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

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CBSE Class 12 Business Studies Chapter-1 Important Questions - Free PDF Download

Important Questions of Class 12 Chapter 1, Nature and Significance of management are outlined by experienced teachers from the same field. Here, on this page, the highlights of the chapter are covered. These facts and important questions  provide an in-depth analysis of the chapter in a very unique way. The important questions of the chapter will prove very beneficial for the students. The expert teachers from Vedantu have developed the important questions of Business Studies Class 12 as per the latest syllabus NCERT (CBSE).

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

Very Short Questions and Answers (1 or 2 Marks Question)

1.'Management is the process of getting things done.' State the meaning of the term 'process' used in this statement.

Ans: ‘Process’ refers to the series of interrelated functions performed by individuals or groups like planning, organizing, directing, staffing and controlling. 


2. The Activities involved in managing an enterprise are common to all organizations whether economic, social or political. Which characteristic of management is highlighted by this statement?

Ans: ‘Management is all pervasive’. 


3. What is meant by management?

Ans: Management refers to the process of managing people and tasks efficiently and effectively using the right techniques and methods.


4. In order to be successful an organization must change its goals according to the needs of the environment. Which characteristic of management is highlighted in the statement?

Ans: ‘Management is a dynamic function’.


5. To meet the objectives of the firm the management of Angora Ltd. offer employment to physically challenged persons. Identify the organizational objective it is trying to achieve.

Ans: ‘Social objective’


6. “A collection of diverse individuals with different needs but working towards fulfilling the common organizational goals” this statement highlights which characteristic of management?

Ans: ‘Management is a group activity’.


7. 'Is Management concerned only with doing the right task, completing activities and achieving goals without taking into consideration the cost benefit’? Give reason in support of your answer?

Ans: No, to accomplish organizational goals management must focus on both effectiveness and efficiency i.e., completing the task on time, with minimum cost and optimum utilization of resources.


8. List any two social objectives of management.

Ans: The two social objectives are:

  • Providing equal employment opportunities to physically challenged sections of society.

  • To contribute in improving living standards of the society, by working upon the development of regional, rural and backward areas.


9. “Management is considered to be a three-tier machinery”. Why?

Ans: Management is considered to be a three-tier machinery as there are three levels of management, namely top, middle and lower level management.


10. How does coordination integrate group efforts? State Briefly.

Ans: Coordination unites the interests and efforts of different individuals towards the attainment of common objectives of the organization.


11. How is entry to a profession restricted?

Ans: The entry to a profession is restricted as an individual must acquire an educational degree or examination to become a professional. 


12. State any two points which prove that management is multidimensional?

Ans: Management is multidimensional because:

  • It manages work and people.

  • It manages the operations of the organization.


13. An achievement of which organizational objectives results in “an increase in sales volume, increase in number of employees, no of products, and increase in capital investment’

Ans: Growth objective of organizational objective of management.


14. A company’s target production is 5000 units in a year, to achieve this target the manager has to operate in double shifts due to power failure. The manager is able to meet the target but at a higher production cost. Is the manager efficient or effective?

Ans: Manager is effective as he has completed the task on time but inefficient as the task has been completed at a higher production cost.


Short Questions and Answers (3 or 4 Marks Question)

15. Explain the features of management that do not establish it as a profession.

Ans: The features of management that do not establish it as a profession are:

  • Restricted Entry: To become a professional one needs to pass an examination or have an educational degree. However to make a career in management, there is no need to have any professional qualification, or an educational degree etc.

  • Statutory Body: Every profession is regulated by a legally recognized body like ICAI for a chartered accountant. Management also have their association like All India Management Association but management associations are not statutory bodies.

  • Ethical Code of Conduct: A strict code of conduct exists in every profession. This feature is not present in management as there is no specific code of conduct for managers that legally binds a manager.

  • Service Motive: The basic motive of a profession is to serve clients with dedication. This feature is not present in management as it aims to accomplish organizational goal which is generally profit maximisation.


16. ABC ltd. is facing a lot of problems these days. The company’s profit margin is declining day-by-day. The production manager is blaming marketing management whereas marketing is blaming the production department for not maintaining the quality. Finance department is blaming both. What quality of management do you think is lacking? Explain it briefly.

