CSS Solved MCQS from 2000 to 2011

THE CSS POINT
2012-13
BUSINESS ADMINISTRATION
CSS Solved MCQS from 2000 to 2011
Solved By: Agha Zohaib Khan
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Business Administration Paper 2000

(1) Public Accountants generally perform these services:

(a) Income tax services, Management Advisory services, and independent
auditing services
(b) Internal auditing, Income tax services and management controlling.
(c) Public accounting, private accounting and budgeting.
(d) None of the above is correct.

(2) Identify the organization created by Congress to regulate security markets including
flow of information from companies to public:

(a) TVM
(b) NPV
(c) IRR
(d) SEC

(3) Select the term that describes a cash distribution to a Corporations Stockholders:

(a) Paid out Capital
(b) Cash Management
(c) A dividend
(d) None of these
(e) All of the above are correct

(4) Frederick Winslow Taylor work/book entitled the principles of Scientific Management
is published, in:

(a) 1875
(b) 1901
(c) 1911
(d) None of these

(5) One of the most successful Industrialists and the father of Modern Personnel
Management is:

(a) F.W. Taylor
(b) James Watt
(c) C. Babbage
(d) Robert Owen

(6) Who has the major Contributions in the Theory of Bureaucracy:

(a) Henry Gantt
(b) Hanri Fayal
(c) W.D. Scatt
(d) Max Weber
(e) None of these

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(7) Which one, of the following MNCs (Multinational Co.) has the higher revenues during
mid. 1990s:

(a) General Motor
(b) IBM
(c) AT &T
(d) General Electric
(e) None of the above

(8) Give the, name of the author who has the major contributions in the field of
marketing:

(a) H. Koontz
(b) W.J. Stanton
(c) P.B. Miller
(d) Gitt Man
(e) All of these

(9) The profit margin is a ratio between the corporations net income and:

(a) Total expense
(b) Total assets
(c) Cost
(d) Total revenues

(10) MNCs are responsible for the majority of Foreign Direct Investment (FDIs) and have
a higher revenues than the national income of some of the countries they serve:

(a) Fully agreed
(b) Not agreed
(c) It is not possible
(d) None of these

(11) Earned but uncollected revenues, that are recording the adjusted process, recorded
with a credit to the revenues and debit to the expense is called:

(a) Adjusted Trail balance
(b) Expenses
(c) Accrued revenues
(d) None of these

(12) Which one of the following is not a part/variable of the marketing Mix (4Ps):

(a) Product
(b) Price
(c) Place
(d) Person
(e) None of these

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(13) The major steps in the accounting cycle are the following:

(a) The procedure used in worksheet
(b) Begin with Trail Balance
(c) Completed only once in business life
(d) None of the above
(e) All of these

(14) Which of the following items is not unique to the financial statements of
merchandising Companies?

(a) Cost of good sold
(b) Gross profit
(c) Account receivable
(d) Net sales
(e) All of the above
(f) None

(15) The repairs made to keep a plant/asset in normal and good operating condition are
called:

(a) Plant Management
(b) Operation Management
(c) Ordinary repairs

(16) A company that owns more than 50% shares of another company and controls that
corporation is known as:

(a) Subsidizing
(b) Consolidated CO.
(c) None of these

(17) The process of individual growth in the full utilization of a persons managerial
capabilities is called management development:

(a) True
(b) False

(18) Promotion is not a part of marketing:

(a) Agreed
(b) Not agreed
(c) None of these

(19) A way of analyzing leadership style where leaders are classified on a grid with TWO
dimensions is called:

(a) Managerial grid
(b) Two way theory
(c) None

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(20) Robert Owen is known as the Father of Modern Personnel Management:

(a) Yes
(b) No
(c) May be Taylor


(1) Most preferred stock pays a fixed dividend at regular intervals.

(a) True
(b) False

(2) Any increase in an asset item is a source of funds.

(a) True
(b) False

(3) Depreciation is a book-keeping entry that allocates the cost of assets against income
but does not involve any movement of capital.

(a) True
(b) False

(4) The maturity of a security relates to the owners ability to convert it into cash on
short notice:

(a) True
(b) False

(5) The credit period represents the period of time during which a cash discount can be
taken on short notice.

