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Punjab PSEB Senior Secondary NSQF Management & Entrepreneurship (Secretary) study materials
Punjab PSEB Senior Secondary NSQF Management & Entrepreneurship (Secretary) study resources

Punjab PSEB Senior Secondary NSQF Management & Entrepreneurship (Secretary) practice questions

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Question 1Management

In the NSQF Management & Entrepreneurship course, which function of management is described as grouping activities, assigning them to departments and fixing authority relationships?

  1. Directing
  2. Staffing
  3. Organising Correct answer.
  4. Controlling

Explanation

Organising is the management function that divides work into tasks, groups them into departments, delegates authority and establishes reporting relationships so that plans can be executed. Directing and staffing come later in the process, and controlling compares performance with standards.

Question 2Management

A small hosiery unit in Ludhiana writes down in advance how many workers each machine will need next season. This activity belongs primarily to which management function?

  1. Controlling
  2. Planning Correct answer.
  3. Coordination
  4. Communication

Explanation

Deciding in advance what is to be done, how and with what resources is planning, the first function of management. It precedes action and provides the basis for later staffing and control. Coordination and communication are supporting processes rather than the forward-looking decision itself.

Question 3Management

According to the principle of unity of command, an employee in an NSQF workshop should receive orders from:

  1. all supervisors present on the floor
  2. one superior only Correct answer.
  3. the senior-most worker of the group
  4. the quality inspector and the storekeeper jointly

Explanation

Unity of command states that each subordinate should report to and take orders from only one superior, which prevents confusion and conflicting instructions. Multiple bosses create divided loyalty and delay.

Question 4Management

Which of the following is a component of Maslow's esteem needs for a shop-floor employee?

  1. Recognition and status for good work Correct answer.
  2. Food and rest breaks
  3. Safety of the job and pension
  4. Friendship among team members

Explanation

Esteem needs cover self-respect, recognition, status and appreciation from others. Job security and pension belong to safety needs, friendship to social needs, and food and rest to physiological needs.

Question 5Management

In a sole proprietorship, the liability of the owner for business debts is:

  1. shared equally with the suppliers
  2. limited to the capital contributed
  3. limited to the value of machinery
  4. unlimited, extending to personal assets Correct answer.

Explanation

A sole proprietor has no separate legal identity from the business, so creditors can recover business dues from personal assets as well. Limited liability arises only in incorporated forms such as a company or an LLP.

Question 6Management

Which document is prepared by a promoter to invite the public to subscribe for shares of a new company?

  1. Memorandum of Association
  2. Certificate of Incorporation
  3. Prospectus Correct answer.
  4. Articles of Association

Explanation

A prospectus is the formal document that discloses the company's objectives, capital structure and risks in order to invite public subscription to its securities. The memorandum and articles govern the company's constitution and internal rules, while the certificate of incorporation merely evidences registration.

Question 7Management

A PSEB vocational trainee notes that the break-even point falls when selling price per unit rises, other things remaining equal. This happens because:

  1. fixed cost per unit increases
  2. contribution per unit increases Correct answer.
  3. the margin of safety falls
  4. variable cost per unit rises

Explanation

Break-even quantity equals fixed cost divided by contribution per unit. A higher selling price raises contribution per unit, so fewer units are needed to cover fixed costs and the break-even point falls.

Question 8Management

Which of the following best describes an entrepreneur as the term is used in the NSQF Entrepreneurship component?

  1. A salaried manager who supervises daily operations of a department
  2. A person who lends money to existing firms at a fixed rate of interest
  3. A government officer who regulates small-scale industries
  4. A person who identifies an opportunity and combines resources to create value while bearing risk Correct answer.

Explanation

An entrepreneur spots an unmet need, assembles land, labour, capital and technology, and accepts the uncertainty of the outcome in return for profit. Lenders, salaried managers and regulators perform different roles in the economy.

Question 9Management

A supervisor in a PSEB workshop tells a trainee that a task must be finished by Friday evening. Which element of directing is illustrated?

