With the recent introduction of OMR-based MCQ exams in HS 1st Year, there's a strong possibility that the HS Final Year exams may also include a Multiple Choice Question (MCQ) section. To help you stay ahead of the curve, The Treasure Notes has curated the most important MCQs from Unit 1: Nature and Significance of Management, based on the latest AHSEC syllabus and previous year questions (2012–2025).
Nature and Significance of Management MCQs
Most Important Previous Year Multiple Choice Question Sets:
(1). Who defined management as “the art of getting things done through others”? (AHSEC 2015)
a) F.W. Taylor
b) Henry Fayol
c) Harold Koontz
d) George R. Terry
Answer: c) Harold Koontz
(2). Which function of management is considered the base of all other functions? (AHSEC 2025)
a) Controlling
b) Organizing
c) Planning
d) Staffing
Answer: c) Planning
(3). At what level of management does a Managing Director work? (AHSEC 2012, 2024)
a) Lower level
b) Middle level
c) Top level
d) Functional level
Answer: c) Top level
(4). Which principle of management promotes team spirit? (AHSEC 2012, 2015)
a) Unity of Command
b) Discipline
c) Esprit De Corps
d) Centralisation
Answer: c) Esprit De Corps
(5). Name the book authored by Henry Fayol on management. (AHSEC 2012, 2017, 2025)
a) Management by Objectives
b) General and Industrial Management
c) Principles of Scientific Management
d) Art of War
Answer: b) General and Industrial Management
(6). Why is management said to be pervasive? (AHSEC 2016)
a) It is a universal profession
b) It is practiced at all levels in all types of organizations
c) It applies only in business
d) It is a legal requirement
Answer: b) It is practiced at all levels in all types of organizations
(7). How is management an intangible force? (AHSEC 2017)
a) It cannot be measured
b) It cannot be used
c) It can be seen directly
d) It is felt through results and efficiency
Answer: d) It is felt through results and efficiency
(8). Management is required in— (Conceptual: asked repeatedly)
a) Business only
b) Government only
c) NGOs only
d) All types of organizations
Answer: d) All types of organizations
(9). Which of the following best describes management as a process? (Conceptual: implied in AHSEC 2013, 2014)
a) A static body of principles
b) A series of ongoing functions like planning, organizing, controlling
c) A type of communication
d) A branch of accounting
Answer: b) A series of ongoing functions like planning, organizing, controlling
(10). What type of force is management considered to be? (AHSEC 2017)
a) Tangible
b) Visible
c) Intangible
d) External
Answer: c) Intangible
(11). Which level of management is concerned with framing policies and plans? (AHSEC 2012, 2024)
a) Middle-level management
b) Lower-level management
c) Top-level management
d) Operational management
Answer: c) Top-level management
(12). What is the primary objective of management? (AHSEC 2013, 2014)
a) Earning maximum profit
b) Achieving organizational goals efficiently and effectively
c) Enhancing competition
d) Increasing government control
Answer: b) Achieving organizational goals efficiently and effectively
(13). Which of the following is NOT a feature of management? (AHSEC)
a) Goal-oriented
b) Dynamic
c) Tangible
d) Social Process
Answer: c) Tangible
(14). Why is management considered a science? (AHSEC)
a) It’s theoretical
b) It has universally accepted principles
c) It is practiced by scientists
d) It is derived from mathematics
Answer: b) It has universally accepted principles
(15). What kind of objective is ensuring fair salaries and work satisfaction for employees? (AHSEC 2013, 2014)
a) Organizational objective
b) Social objective
c) Personal/Individual objective
d) Economic objective
Answer: c) Personal/Individual objective
TOP 50 MCQs on Nature and Scope of Management
(1). What is management primarily concerned with?
a) Achieving personal goals
b) Coordinating group efforts to achieve organizational goals
c) Managing finances only
d) Marketing products
Answer: b) Coordinating group efforts to achieve organizational goals
Explanation: Management involves planning, organizing, staffing, directing, coordinating, and controlling to achieve organizational objectives efficiently.
