100+ Principles of Business Management MCQs [PBM Multiple Choice Questions and Answers]

Principles of Business Management MCQs


Multiple Choice Questions and Answers

1. Management is essential in every:

(a) Business.

(b) Organised group effort.

(c) Government.

(d) Industry.

Ans: (b) Organised group effort.

2. Management is need at:

(a) Top level.

(b) Middle level.

(c) Lower level.

(d) All levels.

Ans: (d) All levels.

3. "Management by objective (M.B.O.) is not only a technique of management but is philosophy of management. " Who said it?

(a) F.W. Taylor

(b) Chestor Bernard

(c)Peter Drucker

(d) Henry Fayol

Ans: (c) Peter Drucker

4. Management is:

(a) An art.

(b) A Science.

(c) An art as well as a Science.

(d) None of these.

Ans: (c) An art as well as a Science.

5. Communication between the manager and the employees is known as __________

(a) Inter scalar

(b) Extra organizational

(c) Intra scalar

(d) Crose wise

Ans: (c) Intra scalar

6. Management is:

(a) A pure science.

(b) An exact science.

(c) A social science.

(d) Natural science.

Ans: (c) A social science.

7. Management is:

(a) Tangible.

(b) Intangible.

(c) Fictitious.

(d) None of these.

Ans: (b) Intangible.

8. "Espirit De Corps" principle was enunciated by

(a) Earnest Dale

(b) R.C. Davis

(c) Henry Fayol

(d) Peter Drucker

Ans: (c) Henry Fayol

9. `Management is an art of getting things done through and with formally organized group` . This definition has been given by:

(a) Peter Drucker

(b) Henry Fayol

(c) Harold Koontz

(d) F.W. Taylor

Ans: (c) Harold Koontz

10. `Grapevine` is an organization means__________

(a) A prolonged meeting

(b) Garden of a company

(c) An angry manager

(d) Informal gossip

Ans: (d) Informal gossip

11. `Span of control` refers to __________

(a) A number of units under a company

(b) Supply area of a company

(c) Numbers of subordinates under a manager

(d) Controlling techniques

Ans: (c) Numbers of subordinates under a manager

12. If two or more sugar mills combine together, it is known as __________

(a) Horizontal combination

(b) Vertical combination

(c) Lateral combination

(d) None of the above

Ans: (a) Horizontal combination

13. Marketing is a:

(a) Managerial function of management.

(b) Operative function of management.

(c) Process of management.

(d) None of these.

Ans: (b) Operative function of management.

14. Planning is:

(a) Looking ahead.

(b) Looking back.

(c) Guiding people.

(d) Delegation of authority.

Ans: (a) Looking ahead.

15. Authority flows vertically in:

(a) Functional organisation.

(b) Line organisation.

(c) Line and staff organisation.

(d) None of these.

Ans: (b) Line organisation.

16. Recruitment, selection and training as the essence of management:

(a) Organising.

(b) Directing.

(c) Leadership.

(d) Staffing.

Ans: (d) Staffing.

17. Fayol classified industrial activities into:

(a) Five groups.

(b) Three groups.

(c) Six groups.

(d) Four groups.

Ans: (c) Six groups.

18. Fayol identified how many functions of management:

(a) Four.

(b) Twelve.

(c) Three.

(d) Five.

Ans: (d) Five.

19. Fayol has given how many principles of management:

(a) Ten.

(b) Twelve.

(c) Fourteen.

(d) Fifteen.

Ans: (c) Fourteen.

20. Fayol concentrated on:

(a) Top level.

(b) Shop level.

(c) Middle level.

(d) Productivity.

Ans: (a) Top level.

21. Fayol attempted to develop:

(a) Scientific management.

(b) Universal theory of management.

(c) Productivity theory.

(d) None of these.

Ans: (b) Universal theory of management.

22. Planning provides:

(a) information to management.

(b) basis for future policy formulation.

(c) purpose and direction to all persons.

Ans: (c) purpose and direction to all persons.

23. When planning is reduced to black and white it is known as:

(a) informal planning.

(b) formal planning.

(c) prospective planning.

Ans: (b) formal planning.

24. Departmentation involves:

(a) Dividing of activities.

(b) Grouping of activities.

(c) Division of work.

Ans: (a) Dividing of activities.

25. Departmentation helps in the:

(a) improvement of efficiency.

(b) increase of profits.

(c) expansion of the enterprise.

Ans: (b) increase of profits.

26. Departmentation helps in:

(a) concentration of authority with the manager.

(b) control of activities.

(c) decentralization of authority.

Ans: (3) decentralization of authority.

27. Who is referred to as Father of Scientific Management?

(a) Henry Fayol.

(b) F.W. Taylor.

(c) Louis D. Brandeis.

(d) None of these.

Ans: (b) F.W. Taylor.

28. The scientific technique of task setting is known as:

(a) Work study.

(b) Motion study.

(c) Time study.

(d) None of these.

Ans: (a) Work study.

29. According to Taylor the two functions of planning and doing should be:

(a) Combined.

(b) Separated.

(c) Flexible.

(d) Rigid.

Ans: (b) Separated.

30. Taylor suggested how many functional specialists:

(a) Six.

(b) Four.

(c) Eight.

(d) Seven.

Ans: (c) Eight.

Principles of Business Management MCQs Asked in Past Exams (From 2008 to 2024)

1) Who first propounded the principle of ‘esprit de crops’?                          1

Ans: Henry Fayol                                             

2) Write the full form of MIS.                                      1

Ans: Management Information System                

3) ‘Zero-based budgeting’ technique was first used in ____. (Fill in the blank)                                  1

Ans: This technique was first used in America in 1962. The former President of America, Jimmy Carter used this technique when he was the Governor of Georgia for controlling state expenditure.