  1. Planning
  2. Controlling
  3. Supervision Correct answer.
  4. Coordination

Explanation

Supervision is the direct, day-to-day guidance and instruction of subordinates at the workplace, including setting deadlines and watching execution. Coordination and planning are broader processes, and controlling evaluates results afterwards.

Question 10Management

In a functional organisation, as described by F.W. Taylor, a worker is expected to:

  1. take instructions from several specialised foremen, each expert in one area Correct answer.
  2. be supervised only by the works manager
  3. supervise the foremen himself
  4. report to a single general foreman for all matters

Explanation

Taylor's functional foremanship divides supervision among specialists such as the speed boss, route clerk and inspector, so a worker receives expert instructions from more than one foreman. This breaks strict unity of command but increases technical expertise.

Question 11Management

A firm's fixed cost is ₹40,000, selling price per unit is ₹20 and variable cost per unit is ₹12. What is the break-even quantity in units?

  1. 5,000 Correct answer.
  2. 8,000
  3. 2,000
  4. 3,333

Explanation

Contribution per unit equals ₹20 minus ₹12, that is ₹8. Dividing fixed cost of ₹40,000 by ₹8 gives a break-even quantity of 5,000 units, at which total contribution exactly covers fixed cost.

Question 12Management

Which of the following is a limitation of a partnership firm compared with a joint stock company?

  1. The firm can be dissolved only by a court order
  2. Partners can share profits according to the deed
  3. Partners have limited liability for firm debts
  4. The firm's continuity depends on the partners, and its capital-raising capacity is restricted Correct answer.

Explanation

A partnership lacks perpetual succession, since death, insolvency or retirement of a partner may dissolve it, and it cannot raise capital from the general public. Profit sharing by deed is a normal feature rather than a limitation, and partners in an ordinary partnership have unlimited liability.

Question 13Management

A manager estimates demand for the coming quarter using last year's sales figures adjusted for a festival season. This is an example of which type of plan?

  1. Rule
  2. Procedure
  3. Forecast Correct answer.
  4. Budget

Explanation

A forecast is a projection of future conditions based on past data and expected changes, and it feeds into planning. Rules and procedures prescribe how actions must be performed, while a budget is a quantified financial plan rather than a demand projection.

Question 14Management

Under the Companies Act framework studied in the course, which clause of the Memorandum of Association states the activities the company may undertake?

  1. Objects clause Correct answer.
  2. Liability clause
  3. Capital clause
  4. Situation clause

Explanation

The objects clause defines the purposes for which the company is formed and the business activities it may lawfully pursue, and acts beyond it are ultra vires. The liability clause states whether members' liability is limited, the capital clause gives authorised capital, and the situation clause gives the registered office.

Question 15Management

Which of the following is the most appropriate first step when a trainee group wants to start a small enterprise under the entrepreneurship component?

  1. Identifying and evaluating a business opportunity Correct answer.
  2. Registering the firm with the authorities
  3. Purchasing raw material in bulk
  4. Recruiting employees

Explanation

Idea generation and opportunity evaluation come first, because they determine whether a viable product, market and margin exist. Registration, hiring and bulk purchasing are commitments that should follow only after the opportunity is validated.

Question 16Management

Herzberg's two-factor theory treats salary and working conditions as:

  1. motivators that directly create job satisfaction
  2. esteem needs in Maslow's hierarchy
  3. outcomes of the controlling function
  4. hygiene factors that prevent dissatisfaction but do not motivate Correct answer.

Explanation

Herzberg classified pay, company policy and working conditions as hygiene or maintenance factors; their adequacy prevents dissatisfaction but does not produce positive motivation. Achievement, recognition and responsibility are the motivators that generate satisfaction.

Question 17Management

A firm has contribution of ₹5,00,000 and fixed cost of ₹3,00,000. What is its margin of safety in rupees?