(a) True
(b) False

(6) Which ratio is computed with the help of the following? Cost of goods sold/Inventory

(a) Receivable turnover
(b) Times interest earned
(c) Inventory Turnover
(d) None of these

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(7) ________ is the right that is delegated to an individual or a department to control
specific processes, practices, policies and other matters relating to activities
undertaken by person in other departments.

(a) Line authority
(b) Functional Authority
(c) Line and Staff Authority
(d) None of these

(8) Decentralization is the tendency to disperse decision making in an organized
structure:

(a) True
(b) False

(9) Programmes are plans which are general statements or understandings that guide or
channel thinking in decision making:

(a) True
(b) False

(10) _______ is that part of managing that involves establishing an international s
tructure of roles for people to fill in an organization:

(a) Leading
(b) Controlling
(c) Planning
(d) None of these (Organizing)

(11) Henri Fayol applied the principle of Division of Work to all kinds of work,
managerial as well as technical.

(a) True
(b) False

(12) ________ spell out specific required actions or non-actions, allowing no discretion:

(a) Procedures
(b) Budgets
(c) Rules
(d) None of these

(13) Business buyers are as geographically dispersed as final consumers.

(a) True
(b) False

(14) The distribution between a consumer good and an industrial good is based on the
purpose for which product is purchased:

(a) True
(b) False

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(15) Intensive distribution occurs when the product is stocked in as many outlets as
possible.

(a) True
(b) False

(16) Merchant wholesalers are independently owned business that do not own (take title
to) the goods they sell:

(a) True
(b) False

(17) Which of the following elements in a compensation package provides the greatest
amount of incentive for salespersons?

(a) Salary
(b) Fringe Benefits
(c) Commissions
(d) Use of Company Vehicle

(18) The process whereby the seller distinguishes between market segments, selects one
or more of these segments, and develops products and marketing-mixes tailored to
each segment is called _______ marketing.

(a) Mass
(b) Target
(c) Product Variety
(d) Service

(19) Goods that the consumer, in the process of selection and purchase, characteristically
compares on such bases as suitability, quality, price and style are called _______
goods.

(a) Shopping
(b) Specialty
(c) Unsought
(d) Convenience

(20) Product ______ is a period of rapid market acceptance and increasing profits.

(a) Development
(b) Introduction
(c) Growth
(d) Maturity

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Q1. Which one of the following statement is correct?

(a) Decisions in public organizations emphasize political priorities, while decisions in
business organizations are rational and apolitical.
(b) Public decisions makers, in contracts to their business counter parts are
constrained by administrative procedure that limit managerial authority and
autonomy.
(c) It is hard to get high performance out of government employees because, compared
to their business counterparts they are logy, more security oriented and less
motivated.
(d) None of the above is true.

Q2. Who has written the famous book Principles of Scientific Management?

(a) Eltca Mayo
(b) Henls Fayol
(c) Fredric Taylor
(d) Maw weber
(e) None of These

Q3. Which one of the following cannot be consider as an important dimension on which
nations culture differ?

(a) Individualism Vs Collectivism
(b) Power Distance
(c) Uncertainty Avoidance
(d) Economic development

Q4. Market penetration pricing strategy can be pursued in price sensitive market?

(a) True
(b) False

Q5. A Product can have a combination of physical product and service

(a) True
(b) False

Q6. Vertical marketing System is integration of manufacturing and marketing activities

(a) True
(b) False

Q7. Distribution of free product samples is part of publicity

(a) True
(b) False

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Q8. Which one of the following is not the part of marketing Mix?

(a) Advertising
(b) Personel Selling
(c) Publicity
(d) Sales promotion
(e) None of the above is the part of martikng mix

Q9. Which one of the following is not the part of product attributes?

(a) Quality
(b) Positioning
(c) Brand
(d) Packaging

Q10. Under the monopolistic combination, market consist of few sellers who are highly
sensitive to each others pricing and marketing strategies

(a) True
(b) False

Q11: Which of the following statements is not part of theory 'X'
assumptions?

(a) Decisions are made in participative manner
(b) Employees inherently dislike work
(c) Employees must be coerced to achieve goals
(d) Employees tend to avoid responsibilities

Q12: Which of the following statement is not true?

(a) Planning that proves inaccurate is a waste of management time
(b) Planning can eliminate change
(c) Planning reduces flexibility
(d) None of these

Q13: Which of the following sources of power is dependent on authority?

