All India Management Association (AIMA) 2007 M.B.A Marketing Management Introduction to Management - I - Question Paper

are to be implemented.

46. A Socio economic purpose is at the top of the hierarchy of objectives.
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47. A Inter personal or Human skills refer to the ability of a person to work well with
the other people in a group. Therefore choices (II), (III) does not relate with
Interpersonal skills. Only choice (I) is the accurate definition of Interpersonal
skills/human skills.

48. C All choices (a), (b), (d) and (e) are actual with respect to SBUs other than choice (c).
SBUs have distinct mission from that of its parent company.

49. D All of the subsequent would be considered a pitfall to the planning process of an
organization other than improved managerial skill levels.

50. B Identifying a issue is the 1st step in the decision-making process.
Hence from above discussion, we can infer that choice (b) is accurate.

51. A Brainstorming is technique used for generating option solutions.
52. B Game Theory is a decision-making technique, which involves selecting the best
strategy, taking into consideration one's own actions and the actions of one's
competitors. Minimizing the maximum loss (minimax) and maximizing the
minimum gain (maximin) are the 2 concepts used in the Game Theory.
Hence, from above discussion, we can infer that choice (b) is accurate.

53. E Centralization refers to the degree to which decision-making is concentrated at
a single point in the organization.
The characteristic that makes centralization more improper is when an
organization is built by an individual’s effort.

54. A “Only employees with top-secret clearance may enter the sealed room," is an
example of a rule.

55. C The divisional structure is an organization design made up of self-contained
units.

56. A a different approach to decision-making is the incremental model. The
incremental model states that managers put in the lowest possible effort - only
enough to decrease the issue to a tolerable level. The manager here is
concerned more with finding a short-term solution to the issue than making
a decision that will facilitate the attainment of goals in the long-term.

57. D The tendency of systems to break down, become disorganized, or to
disintegrate is known as entropy. Systems can fight entropy by taking resources
- energy, money, machinery and human talent - from the environment and
transforming them into outputs on a continuous basis. By so doing, the systems
can mend themselves, survive and grow. Systems that can remain healthy for
long periods of time are stated to exhibit negative entropy.

58. D Tom has a remarkable ability to get his employees to do what he directs. He is
an upper level manager at the company and is very gifted with business
knowledge. The employees fear that if they do not act as directed Tommy
would provide them a poor work reference. We can say Tommy has Coercive
power.

59. D Having many levels within an organization has a few disadvantages. Firstly, as
the number of levels increase, the effort and expenditure involved in managing
them also increases. The 2nd disadvantage of a tall structure is that
communication gets unduly complicated. It is much more difficult to
communicate the objectives, policies, plans and procedures in organizations
with a tall structure as compared to the organizations with a flat structure.
Finally, in an organization with a tall structure, numerous departments and
levels make the planning and controlling tasks complicated.

60. A When managers delegate authority, they must allocate commensurate
responsibility.

61. B The main benefit of departmentation is it divides a large and complex
organization into smaller and more flexible administrative units.

62. D Expert Power is based on the perception or belief that the influencer has a few
relevant expertise, special knowledge or skill that the influencee does not.
Hence, from above discussion, we can infer that choice (d) is accurate

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63. D Power is the ability to influence other people and their behavior. A manager is
stated to have power if he can change the behavior or attitudes of his employees.
Thus, while authority is conferred by the organization, the personality and
actions of an individual provide him the power to influence others. Unlike
authority, power requires no formal position.

64. A Restructuring involves major modifications in organizational structure and modifications
in a few major components of the organization.

65. B Departmentation by simple numbers was used in classifying tribes, clans, and
armies.

66. C MBO (Management By Objectives) is the process of joint setting of
goals/objectives by the superior and the subordinate, and clarifying on the
objective itself.
The different steps in the MBO Process are:
i. Develop overall organizational goals.
ii. Clarify organizational roles.
iii. Establish specific goals for different departments, subunits and
individuals.
iv. Formulate action plans.
v. Implement and maintain self-control.
vi. Do periodic review.
vii. Do performance appraisal.

67. E Fayol’s 14 principles of management do not include bases of power.
68. D A functional structure is a kind of departmentalization in which positions are
grouped according to their main functional (or specialized) area. In other
words, positions are combined into units on the basis of likeness of expertise,
skills and work activities.

69. C The intensity of an ethical problem is greater in the subsequent cases:
I. The number of people harmed is large.
II. Everyone agrees that the action is wrong.
IV. The person feels close to the victims.
The intensity of an ethical problem is greater when the consequences of the action
may be felt immediately.