  1. ₹8,00,000
  2. ₹2,00,000 Correct answer.
  3. ₹5,00,000
  4. ₹3,00,000

Explanation

Margin of safety equals contribution minus fixed cost, that is ₹5,00,000 minus ₹3,00,000, giving ₹2,00,000. It represents the fall in contribution the firm can absorb before it reaches break-even.

Question 18Management

Which of the following situations best illustrates the scalar chain principle in a workshop with a clear hierarchy from manager to trainee?

  1. A worker bypasses the supervisor to complain directly to the manager
  2. A message moves step by step from the manager down to the trainee through each level Correct answer.
  3. A staff specialist advises the production foreman without any authority
  4. Two departments exchange information freely without informing their seniors

Explanation

The scalar chain is the unbroken line of authority from the top to the lowest level, along which orders and communications normally travel. Bypassing levels or free lateral exchange are exceptions such as the gang plank, and staff advice is a line-and-staff arrangement.

Question 19Management

Which source of recruitment is likely to be most economical for a small unit seeking a machine operator with no specialised skill?

  1. Engagement of a private placement agency
  2. Employee referrals from the existing workforce Correct answer.
  3. Advertisement in a national daily
  4. Campus placement at an engineering college

Explanation

Referrals from current employees are low-cost, quick and often produce candidates who are already familiar with the work culture. Campus placement, national advertising and private agencies involve substantial fees or media costs that are hard to justify for a general operator post.

Question 20Management

A firm's sales rise from ₹4,00,000 to ₹5,00,000 while profit rises from ₹40,000 to ₹70,000. What is the operating leverage?

  1. 3.0 Correct answer.
  2. 0.33
  3. 1.75
  4. 1.33

Explanation

Operating leverage equals percentage change in profit divided by percentage change in sales. Sales rose by 25 per cent and profit by 75 per cent, so the leverage is 75 divided by 25, that is 3.0.

Question 21Management

A manager identifies a problem, lists alternatives, evaluates them and selects one. This sequence is best described as:

  1. the delegation process
  2. the decision-making process Correct answer.
  3. the staffing process
  4. the controlling process

Explanation

Decision making is the systematic process of defining a problem, generating alternatives, evaluating them against criteria and choosing a course of action. Controlling, staffing and delegation are different managerial processes with their own steps.

Question 22Management

A company's sales are ₹10,00,000, variable cost is 60 per cent of sales and fixed cost is ₹2,50,000. What is the profit?

  1. ₹4,00,000
  2. ₹1,50,000 Correct answer.
  3. ₹2,50,000
  4. ₹6,00,000

Explanation

Contribution is 40 per cent of ₹10,00,000, that is ₹4,00,000. Deducting fixed cost of ₹2,50,000 leaves a profit of ₹1,50,000, which shows how contribution first absorbs fixed cost and the residue is profit.

Question 23Management

An entrepreneur's project needs ₹8,00,000 and is expected to earn ₹2,00,000 per year for six years. Using the payback period method, the project is acceptable if the firm's maximum acceptable payback is:

  1. five years Correct answer.
  2. three and a half years
  3. two years
  4. three years

Explanation

The payback period is the initial outlay divided by the annual cash inflow, that is ₹8,00,000 divided by ₹2,00,000, giving four years. The project is accepted only where the firm's cut-off is at least four years, so a five-year limit qualifies.

Question 24Management

A firm wants to keep its break-even point low while facing rising raw material prices. Which combination of actions is most consistent with this objective?

  1. Raise variable cost per unit while holding selling price
  2. Reduce fixed costs and improve contribution through better product mix or price realisation Correct answer.
  3. Increase fixed costs to buy in bulk and lower selling price
  4. Reduce selling price and simultaneously raise fixed cost

Explanation

Break-even quantity is fixed cost divided by contribution per unit, so lowering fixed cost and raising contribution both pull the break-even point down. The other combinations either raise fixed cost, lower contribution, or do both.

Question 25Management

A supervisor wants to improve coordination between production and stores without weakening the formal chain of command. Which measure best fits the principles studied?