(a) Legitimate power
(b) Coercive power
(c) Expert power
(d) Referent power

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Q14: Deciding whether to record a sale when order for services is received or
when the services are performed is an example of a

(a) Classification issue
(b) Recognition issue
(c) Valuation issue
(d) None of these

Q15: Payment for a two year insurance policy (in advance) is debit to

(a) Unexpired insurance
(b) Cash
(c) Insurance expense
(d) Expired insurance

Q16: Which of the following is an important reason for studying
accounting?
(a) Accounting information is useful in making economic
decisions
(b) Accounting plays an important role in society
(c) The study of accounting can lead to a challenging career

Q17: If a company has liability of 19,000 and owner's equity of 57,000 its assets are

(a) 38,000
(b) 57,000
(c) 76,000
(d) 19,000

Q18: Transactions are initially recorded in the

(a) Books of Final Entry
(b) Books of original entry
(c) T accounts
(d) Accounting equation

Q19: The term Hybrid Security is used for

(a) Common Stock
(b) Defferred Stock
(c) Preferred Stock

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(1) Business risk is influenced by the firms decision to use debt in its financial
structure. TRUE

(2) The most important function of management is controlling. TRUE

(3) A short term creditor would consider liquidity ratios to be more important than
efficiency ratios. TRUE

(4) According to Maslow, when a need is satisfied, it tends to lose its ability to motivate.
TRUE

(5) The term marketing mix refers to the degree of advertising Vs personal selling used
to market product. FALSE

(6) The difference between an agent and a merchant wholesaler is that an agent always
takes title but a merchant wholesaler does not. FALSE

(7) The management of working capital is required because of a lack of short term
synchronization between demand and supply. TRUE

(8) A manager who believes that people inherently dislike work probably accepts
McGregors Theory X. TRUE

(9) Inventory carrying costs can be minimized by carrying fewer units in inventory.
TRUE

(10) A balance sheet is an accounting report used solely for the corporate form of
business. FALSE

(11) For management, budgeting is perhaps the most powerful_____.

(a) Forecasting tool
(b) Control device
(c) Hiring tool
(d) Accounting measure

(12) The income statement is a summary of:

(a) Revenue and expenses
(b) Assets, liabilities and capital
(c) Increases and decreases in capital
(d) None of these

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(13) One benefit of using ratio analysis when interpreting financial statements is that:

(a) Ratios facilitate comparisons between different companies.
(b) All ratios have exact standard values with which performance can be compared.
(c) Ratios take into account all the specific factors affecting particular companies and
industries.
(d) None of these

(14) Planting and policy making are primarily functions of:

(a) Top management
(b) Middle management
(c) Operating management
(d) None of these

(15) An informal organization often exists within a business because:

(a) Not all relationships can be specifically defined.
(b) Small organizations do not necessarily emphasize strict adherence to line authority.
(c) Human behavior naturally crosses established authority lines.
(d) All of these

(16) In marketing, selling and buying would be called the:

(a) Primary functions
(b) Exchange functions
(c) Profit functions
(d) Critical functions

(17) Institutional advertising is:

(a) Aimed only at people in institutions
(b) Run only by institutions
(c) Designed to promote a type of product rather than a particular brand.
(d) Designed simply to show that the firm is a good place to do business.

(18) The current ratio of a firm having Rs. 25,000 of current assets, Rs. 30,000 of fixed
assets, Rs. 5000 of current liabilities and Rs. 10,000 of fixed liabilities would be:

(a) 5:1
(b) 7:1
(c) 10:1
(d) None of these

(19) The organizational form that replaces individual authority at all levels with group
representation is:

(a) Line
(b) Line and staff
(c) Functional
(d) Committee

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(20) Working Capital may be expressed as:

(a) Current assets minus current liabilities
(b) Current and fixed assets minus current and fixed liabilities
(c) Current assets over current liabilities
(d) Current and fixed assets over current and fixed liabilities


(1) In a large corporation, the firms owners are usually its top managers. False

(2) The basic information needed to construct a flow of funds statement is found on the
income statement. True

(3) The operating break-even point is the point at which operating profits equal revenues
minus operating costs. False

