C) source monitoring error
D) severity error
E) average error
a

1) A performance appraisal system in which managers are evaluated by everyone around

them-their boss, their peers, and their subordinates is known as _____.
A) employment at will
B) 360-degree feedback
C) source monitoring
D) job evaluation
E) job specialization
b

1) _____ is the financial remuneration given by an organization to its employees in exchange

for their work.
A) Progression
B) Compensation
C) Validation
D) An intangible benefit
E) Insurance
b

1) A(n) _____ represents a special compensation opportunity that is usually tied to

performance.
A) wage
B) salary
C) incentive
D) benefit
E) intangible reward
c
1) _____, sometimes called indirect compensation, are things of value other than
compensation that an organization provides to its workers.
A) Appraisals
B) Ratings
C) Rankings
D) Benefits
E) Scrap rates
d

1) At Omega Inc., a fixed amount of money is added to the salaries of employees if their
performance exceeds a predetermined level of expectation. A smaller portion of the amount
is added if the employees' performances just meet the expected level. Omega is most likely
to be motivating their employees with _____.
A) incentives
B) intangible benefits
C) rankings
D) progressions
E) appraisals
a

1) During a job interview, Sarah asked the HR manager if the company would provide her a
family insurance or a retirement plan. She was discussing the _____ that companies
generally offer.
A) benefits
B) intangible benefits
C) incentives
D) wages
E) progressions
a

1) Gamma Inc. has a reputation for paying higher than the prevailing wages in its industry.
This is an example of a(n) _____ decision by its management.
A) wage-level
B) wage-structure
C) individual wage
D) wage-benefit package
E) benefit-level
a

1) The _____ is a management policy decision about whether a firm wants to pay above, at,
or below the going rate for labor in the industry or the geographic area.
A) wage-level decision
B) benefit-level decision
C) wage-structure decision
D) individual wage decision
E) individual benefit decision
a
1) An attempt to assess the worth of each job relative to other jobs is known as _____.
A) job analysis
B) job evaluation
C) the wage-level decision
D) performance appraisal
E) benefit determination
b

1) When human resource managers determine how much each worker in a particular wage
grade will be paid, they are making a(n) _____ decision.
A) wage-level
B) wage-structure
C) individual wage
D) benefit-level
E) overall-benefit
c

1) _____ are usually set up through a procedure called job evaluation-an attempt to assess
the worth of each job relative to other jobs.
A) Wage-level policies
B) Wage structures
C) Individual wage policies
D) Wage level decisions
E) Individual-benefit structures
b

1) A policy at Synergy Corp. states that the middle managers get a pay that is three times
the pay of supervisors and the top managers get a pay that is six times the pay of first-line
managers. The policy is regarding the _____ of Synergy.
A) wage-benefit decision
B) wage-level decision
C) individual-wage structure
D) benefit structure
E) wage structure
e

1) A cafeteria benefits plan:

A) allows employees to choose from a set of optional benefits.
B) provides performance-linked incentives to employees.
C) reimburses employees for their food and transportation expenses.
D) pays extra wages to employees for work they do during their lunch hour.
E) allows employees to take a certain number of unpaid leaves.
a

1) In the business world, the term _____ is generally used to refer to demographic
differences among people-differences in gender, age, ethnicity, and so forth.
A) homogeneity
B) synergy
C) diversity
D) divestiture
E) entropy
c

1) Organizations with a diverse workforce are most likely to _____ when compared to less
diverse organizations.
A) have higher levels of productivity
B) have higher levels of turnover
C) have higher levels of absenteeism
D) foster fewer conflicts
E) have a lack of understanding of different market segments
A

1) Which of the following is an effective individual strategy for managing diversity?

A) Using micromanagement techniques for managing minority groups
B) Limiting interpersonal communication
C) Fostering tolerance
D) Treating everyone the same without regard for their fundamental human differences
E) Forming culturally and ethnically homogenous work teams
c

1) An effective individual strategy for managing a diverse workforce is:

A) Encouraging interpersonal communication
B) Treating everyone the same without regard for their fundamental human differences
C) Creating ethnically homogenous work teams
D) Using micromanagement techniques
E) Limiting managerial communication
a

1) An organization with a diverse workforce:

A) is most likely to have a high turnover.
B) is most likely to have low productivity.
C) is least likely to have conflicts.
D) is least likely to require communication.
E) is most likely to have a competitive advantage.
e

1) Which of the following statements is true in the context of diversity in an organization?

A) Organizations with a diverse workforce are also better able to understand different market
segments than are less diverse organizations.
B) Organizations with diverse workforces are generally less creative and innovative than
other organizations.
C) Organizations that place emphasis on diversity tend to have fewer conflicts and
communication problems than other organizations.
D) Organizations that place emphasis on diversity have fewer training requirements than
organizations with non-diverse workforces.
E) Organizations with diverse workforces generally have lower levels of productivity than
other organizations.
a

1) Organizations with a diverse workforce:

A) have fewer training needs.
B) find it difficult to gain competitive advantages.
C) tend to have low productivity.
D) tend to have conflicts.
E) find it difficult to understand different market segments.
d

1) Which of the following statements is true in the context of effectively managing diverse
workforces?
A) Tolerance is not required to effectively function in a diverse workforce.
B) A diverse workforce can be managed effectively by not acknowledging the differences
among people.
C) Organizations can more effectively manage diversity by following practices and
procedures that are based on flexibility.
D) Any effort to treat everyone the same, without regard for their fundamental human
differences, will reduce problems.
E) Limiting communication among different ethnic groups is an effective way of handling
conflicts in a diverse organization.
c

1) _____ is the process of dealing with employees who are represented by a union.
A) Labor relations
B) Public relations
C) Human relations
D) Operational management
E) Assembly-line management
a

1) A person who works for an organization on something other than a permanent or fulltime
basis is known as a(n)_____.
A) SCORE volunteer
B) union worker
C) contingent worker
D) knowledge worker
E) intrapreneur
c

1) Which of the following is a discussion process between a union and management that
focuses on agreeing to a written contract that will cover all relevant aspects of their
relationship?
A) Job evaluation
B) Collective bargaining
C) The grievance procedure
D) Certification
E) Arbitration
b

1) The means by which a labor agreement is enforced is the _____.

A) grievance procedure
B) union rights clause
C) management rights clause
D) union security clause
E) strike/lockout procedure
a

1) Executives who retire and then work as consultants are part of the _____ workforce.
A) temporary
B) emergent
C) task-oriented
D) job-specific
E) union
a

1) Top managers at Phoenix Inc. are all computer engineers and are highly regarded by
other companies. They are frequently approached by executive search firms with information
about openings at other companies. The managers are examples of _____.
A) temporary workers
B) emergent workers
C) contingent employees
D) job-specific employees
E) knowledge workers
e

1) A category of temporary workers is:

A) independent contractors.
B) shareholders. C) intrapreneurs
. D) angel investors.
E) venture capitalists.
a

1) _____ is defined as the set of forces that cause people to behave in certain ways.
A) Motivation
B) Management
C) Attribution
D) Personality
E) Contribution
a

_____ is defined as the set of forces that cause people to behave in certain ways.
A) Motivation
B) Management
C) Attribution
D) Personality
E) Contribution
b

1) Madeline works at a local retail store. She feels that she is being underpaid in spite of her
job performance. She motivates herself to improve her performance to get the due
recognition she deserves. Madeline's motivation is due to a _____.
A) need deficiency
B) negative reinforcement
C) low performance-to-outcome expectancy
D) dissatisfaction of physiological needs
E) need for belongingness
a

1) According to the motivation framework, after a worker notices an unfilled need, the next
step is:
A) choosing a behavior that satisfies the need.
B) determining future needs.
C) searching for ways to satisfy the need.
D) evaluating need satisfaction.
E) identifying a need deficiency.
c

1) Under which of the following circumstances will an employee feel a need deficiency?
A) When she feels that her tasks are challenging
B) When she receives recognition for a job well done
C) When she feels she is underpaid
D) When she is motivated to perform a job
E) When she attains self-actualization
c

1) Which of the following perspectives on motivation concerns "what" motivates people

rather than "how" they are motivated?
A) Reinforcement
B) Process
C) Content
D) Equity
E) Expectancy
c

1) Which of the following factors would be included in Maslow's physiological needs

category?
A) Air
B) Job stability
C) Safety
D) Recognition
E) Self-image
a

1) According to Maslow's hierarchy of needs, once an individual has satisfied his

physiological needs, he turns his focus towards _____ needs.
A) survival needs
B) esteem
C) belongingness
D) security
E) self-actualization
d

1) Organizations provide adequate wages, comfortable temperatures, restrooms, ventilation,

etc. as a means to address the _____ needs of its employees.
A) esteem
B) belongingness
C) self-actualization
D) security
E) physiological
e

1) According to Maslow's hierarchy, the need to have a safe physical and emotional
environment is a(n) _____ need.
A) esteem
B) physiological
C) psychological
D) security
E) social
d

1) When a manager tries to encourage social interaction among his subordinates, he is

trying to address their need for _____.
A) belongingness
B) esteem
C) security
D) physiological
E) self-actualization
a

1) According to Maslow's hierarchy, when a satisfaction of security needs is achieved an

individual is typically concerned with a need for _____.
A) self-actualization
B) recognition
C) physiology
D) belongingness
E) positive self-image
d
1) Martha is given a new cabin and a new job title as recognition for her accomplishment
over her years of service to the organization. She is satisfied with the recognition and
respect from her colleagues. This portrays that the organization is addressing her _____
needs.
A) esteem
B) psychological
C) security
D) physiology
E) self-actualization
a