Ans: The management of the company is lacking the quality of ‘coordination’. Coordination synchronises the activities of different departments of the organization. It performs the following functions:

  • Harmonization: Coordination harmonizes individual goals with the organizational goals. This results in the growth of the organization which results in an increase in the number of people employed with it.

  • Creates link: The various departments of the organization have their own objectives, policies and their own style of working. But to achieve organizational objective coordination is important so as to link the activities of all departments. It brings in unity among the interdependent departments and helps to avoid confusions and conflicts

  • Integration and Unification of efforts: Coordination integrates all the specialists activities into a collective effort. It ensures that all managerial functions at all levels of management are unified for effective planning, efficient implementation to achieve given targets.


17. What is meant by 'Management'? Explain its three features that establish it as an Art.

Ans: Management refers to the process of getting things done with the aim of achieving organizational goals effectively and efficiently.

The three features that establish it as an Art are as follows:

  • Existence of theoretical Knowledge: Art involves the application of theoretical knowledge. Management is an art of getting things done through individuals for accomplishment of desired results by putting the available knowledge into practice.

  • Personalized application: The use of knowledge varies from person to person and hence management is basically an individual skill. Two different people can perform the same type of work but will always differ in the way they perform. For example: two singers will always perform differently.

  • Based on practice and creativity: Management is goal-oriented and result-oriented. As for art, management also requires practice, continuous practice hones the skills and creativity of an individual.


18. Ashutosh Goenka was working in 'Axe Ltd.', a company manufacturing air purifiers. He found that the profits had started declining from the last six months. Profit has an implication for the survival of the firm, so he analysed the business environment to find out the reasons for this decline.

(a) Identify the level of management at which Ashutosh Goenka was working.

Ans: Ashutosh Goenka was working at the ‘top level management’.


(b) State three other functions being performed by Ashutosh Goenka. 

Ans: Ashutosh Goenka must perform these three functions:

  • He needs to organise all the physical and human resources required.

  • He must formulate objectives and set goals for the organization.

  • He must assign work to the middle level managers and guide them accordingly.


19. Rishitosh Mukherjee has recently joined AMV Ltd, A company manufacturing refrigerators. He found that his department was under-staffed and other departments were not cooperating with his department for smooth functioning of the organization. Therefore, he ensured that his department has the required number of employees and its cooperation with other departments has improved. 

(a)Identify the level at which Rishitosh Mukerjee was working.

Ans: Rishitosh Mukherjee was working at the ‘middle level management’.


(b) Also, state three more functions required to be performed by Rishitosh Mukerjee at this level.

Ans: Rishitosh Mukherjee needs to perform following three functions:

  • He needs to assign work to the lower level managers and guide them so that desired objectives are achieved.

  • He needs to inform the top level management regarding the market demands and requirements of physical and human resources.

  • He must also motivate and control the activities of lower level management so that they achieve desired results.


20. How is management all pervasive?

Ans: Management is a universal process. It is required in all types of organization whether big or small,financial or non financial, social or economic, profit or non profit organization and is performed at every level of authority; top, middle or lower.  The five activities of management are the same for all the organizations irrespective of economic, social or political boundaries. It's just that the methodology differs but the basics and foundation remains the same.


21. ‘Management provides judgement and vision’. Explain?

Ans: Management is a dynamic function hence, it responds to the changes in external and internal environment and helps organization in making strategies to adapt itself to those changes so as to maintain competitive edge. It helps organizations in decision making and future vision. Thus, management provides judgement and vision.


22. Explain any four features of coordination.

Ans: The features of coordination are as follows:

  • Coordination Integrates Group Efforts: It integrates efforts of all individuals working either individually or in a group towards achievement of organizational goals.

  • Coordination Is A Continuous Process: Coordination is an ongoing process. It is required in all the functions of management from planning till achieving the targets.

  • Coordination Is An All Pervasive Function: Coordination is required for all the activities, in all the departments and at all the levels of management to achieve the desired results.

  • Coordination Is The Responsibility Of All The Managers: Coordination among all the managers at all the departments and at all the levels of management is must to ensure proper implementation of policies and plans in the organization.