(4) A sinking fund is a poorly performing mutual fund whose net asset value is declining.
False

(5) Penetration Pricing is used when a marketer introduces a new product at a relatively
high price. False

(6) The most common channel for consumer products is manufacturer-retailer-
consumer. True

(7) In the classification of consumer products, convenience products are usually more
expensive than shopping products. False

(8) During the maturity stage of the PLC, sales increase at faster rate than during any
other stage. False

(9) A wide span of management results in few organizational levels, and a narrow span
results in many levels. True

(10) The Line relationship involves making decisions and acting on them. True

(11) Data is defined as formal system of gathering, integrating, comparing, analyzing,
and dispersing information internal and external to the enterprise in a timely,
effective and efficient manner. False

(12) A manager who believes that people inherently dislike work probably accepts
McGregors Theory X. True

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(13) If a manufacturer gives a 30 percent discount to retailers and a 10 percent discount
to wholesalers, which type of discount is being given?

(a) Quantity
(b) Cash
(c) Functional (also called trade discount)
(d) Seasonal

(14) Publicity differs from advertising in as much as:

(a) It is directed at large numbers of consumers.
(b) Its message is of a non personal nature.
(c) It is carried by the mass media.
(d) It is a non paid Form of reaching the public.

(15) In which stage of the PLC are promotion expenses per product item usually highest?

(a) Introduction
(b) Growth
(c) Maturity
(d) Decline

(16) Which of the following is not a disadvantage of using a Committee?

(a) High cost in time and money
(b) Splitting responsibility
(c) Group deliberation and judgment
(d) Compromise decisions

(17) Identify the Organization established by our Federal government to regulate security
markets:

(a) SBP
(b) SEC
(c) NAB
(d) NFC

(18) If the credit terms are 2/10, net 30 and the amount of invoice is Rs. 4000, how
much is the discount if the invoice is paid in 20 days?
(for example, the term 2/10, net 30 allows a customer to deduct 2% of the net
amount owed if the customer pays within 10 days of the invoice date. If a customer
does not pay within the discount period of 10 days, the net purchase amount
(without the discount) is due 30 days after the invoice date.)

(a) Zero
(b) Rs. 30
(c) Rs. 60
(d) Rs. 120

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(19) Which of the following is not part of the promotion-mix?

(a) Public relations
(b) Product planning
(c) Personal selling
(d) Advertising

(20) Selling activities include:

(a) Sales presentations
(b) Demonstrations
(c) Handling objections
(d) Closing the sale
(e) None of these


(1) Planning initiates other functions of management. True

(2) Managements make things to happen. False

(3) The ultimate criterion of control is the extent that activities are complete in ways
that lead to more profits. False

(4) Computer Technology helps the management but does not replace the management.
True

(5) Promotional mix is also known as communication mix. True

(6) Marketing environment is made up of micro-environment and macro-environment.
True

(7) Promotional mix is the part of marketing mix. False

(8) Marketing strategy consists of specific strategy for target markets, positioning, the
marketing mix and marketing expenditure levels. True

(9) A Financial manager has a full control over its firms stock price. False

(10) Liquidity ratios measure a firms ability to meet short term obligations. True

(11) The internal rate of return method is the most widely used capital budgeting
techniques. False

(12) Stock exchange facilitates investment in real assets by providing secondary market
to the financial securities. False

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(13) The organizing function of management includes:

(a) How tasks to be grouped.
(b) Conflict resolution among sub-ordinates.
(c) Comparison of actual results with a budget.
(d) Definition of organizations goals.

(14) The key to motivating todays diversified work force lies in:

(a) Creativity
(b) Goal setting
(c) Support
(d) Flexibility

(15) Control should be placed:

(a) Where they are cost-effective
(b) On all activities
(c) Where there are problem areas
(d) On the single most important

(16) The marketing logic by which the business unit hopes to achieve its marketing
objective is called:

(a) Business strategy
(b) Marketing strategy
(c) Production & distribution strategy
(d) All of these

(17) Strategic planning is the process of developing a formal strategy for:

(a) Identifying clear objectives
(b) Long run survival & growth
(c) Continuity & Consistency
(d) All of these

(18) Who are the true owners of Corporation?

(a) Debt holder
(b) Common stock holders
(c) Managers of the firm
(d) Board of directors

(19) What does an efficient port folio provide?