  1. Allowing each unit to set its own independent schedules
  2. Asking production workers to report directly to the storekeeper
  3. Creating a standing liaison role or committee that links the two units while keeping reporting lines intact Correct answer.
  4. Abolishing the supervisor's post to shorten the chain

Explanation

Liaison roles and committees provide horizontal communication across units while preserving the vertical chain of authority, which is the standard way to reconcile coordination with unity of command. The other options either break reporting lines or remove coordination altogether.

Question 26Management

In the NSQF Management & Entrepreneurship course, which function of management is performed first and involves setting objectives and deciding in advance how to achieve them?

  1. Controlling
  2. Coordinating
  3. Staffing
  4. Planning Correct answer.

Explanation

Planning is the primary management function because it sets objectives and lays down the course of action before other functions such as organising, staffing and controlling can proceed. All later functions flow from the plan that has already been decided.

Question 27Management

A small enterprise making school bags is owned by one person who takes all decisions and keeps all profits but has unlimited liability. This form of organisation is a:

  1. Public limited company
  2. Cooperative society
  3. Sole proprietorship Correct answer.
  4. Joint venture

Explanation

A sole proprietorship is owned, managed and financed by one person who enjoys the whole profit and bears unlimited personal liability for the business debts. The description in the question matches these features exactly.

Question 28Management

Which principle of management, given by Henri Fayol, states that a worker should receive orders from only one superior?

  1. Unity of command Correct answer.
  2. Division of work
  3. Esprit de corps
  4. Equity

Explanation

Unity of command means each subordinate has only one boss, which prevents confusion and conflicting instructions. Fayol treated a breach of this principle as a major source of disorder in organisations.

Question 29Management

In Maslow's hierarchy of needs, which level immediately follows safety needs as a person moves upward?

  1. Esteem needs
  2. Self-actualisation
  3. Social needs Correct answer.
  4. Physiological needs

Explanation

Maslow arranged needs as physiological, safety, social, esteem and self-actualisation. Social or belonging needs therefore come directly above safety needs.

Question 30Management

A trainee is asked to list the elements of the marketing mix for a small enterprise. Which set is correct?

  1. Planning, organising, staffing, control
  2. Product, price, place, promotion Correct answer.
  3. Purchase, storage, production, sale
  4. Land, labour, capital, enterprise

Explanation

The marketing mix consists of the four Ps: product, price, place and promotion. These are the decision areas a marketer controls to satisfy the target customer.

Question 31Management

Which of the following is a fixed cost for a small tailoring unit?

  1. Monthly rent of the workshop Correct answer.
  2. Piece-rate wages paid per shirt
  3. Buttons and thread consumed
  4. Cloth used per shirt

Explanation

Fixed costs do not change with the level of output in the short run, and workshop rent is paid whether or not shirts are stitched. Materials and piece-rate wages vary directly with output and are variable costs.

Question 32Management

In the context of the NSQF course, which of the following best describes a business idea being tested for feasibility?

  1. Recruiting workers for the new unit
  2. Printing visiting cards for the proprietor
  3. Checking whether the idea is technically possible and commercially viable Correct answer.
  4. Registering the firm with the authorities

Explanation

Feasibility testing examines whether an idea can be made with available technology and whether it can earn a profit in the market. Registration, recruitment and publicity are later steps that follow a positive feasibility decision.

Question 33Management

Which document, prepared at the time of registration of a company, contains the rules for the internal management of the company?

  1. Articles of Association Correct answer.
  2. Prospectus
  3. Certificate of Incorporation
  4. Memorandum of Association

Explanation

The Articles of Association set out the internal regulations governing the management of the company's affairs. The Memorandum governs the company's relationship with the outside world, while a prospectus invites the public to subscribe to securities.

Question 34Management

A PSEB trainee finds that total contribution is ₹60,000, fixed cost is ₹45,000 and actual sales are ₹1,50,000. What is the profit?

  1. ₹60,000
  2. ₹45,000
  3. ₹15,000 Correct answer.
  4. ₹1,05,000

Explanation

Profit equals contribution minus fixed cost, so ₹60,000 minus ₹45,000 gives ₹15,000. Contribution already covers variable costs, so only fixed cost has to be deducted.

