APSET Paper 2 Mock Test - 3 (Management) - AP TET MCQ

Ethical challenges provides information and activities to help individuals or groups think through basic ethical concepts and considerations. Ethical challenges will not provide specific answers for the specific dilemmas that people face but will help readers bring to conscious awareness some understandings that help in thinking through ethical issues.
Ethical challenges may arise on account of:
(a) Failure of personal character, conflict of personal value and organisational goals and conflict of organisational goals and social values
(b) Hazardous but popular products

Line organisation is the oldest and simplest form of organisation. According to this type of organisation, the authority flows from top to bottom in a concern. The line of command is carried out from top to bottom.

Distribution strategy is precisely the strategy deployed by a company to make sure the product/service can reach the maximum potential customers at minimal or optimal distribution costs.
Distribution strategy of a company is influenced by:

• Nature of product
• Target segment of consumers
• Pricing policy

A holistic marketing approach states that business is considered as a whole wherein all the departments viz. R&D, Marketing, Finance, HR, etc. are integrated and work collectively towards the marketing and sale of a product. There are four components that can very well characterise the holistic marketing approach:
Internal marketing means hiring, training, motivating and inculcating business values in able employees who can serve customers well. Internal marketing deals with the market department to know the understanding level of the product among the employees and thereby imparting the necessary training to meet the expected results.
Performance marketing focuses on the returns to the business from the marketing activities undertaken as well as the effects of the same on the society as a whole. The marketer has to give answers to the top authority for the amount spent on marketing activities along with its effects on business. Brand and customer equity is the major focus area of this marketing.
Integrated marketing means how well the 4 P's of the marketing mix (product, price, place, promotion) are synced to deliver the efficient message to the prospective customers.Integrated marketing, an important character of holistic marketing must ensure that each communication tool must give a real and authentic information to the customer.
Relationship marketing focuses on building a strong and long-lasting relationship with all who can directly or indirectly add to the success of an organization.This is the most essential character of holistic marketing that results in a marketing network that shows how well all the stakeholders have created mutually profitable business relationships.

The operating cycle refers to the time it takes for a company to convert its inventory into cash through the sale of goods or services. It includes the time it takes to purchase raw materials, manufacture or produce the goods, sell them, and collect cash from customers.

The operating cycle consists of two main components: the inventory conversion period and the accounts receivable collection period. The inventory conversion period is the time it takes for a company to convert its raw materials into finished goods and then sell them. The accounts receivable collection period is the time it takes for the company to collect cash from its customers after the sale.

Therefore, the operating cycle represents the time that elapses between the purchase of raw materials and the collection of cash for sales.

An ideal personnel policy encompasses various elements that govern the management of employees within an organization. These elements include:

(A) Probation policy: This policy outlines the rules and procedures for the probationary period that new employees undergo when they join an organization. It typically includes expectations, evaluation criteria, and the duration of the probationary period.

(B) Employment policy: This policy defines the guidelines and principles related to the recruitment, hiring, and employment practices within the organization. It covers aspects such as job postings, selection criteria, compensation, benefits, and other terms and conditions of employment.

(C) Review of progress: This refers to the process of assessing and evaluating the performance and progress of employees. It may involve periodic performance reviews, feedback sessions, goal-setting, and career development discussions to ensure employees' growth and align their performance with organizational objectives.

All three elements are important components of an ideal personnel policy as they address different stages of the employee lifecycle, from hiring to ongoing performance management. Therefore, the correct answer is (D) All a., b., and c. are correct.

Statement (I) : In the applied sciences, normative science is a type of information that is developed, presented, or interpreted based on an assumed, usually unstated, preference for a particular policy or class of policies.

Statement (II) : Normative generally means relating to an evaluative standard. Normativity is the phenomenon in human societies of designating some actions or outcomes as good or desirable or permissible and others as bad or undesirable or impermissible. A norm in this normative sense means a standard for evaluating or making judgments about behavior or outcomes. Normative is sometimes also used, somewhat confusingly, to mean relating to a descriptive standard: doing what is normally done or what most others are expected to do in practice. In this sense a norm is not evaluative, a basis for judging behavior or outcomes; it is simply a fact or observation about behavior or outcomes, without judgment. Many researchers in this[clarification needed] field try to restrict the use of the term normative to the evaluative sense and refer to the description of behavior and outcomes as positive, descriptive, predictive, or empirical.

