Important Questions Class 12 Business Studies Chapter 1 - Nature and Significance of Management

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CBSE Class 12 Business Studies Important Questions Chapter 1 – Nature and Significance of Management

1. “Planning, Organizing, Staffing, Directing and controlling” is the sequence of functions in a process. Name it.

Ans. Management
2. Name that intangible force which creates productive relationships among resources of an organization.
Ans. Management
3. What is the main objective of any organization?
Ans. Main objective of any organization is optimum utilization of resources
4. Production manager tries to produce goods with minimum costs.
Name the concept which is being focused by management?

Ans. Efficiency
5. What do you mean by effectiveness?
Ans.  It means completing the task or achieving the goals within stipulated time period.
6. “Management is a group activity”. Give reasons for statement.
Ans.  An organization is a collection of diverse individuals with needs and purposes
but they work towards fulfilling the common organizational goals.
7. In order to be successful, an organization must change its according to the
needs of the environment. Which characteristic of management is highlighted in the statement?

Ans. Management is a dynamic function.
8. Give one designation each of top and middle level management?
Ans.  Top – CEO, Middle – Divisional Manager
9. Your Grand Father has retired as the director of a manufacturing company.
At what level of management was he working.

Ans.  Top management.
10. Why is management called inexact science?
Ans.  Management relates to human behavior, whose cause and effect is not
certain, that’s why it is called and inexact science.
1. Explain the meaning of management. What do you mean by managers?

Ans. Management is a process of getting things done with the aim of achieving desired
common goals effectively and efficiently persons engaged in performing the functions of the management are known as managers. In other words, those managing the organizational resources for releasing its goals are known as managers.
2. ‘Management is a process’ Explain?
Ans. Management includes various steps such as planning, organizing, staffing, directing and controlling. This process begins with those at the top of the organization and continues in varying degrees at almost every level of the organization. These i n t e r -related steps help to achieve organizational goals in effective manner. That is why management is known as process of employing and organizing resources to accomplish predetermined objectives.
3. ‘Management is multi-dimensional’. Explain?
Ans. Management is a complex activity and involves following three main
dimensions –
i) Management of works
In each and every organization, certain type of work is to be performed. In school, overall development of a child is to be done; in hospitals, patients are treated etc. Management converts these works into goals and devises the means to achieve them.
ii) Management of People.
Management is concerned with “getting things done through people”, which is a very difficult task. All the employees have different personalities, needs backgrounds and methods of work. Thus, it becomes management’s job to make them work as a group by giving common direction to their efforts.
iii) Management of operations.
In order to survive, each organization has to provide certain goods or services. This involves production process thus, management of operations is inter linked with both the above dimensions viz., management of work and the management of people.
4. What are the personal objectives of the management?
Ans.  Personal objectives refer to the objectives which are related to the
employees of an organization. They are as follows:
i) Financial needs like competitive salaries, incentives and other monetary
ii) Social needs like recognition in the organization.
iii) Higher level need which includes personal growth and development.
5. Enumerate the importance of management.
Ans. Following points are the importance of management.
i) Management helps in achieving group goals.
ii) Management increase efficiency
iii) Management creates a dynamic organization.
iv) Management helps in achieving personal objectives.
v) Management helps in development of society.
6. What do you mean by level of management?
Ans. Levels of management means the hierarchy of organization representing the relationships among managers and subordinates on the basis of their relative authority, status and responsibility. There are three levels in the hierarchy of an organization viz.
(i) Top management (ii) Middle management and (iii) Supervisory or operational management.
7. Define co-ordination. Enumerate the features of co-ordination?
Ans. Coordination is an orderly arrangement of group efforts to
maintain harmony among individuals’ efforts towards the accomplishment of
common goals of an organization.
Features of co-ordination
i) It integrates group efforts.
ii) It unifies the action.
iii) It is a continuous process.
iv) It is an all-pervasive function
v) It is the responsibility of all managers.
vi) It is a deliberate function.
1. Explain any five features of management?

