MH SET Paper 2 Mock Test - 2 (Management) - MAHA TET MCQ

Channel marketing focuses on the distribution of products from the manufacturer to the consumer. It is part of the distribution (or place) component in the four P's of the marketing mix – product, pricing, promotion, and place. Since most manufacturers and producers don't sell directly to their end user, they use a marketing channel to distribute their products, whether it's a vending machine, department store, or a trade show hence, manufacturers take the help of channel members.
Channel members acquire the funds to finance inventories at different levels in the marketing channel. They gather information about potential and current customers, competitors and other actors and forces in the marketing environment.

If a hypothesis attempts to nullify the difference between two sample means (by suggesting that the difference is of no statistical significance), it is called a null hypothesis.
Null hypothesis denoted by .
It is a statement that the value of a population parameter is equal to some claimed value.
So, any hypothesis which is tested for the purpose of rejection under the assumption that it is true is called null hypothesis.

If two goods are complements, this means that a rise in the price of one commodity will induce a downward shift in demand for the other commodity.

In order to take consistent decision about store decor, product assortment media, price and service level advertising messages the marketer needs to firstly define the target market.
It involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments consisting of the customers whose needs and desires most closely match your product or service offerings.
Then, Profile the target market by segmenting the business customers by a different set of characteristics, including size of business, industry sector and location.

The World Trade Organization (WTO) deals with the global rules of trade between nations. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible.
The head of WTO is known as director general.
The current Director-General is Roberto Azevedo of Brazil, since 1 September 2013.
The WTO summit is held once in two years.
The summit is known as Ministerial Conference.
So, the head of WTO is known as director general statement is correct.

Modern Customer-oriented Organization Chart:

• Traditionally, the organization chart composed of the top management being given the most importance, the middle management was secondary and issued orders to the front-liners who interacted with customers; thus customers were the last standing in the organizational pyramid and top management made all the decisions.
• Nowadays, customers being the king, it is based on the customer that new products are decided.
• Customers get the complete attention of the organization, and even the top management listens to them.
• Thus, the customers became the apex and the traditional organization chart took a 180-degree turn. 

• In modern customer-oriented organizational design, the entity at the top is customers.
• The front liners have also received importance as they interact regularly with customers and the fundamentals of 360-degree feedback have been brought.
• The front liners are followed by the middle management and finally by the top management.
• Now, the marketing process starts with the question, "What will the customers like or want?"
• Customers are even ready to pay extra money for the extra value they get.
• Once an organization starts thinking "What will my customers need and how can I improve value" then they are the ways determined by modern customer-oriented organizational chart. 

Therefore, in the modern customer-organization chart, the entity at the top are customers.

Green Marketing principles relate to the Preservation Of The Environment.

• Green marketing refers to the practice of developing and advertising products based on their real or perceived environmental sustainability.
• Green Marketing is a relatively new concept, which involves the promotion of products and services which are safe for the environment.
• It involves the development, manufacturing, promotion, distribution, consumption, and disposal of the products and services in a sustainable fashion so that the least damage is caused to nature.
• The primary aim of green marketing is to reduce the adverse effects of the products and their consumption and disposal, on the environment.
• This means that the products and services are either eco-friendly or produced in an eco-friendly manner, which does not harm the environment.
• Examples of green marketing include advertising the reduced emissions associated with a product’s manufacturing process, or the use of post-consumer recycled materials for a product's packaging.
• Some companies also may market themselves as being environmentally conscious companies by donating a portion of their sales proceeds to environmental initiatives, such as tree planting.
• Green marketing is typically practiced by companies that are committed to sustainable development and corporate social responsibility. 

Managerial economics

• The study of managerial economics focuses on the application of economic theory to corporate management. 
• It deals with the use of economic theories and principles of business decision-making.

​Important Points 

Definition of Managerial economics

According to M.H. Spencer and L. Siegelman- 

“Business Economics (Managerial Economics) is the integration of economic theory with business practice for the purpose of facilitating decision making and forward planning by management.” 