1) According to Maslow's hierarchy, _____ needs include the need that people have for
respect and recognition.
A) achievement
B) security
C) self-actualization
D) belongingness
E) esteem
e

1) _____ needs in Maslow's hierarchy involve realizing one's potential for continued growth
and individual development.
A) Esteem
B) Social
C) Self-actualization
D) Security
E) Physiological
c

1) Brenda, a senior engineer at Machineworks Inc., sets herself difficult goals and assumes
personal responsibility for the performance of her subordinates. Brenda most likely has a
high need for _____.
A) achievement
B) affiliation
C) esteem
D) security
E) potential
a

1) A construction worker injured on the job is on convalescent time-off for five weeks. She
has a desire to get back to work and achieve her goals more effectively than she has done in
the past. This portrays her need for _____.
A) esteem
B) power
C) affiliation
D) security
E) achievement
e
1) In expectancy theory, raises, promotions, stress and resentment are all _____ of an
individual's behaviors.
A) factors
B) motivations
C) reinforcements
D) outcomes
E) valences
d

1) Amelia believes that if she tries hard to eliminate distractions and concentrate on her
work, she will learn to do her job more efficiently. Amelia has:
A) low effort-to-performance expectancy.
B) moderate performance-to-outcome expectancy.
C) low performance-to-outcome expectancy.
D) high effort-to-performance expectancy.
E) moderate effort-to-performance expectancy.
d

1) Neal works for the state of Vermont. He perceives that his union will protect him from
getting fired, but the only way he will get promoted is if the person above him retires or dies.
He has
A) low effort-to-performance expectancy, and low performance-to-outcome expectancy.
B) low effort-to-performance expectancy, and high performance-to-outcome expectancy.
C) high effort-to-performance expectancy, and low performance-to-outcome expectancy.
D) high effort-to-performance expectancy, and high performance-to-outcome expectancy.
E) zero valence.
a

1) A manager expends extra effort because she has been told that she will get a $50,000
bonus if her team meets their quota. She also feels stress because she has been informed
that she will be put on probation if she does not get her team to perform above last year's
total. Which of the following does this scenario illustrate?
A) Equity theory
B) Maslow's esteem needs
C) Two-factor theory
D) Performance-to-outcome expectancy
E) The Porter-Lawler extension
d

1) Which of the following motivational theories is based on the idea that employees compare
the treatment they receive relative to others' treatment in order to determine if they are being
treated fairly?
A) Expectancy theory
B) Reinforcement theory
C) Equity theory
D) Hierarchy of needs theory
E) Two-factor theory
c

1) Which of the following is a process perspective on motivation?

A) Maslow's need hierarchy
B) McClelland's work on need for power
C) McClelland's work on need for achievement
D) Two-factor theory
E) Equity theory
e

1) What is the most important idea for managers to remember from equity theory?
A) People who feel underrewarded may try to decrease the inequity by increasing their
inputs.
B) Employees must receive equal rewards irrespective of their overall performance.
C) For rewards to motivate employees, employees must perceive them as being fair.
D) Employees must consider their inputs equal to the inputs of their colleagues.
E) Employees must consider their outcomes equal to the outcomes of their colleagues.
c

1) Ana is a police detective. She believes that she is just as good a detective as her male
counterparts. Because she is female, many of her counterparts assume that she will type up
their reports as well as her own. She has been doing this typing for a while and is
increasingly feeling underrewarded for her efforts. In terms of _____, she will decrease her
inputs by refusing to do additional work and try to reduce the gap between work and
rewards.
A) expectancy theory
B) reinforcement theory
C) equity theory
D) hierarchy of needs theory
E) two-factor theory
c

1) Brianna's employer has announced a goal of getting workers to live a healthier lifestyle.
Because of this, Brianna has improved the foods she eats and is getting more physical
activity. Which attribute of the expanded goal-setting theory best portrays this example?
A) goal specificity
B) goal acceptance
C) goal satisfaction
D) goal congruity
E) goal difficulty
b

1) Tyler is the marketing manager at MarketAds Inc., and Emily is an account manager
reporting to him. Tyler instructs Emily to improve public opinion. The goal that Emily was
given lacks goal _____.
A) specificity
B) acceptance
C) conformity
D) congruity
E) difficulty
a

1) Workers at Windlock Works Inc. were instructed by their supervisor to increase

productivity to 350 percent in the next three months. The workers are most likely to be
challenged by goal _____.
A) specificity
B) acceptance
C) conformity
D) congruity
E) difficulty
e

1) Leo showed up late for a meeting. His boss ignored it. She was using _____ as
reinforcement.
A) avoidance
B) extinction
C) positive reinforcement
D) punishment
E) distortion
b

1) Jaime, who works at Minlog Inc., maintains punctuality to avoid a loss of pay. Jaime's
behavior is strengthened through _____.
A) avoidance
B) extinction
C) positive reinforcement
D) punishment
E) distortion
a

1) Justin is rewarded a significant pay raise for his contributions to the organization. This
motivates him to put in more hard work and better performances. The organization has used
_____ to strengthen his behavior.
A) Avoidance
B) Extinction
C) Positive reinforcement
D) Punishment
E) Distortion
c

1) Employees at GreenTech Inc. complete their schedules on time as every hour they take in
excess may lead to a corresponding loss of pay. Their behaviors are strengthened through
_____.
A) Avoidance
B) Extinction
C) Positive reinforcement
D) Punishment
E) Incentives
a

1) Monthly paychecks are examples of reinforcements provided at a _____ schedule.

A) Random
B) Fixed-interval
C) Fixed-ratio
D) Variable-ratio
E) Variable-interval
B

1) Which of the following reinforcement schedules offers a worker the least incentive to do
good work?
A) Fixed-interval
B) Fixed-ratio
C) Variable-interval
D) Variable-ratio
E) Continuous
A

1) Which of the following reinforcement methods can be used to weaken behaviors?

A) Recognition
B) Avoidance
C) Extinction
D) Participation
E) Pay raises
C

1) Clara plays offensive pranks at her workplace, which were so far encouraged by her
colleagues. To make sure that she does not repeat such behaviors, managers at the
organization instruct her colleagues to ignore her actions. The reinforcement method
adopted by the organization is _____.
A) Recognition
B) Punishment
C) Avoidance
D) Extinction
E) Pay raises
D

1) Alberto complimented Daniel on his project updates two weeks in a row. Then he waited a
month to compliment him again. Not knowing when Alberto will drop by for inspection, Daniel
keeps his projects updated regularly. What reinforcement schedule is he using?
A) Fixed-interval
B) Fixed-ratio
C) Variable-interval
D) Variable-ratio
E) Fixed-variable
C

1) A popular retail outlet provides its salespersons a small bonus for every sale that exceeds
a $50 bill amount. The type of reinforcement used here is _____.
A) Fixed-ratio
B) Fixed-interval
C) Variable-interval
D) Variable-ratio
E) Fixed-variable
A

1) When a subordinate has outstanding performance and his or her supervisor publicly
praises it, the supervisor is using:
A) positive reinforcement.
B) punishment.
C) avoidance.
D) extinction.
E) an intrinsic reward.
A

1) Every alternate day, quality control inspectors at McHeinz Inc. randomly select items from
an assembly line for inspection, and compliment the workers for every product that meets
their expectations on quality. However, they vary the number of items they inspect each
time.This motivates the employees to put in more effort to ensure that all the items are of the
required quality. What reinforcement schedule are the quality control inspectors using?
A) Variable-interval
B) Variable-fixed
C) Fixed-ratio
D) Fixed-interval
E) Variable-ratio
E

1) A manager who provides reinforcement on a periodic basis, regardless of behavior, is

using a _____ schedule.
A) variable-interval
B) variable-fixed
C) fixed-ratio
D) fixed-interval
E) variable-ratio
D

1) If one wants to maintain an employee's behavior at a high level with variations in the level
of behavior irrespective of the time interval, which of the following schedules of
reinforcement would be most successful?
A) Fixed-interval
B) Fixed-ratio
C) Variable-interval
D) Variable-ratio
E) Continuous
D

1) A manager who provides reinforcement on the basis of a particular number of behaviors,

rather than on the basis of time is using a(n) _____ schedule.
A) fixed-ratio
B) fixed-interval
C) variable-interval
D) variable-ratio
E) interval-ratio
A

1) Which of the following programs applies the concepts of reinforcement theory?