Ans. Following are the features of management:
(i) Management is a group activity
Management consists of a number of persons who work as a group.
Their efforts are directed towards the common goals. Members initiate,
communicate, coordinate and join their hands for the achievement of
organizational objectives.
(ii) Management is a goal-oriented process
Management aims at common goals through a process of series of
continuous functions  via  planning, organizing, directing, staffing and
controlling. These composite functions of management are separately
performed by all managers all the time simultaneously to realize
organizational goals
(iii) Management is all pervasive
Whether it is a commercial organization or noncommercial
organization, big or small all require management to handle their operations
effectively and efficiently.
(iv) Management is a continuous process
Management is a continuous process consisting of a series of
functions viz., planning, organizing, directing and controlling. All the managers
perform these functions regularly.
(v) Management is a dynamic function
The environment in which a business exists keeps on changing. Thus in
order to be successful, management must change its goals, plans and politics
according to the needs of its environment.
2. Explain the organizational objectives of management.
Ans. The organizational objectives of management refer to the main objectives
required to fulfill the economic goals of the business organization. The main
objective of management is to utilize the human and material resources in such a
manner that it should give maximum advantage to the organization. Every
management group strives to accomplish these objectives for its organization.
These objectives of every organization are survival, profit and growth.
(a) Survival: The basic objective of every business is to survive for a longer
period in the market. The management must ensure survival of the
organization by earning enough revenue to cover its costs.
(b) Profit: Only survival is not sufficient for business. Profit earning is essential for
meeting the expenses and for the successful operation of the bus’ Thus
management must ensure earning of sufficient profit.
(c) Growth: The next important objective of the management is to ensure
future growth and development of the business.
3. Explain the ‘social objectives’ of management.
Ans. Each organization is a part of society and thus it has certain social obligations
to fulfill.
Some of them are as follows:
(i) To supply quality goods and services
(ii) Providing basic amenities to the employees like schools and creches for
their children, medical facilities etc.
(iii) To generate employment opportunities especially for the backward
(iv) To provide environment friendly methods of production.
(v) To provide financial support to society by donating for noble causes.
(vi) To organize educational, health and vocational training programmes.
(vii) To participate in social service projects of Government and Non –
Governmental Organizations (NGOs).
4. Do you mean by’ Personal Objectives’ of management? Enumerate
personal objectives of management.

Ans. Personal Objectives refer to the objectives which are related to the individual
needs of the employees of an organization. All organizations are made up of
people with different values, experiences and objectives. People join an
organization to satisfy their different needs. These are as follows:
i) Financial needs like competitive salaries, incentives and other monetary
ii) Social needs like recognition in the organization.
iii) Higher level need which includes personal growth and development.
5. Explain five functions of top-management.
Ans. Top management performs the following functions.
i) Develops long-term objectives: Top-level managers develop the long – term objectives like expansion of business, manpower planning etc.
ii) Framing of policies: They lay down guidelines for departmental head i.e., policies relating to production, marketing, personnel, finance public relation etc.
iii) Organizing : Top management organizes the business into various sections and departments to achieve the desired organizational objectives.
iv) Key appointments: Top-level authorities appoint the departmental heads and some other key persons to develop the organizational structure for profitable growth of the enterprises.
v) Controlling: Top-level managers periodically review the work of executives at different levels to ensure that their performance is as per predetermined plans.
1.Give any one social objective of management. (1)

Ans. Either one of the following:
i) Desired quality of products at reasonable price.
ii) Using environment friendly methods of production
iii) Generation of employment opportunities.
2.Name any two designations given to first line managers. (1)
Foremen and supervisors.
3.Which force binds all other functions of management? (1)
. Coordination
4. What do you mean by Management Hierarchy? – (1)
Ans. The chain of authority – responsibility relationships from top to bottom is called as management hierarchy.
5. How is management all pervasive? – (3 or 4)
Ans. Activities involved in management are applicable to every type of organisation whether economic, social or economic, social or political. For example, a cricket team needs to be managed as much as a club or a hospital. The activities of managers in India are similar to their activities in say U.K. or USA. Thus it can be said that management is all pervasive.
6. ‘Management provides judgement and vision’. Explain? -(3 or 4)
Ans. Management keeps adjusting to the complex and ever-changing external environment. It helps in decision making. As it visualizes the future and the right course of action for same, sound decisions become possible. Thus, its foresight provides judgment and vision.
7. Why is management considered as a discipline? (3 or 4)
Ans. Discipline refers to a subject, the study of which can be organized and taught. Management is considered as a discipline because it is being continuously researched and studied. Also, it emphasis on knowledge, diversification, theory and practice, just like any other discipline.
8. Mr. Kunal is working as the Finance Manager of XYZ Ltd. At what level of management is he working? State any two functions being performed by him? (3 or 4)
Ans. He is working as a middle level manager.
His functions are as follows.
i) Deciding various sources from which required funds can be raised.
ii) Negotiating with banks, brokers, under-writers etc. for raising finance.
9. ‘Coordination is a continuous activity’. Explain? (3 or 4)
Ans. Coordination is a continuous activity carried out by all mangers at all times. It
starts at the planning stage and continues with the other functions of
management. It is a never-ending process. It integrates all the activities and
ensures the orderly arrangement of individual and group efforts to ensure
unity of action in the realization of common objectives.
10. What is mean by Co-ordination? Explain how does coordination
’integrates group efforts’ and ‘ensures unity of action’. (cbse  2012)

Ans. Meaning of Coordination and Explanation of relevant features.
11. Identify the nature of management when it is practiced as personal
application of existing knowledge to achieve desired results. (cbse  2012)

Ans. Management as an art.