ISO 9000:

• ISO 9000 is defined as a set of international standards on quality management and quality assurance developed to help companies effectively document the quality system elements needed to maintain an efficient quality system.
• They are not specific to any one industry and can be applied to organizations of any size.
• Thus Both (A) and (R) are correct.
• ISO 9000 can help a company satisfy its customers, meet regulatory requirements, and achieve continual improvement.
• It should be considered to be the first step or the base level of a quality system.
• Published by the International Organization for Standardization, it aims to encourage the production of goods and services that meet a globally-acceptable level of quality.
• ISO 9000 lays out best practices, guidelines, and a standard vocabulary for quality management systems.
• There isn't any relationship between the two statements. So (R) is not the correct explanation of (A).

Therefore, the method used to compare the means of more than two populations simultaneously is called Analysis of Variance.

Importance of financial statement analysis:

• Measuring the profitability
• Indicating the Trend of Achievements
• Assessing the Growth Potential of the Business
• Comparative Position in Relation to Other Firms
• Assess overall financial strength
• Assess solvency of the firm

(a) Job-evaluation is used to determine compensation: This statement is true. Job evaluation is a process used to determine the relative worth of jobs within an organization, which helps in establishing a fair and equitable compensation structure.

(c) Job-enrichment is referred to as vertical job loading: This statement is also true. Job enrichment involves increasing the depth and complexity of a job by adding tasks that require more skill, responsibility, and autonomy. It is often referred to as vertical job loading because it involves enhancing the job vertically by giving employees more control and decision-making authority.

A buffer stock is a system or scheme which buys and stores stocks at times of good harvests to prevent prices falling below a target range (or price level), and releases stocks during bad harvests to prevent prices rising above a target range (or price level).

So, Buffer stock’ is the level of stock at times of good harvests to prevent prices falling below a target range (or price level).

Capital economy the government intervention is absent.
Everything is controlled by the private owners for profit.
Capitalism is an economic and political system in which a country’s trade and industry are controlled by private owners.
This system is based on private ownership.
It is an economic system based on principle of free enterprises.

Factoring: 

• Factoring is a financial service provided by specialized agents to help manufacturers and traders etc. manage their receivables.
• It is a process of selling receivables to a third party at a discount.
• The supplier (exporter) assigns his accounts receivables in favor of the factor and gives notice of assignment to the debtor.
• The factors undertake collection/accounting and management of debts of their clients.
• A factor may either lend against accounts receivables or by purchasing invoices. He will take responsibility for collecting the debt.
• A factoring agency is a service provider to a firm that extends the services of Sales ledger administration and credit management.
• The factoring service may be offered with or without recourse.
• Factoring with recourse refers to the right of the factor to claim bad debts from his client, whereas, without recourse factoring, the risk of bad debt will be borne by the factoring agent himself.

Strategic Aspect of Green Management:

• According to Zoogah, D. (2010), five major platforms where sustainability principles can be applied in the transforming an organization to the wholly sustainable enterprise is as follows;
• “The Green products/services Portfolio” including waste and pollution management, resource replacement, sustainable design, and adaptive reuse.
• “The Green Workforce” including Human Resource strategies, culture, recruiting and retention, training, career path development, and diversity.
• “The Green Workplace,” including global locations, physical plants, ergonomics, virtual workplaces, green buildings, environmental discharge, waste and energy, use, and source.
• “The Green Function/Process Model,” including sustainability applied to traditional functions, enterprise-wide green process modeling to incorporate green practices and sustainable-management.
• “Green Management and Governance Principles,” including board and management accountability, sustainability test, compliance, incentives, ethics, reporting, and assurance.

Hence, the correct answer is four.