A) Modified workweek
B) Work redesign
C) Organizational behavior modification
D) Attribution theory
E) Two-factor theory
C

1) _____ represents an important method that managers can use to enhance employee
motivation.
A) Punishment
B) Extinction
C) Absenteeism
D) Turnover
E) Empowerment
E

1) Windmere allows its administrative employees to arrive any time between 7:00 a.m. and
9:00 a.m., and to leave any time between 4:00 p.m. and 6:00 p.m., as long as they work an
eight-hour day. This arrangement is known as _____.
A) empowerment
B) compressed work schedule
C) a nine-eighty schedule
D) flextime
E) traditional schedule
D

1) Cheri and Aaron both wanted to work part-time, and they found a lawyer who was willing
to split one full-time paralegal job between the two of them so that Cheri works mornings and
Aaron works afternoons. This arrangement is known as _____
. A) flextime
B) participation
C) OB Mod
D) job sharing
E) reinforcement
D
1) Jessica is required to follow a forty-hour work schedule from 9:00 in the morning and ends
at 5:00 each day, every week. However, she has the freedom to take a day off by working
two extra hours each day. This reflects a _____.
A) variable work schedule
B) flexible work schedule
C) telecommuting arrangement
D) job sharing arrangement
E) traditional work schedule
A

1) Rewards tied specifically to _____ have the greatest impact on enhancing motivation.
A) outcome
B) performance
C) effort
D) ability
E) skill
B

1) Aside from motivational strategies such as the content perspective, process perspectives,
and reinforcement perspectives, an organization's _____ is its most basic tool for managing
employee motivation.
A) strategic plan
B) vision statement
C) objective
D) reward system
E) goal
D

1) Allowing employees to spend part of their time working offsite, usually at home, is called
_____.
A) empowerment
B) compressed work schedule
C) flexitime
D) job sharing
E) telecommuting
E

1) Elena is a sales representative. She gets paid a base salary plus a percentage of sales
attained as a commission for a period of time. Her pay is an example of _____.
A) merit pay plan
B) scanlon plan
C) gainsharing program
D) nonmonetary incentives
E) incentive pay plan
E

1) A criticism against executive compensation in recent years is that:

A) organizations are getting increasingly innovative in their incentive programs.
B) executive compensation is based on the performance of each and every employee in an
organization.
C) there seems to be no relationship between organization's performance and executives'
compensations.
D) executives are earning a meager amount compared to the typical worker in an
organization
E) the gap between the earnings of a CEO and the earnings of a typical worker is
significantly less.
C

1) Jessica Weller, a senior manager at DigWell Inc., differentiates the annual pay raises
provided to her subordinates based on their individual contributions to the organization. The
type of reward system used by Jessica is an example of _____.
A) fixed-rate pay
B) profit sharing
C) gainsharing
D) scanlon plan
E) merit pay
E

1) A manager gives her employees a variable bonus every month based on resulting cost
savings every time they exceed their sales quota. This type of incentive pay is known as
_____.
A) fixed-rate pay
B) profit sharing
C) gainsharing
D) lump-sum bonus
E) pay-for-knowledge
C

1) _____ is an intangible determinant of individual performance.

A) Motivation
B) Management
C) Attribution
D) Personality
E) Contribution
A

1) Assurance on ____ can satisfy the security needs of an employee in the workplace.
A) comfortable work environment
B) positive self-image
C) adequate wages
D) job continuity
E) recognition
D

1) _____ needs are at the top of Maslow's hierarchy of needs.

A) Security
B) Self-actualization
C) Physiological
D) Esteem
E) Belongingness
B

1) According to Maslow, an individual is motivated first and foremost to satisfy _____ needs.
A) security
B) self-actualization
C) physiological
D) esteem
E) belongingness
C

1) According to the two-factor theory, which of the following is a hygiene factor that
influences an employee's satisfaction or dissatisfaction?
A) Achievement
B) Recognition
C) Working conditions
D) Advancement and growth
E) The work itself
C

1) Brianne, a graduate engineer, prefers to work in a job that provides her the opportunity to
interact with people and make new friends on the job. Brianne has a need for _____.
A) achievement
B) affiliation
C) power
D) esteem
E) security
B

1) _____ focuses on why people choose certain behavioral options to satisfy their needs and
how they evaluate their satisfaction after they have attained those goals.
A) Maslow's hierarchy
B) Two-factor theory
C) Expectancy theory
D) Reinforcement theory
E) Variable work schedule
C

1) A basic assumption on which the expectancy theory is based on is that:

A) behavior is determined by a combination of forces in the individual and in the
environment.
B) people do not make decisions about their own behaviors in organizations.
C) different people have the same type of needs, desires, and goals.
D) people make choices based on the extent to which a given behavior will lead to undesired
outcomes.
E) people are motivated to seek social equity in the rewards they achieve for performance.
B

1) A value associated with the outcomes of a performance is called its _____.

A) behavior
B) valence
C) need
D) hygiene factor
E) commitment
B

1) _____ are consequences of behaviors in an organizational setting, usually rewards.

A) Performance
B) Valences
C) Outcomes
D) Need deficiencies
E) Commitments
B

1) According to the expectancy theory, which of the following conditions must be met for
motivated behavior to occur?
A) Effort-to-performance expectancy must be greater than zero
B) Performance-to-outcome expectancy must be less than zero
C) Sum of the valencies for an outcome must be less than zero
D) The individual must believe that effort and performance are unrelated
E) Every outcome must have a negative valence
A

1) _____ is the process of enabling workers to set their own work goals, make decisions,
and solve problems within their sphere of responsibility and authority.
A) Participation
B) Empowerment
C) Commitment
D) Reinforcement
E) Enrichment
B

1) _____ is the process of giving employees a voice in making decisions about their own
work.
A) Participation
B) Empowerment
C) Commitment
D) Reinforcement
E) Enrichment
A
1) Working a full forty-hour week in fewer than the traditional five days is called as _____.
A) job sharing
B) flexitime
C) nine-eighty schedule
D) compressed work schedule
E) flexible work schedule
D

1) A disadvantage of using compressed work schedules is that:

A) some individuals develop resentment as they feel constrained by their job schedules.
B) it makes it difficult for employees to attend routine personal businesses.
C) employees put too much effort in a single day, and tend to perform at lower levels.
D) employees have to work additional hours all the five days of a week.
E) it gives employees more personal control over the times they work.
D

1) An arrangement where an employee works a traditional schedule one week and a

compressed schedule the next, getting every other Friday off is called as _____.
A) job sharing
B) flextime
C) nine-eighty schedule
D) compressed work schedule
E) traditional work schedule
C

1) Work schedules that allow employees to select, within broad parameters, the hours they
work is called _____.
A) job sharing
B) flextime
C) nine-eighty schedule
D) compressed work schedule
E) traditional work schedule
B

1) An organizational _____ is the formal and informal mechanisms by which employee

performance is defined, evaluated, and awarded.
A) reinforcement policies
B) reward system
C) work schedule
D) outcome
E) valence
B

1) _____ refers to pay awarded to employees on the basis of the relative value of their
contributions to the organization, which is a performance-based reward arrangement for
individuals.
A) Scanlon plan
B) Piece-rate incentives
C) Incentive pay
D) Merit pay
E) Gainsharing
D

1) _____ is a reward system wherein an organization pays an employee a certain amount of

money for every unit he or she produces.
A) Scanlon plan
B) Piece-rate incentive plan
C) Incentive pay
D) Merit pay plan
E) Gainsharing
B

1) Which of the following is true about individual incentive plans?

A) They are focused to recognize efforts rather than individual performances.
B) They are used to provide individual performances with non monetary rewards.
C) They are most likely to be used when performance can be subjectively assessed.
D) They are focused at increasing a person's base salary at the end of every year.
E) They are used to reward individual performance on a real-time basis.
E

1) A major advantage of incentives relative to merit systems is that:

A) incentives do not accumulate by becoming part of an individual's salary.
B) incentives are provided only one time, based on that level of performance.
C) individuals receive the same amount or larger irrespective of their performances over the
years.
D) the base salary of an individual is unaffected by lower incentives.
E) these plans remain static and cannot be modified by an organization.
A

1) Which of the following is a group based incentive reward system

A) Merit pay
B) Gainsharing
C) Piece-rate incentive plan
D) Annual pay raise
E) Sales commission
B

1) _____ is a group based incentive reward system where the distribution of gains is tilted
heavily toward the employees.
A) Merit pay
B) Gainsharing
C) Piece-rate incentive plan
D) Scanlon plan
E) Sales commission
D
1) _____ argues that behavior that results in rewarding consequences is likely to be
repeated, whereas behavior that results in punishing consequences is less likely to be
repeated
A) Equity theory
B) Reinforcement theory
C) Two-factor theory
D) Maslow's hierarchy
E) Expectancy theory
B

1) _____ is used by managers to weaken undesired behaviors by creating unpleasant

consequences.
A) Recognition
B) Extinction
C) Avoidance
D) Punishment
E) Incentive
D

1) ____ is a counterproductive side affect of using punishment as a reinforcement method.

A) Commitment
B) Motivation
C) Resentment
D) Participation
E) Empowerment
C

1) The _____ is the most powerful schedule in terms of maintaining desired behavior.
A) variable-interval schedule
B) fixed-ratio schedule
C) variable-ratio schedule
D) fixed-interval schedule
E) nine-eighty schedule
C

1) The _____ varies the number of behaviors needed for each reinforcement.
A) variable-ratio schedule
B) fixed-ratio schedule
C) variable-interval schedule
D) fixed-interval schedule
E) nine-eighty schedule
A

1) A variable-ratio schedule is difficult to use for formal rewards such as pay because:
A) it typically weakens the behavior that has been previously rewarded.
B) is the least powerful schedule in terms of maintaining the desired behaviors.
C) it has a fixed number of desires to needed for each reinforcement.
D) it does not motivate the employee to increase the frequency of the desired behavior.
E) it would be complicated to keep track of who was rewarded when.
E

1) As a process, leadership can be defined as:

A) the practice of empowering employees to participate in organizational decision making.
B) the set of characteristics attributed to individuals who are perceived to be leaders.
C) the use of noncoercive influence to shape an organization's goals.
D) the ability to assess business process performance.
E) the ability to adjust to and understand the changes in a workplace.
C

1) As a property, leadership can be best defined as:

A) the practice of empowering employees to participate in organizational decision making.
B) a set of belief that supports the practice of interpersonal risk taking in teams.
C) the ability to shape employee behavior without using force.
D) the ability to adjust to and understand changes in the workplace.
E) a set of characteristics found in people who can influence the behavior of others.
E

1) Which of the following is an example of a good leader in the context of business?