Long Questions and Answers (5 or 6 Marks Question)

23. A company manufacturing mobiles is facing the problem of decreasing sales in the market. You can imagine any product about which you are familiar. What decisions/ steps each level of management should take to give effect to this decision?

Ans: Modification is needed to compete with the similar products in the market. For this, each level of management has to contribute in following ways:

  1. Top Level Management:

  • They need to analyse the business environment and take decisions regarding the modification to be done.

  • They need to establish objectives of modification, formulate plans and policies to implement the modification.

  • They need to organise all physical and human resources required for modification.

  • Inform all departments about modification and coordinate their activities.

  1. Middle Level Management

  • They must inform top level management about the possibilities of modification, market demand or expectations required to implement modification.

  • They must interpret plans and policies and instruct lower level management for their implementation.

  • They must recruit, select and train personnel to be able to take up modification.

  • They must assign responsibilities and duties to lower level managers.

  1. Lower Level Management

  • Before the modification decision is taken, they may give their views about the kind of modification or technology is required 

  • They must issue orders and instructions to the workforce to implement plans.

  • They must train or guide the workforce to carry out production activities.

  • They must supervise work closely to ensure that work is done effectively and efficiently.


24. Without effective management the resources will remain as resources cannot be converted into productive utilities. “do you agree” ? give reasons.

OR

“Success of an organization largely depends upon its management.” Explain any five reasons to justify the above statement.

Ans: Yes, I agree. The following points of importance of management justify the statement: 

  • Achievement of group objectives: Management creates coordination and team spirit in the group of individuals. Management also inspires the members of the groups to make their best contribution towards the achievement of the common objective. This common objective is set by the management itself.

  • Optimum utilization of resources: Management brings together men, money, material, machine in the right proportion to reduce cost and maximize production.

  • Minimization of Cost: Management improves efficiency and reduces cost through better planning, sound organization and effective control. By eliminating wastage and minimum cost, management helps an organization to face cut throat competition.

  • Social development: Management increases the standard of living of the people by providing good quality products and services at minimum cost. It also helps in generating employment opportunities and adopting new technologies.

  • Achievement of personal objectives: Each and every individual joins an organization for pursuing their personal objectives. Some join for a good package of salary, some join for greater recognition, some just for survival. So, this depends upon individual to individual. Management plays an important role in identifying the personal objectives so as to integrate it with the organizational objectives to bring harmony in the organization, as well as successful fulfilment of the personal objectives of the individuals.. 


25. Aman, Ahmad and Ally are partners in a firm engaged in the distribution of dairy products in Maharashtra state. Aman is a holder of a Senior Secondary School Certificate from the Central Board of Secondary Education with Business Studies as one of his elective subjects. Ahmad had done his post graduation in History and Ally in dairy farming. One day there was a serious discussion between Ahmad and Ally regarding the nature of management, Ahmad argued that management was a profession.

Whereas Ally argued against it saying that the legal and medical profession are the only professions because they fulfill all the conditions of profession. Aman on the basis of his knowledge of business studies explained the nature of management as a profession to Ahmad and Ally. Explain how Aman would have satisfied both Ahmad and Ally.

Ans: Ahmed and Ally could have been satisfied by Aman through the explanation of the following features of management as a Profession:

Points that justifies Ahmad’s argument of management as a profession:

  • Well Defined Body of Knowledge: Every profession has a systematised body of knowledge which can be learned through instructions. This feature of the profession is present in management as it consists of systematic knowledge of concepts, theories and principles.

            Points that justifies Ally’s argument of management not a profession:

  • Restricted Entry: To become a professional one needs to pass an examination or have an educational degree. However to make a career in management, there is no need to have any professional qualification, or an educational degree etc.

  • Statutory Body: Every profession is regulated by a legally recognized body like ICAI for a chartered accountant. Management also have their association like All India Management Association but management associations are not statutory bodies.

  • Ethical Code of Conduct: A strict code of conduct exists in every profession. This feature is not present in management as there is no specific code of conduct for managers that legally binds a manager.

  • Service Motive: The basic motive of a profession is to serve clients with dedication. This feature is not present in management as it aims to accomplish organizational goals that is generally profit maximisation.