• They believe that the theory of decision-making acknowledges the diversity of objectives and pervasiveness of uncertainty in the real management world.
• The decision-making theory rejects the idea of a single optimal solution in favor of the idea that the goal is to find a solution that "satisfies" as opposed to "maximizes."
• It delves into an examination of motivation, the relationship between rewards and aspirational levels, and the distribution of power.
• Hence, the correct answer is Spencer.

Assertion (A): Plant location is often oriented toward dominant factors such as raw material sources while warehouse location is definitely distribution oriented.

•  Plant  Location refers to identifying best region/ location for the production facility.
• The main objective behind plant location is to maximize the potential profit and reducing the cost of production.
• It is based on the assumption that if plant is located near to its potential market, then it will lead to better understanding of the market.

There are various factors that are responsible for Plant Location decision, such as:

• Availability of Raw Material
• Labor Supply
• Nearness to the Potential Market
• Transport Facility
• Supply of Power and Capital
• Natural Factors
• Personal Factors
• Competition etc.

​Reason (R): Plant location decision is driven by the competition and competitor while the warehouse location decision is exclusively driven by the cost considerations

• ​Warehouses are mainly used for storage and distribution purpose.
• Warehouse decision involves:
  • Feasible location
  • Ownership decision
  • Warehouse capacity
  • Warehouse management etc.
• Plant Location decisions are affected by competition and warehouse decisions are driven by cost considerations. 

​Hence, Both the statements are correct and statement (R) is not the correct explanation of (A).

Transactional leadership is a style of leadership in which leaders promote compliance by followers through both rewards and punishments.

Transformational leadership is a leadership style in which leaders try changing organisation by creating and communicating a vision. The organisation encourages, inspires and motivates employees to innovate and create change that will help grow and shape the future success of the company.

Charismatic leadership is basically the method of encouraging particular behaviours in others by way of influencing, dint of personality and charm. Charismatic leaders motivate followers to get things done or improve the way certain things are done.

Situational leadership refers to when the leader or manager of an organisation must modify his style to fit the development level of the followers he is trying to influence. With situational leadership, it is up to the leader to change his style, not the follower to adapt to the leader's style.

Predatory pricing is the illegal act of setting prices low in an attempt to eliminate the competition. Predatory pricing violates antitrust law, as it makes markets more vulnerable to a monopoly. Such pricing was introduced by Competition Commission of India (CCI) in India.

Cognitive dissonance is a consumer buying decision process. It is the state of mind that holds opposing, and even irreconcilable ideas, at the same time.

Diffusion of innovations is a theory that seeks to explain how, why, and at what rate new ideas and technology spread. This theory was given by Everett M. Rogers in 1962.

'Marketing myopia' is a term coined by Theodore Levitt. A business suffers from marketing myopia when a company views marketing strictly from the standpoint of selling a specific product rather than from the standpoint of fulfilling customer needs.

Definition of Cycle Time: The total time from the beginning to the end of your process, as defined by you and your customer. Cycle time includes process time, during which a unit is acted upon to bring it closer to an output, and delay time, during which a unit of work is spent waiting to take the next action.

As per Indian judicial system an offender must give opportunity to prove his innocence. So As per judicial approach to deal with employee indiscipline provides the offender every opportunity to state his side of the case.
This approach is adopted to avoid injustice with employees. Humanistic approach states that every employee should be treated as human being. HRD approach is related to human resource development.

Benefits of Green HRM:

• It can support organizations to minimize expenses without losing talent.
• It decreases a company's total costs as it becomes more effective concerning the use of electricity, water, and manufactured goods.
• It helps to achieve greater employee job satisfaction and dedication, which leads to increased productivity.
• Develop a culture of concern for the holistic wellbeing of fellow employees.
• Small companies can also reduce their electricity costs by using technologies that are energy-efficient and less costly.
• It can be used to create good public relations if an organization adds a green initiative to its workplace.

Hence, the correct answer is (A), (B), (C) and (E) only.