A) A person who relies on force to lead people
B) A person who disobeys authority
C) A person who is a dictator
D) A person who can influence others
E) A person who is efficient and does not delegate his or her duties
D

1) Christine is in charge of managing the marketing team at her office. To be an efficient

leader, she should:
A) affect the behavior of others only through coercion.
B) use her power only in ways that are ethical.
C) defy all forms of authority.
D) engage in freeriding.
E) encourage instances of groupthink.
B

1) When leaders decide to either give salary increases to their employees or withhold any
salary increases, which of the following types of power do they exercise?
A) Coercive
B) Reward
C) Informal
D) Expert
E) Referent
B

1) Karl is fond of saying, "Remember, half the doctors you see graduated in the bottom of
their class." Karl is attempting to limit the _____ power of physicians
A) expert
B) legitimate
C) referent
D) reward
E) coercive
A

1) Bullies in the workplace use sarcasm, humiliation, and fear to influence others. This is a
form of _____ power.
A) expert
B) legitimate
C) referent
D) reward
E) coercive
E

1) Which of the following is NOT a possible reward for a manager to use who wants to
exercise effective reward power with his or her subordinates?
A) A cash bonus
B) A recommendation for promotion
C) An interesting job task
D) A salary increase
E) A standard reward for everyone
E

1) The more a manager uses coercive power, the more likely he is to encourage _____.
A. sympathy.
B. good will.
C. resentment.
D. cordiality.
E. tolerance.
C

1) A supervisor's frequent use of coercion involves the:

A) use of distortion.
B) use of extinction.
C) use of positive reinforcement.
D) loss of leadership.
E) loss of persuasion.
D

1) One of the reasons Steve Jobs was very successful at Apple was his charisma. From this
observation, we can infer that he had _____ power.
A) referent
B) reward
C) legitimate
D) coercive
E) expert
A
1) When an organization promotes someone, it sends a signal to everyone that the person is
competent. This gives the person _____ power
A) legitimate
B) technological
C) reward
D) referent
E) coercive
A

1) A news producer has the authority to choose which reporter will get to cover important
news items and which reporter will cover trivial news items. The news producer uses this
authority to recognize the hard work of reporters. Which of the following types of power is the
producer using in this case?
A) Referent
B) Expert
C) Reward
D) Coercive
E) Informal
C

1) Bill Lennox is a good man. He demonstrates high moral standards with every decision he
takes and inspires others to follow suit. From the given information, we can say that he has
_____ power.
A) legitimate
B) technological
C) expert
D) referent
E) coercive
D

1) The first organized approach to studying leadership focused on

A) leadership behavior
B) leadership traits.
C) rewards expected.
D) situational favorableness.
E) leader-member relations.
B

1) Which of the following approaches to identifying a leader is a person using if he votes for
a politician based on his communication skills, intelligence, appearance, and assertiveness?
A) LPC theory
B) Vroom's decision tree approach
C) Path-goal theory
D) Trait approach
E) Fiedler's contingency theory
D
1) The behavior that is called "job-centered leader behavior" in the Michigan studies is
similar to the behavior called _____ behavior in the Ohio State studies.
A) initiating-structure
B) consideration
C) concern for production
D) concern for people
E) employee-centered leader
A

1) Abbott, a shoe manufacturing company, strives to keep its workers satisfied. As many of
them are working mothers, the company allows flexible time shifts. CEO Miles White says,
"One of the most important things we can do for working families today is to help them lead
healthier lives." According to the Michigan studies, White is demonstrating _____ behavior.
D) employee-centered leader
D

1) In the Ohio State studies, employees of supervisors who ranked high on initiating
structure:
A) reflected low absence rates.
B) were high performers.
C) expressed high levels of satisfaction.
D) had low productivity.
E) were confused about the leader-subordinate role.
B

1) At the opposite ends of the single continuum used by the Michigan studies are the
leader's:
A) initiating-structure behavior and consideration behavior.
B) job-centered leader behavior and employee-centered leader behavior.
C) concern for production and concern for people.
D) task-oriented behavior and relationship-oriented behavior.
E) traits reflecting the hierarchical theory x and traits reflecting the innovative theory y.
B

1) The CEO at Green Inc. has established that employees at the workplace should adhere to
the vertical communication system. She has established fixed work flow systems and strictly
monitors these processes. The steps taken by the CEO at Green Inc. reflect the _____
behavior of leaders suggested by the Ohio State studies.
A) consideration
B) initiating structure
C) employee-centered
D) job-centered
E) authoritative
B

1) In the Managerial Grid, the ideal manager behavior is represented by a 9,9 "team"
manager, who has high concern for both:
A) structure and people.
B) people and production.
C) leadership and production.
D) finances and operations.
E) resources and products.
B

1) Which of the following is a generic approach to leadership?

A) The least-preferred coworker model
B) The path-goal model
C) Vroom's decision tree approach
D) The Ohio state studies
E) The leader-member exchange approach
D

1) What is the basic assumption of situational approaches to leadership?

A) Increasing worker job satisfaction through considerate leadership will get the best results.
B) Initiating structure for employees so they know exactly what needs to be done will be
most effective.
C) The appropriate leader style will vary from one set of circumstances to another.
D) Effective leaders can be identified by certain traits.
E) The 1,1 manager exhibits minimal concern for both production and people.
C

1) Which of the following is a situational leadership model?

A) Trait approach
B) Michigan studies
C) Ohio State studies
D) Leadership Grid
E) Path-goal theory
D

1) How did Fiedler measure leadership styles?

D) By means of a questionnaire called the least-preferred coworker measure
D

1) According to Fiedler, a task is structured when it is:

A) routine, difficult to understand, and unambiguous.
B) routine, easy to understand, and ambiguous.
C) irregular, difficult to understand, and ambiguous.
D) routine, easy to understand, and unambiguous.
E) irregular, difficult to understand, and unambiguous.
D

1) In Fiedler's model, a high least-preferred coworker score is said to reflect a _____

orientation.
A) relationship
B) task
C) structure
D) communication
E) schedule
A

1) In Fiedler's model, favorable situations are those that have:

B) good leader-member relations, highly structured tasks, and strong leader position-power.
B

1) Daniel has been appointed leader of a project task force. He has legitimate power in this
position. The task is unstructured. Also, Daniel has weak leader-member relations.
According to Fiedler's LPC theory, what type of leadership style is appropriate in this
situation?
A) Task-oriented
B) Relationship-oriented
C) Participative
D) Transformational leadership
E) Concern for people
A

1) Mihee, the chief nurse in a hospital, sets challenging goals for her subordinates because
she has confidence in her fellow nurses. Based on the path-goal theory, what kind of leader
behavior is Mihee exhibiting?
A) Task-oriented
B) Employee-centered
C) Achievement-oriented
D) Relationship-oriented
E) Bureaucratic
C

1) Vernique, a manager, consults with her subordinates and encourages their involvement in
the decision making process. Based on the path-goal theory, what kind of leader behavior is
Vernique exhibiting?
A) Job-oriented
B) Employee-centered
C) Achievement-oriented
D) Participative
E) Bureaucrat
D

1) Which of the following leadership models is a direct extension of the expectancy theory of
motivation?
A) Vroom's decision tree approach
B) Fiedler's contingency
C) Vertical-dyad linkage
D) Path-goal
E) Substitutes for leadership
D
1) In contrast to Fiedler's theory, path-goal theory assumes that leaders:
A) have little tolerance for their least-preferred coworker.
B) can change their leadership style to fit the demands of a particular situation.
C) should maintain a consistent leadership style to avoid confusing subordinates.
D) must find a fit between their leader styles and the situation.
E) should always maintain a participative leader style.
B

1) Don Draper is responsible for managing the creative section of his ad agency. In one-to-
one sessions, he asks each member of his group to give ideas for the ad campaign to
promote a new product. He considers all the ideas and decides to go ahead with the best
among them. Which decision-making style is best reflected in the given scenario?
A) Consult individual
B) Facilitate
C) Delegate
D) Participate
E) Decide
A

1) Which of the following is a task characteristic that may neutralize or substitute for
leadership?
A) Collective hysteria
B) Conformity
C) Intrinsic satisfaction
D) Bystander apathy
E) Groupthink
C

1) Demonstrating personal excitement or passion about something is part of _____

leadership.
A) charismatic
B) entrepreneurial
C) symbolic
D) integrative
E) participative
A

1) The concept of charismatic leadership is most closely related to:

A) the Vroom-Yetton-Jago approach.
B) the trait approach.
C) Fiedler's contingency theory.
D) substitutes for leadership.
E) path-goal theory.
B

1) Carl, the manager at a publishing house, heads the editorial team. Peggy, one of his
subordinates belongs to his in-group. This information would be significant for the
proceedings of the:
A) Vroom's decision tree approach.
B) path-goal theory.
C) leader-member exchange model.
D) least-preferred coworker theory.
E) leadership grid.
C

1) _____ is the style of leadership that goes beyond ordinary expectations by transmitting a
sense of mission, stimulating learning experiences, and inspiring new ways of thinking.
A) Directive leadership
B) Participative leadership
C) Transformational leadership
D) Supportive leadership
E) Task-oriented leadership
C

1) Which of the following is a defining characteristic of strategic leaders?

A) They possess interpersonal attraction that inspires support and acceptance.
B) They understand the organization and recognize its superior alignment with the
environment.
C) They transmit a sense of mission, stimulate learning experiences, and inspire new ways
of thinking.
D) They understand international differences and diversity-based differences within one
culture.
E) They encourage others by supporting them, empathizing with them, and expressing
confidence in them.
B

1) Why has the importance of cross-cultural leadership increased in today's times?