Chapter 1 Class 12 Business Studies Important Questions PDF

The entire chapter in Business Studies for Class 12  is enveloped in the important questions paper. This question paper will give a clear picture as to what students can expect in their exams. All the questions in the sample paper along with their solutions are developed in a very easy and precise way. The PDF version of the important questions for CBSE Class 12 Chapter 1 is available free on the official website of Vedantu and you can download them on any device.


Nature and Significance of Management

Following are some highlights of Chapter 1 of Class 12 Business Studies that quickly gives you a summary of the chapter.

Management: It is the process of strategizing, designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish a common goal. It is the process of planning, organizing, actuating and controlling the organization’s operations and activities, effectively and efficiently.

There are two concepts of Management: Traditional Concept and Management Concept.


Characteristics of Management

  1. Management is a Goal-oriented Process.

  2. All pervasive.

  3. Management is Multidimensional.

  4. Management is a continuous process.

  5. Group Activity.

  6. Dynamic Function.

  7. Intangible Force.

 

Objectives of Management

  1. Organizational Objectives: Management is expected to work for the benefit of all stakeholders for the achievement of goals.

  2. Social Objectives: Social objectives deal with the commitment of an organization towards society.

  3. Personal Objectives: Personal Objectives are linked with fulfilling the personal needs of the employees.

 

Importance of Management

  1. Management helps in achieving group goals by giving proper direction to the efforts of all individuals.

  2. Management increases efficiency by making optimum utilization of all resources such as labour, money and material.

  3. Management creates a dynamic organization by helping people to adapt to these changes so that an organization is able to maintain its competitive edge.

  4. Management helps in achieving personal objectives through motivation like good salary, peer recognition, profit sharing, etc. and leadership along with the attainment of organizational objectives.

  5. Management helps in the development of the society by providing employment, good quality products at a reasonable price, establishing schools, hospitals and creches.

 

Nature of Management

Management can be described as an art, science or a profession. It is considered as an art because it is a personalized process where an individual applies his acquired knowledge in a personalized and skilful manner.

Management can be described as a science because like science there is a systematized body of knowledge in management consisting of theories, principles and concepts. It involves the study of human behaviour.

Management can also be considered as a profession because management has a well-defined body of knowledge. It has its own principles which are based on experiments.


Levels of Management

Levels of Management is a series of managerial positions from top to bottom in an organization. Typically, there are three levels of management in any organization:

  • Top Level Management: This level comprises the Board of Directors, Chief Executives, Chief Operating Officers and many more. Individuals at this level, frame policies for the overall achievement of management objectives.

  • Middle Level Management: This level consists of departmental heads, officers, finance managers and divisional heads. In this level, managers and heads are responsible for implementing and controlling the plans and strategies of an organization.

  • Operational Level Management: This level is the lowest level of management comprising superintendents, clerks, supervisors, etc. They are responsible for technical and day-to-day operations.

 

Functions of Management

Management is defined as the process of planning, organizing, staffing, directing and controlling the efforts of every individual and resources to achieve specific goals.

  1. Planning: It is the process of strategizing and taking decisions in advance as to what needs to be done to accomplish the purpose.

  2. Organizing: It is the process of allotting duties and responsibilities. It includes establishing authority and allocating resources in order to execute a specific plan.

  3. Staffing: It is the process of deploying people at the right positions according to the need of work.

  4. Directing: This process includes influencing, guiding, supervising and motivating people towards the achievement of specific targets.

  5. Controlling: It is the process of ensuring that the organization is heading in the right direction. This process ensures that the standards sets are followed.

 

Meaning, Characteristics and Importance of Coordination

Coordination is the essence of management because it is the process that ensures harmony in the organization is established. This process synchronizes the efforts of all individuals  towards the accomplishment of goals. Coordination is needed in all three levels.


Characteristics of Coordination

  1. Integrates Group Efforts: Coordination is needed to bind the efforts of all individuals towards a common goal.

  2. Ensures Unity of Action: Coordination is required to create unity among people of the organization.

  3. Continuous Process: Coordination is required in every step and in every activity of a business. Therefore, it is a continuous process.

  4. All Pervasive: Coordination is pervasive as it is needed in all levels. It is applicable in economic, social, legal, political forms of organization.

