SAHAY INSTITUTE

Chapter 4

Planning

Multiple Choice Questions

1. 'Dreams can be turned into reality only when managers think in advance what
to do and how to do it . Identify the function of management indicated by the
statement.

(a) Planning
(b) Organising
(c) Directing
(d) Controlling

2. Identify the key elements of planning from the following.

(a) Determining the objectives

(b) Identifying alternative courses of action
(c) Selecting the best course of action
(d) All of the above

3. Which of the following statements is false with respect to planning?

(a) It is one of the basic managerial functions

(b) Planning is closely connected with creativity and innovation
(c) It requires taking decisions
(d) None of the above

4. Which of the following is a feature of planning?

(a) Provides directions
(b) Reduces the risks of uncertainty
(c) Focuses on achieving objectives
(d) All of the above

5. Planning gives direction, reduces the impact of change, minimizes waste and
redundancy and

(a) establishes chaos among departments

(b) sets the basis used for promotion of individuals within the organisation
(c) planning guarantees safeguard from external environment
(d) sets the standards used in controlling

6. Which of the following is not a step in the process of planning?

(a) Making assumptions about the future

(b) Evaluating different proposals in light of the objectives to be achieved
(c) Allocation of jobs to members of each department
(d) Seeing whether activities are performed as per schedule or not

7. All other managerial functions are performed within the framework of the
plans drawn. Thus, it can be said that planning preceeds other functions."
This statement describes which function of planning?

(a) Planning focuses on achieving objectives

(b) Planning is pervasive
(c) Primacy of planning
(d) Planning is futuristic

8. A Co is manufacturing garments. The manager wants to increase profits by

purchasing new high speed machines or increasing the sale price or using waste
materials in manufacturing stuffed toys He decided that using waste material is
the best solution for him. Identify the concept of management involved

(a) Directing
(b) Coordinating
(c) Planning
(d) Organising
9. It requires application of mind involving foresight, intelligent, imagination and
sound judgement.Which feature of planning is indicate here?

(a) It is futuristic
(b) It involves decision-making
(c) It is mental exercise
(d) It is continuous

10. Rahul decided to start a desert cooler manufacturing business. He sets the
target of earning 20% profit On sales in the first year. He was very much
concerned about the future prospects of the business, which were uncertain For
this, he gathered information from the potential market and analyzed that the
demand for wall mounted coolers is increasing day by day. He used this
information as the base for future planning. On the basis of the gathered
information, he called a meeting in the following week to find new methods to
achieve the objective.

Identify the function of management involved in the above case.

(a) Controlling
(b) Staffing
(c) Planning
(d) Organising

11. Bawa Cycles' was in the business of manufacturing racing cycles and had a
monopoly in the market, The business was doing well and the company was
consistently meeting its objective of 10% increase in sales every year.
Encouraged by the good track record, the Managing Director of the company
kept an ambitious target of 15% increase in sales for the next year. The same
year, two competitors also entered the market and because of this the company
was not able to meet target. Identify the limitation of one of the functions of
management because of which the company was not able to achieve its target.

(a) Planning may be rigid

(b) Planning may not work in dynamic environment
(c) Planning does not guarantee success
(d) None of the above
12. Gautama, Product Head at Ashok Leyland Limited, plans to make his
company of the decade. For this purpose, he sets objectives, prepares strategies
and other action plans keeping the internal as well as external forces in mind so
that departments and individuals working in the organisation are able to decide
what action should be taken and in which direction.

Identify the importance of management highlighted in the case.

(a) Planning reduces uncertainty

(b) Planning reduces overlapping
(c) Planning provides direction
(d) Planning facilitates decision-making

13. Name the step in the process of planning which is considered "the real point
of decision-making"

(a) Developing premises

(b) Evaluating alternatives
(c) Selecting the best alternative
(d) Follow up

14. Which of the following steps in the process of planning states that the
manager is required to make certain assumptions about the future?