(a) Highest return for a given amount of risk
(b) Least risk for a given level of return
(c) Highest possible return and least amount of risk
(d) Both a and b

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(20) The economic order quaintly (EOQ) increases when which of the following increases?

(a) Sales
(b) Ordering costs
(c) Carrying costs
(d) Both a and b


1) The three stages of marketing practices through which a company may pass are
entrepreneurial marketing, formulate marketing and entrepreneurial marketing.
[True]

2) The continual segmenting or fragmenting of markets impedes the new product
development process.[False]

3) Reverse-flow channels refer to situations where one channel level acquires a level
back in the channel, such as sears owning its own suppliers [True]

4) Planning is concerned with defining an organizations goals and objectives and how
to integrate and coordinate activities. [True]

5) Leadership and management are two terms for the same process. [False]

6) Effective control systems monitor everything happening in the organization.[False]

7) In informal planning, the organizations objectives are rarely verbalized. [True]

8) The trait approach to leadership has identified a specific set of personality
characteristics that determine leader success.[True]

9) A brand is an offering from a known source. [True]

10) The concept of compounding deals with finding the future value of a present
sum.[True]

11) Short term creditors would be most interested in the firms of leverages
ratios.[False]

12) Working capital management includes in part the administration of cash, marketable
securities, receivables and inventories. [True]

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(13) Which of the following is NOT one of the four specific drivers that underpin the new
economy?

a. Industry convergence
b. Disintermediation and reintermediation
c. Customer delivered value
d. Customization and customerization
e. Digitalization and connectivity

(14) ___ lays out the target markets and viable propositions that organization will offer
based on an analysis of the best market opportunities

a. the strategic market plan
b. the portfolio analysis
c. the human resource plan
d. the tactical marketing plan
e. marketing research

15) the attractiveness of a market offering is based:

a. on the product, its placement, its price and its promotion
b. on the match between customer needs and wants and distribution and
pricing of the product
c. almost entirely on the product being offered
d. on product features and quality, services mix and quality, and price appropriateness
e. entirely on the match between perceived product and actually product

16) high levels of efforts are unlikely to lead to favorable job performance unless:

a. technology is also considered
b. quality of the effort is also considered
c. team work is also considered
d. management efforts are also considered

17) In order to bring about effective organizational change, changes in technology need
to be accompanied by making changes in _____:

a. Strategies
b. Structure
c. People
d. Both (b) and (c)

18) A capital investment is one that:
a. has the prospect of short term benefits
b. has the prospect of long term benefits
c. Is only undertaken by large corporations with large amounts of capital
d. applies only to investment is fixed assets

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19) If the general level of interest rates rises, the prices of already issue bonds will:

a. Rise
b. Remain unchanged
c. Fall
d. Fluctuate

20) If the EOQ for an item decreases, the average level of inventory will:

a. Decrease
b. Increase
c. Remain the same
d. There is no relationship between EOQ and inventory levels


(1) A decision is a choice made between two or more alternatives. (True)

(2) Frank Gilbreth is known as father of Scientific Management. (False)

(3) The responsibility for organizational planning rests with middle level management.
(True)

(4) The Hawthrone Experiments found that people were more concerned with preserving
the work group than with maximizing their pay. (True)

(5) Selling concept assumes that heavy selling and promotional efforts are needed to
stimulate more demand for the product. (True)

(6) Any paid form of non-personal presentation and promotion of ideas, goods or
services by identified sponsor is known as public relation. (False)

(7) Market Segmentation is concerned with dividing the market demographically and
geographically. (False)

(8) Joint Venturing is a form of entering foreign markets by joining with foreign
companies to produce or market a product or service. (False)

(9) Another name of cash flow is accounting profit. (False)

(10) The Financial Manager has full control over his firms stock price. (False)

(11) Systematic risk can be diversified away by adding more securities to a portfolio.
(False)

(12) Discounting is the process of finding present value. (True)

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(13) Extreme division of labour leads to result in:

(a) Motivation
(b) Boredom
(c) Decreased work skill
(d) Non-specialization
(e) None of these

(14) Fayol defines 14 principles of management. Which of the following is not one of
those principles?