  5. Deliberate Function: This process is created by the managers deliberately to bind the efforts of all individuals.

  6. Responsibility of Managers: All managers in all levels  of an organization are responsible for coordination.

 

Importance of Coordination

Coordination is important because it integrates the efforts of individuals for an effective and efficient function of an organization.

  1. Coordination is important in a large organization where individuals come from different backgrounds with different interests, thinking, understanding, etc. Therefore it is necessary to bind them together.

  2. Coordination is important in an organization because the functions of the entity are divided into various departments with their own objectives, strategies and policies. So it is important to avoid any kind of conflict.

  3. Coordination is important to create unity of action of the specialists of the organization.

 

Advantages of Using Vedantu’s Important Questions

  • Important Questions for Class 12 CBSE are an effective way for students to prepare for the final exams.

  • These questions are designed to be in line with the NCERT course textbook, ensuring that students are completely in sync with the syllabus.

  • Solving important questions will provide ample practice to the students and help them understand the distribution of marks in the final exam.

  • By solving these questions, students can also get a better understanding of time management during the examination.

  • The important question paper is created by subject matter experts, who design it to be similar to the real question paper.

  • This gives students a feel of how the actual examination paper would look like, and they can prepare accordingly.

  • Students who solve important questions for Class 12 CBSE are likely to improve their grades in the final exam.


Preparation Strategy by Vedantu

  • Chapter 1 of Business Studies Class 12 is considered highly scoring in the board exams.

  • Short types of questions on topics like 'Meaning, Characteristics, Objectives and Importance of Management' are frequently asked.

  • 'Management as an art, science and profession', 'Level of management' and 'Coordination' are important topics that appear in 3 to 5 marks.

  • Based on these observations, important questions for Chapter 1 have been prepared by experienced teachers in Vedantu.

  • It is recommended to give utmost importance to this chapter and go through all the notes relating to the subject for better preparation.

  • Vedantu has chalked out a strategy for the preparation of Chapter 1, and implementing these strategies can improve your performance in board exams.

FAQs on Important Questions for CBSE Class 12 Business Studies Chapter 1 - Nature and Significance of Management

1. Can CBSE Important Questions for Class 12 Business Studies Chapter 1 help me Score well in the Exam?

Ans: Yes, CBSE Important Questions for Class 12 Business Studies Chapter 1 will help you score an excellent grade. These solutions are curated by subject matter experts with years of experience in a similar field. Hence these are accurate and can be relied upon without any doubt. Referring to these important questions and answers will definitely help you score well in the exam.

2. Are these Important Questions for CBSE Class 12 Business Studies Chapter 1 free to download?

Ans: Yes, these Important Questions for CBSE Class 12 Business Studies Chapter 1 free to download for everyone. Any Class 12 Commerce student can opt for these Business Studies study materials and download them for absolutely free of cost from Vedantu website. These are available for download on Vedantu app as well. In that case, students have to download the app on their phone from Google play store. In both scenarios (site and app), the student has to register himself by enrolling his phone number and email address. 

3. Can I avail these from Vedantu App?

Ans: Yes, you can avail these important questions and answers from Vedantu app apart from the website. These important questions for CBSE Class 12 Business Studies Chapter 1 along with the solutions have been made easily available in free PDF format on both Vedantu website and app for download. 

4. What are the benefits of using these Important Questions for Class 12 Business Studies offered by Vedantu?

Ans: These important questions and answers of Class 12 Business Studies are the ultimate saviour for last-minute revision. You do not have to hustle for anything. Once you are done with your textbook revision, just go through these questions and answers in order to assure that you hold a strong grasp over these basic concepts. You can blindly rely upon these as these are carefully curated by Vedantu’s subject matter experts.

5. Why is the nature and significance of management important in life?

Understanding the nature and significance of management is important in life for several reasons:

  • Management principles can be applied to personal life to organize tasks, set goals, and achieve them efficiently.

  • Understanding management helps to achieve organizational goals, increase productivity, and improve overall performance in professional life.

  • Understanding the principles of management enhances decision-making in both personal and professional life.

  • Understanding management principles can help in effective teamwork, leading to increased success and productivity.

  • Understanding the nature and significance of management can help in improving communication skills, both verbal and non-verbal.