(2). Which of the following best defines management as a process?
a) A group of managerial personnel
b) A series of functions like planning, organizing, and controlling
c) A body of knowledge only
d) A leadership technique
Answer: b) A series of functions like planning, organizing, and controlling
Explanation: As a process, management includes interconnected functions like planning, organizing, staffing, directing, coordinating, and controlling.
(3). Who defined management as “the art of getting things done through and with people in formally organized groups”?
a) Henry Fayol
b) Harold Koontz
c) George R. Terry
d) John F. Mee
Answer: b) Harold Koontz
Explanation: This definition by Harold Koontz emphasizes management’s role in achieving goals through people in organized settings.
(4). Which characteristic of management emphasizes that it is required wherever there is human activity?
a) Goal-oriented
b) Universal
c) Intangible
d) Social process
Answer: b) Universal
Explanation: Management is universal as it applies to all organizations, including business, education, government, and more.
(5). Management is considered a social process because:
a) It involves dealing with machines
b) It focuses on profit-making only
c) It involves interaction with people to achieve goals
d) It is a scientific process
Answer: c) It involves interaction with people to achieve goals
Explanation: Management is a social process as it involves directing and coordinating human efforts for organizational objectives.
(6). Which of the following is NOT a function of management?
a) Planning
b) Organizing
c) Advertising
d) Controlling
Answer: c) Advertising
Explanation: Advertising is a marketing function, not a core management function like planning, organizing, staffing, directing, coordinating, or controlling.
(7). What is the primary focus of organizational objectives in management?
a) Employee welfare
b) Growth and prosperity of the business
c) Social welfare
d) Environmental protection
Answer: b) Growth and prosperity of the business
Explanation: Organizational objectives focus on survival, growth, productivity, profitability, and innovation.
(8). Which of the following is a social objective of management?
a) Increasing market share
b) Providing quality goods at reasonable prices
c) Ensuring employee promotions
d) Maximizing profits
Answer: b) Providing quality goods at reasonable prices
Explanation: Social objectives include contributing to society through quality products, employment, and environmental efforts.
(9). Which individual objective of management focuses on employee aspirations?
a) Survival of the organization
b) Providing promotional opportunities
c) Increasing productivity
d) Controlling pollution
Answer: b) Providing promotional opportunities
Explanation: Individual objectives cater to employee needs like fair salaries, promotions, and healthy work conditions.
(10). Why is management considered an inexact science?
a) It lacks principles
b) It deals with unpredictable human behavior
c) It has no universal application
d) It is purely theoretical
Answer: b) It deals with unpredictable human behavior
Explanation: Management is an inexact science because human behavior is difficult to predict, unlike physical sciences.
(11). Which feature of management as an art emphasizes creativity?
a) Personal skill
b) Regular practice
c) Creativity
d) Practical knowledge
Answer: c) Creativity
Explanation: Creativity is a key feature of management as an art, as managers find innovative ways to solve problems.
(12). Management is considered a profession because:
a) It has a universal code of conduct
b) It has a specialized body of knowledge
c) It is regulated by a single body
d) It does not require training
Answer: b) It has a specialized body of knowledge
Explanation: Management has a systematic body of knowledge, but it lacks a universal regulatory body, making it an emerging profession.
(13). Which of the following is a characteristic of management as a science?
a) Personal skill
b) Universal application of principles
c) Result-oriented approach
d) Creativity
Answer: b) Universal application of principles
Explanation: Management as a science has universally applicable principles like unity of command and division of labor.
(14). What does the term ‘intangible’ mean in the context of management?
a) Management can be seen physically
b) Management is felt through results, not seen
c) Management is a physical resource
d) Management is a static process
Answer: b) Management is felt through results, not seen
Explanation: Management is intangible as its impact is observed through outcomes like productivity or efficiency.
(15). Which level of management is primarily responsible for policy formulation?
a) Middle-level management
b) Supervisory-level management
c) Administrative management
d) Operative management
Answer: c) Administrative management
Explanation: Administrative management (top level) focuses on policy-making and planning.
