MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Planning Class 12 MCQ Questions With Answers.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 1.

Which of the following statements is false with respect to Planning?

(A) It is one of the basic managerial functions.
(B) Planning is closely connected with creativity and innovation.
(C) It requires taking decisions.
(D) None of the above
Answer:
(D) None of the above

Explanation:
Planning lays down the base for other functions of management. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.

Question 2.

Which of the following is a feature of Planning?

(A) Provides directions
(B) Reduces the risks of uncertainty
(C) Focuses on achieving objectives
(D) All of the above
Answer:
(D) All of the above

Explanation:
Planning reduces uncertainty, risk and confusion in operation. Planning begins with the determination of objectives and is directed towards their achievement.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 3.

‘It is that function of management which is considered as the base of all other functions.’ Identify the function of management stated in the above lines.

(A) Planning
(B) Controlling
(C) Organising
(D) Staffing
Answer:
(A) Planning

Explanation:
Planning precedes all other managerial functions and provides the very basis for organising, staffing, directing and controlling. Planning is deciding in advance what to do and how to do. It is one of the basic managerial functions. Before doing something, the manager must formulate an idea of how to work on a particular task. Thus, planning 5 is closely connected with creativity and innovation.

Question 4.

‘It involves application of high order thinking skills and intellectual faculties, involving vision and foresightedness to decide the things to be done in the future.’Which feature of Planning is stated in the above line?

(A) Planning is futuristic.
(B) Planning is pervasive.
(C) Planning is a mental exercise.
(D) None of the above
Answer:
(C) Planning is a mental exercise.

Explanation:
Planning requires application of the mind involving foresight, intelligent imagination and sound judgement. It is basically an intellectual activity of thinking rather than doing, because planning determines the action to be taken.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 5.

‘Planning is required in all organisations, at all levels and in all departments. feature of Planning is stated in the above statement ?

(A) Planning is futuristic.
(B) Planning is pervasive.
(C) Planning is a mental exercise.
(D) None of the above
Answer:
(B) Planning is pervasive.
Explanation:
Planning is required at all levels of management as well as in all departments of the organisation. It is not an exclusive function of top management nor of any particular department.

Question 6.

Meena, a proof  reader  in Akash Publications, has been given a target of reading at least 40 pages per day. She has a habit of doing things differently. While doing her work, an idea struck her that a summary of a chapter in the form of a map where all the concepts related to that chapter would be interlinked, should be given in starting of each chapter. It will give students a gist of chapter as well as provide a competitive edge over other publishers. But instead of appreciating her idea, her immediate boss scolded her and asked her to complete the work as per prescribed format. Out of the following, identify the limitation of planning stated in above paragraph:

(A) Planning reduces creativity.
(B) Planning involves huge cost.
(C) Planning is a time-consuming process.
(D) Planning does not work in dynamic environment.
Answer:
(A) Planning reduces creativity.

Explanation:
Planning reduces creativity: Planning is an activity which is done by the f top management. Usually the rest of the f members just implements these plAnswer: As a consequence, middle management and other decision makers are neither allowed to deviate from plans nor are they permitted to act on their own. Thus, much of the initiative or creativity inherent in them also gets lost or reduced.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 7.

R-Ox Ltd. wants to increase their market share by 4.5% in next two years. It spent a lot of money to hire specialized people for framing their plans, collecting important facts about environment who took lot of time to frame plans for the company. The competition has started increasing, and it is not able to beat its competitors because it has already spent a huge amount. The plan failed and company suffered a huge loss. Identify the limitation of planning stated in the given case.

(A) Planning involves huge cost.
(B) Planning may not work in a dynamic environment.
(C) Planning is a time-consuming process.
(D) All of the above.
Answer:
(D) All of the above.

Explanation:
Planning requires a lot of time to collect information, its analysis and interpretation. So it is a time consuming process. When plans are drawn up huge costs are involved in their formulation. The environment in which a business survives is dynamic as it keeps on changing. The dynamic environment may sometimes lead to failure of plans.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 8.

Which of the following statements is true regarding planning?