A) Because of improving profit margins
B) Because of office politics
C) Because of increasing unethical practices
D) Because of the increasing environmental concerns
E) Because of the improving diversity ratios in workplaces
E

1) Which of the following is a prerequisite for effective leadership?

A) Low tolerance toward diversity
B) Belief in the dictatorship style of leadership
C) High levels of coercive powers
D) Belief in ethnocentrism
E) High standards of ethical conduct
E

1) A manager tells a subordinate that he will not recommend her for promotion unless she
supports his proposal in an upcoming sales meeting. Which type of political behavior is
reflected in the given scenario?
A) Creation of an obligation
B) Coercion
C) Initiating structure
D) Persuasion
E) Assault
B

1) Carolyn, a manager, discusses and reasons with the Board of Directors of her company
until they agree to let her try her new strategic plan for a trial period. Carolyn is using _____
in the given situation.
A) an obligation
B) persuasion
C) coercion
D) inducement
E) passive aggression
B

1) After oil prices hit record highs and the oil companies made record profits, some of the oil
company's CEOs appeared on the Today show to explain their business to consumers. This
is an example of:
A) creation of an obligation.
B) impression management.
C) initiating structure.
D) persuasion.
E) inducement.
B

1) Valencia, an employee at Y Inc., attempts to bring all her contributions to successful

projects to the notice of her manager. Her intention is to build a good image in the eyes of
the management. What is best exemplified by Valencia's behavior?
A) Creation of an obligation
B) Impression management
C) Coercion
D) Persuasion
E) Inducement
B

1) Which of the following is the most probable motive for a manager to engage in political
behavior?
A) To avoid covert activities
B) To acquire power
C) To promote clear communication
D) To promote transparency
E) To avoid charges of political motivation
B

1) What measures should managers take to prevent political behavior from doing excessive
damage?
A) They should refrain from providing subordinates with autonomy.
B) They should provide challenges to subordinates.
C) They should use their coercive powers.
D) They should reduce diversity in the workplace.
E) They should encourage ethnocentrism.
B

1) Which of the following statements is true of political behavior?

A) Political behavior is always a manifestation of good intent.
B) Managers should cover up disagreements so that subordinates will have less opportunity
for political behavior.
C) Even if a manager's actions are not politically motivated, others may assume that they
are.
D) By providing subordinates with autonomy, managers are likely to promote political
behavior.
E) Managers should use power if they want to avoid charges of political motivation.
C

1) According to the Managerial Grid, the _____ manager is highly concerned about
production but exhibits little concern for people.
A) 9,1
B) 0,1
C) 1,9
D) 0,1
E) 9,0
A

1) The Ohio State researchers found that employees of supervisors who ranked high on
_____ were high performers but expressed low levels of satisfaction and had a higher
absence rate.
A) concern for people
B) consideration
C) initiating structure
D) employee-centered leader behavior
E) task-oriented leadership behavior
C

1) _____ is the part of the Managerial Grid that deals with the job and task aspects of leader
behavior.
A) Employee-centered leader behavior
B) Initiating structure
C) Task-oriented leadership behavior
D) Concern for people
E) Concern for production
E

1) Based on the Michigan studies, Rensis Likert argued that the _____ behavior generally
tends to be more effective.
A) initiating structure
B) job-centered leader
C) employee-centered leader
D) considerate
E) authoritative
C

1) According to the Michigan studies, managers using _____ behavior are interested in
developing a cohesive work group and ensuring that employees are satisfied with their jobs.
A) consideration
B) initiating structure
C) job-centered leader
D) employee-centered leader
E) authoritative
D

1) When followers react favorably because they identify in some way with a leader, the
leader is said to possess _____ power.
A) reward
B) expert
C) legitimate
D) coercive
E) referent
E

1) Verbal reprimands, written reprimands, disciplinary layoffs, fines, demotion, and

termination are examples of _____ power possessed by managers.
A) coercive
B) reward
C) legitimate
D) expert
E) referent
A

1) The more important the information and the fewer the people who have access to it, the
greater is the degree of _____ power possessed by any one individual.
A) legitimate
B) reward
C) referent
D) expert
E) coercive
D

1) A secretary who knows how to unravel bureaucratic red tape has _____ power over
anyone who needs that information.
A) reward
B) referent
C) legitimate
D) expert
E) coercive
D

1) A manager expressing praise, gratitude, or recognition best exemplifies _____ power.

A) informal
B) reward
C) referent
D) expert
E) coercive
B

1) A manager can assign tasks to a subordinate, and a subordinate who refuses to do them
can be reprimanded or even fired. This is an example of _____ power.
A) legitimate
B) informal
C) referent
D) expert
E) coercive
A

1) _____ power is power granted through the organizational hierarchy. A) Expert

B) Referent
C) Coercive
D) Reward
E) Legitimate
E

1) ____ is the ability to affect the behavior of others.

A) Power
B) Discipline
C) Function
D) Potential
E) Virtue
A

1) _____ is necessary to create change, while management is necessary to achieve orderly

results.
A) Dominion
B) Leadership
C) Legitimacy
D) Administration
E) Control
B

1) _____ describes activities carried out for the specific purpose of acquiring, developing,
and using power and other resources to obtain one's preferred outcomes.
A) Group cognition
B) Workplace diversity
C) Organizational culture
D) Political behavior
E) Collective intelligence
D

1) In the context of the charismatic leadership theory, proposed by Robert House,

charismatic leaders are likely to:
A) rate low on self-confidence.
B) avoid influencing people.
C) have a firm conviction in their beliefs.
D) have an external locus of control.
E) be dependent on others.
C

1) In the context of the Vroom's decision tree approach, when managers present a problem
to their group at a meeting, define the problem and its boundaries, and then guide group
member discussions as they make the decision, they follow the _____ decision-making
style.
A) delegate
B) consult group
C) facilitate
D) consult individually
E) decide
C

1) In the context of the Vroom's decision tree approach, when a manager allows his group to
define for itself the exact nature and parameters of a problem and then to develop a solution,
they follow the _____ decision-making style.
A) facilitate
B) consult individually
C) decide
D) delegate
E) consult group
D

1) According to the path-goal theory, a person with an internal locus of control is most likely
to prefer _____ leadership.
A) task-oriented
B) achievement-oriented
C) directive
D) supportive
E) participative
E

1) According to the path-goal theory, if people perceive that they are lacking in abilities, they
are most likely to prefer _____ to help them understand path-goal relationships better.
B) directive leadership
B
1) _____ behavior, identified by the path-goal theory, primarily involves being friendly and
approachable, showing concern for subordinate welfare, and treating members as equals.
A) Directive leader
B) Task-oriented leader
C) Achievement-oriented leader
D) Participative leader
E) Supportive leader
E

1) A supervisor exhibiting _____ behavior, identified by the path-goal theory, is most likely to
let subordinates know what is expected of them, gives guidance and direction, and
schedules work.
A) participative leader
B) supportive leader
C) directive leader
D) achievement-oriented leader
E) Task-oriented leader
C

1) _____ leader behavior, identified by the path-goal theory, primarily involves setting
challenging goals, expecting subordinates to perform at high levels, encouraging
subordinates, and showing confidence in subordinates' abilities.
A) Relationship-oriented
B) Achievement-oriented
C) Directive
D) Participative
E) Supportive
B

1) _____ is a theory of leadership which suggests that the primary functions of a leader are
to make valued or desired rewards available in the workplace and to clarify for the
subordinate the kinds of behavior that will lead to those rewards.
A) Path-goal theory
B) Leadership trait approach
C) Least-preferred coworker theory
D) Strategic leadership approach
E) Leader-member exchange theory
A

1) According to Fiedler, _____ is the degree to which the group's task is well defined.
A) task thread
B) task stream
C) task orientation
D) task structure
E) task parallel
D
1) According to Fiedler, the key situational factor of leadership is the _____ from the leader's
point of view.
A) cause of the situation
B) importance of establishing formal lines of communication
C) favorableness of the situation
D) overall objective of the situation
E) importance of an employee-centered environment
C

1) Sam, the CEO of a company, has the power to take decisions related to resource
allocations. His power is mainly derived from his position in the company. Which power is
best demonstrated in the given scenario?
A) Coercive
B) Reward
C) Legitimate
D) Expert
E) Referent.
C

1. The report issued about a major packaging defect showed a culture at an organization
that did not listen when small safety issues were raised. Each issue by itself might not have
caused the flaw. This example illustrates:
the need to understand organizational complexity.
B) that changing conditions are influenced by innovation
C) the need for control in order to reduce the accumulation of errors.
D) the way that control helps organizations respond to changing standards.
E) the way that organizations cope with multiple control standards.
C

1. Which of the following is true of organizational control?

A)Control always results in higher costs for an organization.
B) Sales and marketing forecasting is a part of financial control
. C) Control can help an organization adapt to environmental change.
D) Control systems increase organizational complexity.
E) Public relations is a part of human resources control.
C

1. When large firms merge, the results are often initially disappointing due to control systems
trying to cope with a(n) _____.
A) rise in error accumulation
B) increase in organizational complexity
C) lack of environmental change
D) increase in costs
E) reduction in output
B

1. In organizations, sales forecasting, economic forecasting, and environmental analysis are

examples of the control of _____ resources.
A) physical
B) human
C) information
D) financial
E) inventory
C