70. D 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 does not focus on profit.

71. B MBO is the joint setting of goals and objectives by superiors and subordinates
and clarifying on the objective itself.
The final step of a typical MBO process is that successful achievement of
objectives is reinforced by performance based rewards.

72. E All 3 statements are levels in the stages of moral development.
73. C Socialization refers to the process that helps new employees adapt to the
organization’s culture.

74. B Planning is a primary function as it precedes the execution of all other
management functions. So it is not a secondary function.
Hence from above discussion, we can infer that choice (b) is not a characteristic
of planning.
choices (a), (c), (d) and (e) are all characteristics of planning.

75. D All the said reasons, other than statement (IV), which is not applicable to staff
personnel, reason line-staff conflict as seen from a staff personnel perspective.

76. E Personnel strategies are the strategies developed for managing human
resources.

77. E The 3 contingency factors on which an organizational structure depends on
are size of the organization, technology used and environment.

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78. C other than groupthink, all the choices provided are examples of group decisionmaking
techniques aimed at improving decision-making.

79. E The four Ms of business include men, machines, money and material.
80. C The contingency approach says that managerial practice depends on
circumstances.

81. A An informal organization is a network of personal and social relations not
established or needed formally. It consists of the unofficial but influential
means of communication, decision-making, and control that are part of the
habitual way things get done in the organization.

82. B Middle level management is responsible for tactical plans. Top level
management deals with strategic plans and company policies, while lower level
management deals with short range operational plans.

83. A The subsequent are factors that help measure social responsiveness:
• Valuing diversity
Fund-raising.
Direct Corporate investment.

84. D The subsequent are advantages of a hybrid structure:
• Specific competency and economies of scale with focus on products,
services and markets.
It strikes a balance ranging from divisional and corporate goals.
It facilitates flexibility in handling diverse product lines, territories or differing
needs of customers.

85. B Programmed decisions are those involving simple, common, frequently
occurring issues that have well-established and understood solutions. These
decisions are made in routine, repetitive, well-structured situations through the
use of predetermined decision rules.
Hence, from above discussion, we can infer that choice (b) is accurate.

86. C Work specialization concerns making efficient use of workers' special skills.
87. E Group decision-making is practiced in many large and complex organizations.
Many studies have shown that groups make better decisions than individuals.
As the old adage goes, "Two heads are better than one." A major cause why
group decision-making is more effective than decision-making by individuals is
that more info is available in a group setting. In group decision-making,
several individual members contribute their ideas before a decision is made.
The group has more info and a greater number of options available
to it. a different major strength of group decision-making is the relative ease of
implementing decisions. The people involved in a group decision understand
the rationale behind it, are more likely to accept it and are capable of
communicating the decision to their work groups or departments.

88. C Identifying/determining the issue involves scanning, categorization and
diagnosis.

89. D Duplication of activities and resources is a major disadvantage of the divisional
structure. choice (a) is not a disadvantage as unlike the functional structure
where managers specialize in a particular area managers in a divisional
structure are exposed to different functional areas in their divisions. choice (b) is
not a disadvantage because in a divisional structure coordination is simplified
as every division is similar to an organization. choice (c) is not a disadvantage
as divisional structure provides a good training ground for managers and hence
there is no managerial vacuum. choice (e) is not a disadvantage because in a
divisional structure every unit can respond quickly as it can make independent
decisions.

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90. D Business level strategies are developed by heads of specific business units and
not top management. Hence, statement (III) is not actual about business level
strategies. All other statements are actual.

91. D The preference or utility theory is based on the belief that individual attitudes
toward risk vary with events, with people and positions

92. D Tactics are action plans with the help of which organizations execute their
strategies.

93. A Decision tree involves a graphic representation of option courses of action
and the possible results and risks associated with every action.

94. E The major approaches utilized by managers to induce employees to accomplish
the planned actions associated with implementation should normally include
authority, persuasion or policy.

95. C Bonuses, awards and promotions form part of the rewards system.
96. E An effective organizing effort involves responsibility, authority and delegation.
97. A Entrepreneur is a person who focuses on innovation and creativity and who
transforms a dream or an idea into a profitable venture by operating outside the
organization.

98. D Since change is an endless process, planning is an endless process too. The
process is constantly replaced to suit modifications in environmental conditions,
opportunity and objectives for the firm. Planning is deciding in advance what
action to take, how and when to take a particular action, and who are the people
to be involved in it. It involves anticipating the future and consciously choosing
the future course of action.
99. A Informal communication is also referred to as grapevine. 100. B Management might strive to encourage ethical behavior in organizations in
order to be morally correct; to gain a business advantage by having employees
and customers perceive their company as ethical; and avoid possible costly
legal fees.

Earning:   Approval pending.