(16). Which function of management involves monitoring and correcting performance?
a) Planning
b) Organizing
c) Controlling
d) Directing
Answer: c) Controlling
Explanation: Controlling ensures performance aligns with planned objectives by monitoring and correcting deviations.
(17). What is the essence of coordination in management?
a) Achieving individual goals
b) Integrating and harmonizing activities
c) Increasing profits only
d) Reducing employee interaction
Answer: b) Integrating and harmonizing activities
Explanation: Coordination synchronizes efforts and resources to achieve organizational goals.
(18). Which of the following is NOT a characteristic of management?
a) Goal-oriented
b) Dynamic function
c) Tangible process
d) Social process
Answer: c) Tangible process
Explanation: Management is intangible, as its effects are felt through results, not seen physically.
(19). Who described management as “a distinct process consisting of planning, organizing, actuating, and controlling”?
a) Henry Fayol
b) George R. Terry
c) Harold Koontz
d) Kreitner
Answer: b) George R. Terry
Explanation: This definition by George R. Terry emphasizes management as a process with specific functions.
(20). What is the main difference between administration and management?
a) Administration focuses on doing, management on thinking
b) Administration focuses on policy-making, management on execution
c) Administration is for small firms, management for large firms
d) Administration is intangible, management is tangible
Answer: b) Administration focuses on policy-making, management on execution
Explanation: Administration involves strategic planning, while management focuses on implementing policies.
(21). Which of the following is an example of an interpersonal activity of management?
a) Setting production targets
b) Motivating subordinates
c) Preparing financial reports
d) Analyzing market trends
Answer: b) Motivating subordinates
Explanation: Interpersonal activities involve interacting with subordinates, superiors, or clients.
(22). Why is management considered a dynamic function?
a) It is static and unchanging
b) It adapts to changing environments
c) It focuses only on profits
d) It avoids innovation
Answer: b) It adapts to changing environments
Explanation: Management molds the organization to suit changing business environments.
(23). Which objective of management focuses on reducing production costs?
a) Social objective
b) Individual objective
c) Organizational objective
d) Environmental objective
Answer: c) Organizational objective
Explanation: Organizational objectives include improving productivity and reducing costs.
(24). Which of the following is a feature of management as a profession?
a) Universal code of conduct
b) Formal education and training
c) No need for specialized knowledge
d) Lack of service motive
Answer: b) Formal education and training
Explanation: Management has formal education programs, but it lacks a universal code of conduct.
(25). What is the role of management in minimizing risk?
a) Ignoring external factors
b) Assessing policies and taking corrective measures
c) Focusing only on profits
d) Avoiding employee training
Answer: b) Assessing policies and taking corrective measures
Explanation: Management evaluates internal and external factors to minimize business risks.
(26). Which type of manager is appointed based on qualifications or experience?
a) Family manager
b) Professional manager
c) Civil servant
d) Supervisory manager
Answer: b) Professional manager
Explanation: Professional managers are hired based on their expertise or qualifications.
(27). What does the term ‘management as a group’ refer to?
a) A single manager
b) All individuals performing managerial roles
c) Only top-level managers
d) Non-managerial employees
Answer: b) All individuals performing managerial roles
Explanation: It includes all managers, from chief executives to supervisors.
(28). Which of the following best describes the nature of coordination?
a) A one-time activity
b) A continuous and pervasive process
c) Limited to top management
d) Focused only on profits
Answer: b) A continuous and pervasive process
Explanation: Coordination is ongoing and required at all levels to ensure harmony.
(29). Why is management important for producing better quality goods?
a) It reduces employee training
b) It exercises control over production processes
c) It avoids quality checks
d) It focuses only on marketing
Answer: b) It exercises control over production processes
Explanation: Management controls production to ensure quality and minimize wastage.
(30). Which of the following is NOT a benefit of management to society?
a) Raising living standards
b) Providing quality goods
c) Maximizing employee salaries only
d) Promoting peace and prosperity
Answer: c) Maximizing employee salaries only
Explanation: Management benefits society by providing quality goods, raising living standards, and promoting welfare, not just focusing on salaries.