Leverage:

• Leverage is a company’s capacity to utilize new resources or assets to make better returns or diminish costs.
• Leverage is a reason that is influential for any organization is extremely huge.
• As a rule, leverage implies the impact of one variable over another.
• There are three proportions of leverage that are financial leverage, operating leverage, and combined leverage.
• The financial leverage assesses the impact of interest costs, while the operating leverage estimates the impact of fixed costs.

Key Points

• The usage of such sources of assets that convey fixed monetary charges or financial in an organization’s monetary structure to procure more profit from speculation is known as financial leverage.
• The degree of financial leverage (DFL) is utilized to gauge the impact on earnings per share (EPS) because of the adjustment of firms’ working benefit or operating profit, for example, EBIT.
• At the point when an organization utilizes obligation assets in its capital construction having fixed monetary charges as interest, it is said that the firm utilized monetary influence.
• The DFL depends on interest and money charges; in the event that these expenses are higher, DFL will likewise be higher, which will, at last, bring about the monetary gamble of the organization.

Important Points

The formula to calculate the degree of financial Leverage is: 

DFL = % Change in EPS / % Change in EBIT

Or

DFL = EBIT/ EBT

Hence, Degree of financial leverage is defined as the percentage change in EPS due to a given percentage change in EBIT.

Vision:

• A vision statement is the text mapping of an organization's future and is crucial for decision-making procedures.
• In other words, we can say that the vision guides the alignment of decisions and the company's declared goals.
• It is the road map that shows the future position of the company.
•  It mostly envisions the future of the company where it will be and also incorporates that through strategies. 
• Your vision statement gives the company direction. It is the future of the business, which then provides the purpose.
• The vision statement is about what you want to become. 
• It identifies the needs the firm aspires to solve for others.

In the opinion of Maanen and Schein, socialisation can be conceptualised as a process made up of three stages: pre-arrival, encounter and metamorphosis.

Employee orientation and induction is also called employee socialisation process. In today's world, socialisation is a continuous process due to the fact that the organisations have become dynamic. At metamorphosis stage of socialisation, employees understand the organisation and identify themselves with it. Employees develop a sense of belongingness and become contributors to achieve organisational goals and objectives.

The extrinsic properties of the product or service, including the ways in which the brand attempts to meet customers' psychological or social needs are known as brand imagery. Brand imagery is the tangible or intangible elements that consumers associate with a brand. It could be a package, an experience, a small, a feeling, a taste, and so on. Brand imagery is visual, auditory, olfactory, or tactile.

DUPONT analysis examines the return on assets analysing profit margin, total asset turnover. It was created by the DuPont Corporation in the 1920s.
Return on Assets = 
Here, net profit margin shows the operating efficiency and assets turnover shows the asset use efficiency.

The 5 product mix pricing strategies are defined below.
Product line pricing: Setting prices across an entire product line
Optional Product pricing: Pricing optional or accessory products sold with the main product
Captive Product pricing: Pricing products that must be used with the main product
By product pricing: Pricing low value by products to get rid of them
Product bundle pricing: Pricing bundles of products together

Business marketers

• Business marketers who sell their products and services to another firm 
• it's either for resale or to support their own system
• they deal with only business firms not with end consumers
• who deal with limited numbers of individual firms 
• Due care and precautions are required during communication happens with another firm 

Consumer marketer

• Consumer marketer  who sells goods and services between organizations and potential customers
• a relatively large number of people  involved 
• mass marketing is a key strategy used in consumer marketing
• Compared to business marketing focused communication is less
• in consumer marketing the geographical characteristics are focussed area this includes the market size, climate, and population density of the different regions are taken into consideration

Hence the correct answer is geographically concentrated buyers

Growth of offshoring of IT-enabled services, although not universally accepted, both to subsidiaries and to outside companies (offshore outsourcing) is linked to the availability of large amounts of reliable and affordable communication infrastructure following the telecommunication and Internet expansion of the late 1990s. Services making use of low-cost countries included

• Back-office and administrative functions, such as finance and accounting, HR, and legal,
• Call centers and other customer-facing departments, such as marketing and sales services.
• IT infrastructure and application development.
• Knowledge services, including engineering support, product design, research and development, and analytics.