(a) Setting objectives

(b) Developing premises
(c) Evaluating alternative courses action
(d) Implementation of plan

15. "Planning is required at all levels of management as well as in all

departments of the organisation. It is not an exclusive function of top
management nor of any particular department. But the scope of planning differs
at different levels and among different department."

Identify the feature/characteristic of planning highlighted above.

(a) Planning is continuous

(b) Planning is futuristic
(c) Planning is pervasive
(d) Planning involves decision-making

16. To see whether plans are being implemented and activities are being
performed according to the schedule, is a step of planning process. Identify the
step.

(a) Setting objectives

(b) Follow up
(c) Implementation of plan
(d) Developing premises

17. Karim decided to start a chocolates manufacturing business. He set the

target of earning 10% profit on sales in the first year. As a good businessman he
was concerned about the future of the business, which was uncertain. He
gathered the information that the demand for chocolates is increasing day-by-
day. He used this information as the base for future planning and shared it with
his team. On the basis of the gathered information, he scheduled a meeting in
the following week to find innovative ways to achieve the objectives. Write the
first step, which has been followed by Karim that 'is related to the process of
one of the functions of management

(a) Setting objectives

(b) Developing premises
(c) Evaluating alternatives
(d) Implementing the plan

18. On the introduction of Goods and Services Tax Act', experts in the field of
business started analysing and forecasting its impact on various sectors and
industries. Kanha, an established businessman, attended a few seminars and
conferences organised by such experts to familiarise himself with this
information. He wanted to use these forecast and conjectures to reduce the
uncertainty in making decisions for the future in his business.

Name the step in the planning process that is being discussed in the above
paragraph.
(a) Setting objectives
(b) Developing premises
(c) Evaluating alternatives
(d) Implementing the plan

19. Having transformed 2,500 Kirana stores across eight cities into virtual super
markets, the start-up Quick Bizz' further decided in advance, to collaborate with
15,000-20,000 store owners in top 30 cities of the country by the end of this
year. Identify the step in the process of one of the functions of management
discussed above.

(a) Setting objectives

(b) Developing premises
(c) Evaluating alternatives
(d) Implementing the plan

20. A company wants to increase its market share from the present 10% to 25%
to have a dominant position in the market by the end of the next financial year.
Ms Rajni, the Sales Manager had been asked to prepare a proposal that will
outline the options available for achieving this objective. Her report included
the following options. Entering new markets, expanding the product range
offered to customers, using sales promotion teachings such as giving rebates,
discounts or increasing the budget for advertising activities. Which step of the
planning process has been performed by Ms Raini?

(a) Setting objectives

(b) Developing premises
(c) Evaluating alternatives
(d) Identifying alternatives

21. The last step in the process of planning is "Plan Implementation.

(a) True
(b) False
(c) Can't say
(d) Partially true
 22. "A plan is framed, it is implemented and is followed by another plan, and
so on." Identify the feature/characteristic of planning highlighted above

(a) Planning is continuous

(b) Planning is futuristic
(c) Planning is pervasive
(d) Planning involves decision-making

23. "Following a pre-decided plan, when circumstances have changed, it may

not turn out to be in the organisations interest.” identify the limitation of
planning highlighted above

(a) Planning leads to rigidity

(b) Planning may not work in a dynamic environment
(c) Planning does not guarantee success
(d) Planning reduces creativity

24. “It is not always true that just because a plan has worked before it will work
again. Besides, there are so many other unknown factors to be considered. This
knind of complacency and false sense of security may actually lead to failure of
planning.” Identify the limitation of planning highlighted above.

(a) Planning leads to rigidity

(b) Planning may not work in a dynamic environment
(c) Planning does not guarantee success
(d) Planning involves huge costs

25. “If the end result is clear it becomes easier to work towards the goal.”
Identify the step of one of the functions of management highlighted above.