4) ‘Functional foremanship’ was introduced by ____. (Fill in the blank)                                                   1

Ans: F.W. Taylor. It insists on hiring specialist for every job. (8 Specialists foremen)

5) State two limitations of planning.                                                                                                        2

Ans: Planning does not work in dynamic environment, Planning is a time consuming process.

6) ‘Centralization’ and ‘Decentralization’ are used in the same sense. (Write True or False)                           1

Ans: False

7) State one distinction between formal organization and information organization.                        1

Ans: Formal organsiation is official, so it has prescribed structure of roles and relationships.  It is planned and deliberately created by management. On the other hand, informal organisation is unofficial or natural having no specific structure.  It arises spontaneously without official sanction by management.

8) POSDCORB was introduced by ____. (Fill in the blank)                                                                                               1

Ans: P – Planning. O – Organising, S – Staffing, D – Directing, C – Coordinating, O – Organising, R – Reporting and B – Budgeting. This term is coined by L. Gullick and L. Urwick.

9) Father of scientific management is             1

Ans: F. W. Taylor.

10)  ‘Motion study’ is a part of ____. (Fill in the blank)                                                                                    1

Ans: Scientific management

11) ‘Esprit de corps’ is a basic principle of scientific management. (Write True or False)                   1

Ans: False

12) Who initiated the concept of ‘management of objectives’?                                                                  1

Ans: Peter Drucker

13) Who developed the concept of ‘functional organization’?                                                                     1

Ans: F.W. Taylor. It insists on hiring specialist for every job. (8 Specialists foremen)

14) Mention two features of a good plan.                                                                                                                             2

Ans: Goal-oriented or focus on objectives, flexibility

15) Write down any two functions of a manager.                              2

Ans: Planning and Controlling

16) Who first propounded the principle of Unity of Command?  1

Ans: Henry Fayol

17) Mention two limitations of planning.                               2

Ans: Planning does not work in dynamic environment and Planning is a time consuming process.

18) Write the full form of ROI.                    1

Ans: Return on Investment

19) Management is regarded as a perfect science.                           False

20) Management by objectives is a clever device for the exploitation of labourers.           False

21) Responsibility can be delegated but authority cannot be delegated.                                 False

22) Coordination and cooperation are used in the same sense.                  False                    

23) Planning is a mental exercise.                                             True

24) ‘Division of labour is an essential element of an organisation.                              True

25) The theory of scientific management was propounded by F. W. Taylor.          True      

26) Control is not applicable at all levels of management.                              False    

27) Functional foremanship was introduced by F.W. Taylor.

28) ‘Father of human relation movement’ was Elton Mayo

29) The motivation theory of Abraham Maslow is known as Maslow’s Hierarchy of Needs.

30) ‘PODSCORB’ was introduce by Luther Gulick .

31) Peter Drucker is known as father of MBO technique.

32) Return on investment (ROI)= (Net Income / Total Investment) X 100

33) The minimum duration of long term planning is 5 years.

34) Time study is a part of work study.

35) Management is what manager does.       (f) Louis allen 

36) Management means decision making             (d) Ross Moore     

37) Management means gettig things done throgh others people.(e) American Management Association

38) Father of scientific management             (b) F.W Taylor

39) Planning is the thinking process               (a) Alford and Beatty

40) Esprit De Corps                            (c) Henry Fayol

41) Establishing standards      (h) Step of control process

42) The human side of interprise        (g) Douglas McGregor

43) The theory of scientific management was propounded by Taylor.                                      True

44) The book, General and Industrial Management was written by P.F. Drucker.     False, Henry fayol

45) Management by objectives is a continuous process.                                                True

46) Rationalisation is an element of scientific management.                         False

47) Correction of deviation is the first step in the process of control.   False, Setting performance standard

48) Zero-based budgeting technique was first introduced in America in the year 1962.

49) Management audit is a traditional control technique of control.

50) Planning is determination of future course of action.

51) Coordination is same with cooperation.                                         False                    

52) Write the full form of TQM.                                 Total Quality Management

53) Henry Fayol is known as the ‘father of principles of management’.

54) ‘Identifying the problem’ is a basic principle of decision-making process.        True

55) Give two examples of financial incentives in motivating employees.       Retirement Benefits

56) Give an example of negative motivation.                                      Demotion          

57) Why is management called a ‘group activity’?             

Ans: Management plans, organizes, co-ordinates, directs and controls the group efforts so as to achieve organisational goals efficiently and effectively.

58) “Trying to control everything may end up in controlling nothing.”                       Management by Exception

59) Authority can be delegated, but responsibility cannot be delegated.

60) Give one example of non-financial incentive.                                              Job Security, Job Rotation

61) Write the name of one major proponent of Traditional or Classical theory of management. F.W. Taylor

62) Which concept of management reduces the workload of a manager?                                              Delegation

63) What is meant by ‘efficiency’ in management?                          

Ans: Efficiency signifies a level of performance that describes using the least amount of input to achieve the highest amount of output.         

64) Which function of management establishes authority/responsibility relationship?                     Organising

65) Name the first step in the process of ‘managerial control’.    Setting performance standard

66) Give two examples of positive motivation in motivating employees.      Incentives and rewards

67) Selection starts where _______ ends.

Ans: recruitment.

68) Blank application form is used to get _______ about the applicant.

Ans: information.

69) Proficiency tests measure the _______ of candidates.

Ans: skill.

70) Personality tests are used to know about _______ aspect of the candidates.

Ans: non-intellectual.

71) Final step in selection process is _______ of the employee.

Ans: placement and orientation.

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