Some of IT Enabled services are

1. Call Centers.
2. Electronic Publishing.
3. Medical Transcription Services.
4. Data Centers.
5. GIS Mapping.
6. Knowledge Portals.
7. ERP (Enterprise Resource Planning).
8. Knowledge Management & Archiving.

The control cycle is the iterative process of planning, monitoring outcomes, assessing results, and making revisions. Control cycle is based on following steps:
Adjustment → Action → Feedback → Evaluation

Objectives provide direction, serve as standards for evaluating performance and motivate members of the organisation. Objectives are short-term and medium-term goals that an organisation seeks to accomplish. An organisation's objectives play a large part in developing organisational policies and determining the allocation of organisational resources.

Rate of return (ROR) is a technique of capital budgeting. A rate of return (ROR) is the gain or loss of an investment over a certain period of time. In case of merger, purchase consideration is the agreed amount which transferee company (purchasing company) pays to the transferor company (vendor company) in exchange for the ownership of the transfer or company. It may be in form of cash, shares or any other assets as agreed between both the companies. Diminishing balance method is a technique of depreciation. According to the diminishing balance method, depreciation is charged at a fixed percentage on the book value of the asset. As the book value reduces every year, it is also known as the reducing balance method or written-down value method. Fifo method is used for stock valuation. The first in, first out (fifo) method of stock valuation is a cost flow assumption that the first goods purchased are also the first goods sold. In most companies, this assumption closely matches the actual flow of goods, and so is considered the most theoretically correct inventory valuation method.

Organizational Culture is the collection of shared beliefs, values, rituals, stories, myths and specialized language that foster a feeling of community among organization members.\

It is distinctive in nature, as each organization has its own management philosophy, mission and objectives etcHence from above discussion, we can infer that option (b) is not a characteristic of Organizational Culture.

Options (a), (c), (d) are all characteristics of Organizational Culture.

The following statements are true regarding the task environment of a firm:

II. It consists of specific external elements such as customers and clients, competitors, suppliers, labor supply and government agencies, with which an organization interacts while conducting its business.

III. As it depends largely on the products and services offered by the firm and its business location, it may vary from firm to firm.

Statement (I) pertains to the mega environment of a firm and hence is not true.

Statement (IV) is not true as a firm may not be able to directly influence its mega environment, but it can certainly influence its task environment.

Making proper use of the staff's abilities is an appropriate technique for line personnel in reducing line-staff conflict.

So, from above discussion, we can infer that option (B) is the suitable option.

Human behavioral approach:

•  A major resource within any organization is human resources. Its behavior towards work can be modified to fulfill the management goals as management involves getting things done with and through people, so the study of management must revolve around human behavior.
• It is also called “Human Relations”, “Leadership” or “Behavioral sciences” Approach. As it involves human behavior,
• it can be divided into two groups: first, the “Interpersonal Behavior Approach and the second one is “Group Behavior Approach

Traditional approach 

• This is also known as the “School of Custom”. It is one of the most commonly followed approaches for the management of organizations.
• This approach analyses management as a universal activity and the environment has a great impact on the management and managers.

Empirical approach

• This approach is based on the idea that the management process may be analyzed but such analysis must be based on the past experience
• It is also known as the case approach or management experience approach.
• The major contributors to this approach are Earnest Daley, Mooney, Reiley, Urwick, etc.

Decision theory approach

• Its focus is on the concept of analyzing situations and problems in order to make decisions
• The manager is the decision maker and the organization is the decision-making unit.
• The major contributor to this approach is Simon.

The correct answer is Only (a).

HRD) is an essence of management of any organization is to utilize effectively all the available human and physical resources, financial and technological resources.

• HRD is concerned with the development of human capac­ity.
  • Human capacity or human potential includes-aptitude, knowledge, values, skills of HR, responsiveness, loyalty and commitment, transparency, leadership development.
• Aptitude refers to the potential for learn­ing or acquiring a specific skill.
  • It also differs from intelli­gence which refers to a person’s general potential to find solutions to problems, thinks ideally, adapts to changing situations, and gain from experience.