(a) Scalar chain
(b) Espirit de corps
(c) Centralization
(d) Directedness of command
(e) None of these

(15) An example of pre-control established by management would be:

(a) Rules
(b) Policies
(c) Budgets
(d) All of these

(16) Firms credit policy usually includes establishing:

(a) Credit standards
(b) Credit terms
(c) Collection policy
(d) All of these

(17) Liquidity ratios are computed by using information from:

(a) Balance Sheet
(b) Income statement
(c) Cash flow Statement
(d) Both (a) and (b)

(18) Conservative working capital management strategies involve:

(a) Low risk, Low return
(b) Low risk, High return
(c) High risk, High return
(d) High risk, Low return

(19) Product life cycle has the following stages:

(a) Introduction and Maturity
(b) Growth and Maturity
(c) Introduction, Maturity and Decline
(d) Introduction, Growth, Maturity and Decline

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(20) Which product is most likely to be purchased through routine decision-making?

(a) Car
(b) Desk
(c) Soft Drink
(d) Shirt
(e) None of these


(1) The last stage of Maslow Need Hierachy is Esteem. (False)

(2) An effective Manager is one who achieves the goal with the least amount of
resources. (True)

(3) Audit is a type of controlling system. (True)

(4) Removal of undesirable elements serves as Negative Reinforcement tool to motivate
the people. (True)

(5) Marketing of services heavily rely on advertising. (True)

(6) Advertising is paid, personal communication through media (False)

(7) Skimming pricing is used when the customers are quality conscious. (True)

(8) Advertising is usually at the top of Promotion Mix of every product. (True)

(9) Profit as against Share Price Maximization is always a desirable goal of organization.
(False)

(10) For a short-term creditor, liquidity ratios are more important than efficiency ratios.
(True)

(11) Low levels of net working capital decrease risks. (False)

(12) The present value of an annuity is inversely related to future value of annuity.
(True)

(13) The three levels of a product are:

(a) Core, Packaging and Promotion
(b) Actual, Core and Pricing
(c) Augmentation, Core and Actual
(d) None of these

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(14) MBO means:

(a) Management based on Organization
(b) Management based on Objectives
(c) Management by Objectives
(d) None of these

(15) The two broad price policies are:

(a) Demand and sales based pricing
(b) Penetration and low pricing
(c) Skimming and Demand based pricing
(d) None of these

(16) Quick Ratio is calculated by dividing:

(a) Current Assets by Current Liabilities
(b) Current Assets by Inventories
(c) Current Liabilities by Current Assets
(d) None of these

(17) Decreasing inventories is a source of:

(a) Assets
(b) Funds
(c) Credit
(d) None of these

(18) Entrepreneur is:

(a) Manager looking for profit
(b) Manager looking for employees satisfaction
(c) Manager looking for every opportunity
(d) None of these

(19) The depth of a 'Product Mix' indicates:

(a) All products offered by a company with its versions
(b) All products offered by a company with its brands
(c) All products and service brands
(d) None of these

(20) A person directly involved in operation and accomplishment of main objectives of
the firm is called:

(a) First-Line manager
(b) Line-Manager
(c) Staff-Manager
(d) None of these

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(1) The key inputs into Discounted Cash Flow analysis are projected future cash flows.
(True)

(2) Market demand for a product is the total volume that would be sold by a defined
customer group. (False)

(3) Operational plans apply to the entire organization and establish the organizations
overall goals. (False)

(4) Preferred stock has a fixed divided paid every period forever so preferred stock is
essentially a perpetuity.(True)

(5) The cost of debt is the return that the firms debtors demand on new
borrowing.(True)

(6) With the Internal Rate of Return, we try to find a single rate of return that
summarizes the merits of a project. (True)

(7) IBM is example of a manufacturer brand. (True)

(8) Modifying job responsibilities is an example of structural change. (False)

(9) ---------- is a statement reporting the effects of a firms operating, investing and
financing activities on cash flows over an accounting period.

a. Income statement
b. Annual report
c. Cash flow statement
d. Balance sheet
e. None of these

(10) ---------- studied five chief executives at work and identified ten managerial roles.

a. Max weber
b. Henry fayol
c. Henry mintzberg
d. Fredrick taylor
e. Michael porter

(11) A product life cycle -----------------.

a. Shows how a product sales or profits may rise or fall over its life
b. Tells you how long a product will sell for and make a profit
c. Is divided into three stages
d. Show how profitable a product will
e. None of these

