Business Studies: CUET Mock Test - 3 - CUET MCQ

Henri Fayol outlined management functions in a sequential process. Planning involves setting objectives and strategies, followed by Organising to arrange resources. Commanding directs and motivates employees to execute plans, and Controlling ensures activities align with goals. The correct sequence is Planning, Organising, Commanding, Controlling. Hence, Option C is the correct choice.

Effective organising first leads to specialisation by systematically allocating jobs, followed by clarity in working relationships through defined reporting lines. This ensures optimum utilisation of resources by avoiding duplication, and finally enables adaptation to change by providing structural flexibility. Thus, the correct sequence is (A), (B), (C), (D). Hence, Option A is the correct choice.

Recruitment involves first identifying different sources of labour supply, followed by assessing their validity to ensure they are reliable. Next, the most suitable source is chosen, and finally, applications are invited from prospective candidates. Thus, the correct sequence is Identifying sources of labour supply, Assessing the validity of sources, Choosing the most suitable source, Inviting applications from prospective candidates. Hence, Option C is the correct choice.

(A) Formulating overall organisational goals and strategies.

• Top management (e.g., CEOs, Board of Directors) is responsible for setting long-term objectives, vision, and strategic direction for the organization.

(C) Integrating diverse elements and coordinating departmental activities.

• Top management ensures that different departments (finance, marketing, operations) work together toward common goals through coordination and integration.

Incorrect Options:

(B) Directly overseeing the workforce to ensure quality output.

• This is the role of supervisory/lower-level management, not top management.

(D) Implementing plans and policies developed by middle management.

• Implementation is primarily handled by middle and lower management. Top management focuses on strategy formulation, not execution.

Final Answer:

A & C (Formulating goals/strategies and integrating/coordinating activities).

The business environment is characterized as a relative concept because it varies from one country to another and even within regions. Unlike advantages or benefits, which focus on what businesses can gain, this feature highlights the variability and contextual differences inherent in business environments across different locations.

The business environment is crucial because it helps in identifying opportunities and threats (A), improving performance by adapting to changes (B), and coping with rapid changes in the market (C). Thus, "All of the above" (D) is the best answer.

Inter-relatedness refers to how different elements of the business environment (e.g., health awareness and demand for Ayurvedic products) are interconnected and influence each other. This fits the scenario described.

The rise in health and beauty consciousness (social factor) leading to more spas and clinics shows how different elements of the environment are inter-related, making C the correct choice.

Aqua identified the opportunity for mineral water and acted first, gaining a competitive edge. This highlights the importance of the business environment in spotting opportunities and securing a first-mover advantage.

The case of Yo Tummy adapting to customer demand for healthier foods highlights the importance of the business environment in helping firms cope with rapid changes (A). By responding to shifting consumer preferences, Yo Tummy maintained its customer base.

The development of a surveillance network using the latest satellite technology and the proposed use of drones to monitor illegal mining activities are examples of the technological dimension of the business environment. The technological dimension refers to the ways in which technological advancements impact businesses and their operations.

The involvement of the Rajasthan government in implementing this surveillance network and using drones to combat illegal mining activities is an example of the political dimension of the business environment. The political dimension refers to the ways in which government policies, regulations, and actions impact businesses and their operations.

Therefore, the related dimensions of the business environment in this scenario are the technological dimension and the political dimension.

The political environment includes factors like political stability, peace, and government policies (C). Option A refers to the social environment, and option B refers to the technological environment, making C the correct choice.

Economic (public/private sector roles), legal (restrictions/controls), and political (government planning) dimensions are all highlighted in the scenario, making D correct.

Adhering to laws and fostering community development
The passage emphasizes Toyota’s commitment to legal compliance and contributing to local community development, making this the correct focus.

Through fostering sustainable growth and community respect 
The passage clearly mentions Toyota's global vision, which includes sustainable growth and respect for cultural customs.

Fostering individual creativity and teamwork 
The passage mentions fostering individual creativity and teamwork as one of the key principles of Toyota’s corporate culture.

Environmentally friendly technologies
Toyota is focused on developing environmentally friendly technologies, as mentioned in the passage.​​​​​​​

Long-term growth with respect for society 
The passage discusses Toyota’s aim for sustainable and socially responsible growth.​​​​​​​

Answer: B

Management Audit and its Purpose
- Management audit is a technique used to assess and evaluate the performance of the management of a company.
- The purpose of a management audit is to identify strengths, weaknesses, and areas for improvement in the management practices and processes of a company.
Key Components of a Management Audit
- Structure and Organization: The audit assesses the organizational structure of the company, including the roles and responsibilities of the management team.
- Decision-Making Processes: The audit evaluates the decision-making processes followed by the management, including the involvement of key stakeholders and the use of data and analysis.
- Communication and Collaboration: The audit examines how effectively the management communicates and collaborates with employees, shareholders, and other stakeholders.
- Performance Evaluation: The audit assesses the performance evaluation methods used by the management to measure the effectiveness of their strategies and initiatives.
- Risk Management: The audit evaluates the management's approach to identifying, assessing, and mitigating risks that may impact the company's performance.
- Financial Management: The audit examines the financial management practices of the company, including budgeting, cost control, and financial reporting.
Target Audience of a Management Audit
- The primary target audience of a management audit is the management team of the company.
- The audit helps the management team to identify areas for improvement and make informed decisions to enhance their performance.
- The audit also serves as a tool for the board of directors and shareholders to assess the effectiveness of the management team and hold them accountable.
Conclusion
- A management audit is a valuable tool to assess and evaluate the performance of the management team of a company.
- It helps in identifying areas for improvement and making informed decisions to enhance the overall performance of the company.

Answer: B

Budgetary control technique of managerial control involves the preparation of budgets for each operation of the organisation and then comparing the realised results with the budgetary standards.  budget is a quantitative statement defining the objectives to be achieved in a specified time period and the policies to be followed.

Answer: c

To understand which is not a technique of controlling, consider the following:

• Break-even analysis: Used to determine when a business will be able to cover all its expenses and begin to make a profit. It is a control tool for evaluating financial performance.
• Budget: A financial plan that outlines expected revenues and expenses. It acts as a guide to control financial resources.
• Managerial Audit: An internal review process to evaluate the efficiency and effectiveness of management. It helps in controlling by ensuring that management practices meet organisational goals.
• Cash Flow Statement: A financial statement showing cash inflows and outflows. It provides insights into the financial health of a business but is not primarily a control tool.

The Cash Flow Statement is not primarily used as a technique of controlling, unlike the other options.

Planning provides direction by stating in advance how work is to be done, reduces the impact of change, minimizes waste and redundancy, and sets standards used in controlling. By establishing goals, budgets, and performance metrics, planning provides the benchmarks against which actual performance is measured during the controlling process. Thus, option D is correct.

The statement highlights the primacy of planning, which means planning is the first managerial function that precedes all others, such as organizing, staffing, directing, and controlling. By formulating plans first, it provides the foundation for all other functions, ensuring coordinated action. Thus, option C is correct

The entry of competitors (dynamic environment) disrupted the plan, showing that planning struggles in unpredictable conditions.

Pervasive means planning occurs at all levels and departments, as described.