(31). What is the primary purpose of coordination in an organization?
a) To increase individual efforts
b) To synchronize activities for achieving organizational goals
c) To reduce employee cooperation
d) To focus only on financial planning
Answer: b) To synchronize activities for achieving organizational goals
Explanation: Coordination harmonizes the activities of various individuals and departments to achieve common organizational objectives.
(32). Who defined coordination as “the effort to assure a smooth interplay of functions and forces”?
a) Henry Fayol
b) Ordway Tead
c) George R. Terry
d) Mary Parker Follett
Answer: b) Ordway Tead
Explanation: Ordway Tead’s definition emphasizes coordination as ensuring smooth interplay for maximum effectiveness and minimum friction.
(33). Which of the following best describes coordination as per George R. Terry?
a) A separate managerial function
b) Blending efforts through planning, organizing, actuating, and controlling
c) A voluntary effort by individuals
d) A one-time activity
Answer: b) Blending efforts through planning, organizing, actuating, and controlling
Explanation: Terry views coordination as integrating efforts through various managerial functions to achieve objectives.
(34). Why is coordination considered the essence of management?
a) It replaces all other managerial functions
b) It integrates and synchronizes all managerial functions
c) It focuses only on planning
d) It is performed only at the top level
Answer: b) It integrates and synchronizes all managerial functions
Explanation: Coordination is inherent in all managerial functions (planning, organizing, staffing, directing, controlling), making it the essence of management.
(35). Which of the following is NOT a characteristic of coordination?
a) It is a continuous process
b) It is a separate managerial function
c) It involves group effort
d) It requires cooperation
Answer: b) It is a separate managerial function
Explanation: Coordination is not a distinct function but is inherent in all managerial functions.
(36). At which level of management is coordination required?
a) Only top level
b) Only middle level
c) Only lower level
d) All levels
Answer: d) All levels
Explanation: Coordination is necessary at top, middle, and lower levels to synchronize activities for organizational goals.
(37). What is the role of coordination in the planning function?
a) It eliminates the need for planning
b) It integrates main plans with sub-plans
c) It focuses only on financial planning
d) It reduces employee involvement
Answer: b) It integrates main plans with sub-plans
Explanation: Coordination ensures that long-term, short-term, and departmental plans are harmonized.
(38). Which principle of coordination was given by Mary Parker Follett?
a) Principle of Unity of Command
b) Principle of Direct Contact
c) Principle of Scalar Chain
d) Principle of Division of Work
Answer: b) Principle of Direct Contact
Explanation: Mary Parker Follett emphasized direct interpersonal communication to achieve effective coordination.
(39). According to the Principle of Early Beginning, coordination is most effective when:
a) Implemented during policy execution
b) Started in the early stages of planning
c) Applied only at the end of a project
d) Limited to top management
Answer: b) Started in the early stages of planning
Explanation: Coordination is easier and more effective when initiated during the planning and policy-making stages.
(40). What does the Principle of Reciprocal Relationship imply?
a) Only one department affects others
b) All factors in an organization are interdependent
c) Coordination is a one-time activity
d) Employees work independently
Answer: b) All factors in an organization are interdependent
Explanation: This principle states that the work of one person or department depends on others, requiring mutual coordination.
(41). Why is coordination described as a continuous activity?
a) It occurs only during crises
b) It is performed once during planning
c) It is ongoing to ensure smooth operations
d) It is limited to specific departments
Answer: c) It is ongoing to ensure smooth operations
Explanation: Coordination is a constant process to maintain harmony and prevent disruptions in operations.
(42). How does coordination differ from cooperation?
a) Coordination is voluntary, cooperation is deliberate
b) Coordination is broader and includes cooperation
c) Cooperation is a managerial function, coordination is not
d) Coordination is informal, cooperation is formal
Answer: b) Coordination is broader and includes cooperation
Explanation: Coordination is a deliberate managerial effort to synchronize activities, while cooperation is the voluntary willingness to help, making coordination broader.