(a) Setting objectives

(b) Follow-up Action
(c) Developing Premises
(d) Implementing the Plan

26. “Accurate forecasts become essential for successful plans.” Identify the step
of one of the functions of management highlighted above.
(a) Setting Objectives
(b) Follow-up Action
(c) Developing Premises
(d) Implementing the Plan

27. “An innovative course may be adopted by involving more people and
sharing their ideas.” Identify the steps of planning function of management
highlighted above.

(a) Setting objectives

(b) Developing premises
(c) Identifying alternative courses of action
(d) Evaluating alternative courses

28. "In financial plans, the risk-return trade-off is very common. The more
risky the investment, the higher the returns it is likely to give. To evaluate
Such proposals, detailed calcuations of earrings, earrings per share, interest,
taxes, dividends are made and decision taken.” Identify the step of planning
function of management highlighted above.

(a) Setting objectives

(b) Developing premises
(c) Identifying alternative course of action
(d) Evaluating alternative courses

29. "This is the step where other managerial functions also come into the
picture. This step would also involve organising for labour and purchase of
machinery.” Identify the step of one of the functions of management
highlighted above.

(a) Evaluating alternative courses

(b) Selecting an alternative
(c) Implementing the plan
(d) Follow-up action

30. Planning is the most challenging activity for the management as …………..

(a) it guides all future actions leading to growth and prosperity of the business
(b) specific goals are set out in the plans along with the activities to be
undertaken to achieve the goals
(c) if there was no planning employees would be working in different directions
and the organisation would not be able to achieve by involving more people and
sharing its desired goals
(d) None of the above

31. Sun Pharmacy planned to sell 1 crore ‘Covicare' tablets in a year. The
company received good response from the market and sold 1.5 crore tablets in
a year. Seeing the progress, the company decided to increase sales target to 2
crore tablets in a year.

Which major benefit of planning has the company achieved?

(a) Planning provides directions

(b) Planning facilities decision-making
(c) Planning reduces the risk of uncertainty
(d) Planning establishes standards for controlling

32. Reliable communication limited scans the business environment and adapt
itself to the changes in the environment, yet it becomes difficult to foresee the
future trends. Which limitation of planning is related to the above statement?

(a) Planning may not work in the dynamic environment

(b) Planning reduces creativity
(c) Planning is a time consuming process
(d) Planning does not guarantee success

33. Super Fine Rice Ltd. has the largest share of 55% in the market, The
company's policy is to sell only for cash In 2020, for the first time company's
number one position in the industry has been threatened because other
companies started selling rice on credit also. But the managers of Super Fine
Rice Ltd. continued to rely on its previously tried and tested successful
plans which didn't work because the environment is not static. This led to
decline in sales of Super Fine Rice Ltd.
The above situation is indicating limitation of planning which led to decline in it
sales, Identify it.

(a) Planning leads to rigidity

(b) Planning may not work in a dynamic environment
(c) Planning is pervasive
(d) Planning involves huge costs

34. Ravi was working in a mobile company. It had an assembling unit in Noida.
In this assembling unit, standard output of producing 12 units per day per
worker had been set. While assembling mobile phones, he realised that by
simply reorganising the sequence of tasks more units can
be assembled at a lower cost. He went to his supervisor and informed him
about his new discovery. The supervisor, on the contrary, instructed him to
carry our work as per the method and techniques decided earlier.

Identify this limitation of one of the functions of management.

(a) Planning leads to rigidity

(b) Planning may not work in a dynamic environment
(c) Planning does not guarantee success
(d) Planning reduces creativity

35. Sales executive of a Swatch Jal Water Purifier' suggested the marketing
manager to sell the products with the help of artificial intelligence. He suggested
that a pre-recorded message may be sent to the prospective buyers
and it will help save time, cost and energy for both ends. The marketing
manager liked the idea but suggested him to continue with the strategy the
company was already adopting.

