SOUNDARYA COMPOSITE PU COLLEGE

II PU BUSINESS STUDIES
4 AND 8 MARKS

8 MARKS:
NATURE AND SIGNIFICANCE OF MANAGEMENT:
1. Explain the characteristics of management.
a) Management is a goal oriented process.
b) Management is all pervasive.
c) Management is multidimensional.
❖ Management of work
❖ Management of people
❖ Management of operations
d) Management is a continuous process.
e) Management is a group activity.
f) Management is a dynamic function.
g) Management is an intangible force.

2. “Management as an art and a science are not mutually exclusive, but

complement to each other”. Elucidate.
Management as an art:
a) Existence of theoretical knowledge
b) Personalised applications
c) Based on practice and creativity
d) Goal oriented
Management as a science:
a) Systematized body of knowledge
b) Principle based on experimentation
c) Universal validity
d) Cause and effect relationship

3. Management is a series of continuous interrelated functions. Comment

a) Planning
 b) Organising
c) Staffing
d) Directing
e) Controlling

4. What is coordination? Explain the characteristics of coordination.

Coordination is the process by which a manager synchronises the activities of
different departments to bring unity of action in order to achieve the goals of the
organisation.
Characteristics:
a) Coordination integrates group efforts.
b) Coordination ensures unity of action.
c) Coordination is a continuous process.
d) Coordination is an all pervasive function.
e) Coordination is the responsibility of all managers.
f) Coordination is a deliberate function.
ORGANISING:
1. What is organising? Explain the importance of organising.
Organising is a process which coordinates human efforts, assembles resources and
integrates both into a unified whole to be utilized for achieving specified objectives.
Importance:
a) Benefits of specialization
b) Clarity in work relationship
c) Optimum utilization of resources
d) Adaptation to change
e) Effective administration
f) Development of personnel
g) Expansion and growth
 2. State the advantages and disadvantages of formal organisation.
Advantages:
a) It is easier to fix responsibility.
b) It helps in avoiding duplication of effort.
c) Unity of command is maintained.
d) It leads to effective accomplishment of goals.
e) It provides stability to organisation.
Disadvantages:
a) It may lead to procedural delays.
b) It does not allow any deviations from rigidly laid down policies.
c) It is difficult to understand all human relationships.

3. What is delegation? Explain the importance of delegation.

Delegation refers to the downward transfer of authority from a superior to a
subordinate.
Importance:
a) Effective management
b) Employee development
c) Motivation of employees
d) Facilitates growth
e) Quick decision making
f) Basis of management hierarchy
g) Better coordination

4. What is decentralization? Explain its importance.

Decentralization refers to delegation of authority throughout all the levels of an
organisation.
Importance:
a) Develops initiative among subordinates
b) Develops managerial talent for the future
c) Quick decision making
d) Relief to top management
 e) Facilitates growth
f) Better control
STAFFING:
1. Explain the stages in the staffing process.
a) Estimating the man power requirements
b) Recruitment
c) Selection
d) Placement and orientation
e) Training and development
f) Performance appraisal
g) Promotion and career planning
h) Compensation

2. Describe the steps involved in selection process.

a) Preliminary screening
b) Selection tests
❖ Intelligence tests
❖ Aptitude tests
❖ Personality tests
❖ Trade tests
❖ Interest tests
c) Employment interview
d) Reference and background checks
e) Selection decision
f) Medical examination
g) Job offer
h) Contract of employment

3. Explain the benefits of training and development to the organisation and to

the employees.
To the organisation:
a) It is a systematic learning.
b) It enhances employee productivity both in terms of quantity and quality.
c) It increases employee satisfaction and morale.
d) It reduces absenteeism and employee turnover.
 e) It helps in obtaining effective response from employees to fast changing
environment.
f) It needs less supervision and reduces the cost of supervision.
To the employees:
a) It improves skills and knowledge.
b) It increases the performance of employees.
c) It reduces the chances of industrial accidents.
d) It increases the satisfaction and morale of employees.