1. Performance appraisals are part of _____ control.

A) physical
B) human resources
C) information
D) financial
E) inventory
B

1. Google partnered with Nielsen Co. to poll users about ads on Google+. Nielsen then
packaged the information for advertisers. This was a response to advertiser complaints
about the effectiveness of ads on the social network. This indicates that Google is placing an
emphasis on _____ controls.
A) operations
B) development
C) strategic
D) financial
E) structural
E

1. Quality control is a type of _____ control.

A) physical
B) human
C) operations
D) financial
E) structural
C

1. The control of _____ affects all the other resources in an organization.

A) physical resources
B) human resources
C) financial resources
D) information resources
E) inventory resources
C

1. An organization's attempt to control the behavior of their employees by directing them

toward higher performance is an example of control of _____ resources.
A) physical
B) financial
C) human
D) information
E) inventory
C

1. An organization shifts its budget from a few, large projects to accommodate a number of
smaller projects every year. It also decentralizes power and gives additional responsibilities
to individual project managers. This is an example of the use of _____ control.
A) physical
B) information
C) structural
D) financial
E) screening
C

1. Monitoring receivables to make sure customers are paying their bills on time is an
example of _____ control.
A) operations
B) strategic
C) structural
D) financial
E) physical
D

1. Monitoring the administrative ratio to make sure staff expenses do not become excessive
is an example of _____ control.
A) postaction
B) strategic
C) structural
D) operations
E) information
C

1. Ensuring that receivables are collected in a timely manner is part of _____ control.
A) physical
B) strategic
C) information
D) financial
E) structural
D

1. The first step in the control process is:

A) modifying control standards.
B) comparing performance against standards
C) measuring performance.
D) establishing control standards.
E) determining the need for corrective action.
D
1. In the control process, which of the following steps follows the measurement of
performance?
A) Considering corrective action
B) Comparing performance against standards
C) Establishing standards
D) Developing effective performance measures
E) Setting standards consistent with organizational goals
B

1. The final step in the control process is:

A) establishing standards.
B) expressing standards in measurable terms.
C) measuring performance.
D) comparing performance against standards.
E) considering corrective action.
E

1. Following the accidental release of a batch of phones that failed screening control, a
manufacturer of mobile phones replaces all such phones at no cost to the user-even taking
care of shipping and delivery. Which step in the control process does this example
represent?
A) Taking corrective action
B) Measuring performance
C) Comparison of performance to standards
D) Setting performance standards
A

1. Which of the following is a form of operations control?

A) Financial control
B) Screening control
C) Strategic control
D) Structural control
E) Budgetary control
B

1. A company that carefully evaluates job applicants is using _____ control.

A) screening
B) cybernetic
C) postaction
D) preliminary
E) information
D

1. A manufacturer of health foods ensures that at least 90 percent of all its raw materials is
grown organically. This is an example of _____ control.
A) preliminary
B) postaction
C) feedback
D) screening
E) concurrent
A

1. Everyone working or volunteering for Girl Scouts goes through a background check before
they can work with girls or handle money. This is an example of:
A) screening control.
B) preliminary control.
C) postaction control.
D) information control.
E) structural control.
B

1. _____ control attempts to monitor the quality or quantity of resources before they enter an
organization.
A) Structural
B) Postaction
C) Preliminary
D) Screening
E) Financial
C

1. Inspection reports are used to monitor the quality of raw materials delivered to
manufacturers. This is an example of _____ control.
A) financial
B) structural
C) preliminary
D) screening
E) postaction
C

1. A policy think tank requires all candidates applying for the position of vice-president to
have a minimum of 10 years of experience in governmental organizations, international
business, or multinational non-profits. This is an example of _____ operations control.
A) preliminary
B) screening
C) structural
D) postaction
E) decentralized
A

1. A publisher of children's books only uses recycled paper for all its products. This is an
example of _____ operations control.
A) preliminary
B) screening
C) structural
D) postaction
E) decentralized
A

1. Which of the following types of operations control relies heavily on feedback processes?
A) Strategic control
B) Financial control
C) Postaction control
D) Preliminary control
E) Screening control
E

1. _____ controls are an effective way to catch problems early in the transformation process.
A) Postaction
B) Structural
C) Screening
D) Strategic
E) Financial
C

1. Which of the following is true of screening control?

A) It takes place during the transformation process.
B) It involves interviewing potential employees.
C) It is the same as preliminary control.
D) It is present only in organizations with bureaucratic control.
E) It is a part of structural control.
A

1. Before submitting a final policy memo, analysts may modify certain recommendations
based on feedback from experts and the general public. This is an example of _____ control.
A) preliminary
B) postaction
C) screening
D) financial
E) structural
C

1. _____ control is the form of operations control that tends to be used most often.
A) Human resources
B) Financial
C) Screening
D) Postaction
E) Preliminary
C

1. At a high school, final examinations are held online. During the examination, the difficulty
level of questions assigned to students is modified based on how well individual students
perform. This is an example of _____ operations control.
A) preliminary
B) screening
C) structural
D) postaction
E) decentralized
B

1. Postaction control is applied to _____.

A) resources
B) transformation processes
C) subsystems
D) controllers
E) outputs
E

1. _____ control provides a basis for rewarding employees.

A) Preliminary
B) Strategic
C) Postaction
D) Structural
E) Screening
C

1. Intertek's product quality inspections help protect brand reputations by minimizing

defective merchandise, customer complaints, non-compliant products, and late shipments.
This is an example of _____ control.
A) preliminary
B) postaction
C) screening
D) financial
E) structural
B

1. Which of the following types of control is used for resources such as retained earnings?
A) Financial control
B) Structural control
C) Operating control
D) Interim control
E) Nonmonetary control
A

1. Hermes is a taxi service that asks customers to fill out an online feedback form once their
ride is complete. Hermes is making use of _____ operations control.
A) preliminary
B) screening
C) structural
D) postaction
E) decentralized
D
1. A publishing firm will use a(n) _____ budget to forecast and plan the demand for young
adult books in Southeast Asia in the coming year.
A) labor
B) capital expenditures
C) operating
D) balance sheet
E) space
C

1. A state university develops a budget that shows its projected income from sources that
include government funding, tuition fees, alumni contributions, and research grants. This is
an example of a(n) _____ budget.
A) operations
B) capital expenditures
C) nonmonetary
D) output
E) revenue
E

1. During the scheduling of a project, a plant manager is told that she has 30 workers for 6
hours a day, 5 days a week. This is part of a(n) _____ budget.
A) capital expenditure
B) master
C) space
D) labor
E) personnel
D

1. The _____ budget shows the anticipated differences between sales or revenue and
expenses.
A) expense
B) profit
C) labor
D) capital expenditure
E) cash flow
B

1. A(n) _____ budget forecasts the organization's assets and liabilities in the event that all
other budgets are met.
A) balance sheet
B) revenue
C) fixed asset
D) expense
E) labor
A

1. A budget that deals with costs of major assets such as a new plant, machinery, or land is
known as a _____ budget.
A) revenue
B) balance sheet
C) cash flow
D) expense
E) capital expenditures
E

1. A company that specializes in indoor farming has recently acquired a large warehouse.
Which of the following budgets will this company use to determine and plan the area
available for various functions?
A) Operating budget
B) Space budget
C) Labor budget
D) Revenue budget
E) Expense budget
B

1. Which of the following shows income that the organization expects to receive from normal
operations?
A) Profit budget
B) Balance sheet budget
C) Cash flow budget
D) Space budget
E) Revenue budget
E

1. Which of the following is a nonmonetary budget?

A) Labor budget
B) Capital expenditures budget
C) Sales budget
D) Balance sheet budget
E) Revenue budget
A

1. Which of the following is a weakness associated with budgeting?

A) Budgets do not allow managers to identify problem areas.
B) Budgets do not facilitate effective control.
C) Budgets fail to link planning and controlling.
D) Budgets can limit innovation and change.
E) Budgets hamper coordination between departments.
D

1. Which of the following financial documents shows a listing of all the organization's assets
and liabilities at a given point in time?
A) Balance sheet
B) Expense budget
C) Income statement
D) Revenue budget
E) Capital expenditures budget
A

1. If an energy company wants to discover the effectiveness of its wind-turbine division in a

particular state, it will use a(n):
A) liquidity ratio.
B) balance sheet ratio.
C) return on investment.
D) operating ratio.
E) debt ratio.
D

1. A(n) _____ compares different elements of a balance sheet or an income statement to

one another.
A) expense budget
B) profit budget
C) internal audit
D) operations budget
E) financial ratio
E

1. Which of the following summarizes the financial performance of an organization over a

period of time?
A) Balance sheet
B) Liquidity ratio
C) Cash flow statement
D) Income statement
E) Debt statement
D

1. John began his company making herb vinegars from a recipe his grandmother had given
him. As demand grew, he had to buy a large commercial kitchen. Which of the following
ratios would a banker be most interested in before allowing John to borrow $500,000?
A) Liquidity ratio
B) Balance sheet
C) Return on investment
D) Operating ratio
E) Debt ratio
E

1. Which of the following reflects a firm's ability to meet its long-term financial obligations?
A) Debt ratio
B) Balance sheet
C) Return on investment
D) Profit budget
E) Liquidity ratio
A
1. Which of the following ratios assesses the ease with which an organization's assets can
be converted into cash?
A) Liquidity ratio
B) Profitability ratio
C) Debt ratio
D) Operating ratio
E) Coverage ratio
A

1. Financial analysts look at a company's _____ ratio to determine if it can make interest
payments on borrowed capital.
A) coverage
B) operating
C) debt
D) return
E) liquidity
A