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(12) All of the following are fixed assets except

a. Building
b. Stocks
c. Production plant
d. Vehicles

(13) What is the influencing environmental factor when interest rates increase and firms
find it difficult to borrow funds

a. Political factor
b. Social factor
c. Economic factor
d. Technological factor
e. Competitive factor

(14) Which of the following is not a market entry strategy

a. Licensing
b. Indirect exporting
c. Joint venture
d. International marketing
e. None of these

(15) ------------ is information about physical working conditions, work schedule and the
organizational and social context of the job.

a. Job specification
b. Job context
c. Work activities
d. HR policy manual
e. None of these

(16) The liquidity of a firm is a measure of ---------------

a. Its ability to pay bills
b. Its ability to respond to changes in demand
c. How flexible it is in its production plannning
d. How quickly and easily a firm could relocate to another site
e. None of these

(17) Market share means ---------------

a. How well a firm is doing
b. How much power a firm has in the market
c. How many firms are there in the market
d. How big a market is
e. None of these

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(18) -------------- refers to a management philosophy that requires employers to
continuously set and relentlessly meet ever high quality, cost , delivery and
availability goals.

a. Performance management
b. Performance appraisal
c. Continuous improvement
d. Management by objective
e. None of these

(19) Beta ------------.

a. Is a measure of firm specific risk
b. Is a measure of market risk
c. Is a measure of total risk
d. All of these
e. None of these

(20) What is the price of a stock that is expected to pay a 1.00 divided next year if the
cost of capital is 14% and the growth rate is zero

a. 7.14
b. 6.75
c. 11.9
d. 6.13
e. None of these


(1) You wish to borrow $ 8000 to be repaid in 24 monthly installments at an annual
interest rate of 8%. What is your monthly payment?

a) $ 262.82
b) $ 361.82
c) $ 150.5
d) $ 325.00
e) none

(2) If you invest $ 600 every six months at 8% compounded semi annually, how much
would you accumulate at the end of 10 years?

a) $ 15,883.20
b) $ 16,926.82
c) $ 17, 866.85
d) $ 18,233.45
e) None

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(3) A commercial bank will loan you $ 12,250 for three years to buy a car. The loan
must be repaid in 36 equal monthly payments. The annual interest rate on the loan I
s 12% of the unpaid balance. How large are the monthly payments?

a) $425.00
b) $350.67
c) $375.09
d) $406.88
e) none

(4) What is the future value of $500 investment, with a stated rate of 6% compounded
monthly for 7 years.

a) 700
b) 730
c) 760
d) 790
e) none

(5) You are considering investing in a preferred stock that has a dividend of $ 3.25 per
share. The market price of this stock is $ 48.625. What is the rate of return you
would expect to make on this perpetuity?

a) 6.68%
b) 6.24%
c) 6.05%
d) 6.28%
e) none

(6) What is not a disadvantage of traditional file processing system?

a) Program-data dependence
b) Reduce data redundancy
c) Limited data sharing
d) Lengthy development time
e) none

(7) An enterprise data model is a (n) _______ model.

a) numerical
b) mathematical
c) narrative
d) graphical
e) none

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(8) Which is not a component of relational database?

a) Entity
b) Table
c) Attribute
d) Hierarchy
e) none

(9) Data base application can be divided into 5 categories. Which is NOT a database
application category?

a) Personal
b) Department
c) Enterprise
d) Relational
e) none

(10) A data base that supports organization wide operations and decision making is a (n)
________ database.

a) department
b) enterprise
c) work group
d) extra-net
e) none

(11) As small companies begin to achieve success, they tend to adopt some of the tools
used in professionally run marketing commas. This is a sign that the firm is in the
________ stage of marketing practice.

a) Entrepreneurial marketing
b) Formulated marketing
c) Intrepreneurial marketing
d) Effective marketing
e) none

(12) The concept of a _______ is used to describe a cluster of complementary products
that are closely related in the minds of the consumers but are spread across a
diverse set of industries.

a) Metamarket
b) Metamediary
c) Market place
d) Marketspace
e) none

(13) Marketers can increase the value of customers offering by:

a) raising benefits and reducing cost
b) raising benefits by more than raising the cost
c) lowering benefits by less than the reduction in cost
d) All of the above can increase the customers value