Question 35Management

A unit sells 4,000 units at ₹50 each. Variable cost is ₹30 per unit and fixed cost is ₹60,000. What is the profit-volume ratio?

  1. 30 per cent
  2. 60 per cent
  3. 40 per cent Correct answer.
  4. 25 per cent

Explanation

Contribution per unit is ₹50 minus ₹30, equal to ₹20, which is 40 per cent of the ₹50 selling price. The P/V ratio is contribution divided by sales, so it is 40 per cent.

Question 36Management

Which of the following is the correct order of the steps in the control process?

  1. Establish standards, measure performance, compare with standards, take corrective action Correct answer.
  2. Take corrective action, measure performance, establish standards, compare with standards
  3. Measure performance, establish standards, take corrective action, compare with standards
  4. Compare with standards, establish standards, measure performance, take corrective action

Explanation

Control begins by fixing standards, then measures actual performance, compares it with the standards and finally corrects deviations. Without a standard fixed first, measurement and comparison have no reference point.

Question 37Management

A PSEB-trained supervisor groups similar machines into one department and places all lathe operators under a single foreman. This arrangement illustrates which basis of departmentalisation?

  1. Territorial departmentalisation
  2. Product departmentalisation
  3. Functional departmentalisation Correct answer.
  4. Customer departmentalisation

Explanation

Grouping activities by the nature of the work performed, such as all lathe work under one foreman, is functional departmentalisation. The grouping key here is the function or process, not the product, place or buyer.

Question 38Management

A trainee is asked to distinguish delegation from decentralisation. Which statement is correct?

  1. Delegation is between a superior and a subordinate, while decentralisation is dispersal of authority across all levels of the organisation Correct answer.
  2. Delegation can be withdrawn easily, while decentralisation is always revoked by a single order
  3. Delegation reduces the importance of the superior's role, while decentralisation increases central control
  4. Delegation is a one-time act, while decentralisation is also a one-time act

Explanation

Delegation is an individual act between one superior and one subordinate, whereas decentralisation is an organisation-wide extension of delegation that spreads decision-making authority to all levels. Decentralisation is therefore wider in scope than delegation.

Question 39Management

Which of the following is the most appropriate method of training for a machine operator who must learn to handle a new CNC lathe safely?

  1. A written test on company history
  2. Induction briefing on leave rules
  3. A general lecture on business ethics
  4. On-the-job training under an experienced operator Correct answer.

Explanation

Operating a CNC lathe is a practical skill that is best learned by supervised practice on the actual machine under an experienced operator. Classroom topics on ethics, history or leave rules do not build machine-handling competence.

Question 40Management

A small unit has a current ratio of 2:1 with current assets of ₹1,60,000. What are its current liabilities?

  1. ₹1,60,000
  2. ₹80,000 Correct answer.
  3. ₹3,20,000
  4. ₹40,000

Explanation

The current ratio equals current assets divided by current liabilities. Here ₹1,60,000 divided by 2 gives current liabilities of ₹80,000.

Question 41Management

Which of the following best explains why a written partnership deed is advisable even though it is not always compulsory?

  1. It is required before any profit can be earned
  2. It provides evidence of the agreed terms and helps avoid disputes among partners Correct answer.
  3. It removes the need to register the firm
  4. It converts the firm into a limited liability entity

Explanation

A written deed records the terms agreed among partners, such as capital, profit-sharing and duties, and serves as evidence if a dispute arises. It does not by itself change the legal liability of the partners.

Question 42Management

A manager uses a formal chain of command but also creates a temporary task force drawn from production and sales to solve a specific problem. Which structure does this describe?

  1. Matrix organisation Correct answer.
  2. Committee organisation with no line authority
  3. Line organisation
  4. Functional organisation

Explanation

A matrix structure superimposes a temporary project or task group on the existing functional hierarchy, so employees report both to their functional head and to the project leader. The dual reporting is the defining feature of the matrix.