1. Which of the following statements about financial audits is true?

A) Audits can only be conducted by experts who are not employees of the organization.
B) Financial audits are always internal to an organization.
C) Audits are used to monitor accounting and financial systems within an organization.
D) Organizational operating systems are not audited.
E) Publicly held corporations are required by law to have internal audits regularly.
C

1. The financial ratio that reflects the ability to meet long-term financial obligations is the
_____ ratio.
A) return
B) operating
C) liquidity
D) debt
E) coverage
D

1. A manager at a supermarket needs to know how easily the store's assets can be
converted into cash. Which of the following ratios will he use?
A) Debt ratio
B) Return ratio
C) Liquidity ratio
D) Coverage ratio
E) Operating ratio
C

1. An appraisal of an organization's accounting and financial procedures conducted by

employees of that organization is known as a(n):
A) internal audit.
B) debt audit.
C) ratio audit.
D) external audit.
E) liquidity audit.
A

1. The purpose of bureaucratic control is to:

A) support employee participation in the control function.
B) produce performance above minimum acceptable standards.
C) get employee compliance.
D) increase group performance.
E) increase employee self-control.
C

1. Which of the following is characteristic of the bureaucratic approach to organizational

control?
A) Rewards are directed at group performance.
B) Organizational structure is flat.
C) Employee participation is extended and informal.
D) Reliance is on strict rules and a rigid hierarchy.
E) Performance expectations extend above and beyond the minimum.
D

1. Organizations that use the bureaucratic control are characterized by:

A) flat structures.
B) rewards focused on group performance.
C) limited employee participation.
D) heavy reliance on group norms.
E) organic structural arrangements.
C

1. An organization that relies on strict rules and a rigid hierarchy and insists that employees
meet minimally acceptable levels of performance most likely uses _____ structural control.
A) strategic
B) decentralized
C) bureaucratic
D) organic
E) screening
C

1. Decentralized control is characterized by:

A) formal rules
B) an organic structural arrangement.
C) focus on employee compliance.
D) a tall structure.
E) limited employee participation.
B

1. Which of the following is an important element of decentralized control?

A) Group norms
B) Rigid hierarchy
C) Tall organization structure
D) Individual performance
E) Employee compliance
A

1. Organizations that use _____ strategic control believe it is effective because it allows the
home office to keep better informed of the performance of foreign units.
A) organic
B) centralized
C) mechanistic
D) bureaucratic
E) environmental
B

1. Organizations make the decision of whether to have a centralized or decentralized

international control system when they are addressing issues of ____ control.
A) screening
B) strategic
C) financial
D) bureaucratic
E) preliminary
B

1. A multinational construction firm does not require its various divisions to report frequently
to the head office. The organization believes in letting each manager have the authority to
respond quickly to environmental changes. These managerial actions do not have to be
approved by the head office before they are implemented. This firm uses _____ strategic
control.
A) bureaucratic
B) mechanistic
C) decentralized
D) formalized
E) inflexible
C

1. International firms which use ____ strategic control require each organization unit around
the world to frequently report the results of its performance to headquarters.
A) decentralized
B) organic
C) screening
D) centralized
E) postaction
D

1. Managers can improve the effectiveness of the control system by:

A) preventing the development of verification procedures.
B) controlling as many things in the organization as possible.
C) focusing only on quantifiable variables.
D) integrating control with planning.
E) correcting all deviations from standards.
D

1. Which of the following is a characteristic of effective control?

A) It provides timely information.
B) It is separate from planning.
C) It is rigid.
D) It is subjective.
E) It directly controls employee behavior.
A

1. An organizational control system that enforces unique employee dress codes for different
days of the week is guilty of:
A) overcontrol.
B) inappropriate focus.
C) rewarding inefficiency.
D) too much accountability.
E) inaccuracy.
A

1. A company buys electronic components, assembles them into PCs, and then ships them
to customers. In this case the electronic components are _____ for the company.
A) Outputs
B) products
C) processes
D) inputs
E) services
d

1. The total set of managerial activities an organization uses to transform resource inputs
into products and services is called _____.
a. technology management
b. strategic management
c. project management
d. operations management
e. self-management
d

1. If the product is a physical good, operations create value and provide _____ utility by
combining many dissimilar inputs to make something that is more valuable than the actual
cost of the inputs used to create it.
a. time
b. form
c. place
d. service
e. statistical
b

1. Operations management was once called _____.

a. service management
b. process management
c. waste management
d. production management
e. output management
d

1. Fast food restaurants that assemble breads, spreads, and fillings as per the customers'
preference belong to the _____ industry.
a. service
b. manufacturing
c. automotive
d. importing
e. exporting
b

1. An organization that transforms resources into an intangible output in order to create time
or place utility for its customers is known as _____ company.
a. an outsourcing
b. a service
c. a manufacturing
d. the International Organization for Standardization 9000
e. total quality management
b

1. During the 1970s in the United States, manufacturing entered a long period of decline.
Which of the following is the primary reason for this decline?
a. Modernization of plants
b. Rise in unemployment
c. Growth in the service sector
d. Foreign competition
E) Recession
d

1. A convenience store at the gas station provides utility for customers because it makes it
easy for them to purchase a few essentials when they stop for gasoline. The convenience
store belongs to the _____ industry.
a. service
b. manufacturing
c. automotive
d. importing
electronics
a
1. During the decline of the manufacturing sector, a tremendous growth in the _____ sector
kept the U.S. economy from declining at the same rate.
a. coal
b. service
c. agriculture
d. steel
electronics
b

1. A(n) _____ organization is one that transforms resources into an intangible output and
creates time and place utility for its customers.
a. manufacturing
b. production
c. service
d. coal
agricultural
c

1. In the United States, which of the following steps did the manufacturing companies take to
recover from the long period of decline?
a. They increased their workforces dramatically.
b. They opened more plants.
c. They changed their market.
d. They modernized their plants.
e. They changed their sector.
d

1. _____ is a form of business that combines and transforms resources into tangible
outcomes that are then sold to others.
a. Service
b. Manufacturing
c. Outsourcing
d. Licensing
e. Exporting
b

1. A highest-possible-quality strategy will stress on _____.

a. the lowest possible cost regardless of quality
b. quality regardless of cost
c. low quality at low cost
d. large quantities at low cost
e. productivity regardless of quality
b

1. Which of the following questions is addressed by product-service mix decisions?

a. How the services need to be provided?
b. How many different products need to be offered?
c. What quantity of a product needs to be produced?
d. Where the products need to be distributed?
e. How products need to be produced?
b

1. Upsilon Inc. manufactures leather handbags. It later adds leather accessories, shoes, and
clothing to its production line. With this step, Upsilon is taking a _____ decision.
a. layout
b. promotion-distribution
c. capacity
d. product-service mix
e. facility
d

1. Globe-Mart, a large chain of department stores, strategically places distribution centers

throughout the United States. In this context, Globe-Mart has made a _____ decision.
a. product layout
b. facilities location
c. capacity
d. product-service mix
e. process layout
b

1. Katina has hurt her hand. She goes to the emergency room. The doctor thinks Katina has
a broken wrist, and sends her for an X-ray. In this example, which type of layout does the
hospital have?
a. Product layout
b. Cellular layout
c. Random layout
d. Fixed-position layout
e. Process layout
e

1. A _____ layout is appropriate when large quantities of a single product are needed.
a. process
b. cellular
c. fixed-point
d. product
e. distributed
d

1. _____ layouts are used in operations settings that create or process a variety of products.
a. Product
b. Cellular
c. Random
d. Fixed-position
e. Process
e
1. In a toy manufacturing factory, the employees are stationed along the assembly line. As a
toy moves along the assembly line, each employee stationed there adds a particular part to
the toy. The toy factory has a _____ layout.
a. process
b. cellular
c. fixed-point
d. product
e. distributed
d

1. Eagle Inc. makes golf clubs. Each set has up to 12 clubs and each club in the set is
slightly different from the other. Which of the following types of layout does Eagle's
manufacturing plant have?
a. Product layout
b. Cellular layout
c. Fixed-position layout
d. Random layout
e. Process layout
b

1. Dina works in a residential construction company. She travels to the job site to build a
house. The residential construction company is an example of a _____ layout.
a. product
b. cellular
c. random
d. fixed-position
e. process
d

1. The _____ layout is used when the organization is creating a few very large and complex
products.
A) product
B) cellular
C) fixed-position
D) process
E) distributed
c

1. The _____ layout is used when the organization is creating a few very large and complex
products.
a. product
b. cellular
c. fixed-position
d. process
e. distributed
c

1. _____ layouts are used when families of products can follow similar flow paths.
a. Product
b. Cellular
c. Random
d. Fixed-position
Process
b

1. In automation, _____ is the flow of information from the machine back to the sensor.
a. feedback
b. agrimation
c. input instruction
d. design
e. control mechanism
a

1. Which of the following is true of automation?

a. The development of automation has created jobs across all industries.
b. Automated machines make more errors.
c. Automation discourages innovation.
d. Automation helps to improve products and services.
Automation was the earliest step in the development of machines and machine-controlling
d

1. In automation, _____ are the parts of the system that gather information and compare it to
preset standards.
a. feedback systems
b. sensors
c. robots
d. mechanical arms
e. control mechanisms
b

a. control mechanisms
2. In automation, which of the following sends instructions to the automatic machine?
a. Feedback
b. Sensors
c. Agrimation
d. Steering system
e. Control mechanism
e