4. Explain the four methods of on the job training and any four methods of off
the job training.
On the job training methods:
a) Apprenticeship training or understudy
b) Coaching
c) Internship training
d) Job rotation
Off the job training methods:
a) Class room lecture
b) Films
c) Case study
d) Vestibule training
e) Computer modeling
f) Programmed instruction
DIRECTING:
1. What is supervision? Explain the role played by a supervisor.
Supervision is the process of guiding the efforts of employees and other resources
to accomplish the desired objectives.
Importance:
a) Supervisor maintains friendly relations with workers.
b) Supervisor acts a link between workers and management.
c) Supervisor plays a key role in maintaining group unity among workers.
d) Supervisor ensures performance of work according to the targets set.
 e) Supervisor provides good on the job training to the workers
f) Supervisor plays a key role in influencing the workers in the organisation.
g) Supervisor analyses the work performed and gives feedback to the workers.

2. Explain any four financial incentives and any four non-financial incentives
used to motivate employees of a company.
Financial incentives:
a) Pay and allowances
b) Productivity linked wage incentives
c) Bonus
d) Profit sharing
e) Stock option
f) Retirement benefits
g) Perquisites
Non-financial incentives:
a) Status
b) Organizational climate
c) Career advancement opportunity
d) Job enrichment
e) Employee recognition programmes
f) Job security
g) Employee participation
h) Employee empowerment

3. Explain the qualities of a good leader.

a) Physical features
b) Knowledge
c) Integrity
d) Initiative
e) Communication skills
f) Motivation skills
g) Self confidence
h) Decisiveness
i) Social skills
 4. Suggest the suitable measures to improve communication effectiveness.
a) Clarify the ideas before communication
b) Communicate according to the needs of receiver
c) Consult others before communicating
d) Be aware of languages, tone and content of message
e) Convey things of help and value to listeners
f) Ensure proper feedback
g) Communicate for present as well as future
h) Follow up communications
i) Be a good listener

4 MARKS
PRINCIPLES OF MANAGEMENT:
1. Explain any four nature or characteristics of principles of management.
a) Universal applicability
b) General guidelines
c) Formed by practice and experimentation
d) Flexible
e) Mainly behavioural
f) Cause and effect relationship
g) Contingent

2. Explain any four points regarding significance of principles of management.

a) Providing managers with useful insights into reality
b) Optimum utilization of resources and effective administration
c) Scientific decisions
d) Meeting changing environment requirements
e) Fulfilling social responsibility
f) Management training, education and research

3. Explain the principles of management contributed by F.W.Taylor.

a) Science, not rule of thumb
b) Harmony, not discord
c) Cooperation, not individualism
 d) Development of each and every person to his/her greatest efficiency and
prosperity

4. What are the four aspects of work study developed by Taylor? Explain.
a) Method study
b) Motion study
c) Time study
d) Fatigue study
BUSINESS ENVIRONMENT:
1. Explain any four features of business environment.
a) Totality of external forces
b) Specific and general forces
c) Inter-relatedness
d) Dynamic nature
e) Uncertainty
f) Complexity
g) Relativity

2. Explain ay four points to show how important the understanding of business

environment for manager is.
a) It enables the firm to identify opportunities and getting the first mover
advantage.
b) It helps the firm to identify threats and early warning signals.
c) It helps in tapping useful resources.
d) It helps in coping with rapid changes.
e) It helps in planning and policy formulation.
f) It helps in improving performance.

3. Explain the impact of government policy changes on business and industry.

a) Increasing competition
b) More demanding customers
c) Rapidly changing technological environment
d) Necessity for change
e) Need for developing human resources
f) Market orientation
g) Loss of budgetary support to the public sector
PLANNING:
1. Explain any four features of planning.
a) Planning focuses on achieving objectives.
b) Planning is a primary function of management.
c) planning is pervasive.
d) planning is continuous.
e) planning is futuristic.
f) planning involves decision making.
g) planning is a mental exercise.

2. Explain the importance of planning with any four points.

a) Planning provides direction.
b) Planning reduces the risk of uncertainty.
c) Planning reduces overlapping and wasteful activities.
d) Planning promotes innovative ideas.
e) Planning facilitates decision making.
f) Planning establishes standards of controlling.

