25 MCQs from Planning Chapter of Business Studies**
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*1. What is the primary function of management that sets the basis for all other functions?**
A. Organizing
B. Staffing
C. **Planning**
D. Controlling
**Answer:** C
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2. Which step in the planning process involves evaluating alternatives based on feasibility and consequences?**
A. Setting objectives
B. **Evaluating alternatives**
C. Implementing the plan
D. Developing premises
**Answer:** B
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3. Which of the following is a limitation of planning?**
A. Reduces creativity
B. **Rigidity in implementation**
C. Increases costs
D. Ensures coordination
**Answer:** B
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4. Which type of plan is designed for recurring activities and used repeatedly?**
A. Programme
B. Budget
C. **Policy**
D. Project
**Answer:** C
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*5. What is the purpose of "setting objectives" in planning?**
A. To allocate resources
B. **To provide direction and focus**
C. To identify competitors
D. To reduce risks
**Answer:** B
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*6. Which of the following is a single-use plan?**
A. Procedure
B. **Budget**
C. Rule
D. Strategy
**Answer:** B
7. What does "premises" refer to in planning?**
A. Final outcomes
B. **Assumptions about the future environment**
C. Resource allocation
D. Employee training
**Answer:** B
8. Which feature of planning emphasizes that it is required at all levels of management?**
A. Continuous
B. Futuristic
C. **Pervasive**
D. Goal-oriented
**Answer:** C
9. Which of the following is NOT a step in the planning process?**
A. Follow-up action
B. **Performance appraisal**
C. Selecting alternatives
D. Setting objectives
**Answer:** B
10. What is the relationship between planning and controlling?**
A. Planning restricts controlling.
B. **Controlling is impossible without planning.**
C. Planning replaces controlling.
D. Both are unrelated.
**Answer:** B
11. Which type of plan specifies the steps to carry out a task?**
A. Policy
B. **Procedure**
C. Rule
D. Method
**Answer:** B
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*12. Why is planning considered a mental exercise?**
A. It requires physical effort.
B. **It involves thinking, analysis, and foresight.**
C. It depends on external consultants.
D. It ignores past data.
**Answer:** B
13. Which limitation arises due to inaccurate assumptions about the future?**
A. Costly process
B. Time-consuming
C. **Planning may fail**
D. Reduces initiative
**Answer:** C
14. What is the purpose of "derivative plans"?**
A. To replace the main plan
B. **To support and execute the primary plan**
C. To evaluate competitors
D. To minimize resources
**Answer:** B
15. Which of the following is a benefit of planning?**
A. Guarantees success
B. **Reduces overlapping and wasteful activities**
C. Eliminates risks
D. Prevents changes
**Answer:** B
*16. Which plan defines organizational boundaries (e.g., "No smoking on premises")?**
A. Strategy
B. **Rule**
C. Programme
D. Policy
**Answer:** B
*17. Why might planning lead to rigidity?**
A. Managers refuse to adapt to changes.
B. **Plans are followed strictly despite environmental shifts.**
C. Employees lack skills.
D. Objectives are unclear.
**Answer:** B
18. What does "strategy" focus on in planning?**
A. Daily operations
B. **Long-term competitive advantage**
C. Employee grievances
D. Financial audits
**Answer:** B
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#### **19. Which factor is NOT a part of planning premises?**
A. Technological changes
B. Market demand
C. **Employee salaries**
D. Government policies
**Answer:** C
20. What is the final step in the planning process?**
A. Selecting alternatives
B. **Follow-up and review**
C. Setting objectives
D. Identifying alternatives
**Answer:** B
21. Which of the following is a standing plan?**
A. Project
B. Budget
C. **Method**
D. Programme
**Answer:** C
22. How does planning reduce risks?**
A. By eliminating competition
B. **By anticipating changes and preparing responses**
C. By avoiding innovation
D. By increasing investment
**Answer:** B
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23. Which of the following is NOT a type of plan?**
A. Objective
B. Strategy
C. **Forecasting**
D. Programme
**Answer:** C
24. Why is planning called a continuous process?**
A. Plans are made once and discarded.
B. **Plans are revised as per changing conditions.**
C. It only occurs during crises.
D. It ignores feedback
.
**Answer:** B
25. Which element of planning involves quantifying outcomes (e.g., sales targets)?**
A. Premises
B. **Objectives**
C. Alternatives
D. Procedures
**Answer:** B
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