1. Which of the following uses computers to design parts and complete products and to
simulate performance so that prototypes need not be constructed?
a. Computer-aided automation
b. Computerized robotics
c. Agrimation
d. Computer-aided design
e. Flexible manufacturing systems
d

1. Which of the following is true of computer-integrated manufacturing (CIM)?

a. It is a simple tool.
b. It is very different from computer-aided manufacturing.
c. In CIM, adjustment of machine placements and settings is manual.
d. It is a powerful management control tool.
e. It is a form of service technology.
d

1. EduCool is a web-based student information system. It allows parents to follow their

child's performance online. It includes grades, attendance, assignments, and student data
on a daily basis. EduCool is an example of:
a. advancement in service technology.
b. advancement in manufacturing technology.
c. computer-aided manufacturing.
d. computer aided design.
e. computer-assisted technology.
a

1. A(n) _____ is any artificial device that is able to perform functions ordinarily thought to be
appropriate for human beings.
A) transformer
B) expert system
C) resistor
D) robot
E) just-in-time inventory system
d

1. _____ include robotic work units or workstations, assembly lines, and robotic carts or
some other form of computer-controlled transport system to move material as needed from
one part of the system to another.
A) Agrimations
B) Flexible manufacturing systems
C) Call-center systems
D) Computer-aided design technologies
E) Expert systems
b

1. Which of the following statements about manufacturing technology is true?

A) Computer-assisted manufacturing generates resistance.
B) Computer-aided design systems are always reliable.
C) Computer-integrated manufacturing systems are inexpensive.
D) Computer-aided design systems are very simple.
E) Computer-assisted manufacturing is the same as automation.
a

1. Which of the following uses robot harvesters to pick fruit from a variety of trees?
A) Agrimation
B) Flexible manufacturing systems
C) Supply chain management
D) Computer--assisted manufacturing
E) Benchmarking
a

1. _____ is the process of managing operations control, resource acquisition and

purchasing, and inventory to improve overall efficiency and effectiveness.
A) Supply-chain management
B) Technology management
C) Design management
D) Quality control
E) Productivity control
a

1. _____ is also called procurement.

A) Automation
B) Purchasing management
C) Inventory Management
D) Materials control
E) Quality control
b

1. Which of the following is concerned with buying the materials and resources needed to
produce products and services?
A) Automation
B) Purchasing management
C) Inventory Management
D) Materials control
E) Quality control
b

1. Which of the following inventory types provides the components needed to make the
product?
A) Raw materials
B) Work-in-process
C) Merchandise
D) Finished goods
E) In-transit
A

1. Which of the following inventory types provides ready supply of products on customer
demand and enables long, efficient production runs?
A) Raw materials inventory
B) Work-in-process inventory
C) Procurements inventory
D) Finished goods inventory
E) In-transit inventory
D

1. Which of the following is a source of control for in-transit inventory?

A) Shop floor control systems
B) High-level production scheduling systems
C) Marketing
D) Distribution control systems
E) Purchasing models and systems
D

1. The purpose of an in-transit inventory is to:

A) provide the materials needed to make the product.
B) enable overall production to be divided into stages of manageable size.
C) reduce the organization's investment on storage space.
D) provide ready supply of products on customer demand and enable long, efficient
production runs.
E) distribute products to customers.
E

1. Just-in-time method helps an organization control its _____.

A) raw materials inventory
B) work-in-process inventory
C) quality
D) finished goods inventory
E) in-transit inventory
B

1. _____ is the totality of features and characteristics of a product or service that bear on its
ability to satisfy stated or implied needs.
A) Inventory
B) Process
C) Quality
D) Quantity
E) Technology
C

1. Which of the following dimensions of quality refers to a measure of product life?

A) Reliability
B) Durability
C) Serviceability
D) Features
E) Perceived quality
B

1. Dorothy loves buying Haven's herb bread. As advertised, she thinks it is the most versatile
bread as well as being nutritious. It can be eaten by itself, made into sandwiches, added to
salads, and so on. The versatility of the herb bread is a supplement to its nutrition and
therefore it constitutes the _____ dimension of quality.
A) features
B) aesthetics
C) reliability
D) durability
E) serviceability
A

1. Sarah followed an online recipe and made pizza for her family. It turned out so badly that
she had to discard it. Sarah and her family said that the pizza tasted like cardboard. Which
dimension of quality were they describing?
A) Aesthetics
B) Conformance
C) Reliability
D) Serviceability
E) Performance
A

1. Serviceability is the dimension of quality that refers to:

A) how a product looks, feels, tastes, and smells.
B) the degree to which a product's design and operating characteristics meet established
standards.
C) a probability of not malfunctioning during a specified period.
D) a measure of product life.
E) the speed and ease of repair.
E

1. Azures Airlines operates between Washington Dulles, Newark Liberty, and Paris Charles
de Gaulle airports. It offers all business-class services. The customers feel that the prices of
Azures' flights are considerably lower than those of other similar airlines. This quality of
Azures is an example of:
A) features.
B) aesthetics.
C) reliability.
D) perceived quality.
E) serviceability.
D

1. The dimension of quality that refers to the degree to which a product's design and
operating characteristics meet established standards is:
A) features.
B) conformance.
C) reliability.
D) durability.
E) serviceability.
B
1. Performance is the dimension of quality that refers to:
A) a product's primary operating characteristic.
B) the degree to which a product's design and operating characteristics meet established
standards.
C) a probability of not malfunctioning during a specified period.
D) a measure of product life.
E) the speed and ease of repair.
A

1. Which of the following is true of the Malcolm Baldrige Award?

A) It is awarded by the Rochester Institute of Technology.
B) It is awarded to firms that achieve major improvements in the quality of their products or
services.
C) It is awarded to the company that has consistently maintained the same quality for 5
continuous years.
D) It is awarded to the company that has shown the highest company productivity.
E) It is awarded not to entire organizations but to individual teams of workers within
organizations.
B

1. The dimension of quality of a product that refers to a probability of not malfunctioning

during a specified period is the product's:
A) features.
B) conformance.
C) reliability.
D) durability.
E) serviceability.
D

1. Which of the following is true of ISO 9000:2000?

A) Firms get to choose the organization they want to be audited by for the certification.
B) It includes 2000 standards that should be met.
C) These standards do not cover employee training and supplier relations.
D) Firms that want to meet these standards need to apply for certification.
E) The auditors review only the firm products in relation to the standards.
D

1. Carrington is one of the best restaurants in Chicago. Carrington's chefs have made
arrangements with local farmers to provide them with fresh and good quality vegetables and
fruits. In the context of total quality management, the chefs are focusing on _____.
A) employee involvement
B) strategic commitment
C) technology
D) materials
E) methods
D
1. Bingo Inc. sends its consultants for change management to various companies to learn
how those companies have coped with changes in the past. Which of the following tools or
techniques is Bingo using for improving quality?
A) Benchmarking
B) Value-added analysis
C) Outsourcing
D) Reducing cycle times
E) Statistical quality control
A

1. _____ is the comprehensive evaluation of all work activities, materials flows, and
paperwork to determine the worth and appeal that they add for customers.
A) Acceptance sampling
B) Benchmarking
C) In-process sampling
D) Six Sigma
E) Value-added analysis
E

1. Virtually all successful quality-enhancement programs involve making the person

responsible for doing the job responsible for making sure it is done right. This critical
ingredient in total quality management refers to:
A) employee involvement.
B) strategic commitment.
C) technology.
D) materials.
E) methods.
A

1. Which of the following is the process of learning how other firms do things in an
exceptionally high-quality manner?
A) Value-added analysis
B) Benchmarking
C) Outsourcing
D) Reducing cycle times
E) Statistical quality control
B

1. Which of the following TQM guidelines for reducing cycle time is most appropriate in a
decentralized organization?
A) Start from scratch
B) Minimize the number of approvals needed to do something
C) Develop and adhere to a schedule
D) Do not ignore distribution
E) Integrate speed into the organization's culture
B
1. _____ is the time needed by the organization to develop, make, and distribute products or
services.
A) In-process time
B) Six Sigma time
C) Process layout time
D) Cycle time
E) Just-in-time
D

1. Which of the following guidelines for increasing speed is followed in a bureaucratic

organization?
A) Start from scratch
B) Minimize the number of approvals needed to do something
C) Develop and adhere to a schedule
D) Do not ignore distribution
E) Integrate speed into the organization's culture
C

1. Which of the following is an example of statistical quality control?

A) Benchmarking
B) Six Sigma
C) In-process sampling
D) ISO 9000:2000
E) Outsourcing
C

1. Implementing _____ requires making corrections until errors virtually disappear.

A) ISO 14000
B) ISO 9000:2000
C) Six Sigma
D) value-added analysis
E) statistical quality control
C

1. A factory produces 100,000 units of its product with 10 hours of direct labor. Which of the
following accurately represents the factory's labor productivity index?
A) 1,000
B) 10
C) 10,000
D) 100
E) 1,000,000
C

1. Which of the following levels of productivity represents the total level of productivity
achieved by a country?
A) Company
B) Partial
C) Partial
D) Individual
E) Aggregate
E

1. At a stereo making factory, the employees stationed along the assembly line are required
to wear ring scanners, small electronic devices worn on their index fingers and wired to a
small computer on their wrists. As a product moves along the assembly line and is handled
by the stationed employee, its location or progress is updated on the company's database
system. This way the management knows if there are any bottlenecks. This method of
improving operations allows the company to:
A) improve its productivity.
B) decrease fixed cost.
C) decrease its dependence on its Web site.
D) increase customer affective responses.
E) manage quality.
A