3. Explain any four limitations of planning.

a) Planning leads to rigidity.
b) Planning reduces creativity.
c) Planning involves huge cost.
d) Planning is a time consuming process.
e) Planning may not work in a dynamic environment.
f) Planning does not guarantee success

4. Explain any two types of plan.

a) Objectives
b) Strategy
c) Policy
d) Procedure
e) Method
f) Rule
g) Programme
h) Budget
STAFFING:
 1. Explain the internal sources of recruitment.
a) Transfers:
It involves shifting of an employee from one job to another or from department to
another, without any change in his status, responsibility and salary.
b) Promotions:
It means vertical movement of an employee from lower level jobs to higher level
jobs with increase in his status, responsibility and salary.
2. Explain any four types of tests used for selection of employees.
a) Intelligence tests
b) Aptitude tests
c) Personality tests
d) Trade tests
e) Interest tests

3. How does training and development of employees benefit the organisations?

To the organisation:
a) It is a systematic learning.
b) It enhances employee productivity both in terms of quantity and quality.
c) It increases employee satisfaction and morale.
d) It reduces absenteeism and employee turnover.
e) It helps in obtaining effective response from employees to fast changing
environment.
f) It needs less supervision and reduces the cost of supervision.
CONTROLLING:
1. A good control system helps an organisation in many ways. Justify the
statement with any four points.
a) It helps in accomplishing organizational goals
b) It helps in judging accuracy of standards
c) It helps in making efficient use of resources
d) It helps in improving employee motivation
e) It helps in ensuring order and discipline
f) It helps in facilitating coordination in action
 2. Explain the limitations of controlling.
a) Difficulty in setting quantitative standards
b) Little control/no control
c) Resistance from employees
d) Costly affair

3. Explain briefly the steps involved in controlling process.

a) Setting performance standards
b) Measurement of actual performance
c) Comparing actual performance with standards
d) Analysing deviation.
e) Taking corrective actions
FINANCIAL MANAGEMENT:
1. What is capital budgeting decision? Explain briefly the factors affecting
capital budgeting decisions.
A long term investment decision is called capital budgeting decision.
Factors affecting capital budgeting decisions:
a) Cash flows of the project
b) The rate of return
c) The investment criteria involved

2. Explain any four factors affecting financing decision.

a) Cost
b) Risk
c) Floatation costs
d) Cash flow position of the company
e) Fixed operating costs
f) Control considerations
g) State of capital market

3. Explain any four factors affecting dividend decision.

a) Amount of earnings
b) Stability of earnings
c) Stability of dividends
d) Growth opportunities
e) Cash flow position
f) Shareholder’s preference
g) Taxation policy
h) Stock market reaction
i) Access to capital market
j) Legal constraints

4. Explain the importance of financial planning with any four points.

a) It helps in forecasting what may happen in future under different business
situations.
b) It helps in avoiding business shocks and surprises.
c) It helps in coordinating various business functions.
d) It helps to reduce wastage and duplication of efforts.
e) It tries to link the present with the future.

5. Explain any four factors affecting the fixed capital requirement of an

organisation.
a) Nature of business
b) Scale of operations
c) Method of production
d) Technology upgradation
e) Growth prospects
f) Financing alternatives
g) Level of collaboration
h) Diversification

6. Explain any four factors affecting the working capital requirement of an

organisation.
a) Nature of business
b) Scale of operation
c) Business cycle
d) Seasonal factors
e) Production cycle
f) Credit allowed
g) Credit availed
h) Operating efficiency
i) Availability of raw materials
 j) Growth prospects
k) Level of competition
l) Inflation
CONSUMER PROTECTION:
1. Explain any four rights of consumers.
a) Right to safety
b) Right to be informed
c) Right to choose
d) Right to be heard
e) Right to seek redressal
f) Right to consumer education

2. State any four responsibilities of consumers while purchasing, using and

consuming goods and services.
a) Buy only standard goods
b) Read label carefully
c) Demand for cash bill
d) Be honest in your dealings
e) File a complaint in consumer court
f) Respect the environment

3. Explain any four ways in which the objective of consumer protection can be
achieved.
a) Self regulation by business
b) Business associations
c) Consumer awareness
d) Consumer organisations
e) Government

4. State any four directions which can be issued by the consumer court to the
opposite party.
a) To remove the defect in goods or deficiency in service.
b) To replace the defective product.
c) To refund the price.
d) To pay compensation.
e) To discontinue the unfair trade practices.
f) To withdraw the hazardous goods from sale.

5. State any four functions of consumer organisations and NGOs for the
protection and promotion of consumer interest.
a) Educating the general public about consumer rights
b) Publishing periodicals to impart knowledge about consumer problems
c) Providing legal assistance to consumers
d) Filing complaints in consumer court on behalf of the consumers
e) Encouraging consumers to strongly protest and take an action against unfair
trade practices

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