Question 43Management

A firm has sales of ₹8,00,000, variable cost of ₹4,80,000 and fixed cost of ₹2,00,000. What is the margin of safety?

  1. ₹2,00,000
  2. ₹1,20,000
  3. ₹3,00,000 Correct answer.
  4. ₹5,00,000

Explanation

Contribution is ₹8,00,000 minus ₹4,80,000, equal to ₹3,20,000, and profit is ₹3,20,000 minus ₹2,00,000, equal to ₹1,20,000. The P/V ratio is 40 per cent, so the margin of safety is ₹1,20,000 divided by 0.40, which is ₹3,00,000.

Question 44Management

A supervisor wants to reduce the time taken to settle a customer complaint. Which technique would most directly help identify the most frequent causes of delay?

  1. Break-even analysis
  2. Pareto analysis Correct answer.
  3. Ratio analysis
  4. Job evaluation

Explanation

Pareto analysis ranks causes by their frequency so that the few causes producing most of the problem can be tackled first. This directly supports reducing complaint settlement time.

Question 45Management

Under the Companies Act framework studied in the course, which of the following is a feature of a private limited company?

  1. Its members have unlimited liability for the company's debts
  2. It must invite the public to subscribe to its shares
  3. It has no separate legal existence from its members
  4. Its shares cannot be freely transferred and it has a restricted number of members Correct answer.

Explanation

A private limited company restricts the transfer of its shares and limits its membership, which preserves control among a close group. It is still a separate legal entity with limited liability for its members.

Question 46Management

Which of the following is the best example of an internal source of finance for a small enterprise?

  1. Retained earnings Correct answer.
  2. Issue of debentures to the public
  3. A term loan from a commercial bank
  4. A grant received from a government scheme

Explanation

Retained earnings are profits ploughed back into the business and are generated internally without any outside party. Bank loans, debentures and grants all come from external sources.

Question 47Management

A firm has fixed cost of ₹90,000, selling price of ₹40 per unit and variable cost of ₹25 per unit. What is the break-even quantity in units?

  1. 6,000 units Correct answer.
  2. 3,600 units
  3. 9,000 units
  4. 2,250 units

Explanation

Contribution per unit is ₹40 minus ₹25, equal to ₹15. Dividing fixed cost of ₹90,000 by ₹15 gives a break-even quantity of 6,000 units.

Question 48Management

A trainee notes that a firm's operating leverage is 3 and its fixed cost is ₹1,20,000. What is its contribution?

  1. ₹2,40,000
  2. ₹40,000
  3. ₹1,20,000
  4. ₹3,60,000 Correct answer.

Explanation

Operating leverage equals contribution divided by operating profit. With a leverage of 3, profit is one-third of contribution, so fixed cost must be two-thirds of contribution; dividing ₹1,20,000 by two-thirds gives ₹3,60,000.

Question 49Management

A firm's P/V ratio is 25 per cent and its fixed cost is ₹50,000. To earn a profit of ₹30,000, what sales value is required?

  1. ₹80,000
  2. ₹1,20,000
  3. ₹3,20,000 Correct answer.
  4. ₹2,00,000

Explanation

Required contribution equals fixed cost plus desired profit, that is ₹50,000 plus ₹30,000, equal to ₹80,000. Dividing this contribution by the P/V ratio of 0.25 gives required sales of ₹3,20,000.

Question 50Management

A small enterprise's sales are ₹6,00,000 and its variable cost is ₹3,60,000, giving a P/V ratio of 40 per cent. If the firm wants to maintain its profit while variable cost rises by ₹30,000, what minimum increase in sales is needed, other things remaining the same?

  1. ₹30,000
  2. ₹50,000
  3. ₹1,20,000
  4. ₹75,000 Correct answer.

Explanation

An extra ₹30,000 of variable cost reduces contribution by that amount, so sales must rise enough to restore it. Dividing the ₹30,000 fall in contribution by the 40 per cent P/V ratio gives a required sales increase of ₹75,000.