Core Competency:

• Core competency is a unique skill or technology that creates distinct customer value.
• For instance, the core competency of Federal Express (Fed Ex) is logistics management.
• The organizational unique capabilities are mainly personified in the collective knowledge of people as well as the organizational system that influences the way the employees interact.
• As an organization grows, develops, and adjusts to the new environment, so do its core competencies also adjust and change.
• Thus, core competencies are flexible and develop with time. They do not remain rigid and fixed.
• The organization can make maximum utilization of the given resources and relate them to new opportunities thrown by the environment.
• Resources and capabilities are the building blocks upon which an organization creates and execute a value-adding strategy so that the organization can earn reasonable returns and achieve strategic competitiveness.
• The key to utilizing organizational core competencies is to own and nurture the resources and competencies that make up the essence of the business.
• Core competencies help an organization to distinguish its products from its rivals as well as to reduce its costs to its competitors and thereby attain a competitive advantage. It helps in creating customer value. '
• Also, core competencies help in creating and developing new goods and services.

Hence, the key to utilizing organizational core competencies is to own and nurture the resources and competencies that make up the essence of the business.

A marketing plan is a comprehensive document or blueprint that outlines the advertising and marketing efforts for the coming year. It describes business activities involved in accomplishing specific marketing objectives within a set time frame.
A marketing plan is composed of three basic components, namely:
1. Objectives
2. Policies
3. Programme

A fixed position layout is where the product stays stationary while workers come to the product site to build it. Fixed position layouts are ideal for products that are large, heavy, or too fragile to move. Ship building and construction of dams and bridges are typical examples of fixed position layout.

Encoding is a process by which a sender translates his thoughts into a series of symbols that he feels, will communicate the message to the intended receiver. (c) A channel is anything that links the sender with the receiver. (d) Decoding is the interpretation and translation of a message into meaningful information. (e) A feedback is a message that is generated by the receiver in response to the sender’s original message. (a) Modeling is not relevant in this context.

Debt ratio measures the percentage of total assets financed by debt (including current liabilities). So, it tests how leveraged an organisation is.Hence, option (c) is correct.

Human Resources Planning (HRP) is the process of forecasting an organization's future demand for employees and determining the necessary actions to meet that demand. It involves analyzing the organization's current human resources, identifying future staffing needs, and developing strategies to acquire, develop, and retain the required workforce.

To ensure the effectiveness and relevance of the HRP process, it is essential to review it regularly. Here's why:

1. Environmental Changes: External factors, such as economic conditions, market trends, technological advancements, and regulatory changes, can impact an organization's human resource requirements. By reviewing the HRP process, the organization can identify and incorporate any changes needed to align its workforce planning with the current business environment.
2. Internal Changes: Organizations also experience internal changes, such as restructuring, expansion, downsizing, or changes in business objectives. These changes may impact the demand for employees, skill requirements, or workforce distribution. Regularly reviewing the HRP process allows the organization to adapt to these internal changes effectively.
3. Evaluation of Effectiveness: By reviewing the HRP process, organizations can evaluate its effectiveness in meeting workforce planning objectives. This includes assessing whether the process is generating accurate forecasts, identifying skill gaps, supporting talent acquisition and development, and aligning with overall business goals. If any shortcomings are identified, adjustments can be made to enhance the process's usefulness.
4. Continuous Improvement: Reviewing the HRP process annually provides an opportunity for continuous improvement. It allows the organization to learn from past experiences, incorporate feedback, and implement best practices in workforce planning. By continuously refining the process, the organization can ensure it remains relevant, effective, and aligned with changing business needs.

Therefore, option d, "Reviewing process," is necessary in the HRP process every year to incorporate changes and make it more useful. It enables organizations to assess and adapt their workforce planning efforts to meet the dynamic demands of the business environment.

Assertion (A): The apprenticeship programme is one of the most widely used off-the-job training methods.

Explanation:

• Apprenticeship training refers to a course of training in any industry or establishment. 
• Apprenticeship training consists of basic training (theoretical instructions) and practical on-the-job training at the actual workplace.
• On-the-job training is an important topic in human resource management. It helps develop the career of the individual and promotes the prosperous growth of the organisation.
• On-the-job training is a form of training provided at the workplace. During the training, employees become familiar with the working environment they will become part of. Employees also get hands-on experience using machinery, equipment, tools, materials, etc. Part of on-the-job training is to face the challenges that occur during the performance of the job.
• An apprenticeship programme is one of the methods of on-the-job training.