(A) Once plans are made to decide the future course of action, the management may not be in a position to change them.
(B) Planning is a one-time process.
(C) Planning is required only at Top Level of Management as plans are made by Top Level of Management.
(D) Planning always leads to success.
Answer:
(A) Once plans are made to decide the future course of action, the management may not be in a position to change them.

Explanation:
In an organisation, a well-defined plan is drawn up with specific goals to be achieved within a specific time frame. These plans then decide the future course of action and managers may not be in a position to change it. This kind of rigidity in plans may create difficulty
(A) (ii), (iii), (i)
(B) (iii), (ii), (i)
(C) (ii), (i), (iii)
(D) (iii), (i), (ii)
Answer:
(C) (ii), (i), (iii)

Question 10.

Planning is deciding in advance, what to do and how to do it. The first step of planning process is :

(A) Setting objectives
(B) Follow up
(C) Implementation of plan
(D) Developing premises
Answer:
(A) Setting objectives

Explanation:
The first and foremost step is setting objectives. Every organisation must have certain objectives. Objectives may be set for the entire organisation and each department or unit within the organisation.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 11.

Which of the following steps in the process of planning states that the manager is required to make certain assumptions about the future?

(A) Setting objectives
(B) Developing premises
(C) Evaluating alternative courses of action
(D) Implementation of plan
Answer:
(B) Developing premises

Explanation:
Planning is concerned with the future which is uncertain and every planner is using conjecture about what might happen in future. Therefore, the manager is required to make certain assumptions about the future. These assumptions are called premises.

Question 12

…………. are the anticipated environments in which plans are expected to operate.

(A) Planning premises
(B) Forecasting
(C) Objectives
(D) None of these
Answer:
(A) Planning premises

Explanation:
Premises include actual forecast data, policies and plans of the enterprise. Planning involves looking into the future which necessitates the enterprise to know how future conditions will affect its activities.

Question 13.

To see whether plans are being implemented and activities are being performed according to the schedule, is a step of planning process. Identify the step.

(A) Selecting the best alternative
(B) Implementing the plan
(C) Follow up action
(D) valuating alternative courses of action
Answer:
(C) Follow up action

Explanation:
To see whether plans are being implemented and activities are performed according to schedule is also part of the planning process. Monitoring the plans is equally important to ensure that objectives are achieved.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 14

…………….. step in the process of planning is considered as the ‘real point of decision making’.

(A) Setting objectives
(B) Selecting an alternative
(C) Implementation of plan
(D) Developing premises
Answer:
(B) Selecting an alternative

Explanation:
The best plan has to be adopted and implemented. The ideal plan, of course, would be the most feasible, profitable and with least negative consequences. Most plans may not always be subjected to a mathematical analysis.

Question 15.

While ‘selecting an alternative’ under the planning process, which of the following are considered?

(A) Combination of plans may be selected instead of one best course.
(B) Subjectivity and manager’s experience or judgment plays a role.
(C) The most feasible, profitable plan with least negative consequences is chosen.
(D) AD of the above
Answer:
(D) AD of the above

Explanation:
The best plan, which is the most profitable plan and with minimum negative effects, is adopted and implemented.
In such cases, the manager’s experience and judgement plays an important role in selecting the best alternative.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 16.

Which of the foUowing is true with respect to the step ‘developing premises’ under the planning process?

(A) Base material for assumptions can be in the form of forecasts, existing plans or any past information about policies.
(B) Only a few managers are required to be familiar with and use the same assumptions.
(C) Assumptions need not necessarily be same for aD.
(D) All of the above
Answer:
(A) Base material for assumptions can be in the form of forecasts, existing plans or any past information about policies.

Explanation:
Assumptions are the base material upon which plans are to be drawn. The base material may be in the form of forecasts, existing plans or any past information about policies. The premises or assumptions must be the same for all and there should be total on them. managers involved in planning should be famihar with and use the same assumptions.

Question 17.

Match the STEPS of Planning process in Column I with the appropriate SEQUENCE in Column II

Column I Column II
(a) Setting Objectives (i) Fourth step
(b) Implementing the plan (ii) First step
(c) Evaluating alternative courses (iii) Sixth step

(A) (iii), (ii), (i)
(B) (ii), (i), (iii)
(C) (ii), (iii), (i)
(D) (iii), (i), (ii)
Answer:
(C) (ii), (iii), (i)

Assertion and Reason Based MCQs

Directions: In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
(A) Both (A) and (R) are true, and (R) is the correct explanation of (A).
(B) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
(C) (A) is true, but (R) is false.
(D) (A) is false, but (R) is true.