Which limitation of planning is reflected in the above case?

(a) Planning is time consuming

(b) Planning leads rigidity
(c) Planning reduces creativity
(d) Planning does not guarantee success
36. Mr. Kapil, an educationist found that the teachers have to travel long to
attend the workshops and they lose the opportunity to gain the knowledge on
updates. He listed various alternatives and finally developed an app which could
work on mobile and laptops to launch online sessions. Suggest which next step
should he follow?

(a) Developing premises

(b) Identifying the alternative course of action
(c) Implementation of plan
(d) Follow up action

37. The Chinese companies launched ‘Vivo’ and ‘Oppo' phones in the Indian
market with high end features to tap low segment population of India, It
remained successful but later the Indians in order to show patriotism decided to
boycott Chinese products.
Which step of planning process, Chinese firms could not perform properly while
launching their products?

(a) Setting objectives

(b) Follow up action
(c) Developing premises
(d) Identifying alternative courses of action

38. A sales manager was required to make a forecast of sales post covid19
impact for 4th Quarter of 2020. He considered the sales of 1st Quarter and 3rd
Quarter of current year and previous year. He followed ...... step of planning
process

(a) setting objectives

(b) follow up
(c) developing premises
(d) identifying alternative courses of action

39. A company wants to increase sales; the alternatives may be reducing prices,
improving packaging, offering trade discount, cash discount after sales due to
credit sales, free samples etc. Which step of planning process relates with the
above examples?
(a) Developing premises
(b) Selecting an alternative
(c) Identifying alternative courses of action
(d) Implementing the plan

40. Name the feature of planning which states that planning is a forward looking
function.

(a) Pervasive
(b) Futuristic
(c) Continuous
(d) Mental exercise

41. Match the following

Column I Column II
A. Specify what an organisation aspire (i) Developing premises
to achieve
B. Planning precedes other functions. (ii) Mental exercise
C. Planning in an intellectual activity. (iii) Goals
D. Assumptions about the future. (iv) Primacy of planning

Find the correct option

A B C D A B C D
(a) (i) (ii) (iii) (iv) (b) (ii) (iv) (I) (iii)
(c) (iii) (iv) (ii) (i) (d) (iv) (i) (ii) (iii)

42. Planning premises are the actual plans about the future organisational
resources.

(a) True
(b) False
(c) Can't say
(d) Partially true

43. To see whether plans are being implemented and activities are performed
according to schedule is known as …………………
(a) Objectives
(b) Planning
(c) Follow-up action
(d) Premises

44. The business environment is ……..… in nature, so planning may not work in
such an environment.

(a) dynamic
(b) creative
(c) innovative
(d) static

45. Match the following

Column I Column II
A. End results (i) Policy
B. Base to interpret strategy (ii) Method
C. Do’s and Don'ts (iii) Objectives
D. One step of a procedure (iv) Rules

Find the correct option.

A B C D A B C D
(a) (i) (ii) (iii) (iv) (b) (ii) (iv) (i) (iii)
(c) (iii) (iv) (ii) (i) (d) (iii) (i) (iv) (ii)

46. Identifying alternative courses of action is a step in organising process.

(a) True
(b) False
(c) Can't say
(d) Partially true

47. Match the following.

Column I Column II
A. Anticipate changes (i) Planning
B. Planning decides in advance how (ii) Reduces the risk of uncertainity
work is to be done
C. Establishes standard for controlling (iii) Promotes innovation
D. Planning encourages new ideas (iv) Provides directions

Find the correct option.

A B C D A B C D
(a) (i) (ii) (iii) (iv) (b) (ii) (iv) (i) (iii)
(c) (iii) (iv) (i) (ii) (d) (iv) (i) (iii) (ii)

48. .......... is a feature of planning and also referred to as primacy of planning

(a) Pervasive
(b) Primary function of management
(c) Continuous
(d) Integrating