(43). Which of the following is a key benefit of coordination?
a) Increased conflicts among employees
b) Improved personnel relations
c) Reduced organizational goals
d) Higher production costs
Answer: b) Improved personnel relations
Explanation: Coordination fosters cordial relations, resolves conflicts, and boosts employee morale.
(44). How does coordination contribute to efficiency and economy?
a) By increasing duplication of efforts
b) By avoiding delays and eliminating waste
c) By focusing only on profits
d) By reducing employee training
Answer: b) By avoiding delays and eliminating waste
Explanation: Coordination minimizes delays and duplication, leading to efficient and economical operations.
(45). What is the outcome of coordination in achieving unity of direction?
a) Conflicting goals among departments
b) Synchronized efforts toward common objectives
c) Reduced employee cooperation
d) Increased production costs
Answer: b) Synchronized efforts toward common objectives
Explanation: Coordination aligns departmental goals with organizational objectives to ensure unity of direction.
(46). Which managerial function requires coordination between standards set and actual performance?
a) Planning
b) Organizing
c) Controlling
d) Staffing
Answer: c) Controlling
Explanation: In controlling, coordination ensures that performance aligns with established standards.
(47). Why is coordination essential in large organizations?
a) To reduce specialization
b) To manage complexity and synchronize efforts
c) To eliminate division of labor
d) To focus only on top management
Answer: b) To manage complexity and synchronize efforts
Explanation: Large organizations with specialization and division of labor require coordination to integrate diverse activities.
(48). What happens in the absence of coordination in an organization?
a) Improved efficiency
b) Chaos and mismanagement
c) Increased employee satisfaction
d) Higher profits
Answer: b) Chaos and mismanagement
Explanation: Lack of coordination leads to conflicting goals, confusion, and inefficiency.
(49). Which of the following is a feature of coordination as a group effort?
a) It applies only to individual tasks
b) It harmonizes the efforts of multiple people or departments
c) It eliminates the need for cooperation
d) It is performed only by top managers
Answer: b) It harmonizes the efforts of multiple people or departments
Explanation: Coordination is necessary when multiple individuals or departments work together.
(50). According to Chester Bernard, what is the crucial factor for an organization’s survival?
a) Financial planning
b) Quality of coordination
c) Employee training
d) Marketing strategies
Answer: b) Quality of coordination
Explanation: Chester Bernard emphasized that effective coordination is critical for organizational survival.
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Why Should You Practice These MCQs?
🔍 OMR-based Exam Trend: AHSEC is shifting towards objective-type questions.
📚 Exam-Oriented Preparation: All MCQs are selected from past board questions and core concepts.
⏱️ Time-Saving Revision Tool: Quick to practice, effective to retain.
📈 Score Booster: Strengthen your fundamentals and improve your performance in the final exam.
📝 About the Chapter: Nature and Significance of Management
This is the first and most fundamental chapter in the Class 12 Business Studies syllabus. It introduces you to the meaning, characteristics, objectives, levels, and importance of management in business. Many 1-mark MCQs, true/false, and fill-in-the-blank questions are usually asked from this unit every year.
📌 What We’ve Covered
We’ve compiled a list of highly important MCQs with four options, correct answers, and board exam references. These include:
Definitions by famous thinkers (like Koontz, Fayol)
Functions and levels of management
Characteristics such as universality, intangibility, social process
Objectives: Organizational, Social, Personal
Management as an art, science, and profession
Role of coordination in management
🎯 Targeted for:
AHSEC Class 12 Business Studies 2026 Exam
ASSEB HS 2nd Year Commerce Students
Anyone preparing for OMR-based competitive or board-level commerce exams
📚 How to Use These MCQs?
Practice them regularly for better retention.
Use them for quick revisions before school/board exams.
Share them with friends for group quiz practice.
🚀 Get Ready with The Treasure Notes
These Unit 1 MCQs for AHSEC Business Studies are your perfect exam prep booster. Whether you’re targeting a high score or want to revise concepts quickly, this set is student-tested and exam-verified.
📌 Don't forget to explore our other chapters, notes, and PYQs available across all AHSEC Class 12 Commerce subjects – exclusively on The Treasure Notes.
✨ Final Tip:
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