Hence, Assertion (A) is incorrect.

Reasoning (R): On-the-job training methods are more effective than off-the-job training methods.

• Off-the-Job Training is the training method wherein the workers or employees learn their job roles away from the actual work floor.
• Off-the-job training is defined as learning which is undertaken outside of day-to-day work duties and leads towards the achievement of the apprenticeship. This training takes place within the apprentice's normal (contracted) working hours.
• The basic components of on-the-job training include verbal and written teaching and demonstration; hands-on practice and imitation; and mentorship from a more seasoned employee or supervisor who can impart industry-specific knowledge and abilities.
• Therefore, on-the-job training methods are more effective than off-the-job training methods.

Hence, Reason(R) is correct.

According to the CAPM model, the cost of equity is represented by:
R_f + (R_m - R_f) β_j
(Where R_m indicates market rate of return, R_f indicates risk free rate of return and β_j indicates beta of stock j.)
The CAPM model indicates security with a positive alpha is one that is expected to yield an abnormal positive rate of return, based on the perceived risk of the security, and thus is under-p riced.

An entrepreneur is an independent person. He makes his own decision and he has risk taking ability. He never blames others for his decisions. Everybody dream but entrepreneurs realize their dreams and work hard to make them true.
They convert their dream in to business idea and business idea in to business opportunity. Whatever they do, they do with full dedication and possess technical knowledge.

A warehouse is a commercial building for storage of goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses etc.
They are usually large plain buildings in industrial areas of cities, towns and villages.
The primary purpose of a storage warehouse is storage. Storage is the physical containment of merchandise while it is awaiting a demand.
The form of storage will depend on the size and quantity of the items in inventory and the handling characteristics of the product or its container.
So, storage are meant to store products for moderate to long period of time.

Statement I: An activity cannot be represented by more than one arrow, but an arrow can represent one or more activities.

This statement is incorrect. In project network diagrams, an activity can indeed be represented by more than one arrow. In fact, it is common to have multiple arrows representing the same activity to indicate different dependencies or relationships with other activities. For example, an activity might have multiple predecessor activities or multiple successor activities, resulting in multiple arrows representing that single activity.

Statement II: The activities in a critical path can be preponed or postponed.

This statement is also incorrect. The critical path in a project network represents the longest path from the project's start to its completion, and it determines the minimum time required to complete the project. Activities on the critical path have zero float or slack, meaning they cannot be delayed without delaying the entire project. Similarly, they cannot be preponed or completed earlier without affecting the project's duration. The critical path activities must be executed as planned to ensure the project is completed within the shortest possible time.

Therefore, since both statements are incorrect, the correct answer is option (b): Both the statements I and II are incorrect.

Benefits provided for temporary and permanent disability disfigurement, medical expenses and medical rehabilitation are referred to as workers' compensation. It is a state-mandated insurance programme that provides benefits to employees who suffer job-related injuries and illnesses.

Issuing stock is a type of equity financing, meaning that management gives up ownership by allowing others to invest money and buy part of the company. Public issue through prospectus is the most popular method of issuing stocks of a company.
Under this method, the company issues a prospectus to the public inviting offers for subscription. The investors who are interested, apply for the securities they are willing to buy.

The internal job posting is a recruitment process where a candidate is selected for the job who is already working in that same company. In other words, the internal job posting process finds a candidate among the employees of the company. It delivers a sense of support from internal employees of the company.

Queuing theory is a branch of operation research that studies the movement of people, objects, or information through a line.

Important Points

• The analytical modeling of a queue would involve providing an input specification describing the queue
• The arrival describes the way the customer enter the system 
• Poisson distribution is a discrete probability distribution that expresses the probability of the given number of an event occurring in fixed intervals.
• The arrival pattern can be expressed  as
  P ( X ) = λ x e − λ X ! μ
• The inter-arrival follows the exponential distribution

Hence the correct answer is In Queuing Theory, the statistical pattern by which customers arrive over a period of time follows Poisson distribution.