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(14) When a firm sees its competitors as all companies that compete for the same
consumer dollars, they are concerned with the ________ level of competition.

a) Brand
b) Industry
c) Form
d) Generic
e) None

(15) The number of channel levels from raw material to final product which a company
will participate defines the firm's _________ scope.

a) Industry
b) Geographical
c) Vertical
d) Competence
(16) Which of the following best describes the organizational members who integrate and
coordinate the work of others?

a) Managers
b) Operatives
c) Subordinates
d) Customers

(17) _________ represent the lowest level of management

a) Team leaders
b) First line managers
c) Operatives
d) Laborers
e) none

(18) Which of the following roles is more important for lower-level managers than for
either middle or top-level managers?

a) Negotiator
b) Leader
c) Coordinator
d) Entrepreneur
e) none

(19) Which of the following skills involve working well with other people?

a) Technical
b) Human
c) Computer
d) Empirical
e) none

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(20) The phrase most associated with scientific management is ________?

a) Management Relations
b) One of the best
c) Supply and demand
d) Quality control
e) none


(1) Fredrick Winslow Taylors Principles of Scientific Management suggested the use of
scientific methods to define:

(a) The easiest way of doing a job
(b) The most complex way of doing a job
(c) The best way of doing a job
(d) None of these

(2) The quantitative approach using quantitative techniques in Management is called:

(a) Scientific Method
(b) Operations Research
(c) Quantitative Approach
(d) None of these

(3) The perspective that Managers are directly responsible for an organizations success
is known as:

(a) Omnipotent view of management
(b) Management orientation
(c) Autocratic management
(d) None of these

(4) Effective Management decisions are:

(a) Emotional
(b) Based on lots of data
(c) Rational
(d) None of these

(5) Breakeven Analysis is a useful technique for:

(a) Reducing operating costs
(b) Maximizing sales
(c) Resource allocation
(d) None of these

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(6) Recruitment helps:

(a) Improve productivity of HR
(b) Reduce number of employees
(c) Improve labour relations
(d) None of these

(7) Grapevine is:

(a) An office decoration plant
(b) An information network
(c) An official drink
(d) None of these (Informal Business Communication)

(8) Most important asset in an organization is:

(a) Money
(b) Plant and Machinery
(c) Employees
(d) None of these

(9) Employees resist organizational change because it:

(a) Reduces their compensation
(b) Creates uncertainty
(c) Puts more work on them
(d) None of these

(10) Strictly observing Corporate Ethics is:

(a) Not important in commercial organizations
(b) Against the concept of profit maximization
(c) An essential requirement of professional business management
(d) None of these

(11) According to Herzbergs Motivation - Hygiene Theory, employees salary is:

(a) Hygiene Factor
(b) Motivating Factor
(c) Employees Retention Factor
(d) None of these

(12) Who has the most power in Value Chain?

(a) Suppliers
(b) Distributors
(c) Customers
(d) None of these

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(13) Marketing is:

(a) Sales of goods and services
(b) The range of services starting and ending with the customer
(c) Sales planning and promotion
(d) None of these

(14) Marketing Strategy is:

(a) Activities focused to defeat competitors
(b) Activities aimed at creating value and profitable relationship with customers
(c) Activities for maximizing sales
(d) None of these

(15) Cost strategy means charging:

(a) Highest price for products
(b) Lowest price for products
(c) Varying prices for products
(d) None of these

(16) Branding is:

(a) Not possible for services
(b) Not very useful commercially
(c) Useful for building product loyalty
(d) None of these

(17) Creation of value in a business means:

(a) Earning maximum profits
(b) Promoting rapid growth in sales
(c) Optimizing shareholders return in a company
(d) None of these

(18) Price/Earnings Ratio of a company shows relationship between its:

(a) Net profit and Sales
(b) Gross profit and Net earnings
(c) Market price of its share and Earnings per share
(d) None of these

(19) Free Cash Flows are:

(a) Net after tax profit
(b) Expected Revenues minus expected costs and capital expenditures
(c) Cash in hand and in bank
(d) None of these

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(20) Term interest earned is:

(a) EBIT Interest on debt
(b) Net profit Debt
(c) Sales Interest Payable
(d) None of these

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