Question 1.

Assertion (A): Planning is a primary function of management.
Reason (R): Planning is required at all levels of management as well as in all departments of the organisation.

Answer:
(B) Both (A) and (R) are true, but (R) is not the correct explanation of (A).

Explanation:
Planning lays down the base for other functions of management. All other managerial functions are performed within the framework of the plans drawn. Thus, planning precedes other functions.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 2.

Assertion (A): Planning is a time-saving process.
Reason (R): The success of an enterprise is possible only when plans are properly drawn up and implemented.

Answer:
(D) (A) is false, but (R) is true.

Explanation:
Planning is a time-consuming process. Sometimes plans to be drawn up take so much of time that there is not much time left for their implementation.

Question 3.

Assertion (A): Planning is futuristic.
Reason (R): Planning is regarded as a forward looking function based on forecasting.

Answer:
(A) Both (A) and (R) are true, and (R) is the correct explanation of (A).

Explanation:
Planning essentially involves looking ahead and preparing for the future. The purpose of planning is to meet future events effectively to the best advantage of an organisation. It implies peeping into the future, analysing it and predicting it.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 4.

Assertion (A): Planning is pervasive at all levels of management.
Reason (R): Planning is required in all types of organisations and at all levels of management.

Answer:
(A) Both (A) and (R) are true, and (R) is the correct explanation of (A).

Explanation:
Planning is required at all levels of I the management. It is not a function restricted f to top level managers only but planning is done by managers at every level. Formation of major plan and framing of overall policies is the task of top level managers whereas departmental managers form plan for their respective departments. And lower level managers make plans to support the overall objectives and to carry on day to day activities.

Question 5.

Assertion (A): Developing Planning Premises is the primary step.
Reason (R): Objectives are end results which the management wants to achieve by its operations. O Answer: Option (D) is correct.

Answer:
(D) (A) is false, but (R) is true.

Explanation:
Setting Objectives is the primary step in the process of planning which specifies the objective of an organisation, i.e. what an organisation wants to achieve.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 6.

Assertion (A): Monitoring of plans is very important to ensure that the plans are being implemented according to the schedule.
Reason (R): Regular checks and comparisons of the results with set standards are done to ensure that objectives are achieved.

Answer:
(B) Both (A) and (R) are true, but (R) is not the correct explanation of (A)

Explanation:
To see whether plans are being implemented and activities are performed according to schedule is also part of the planning process. Monitoring the plans is equally important to ensure that objectives are achieved.

Question 7.

Assertion (A): Planning is concerned with the future which is uncertain.
Reason (R): The manager is required to make certain assumptions about the future.

Answer:
(A) Both (A) and (R) are true, and (R) is the correct explanation of (A).

Explanation:
Planning is concerned with the future which is uncertain and every planner is using conjecture about what might happen in future. Therefore, the manager is required to make certain assumptions about the future. These assumptions are called premises.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Case-Based MCQs

I. Read the following text and answer the following questions on the basis of the same:

Simplex Limited had been taken over by Mundhra Group immediately following India’s independence. Since then it enjoys a rich record of industry presence and experience. In 2005, with the aim to accelerate growth the company had gone through several rounds of meetingsand discussions before launching ERP system to attract large projects. The management had done effective forecast and critical thinking regarding allocation of resources to reduce wastage.

For this purpose, the company had laid down multiple courses of action to meet the challenge of adverse situations. In 2008, the company suffered loss in many projects due to the great recession despite taking many cost cutting measures. The management had taken utmost care regarding the possible outcome and timely review of the plans to achieve the set target during that hard time. In 2010 the system implemented successfully which subsequently helped the company to execute numerous projects with precision and timeliness.

Question 1.

“In 2005, with the aim to accelerate growth the company had gone through several rounds of meetings and discussions.” What is the objective mentioned here according to the process stated here?

(A) Developing Premises
(B) Growth and development
(C) Launching IT enabled system
(D) Cost cutting
Answer:
(B) Growth and development

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 2.

“The management had done effective forecast and critical thinking regarding allocation of resources to reduce wastage.” Identify the function of management mentioned here.

(A) Planning
(B) Organising
(C) Controlling
(D) Directing
Answer:
(A) Planning

Question 3.

“In 2008, the company suffered loss in many projects due to the great recession despite taking many cost cutting measures.” Which limitation of the management process is indicated here?

(A) It fails to cope with sudden changes.
(B) It involves huge cost.
(C) It requires critical thinking.
(D) Need to construct multiple action plAnswer:
Answer:
(A) It fails to cope with sudden changes.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 4.

“The management had taken utmost care regarding the possible outcome and timely review of the plans to achieve the set target during that hard time.” Which is the last step of the process mentioned here?

(A) Implementation of plan
(B) Timely execution of projects
(C) Followup
(D) To prepare alternative course of action
Answer:
(C) Followup

Explanation:
To see whether plans are being implemented and activities are performed according to schedule is also part of the planning process. Monitoring the plans is equally important to ensure that objectives are achieved.

II. Read the following text and answer the questions given below:

Sana inherited a 20 acre ancestral land from her grandparents. She decided to venture into agriculture. For this purpose she set out specific goals, objectives and activities. Everything was a challenge because she was not aware about farming. She learnt every activity and in the process thought of assisting other farmers as well. She eventually launched her own company Agricultural Solutions Ltd. She wanted to be sure that the activities effectively met the best interests of the company and the farmers. Hence, she prepared an annual plan for production, sales and marketing through sales forecasting.

She also realized that farmers were growing only one or two crops. On account of this; the land remained idle for the rest of the year. Thus, she identified and evaluated different alternatives through which the farms could be utilized throughout the year. She used her foresight and logical and systematic thinking based on analysis of all facts and examined and evaluated all the alternatives. She presented a plan to the farmers union, where after harvesting the primary crop, seasonal vegetables and fruits could be grown.

Question 1.

“For this purpose she set out specific goals, objectives and activities.” Which feature of planning is depicted in the statement?

(A) Planning focuses on achieving objectives.
(B) Planning is a primary function of management.
(C) Planning is pervasive.
(D) Planning is continuous.
Answer:
(A) Planning focuses on achieving objectives.

Explanation:
Specific goals are set out in the plans along with the activities to be undertaken to achieve the goals. Thus, planning is purposeful. Planning has no meaning unless it contributes to the achievement of predetermined organisational goals.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 2.

“Hence, she prepared an annual plan for production, sales and marketing through sales forecasting.” Which feature of planning is depicted in the statement?

(A) Planning is continuous
(B) Planning is futuristic
(C) Planning involves decision making
(D) Planning is a mental exercise
Answer:
(B) Planning is futuristic
Explanation:
Planning essentially involves looking ahead and preparing for the future. The purpose of planning is to meet future events effectively to the best advantage of an organisation. It implies peeping into the future, analysing it and predicting it.

MCQ Questions for Class 12 Business Studies Chapter 4 Planning

Question 3.

“Thus, she identified and evaluated different alternatives through which the farms could be utilized throughout the year.” Which feature of planning is depicted in the statement?

(A) Planning is pervasive.
(B) Planning is continuous.
(C) Planning is futuristic.
(D) Planning involves decision-making.
Answer:
(D) Planning involves decision-making.

Explanation:
Planning essentially involves choice from among various alternatives and activities. Planning involves thorough examination and evaluation of each alternative and choosing the most appropriate one.

Question 4.

“She used her foresight and logical and systematic thinking based on analysis of all facts and examined
and evaluated all the alternatives.” Which feature of planning is depicted in the statement?

(A) Planning focuses on achieving objectives.
(B) Planning is a primary function of management.
(C) Planning involves decision making.
(D) Planning is a mental exercise.
Answer:
(D) Planning is a mental exercise.

Explanation:
Planning requires application of the mind involving foresight, intelligent imagination and sound judgement. It is basically an intellectual activity of thinking rather than doing, because planning determines the action to be taken.

MCQ Questions for Class 12 Business Studies with Answers