BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

All business organizations need finance. Among the different source of finance,
which one can be considered as the least source of finance for entrepreneurial
ventures?
O a. Permanent Capital
b. Borrowing
O c. Asset Finance
O d. Working Capital
In which of the social responsibility approach, managers choose not to be socially
responsible?
O a. Defensive
O b. Obstructionist
O c. Accommodative
O d. Reactive
Which one of the stakeholders is highly concerned with financial statement
analysis to protect their job securities?
a. Government
b. Managers
O c. Investors
O d. Employees
The process of evaluating market segments attractiveness and selecting feasible
one is termed as
a. Business market
b. Market research
c. Market segment
O d. Target market
From the data given below, compute the Arithmetic mean for the statistical
distributions table. Class Mark 1-5 6-10
11-15 16-20 Frequency 4312
O a. 9.5 Mark
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

b. 7.5 Mark
O c. 8 Mark

Which one of the following is not the advantage of personal computers?

Ca. Lags business operations effectiveness
Ob. Make our lives more productive
O c. Could cause us to lose some of our basic skills
Od. Takes away some of the boring tasks that we have to perform
Which one of the following source of recruitment is less costly than the others?
Oa. Employee Referral
O b. Advertisement
Oc. Job Posting
O d. Using Agencies
The shift towards a more integrated and interdependent world economy is
O a. Ethical theory
Ob Localization.
Oc Standardization
Od Globalization
is the unorganized raw facts and figures.
a. Data
Ob. Snapshot
Oc Reports
Od. Information
From the following alternatives, identify the component not involved in
downward communication.
O a Indoctrinations
Ob. Manipulations
Oc Job instructions
Od. Job rational
An investor wants to invest in A, B, C and D businesses operations. The expected
return on each investment, given low medium high market demands. Consider
information for the investment conditions given in the following payoff table and
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

identity which is investor's choice if "MAXMAX" decision making approach is

used?
Oa. Alternative "A"
Ob. Alternative "B"
Oc Alternative "C"
Od. Alternative "D"
The ability of firms to readily accommodate demand change by changing product
items and volume is known as
O a Timelines
Ob. Competitiveness
O c. Flexibility
Od. Cost leadership
A business enterprise wants to run printing press service and the operation costs
Birr 50,000 to set up the presses and machinery needed to print and bind a
paperback book. After setup, it costs Birr 5 per book printed and bound. Assume
that the business starts its operation and printed 20,000 books. Therefore, what
will be the operation's average cost?
O a 4000
Ob 5
Oc 7.5
O d. 25
Which of the following is not valuable in upward communication?
O a. Subordinates' achievement
O b. Performance achieved by higher officials
O c. Unsolved job related problems of workers
Od. Job related feeling and attitudes of workers
Identify the criterion which is not considered in judging manageability of
individuals at managerial positions.
O & Approaches employed
Ob. Ethnic background
Oc. Possessed skills
Od. Decision making
Which one of the following is used in finding initial feasible solutions of
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

transportation problems?
O a. Vogel's approximation
O b. Simplex approach
O c. Stepping stone path
Od. Modified distribution
In which one of the following organizational goals is, using external sources for
recruitmentis considered as effective for organization?
O a. To reduce orientation and training cost O
b. To gain new knowledge and experience O
c. To develop loyal employees
d. To increase existing employees moral
Which one of the following is not the negative result of inadequate control of
inventories?
O a. The low sales volume
Ob. Customers dissatisfaction
Oc. Low inventory cost
Od. Production bottlenecks
Which type of data can be gathered by interview technique?
O a Published data
O b. Secondary data
Oc. Tertiary data
O d. Primary data
Which one is not among the reasons why many people engaged in conducting
research regardless of its difficulties?
O a. To be respected and promoted
Ob. Government direction
Oc. To get degree with its consequential benefit
Od. Employment condition
ABC Company decides to have seating chairs. To acquire these seating cheers the
company has two options. One option is making at home and the other option is
to purchase from the market. To make at home, company must require machines
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

that costs 40000 birr. The seating chairs are current purchased at bir 300 birr. If
the company decide to make at home labor, materials and overhead, cost
estimated at 200 birr per chair. Annual demand is estimated as 1000 units. Then,
what is the breakeven volume where it becomes profitable to produce them
rather than to buy from a supplier?
O a. 600 chairs
O b. 500 chairs
O c. 400 chairs
O d. 300 chairs
According to UNIDO'S project cycle, in which stage/phase is detail consultation
and engineering work required?
Oa. Feasibility study
O b. Operating phases
Oc. Investment phases
Od. Appraisal report phases
The marketing philosophy that consumers will favor products those are available
and highly affordable in market
is
O a. Societal concept
Ob. Marketing concept O
c. Product concept
Od. Production concept
Among random sampling techniques, which method is commonly used by data
collectors in production processes, business surveys, and for selecting items from
files?
O a. Cluster sampling
Ob. Stratified sampling
O c. Simple random sampling
Od. Systematic sampling
Which one of the following describes the component of business mission which
deals with where does the firm compete?
O a. Philosophy
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

O b. Technology
Oc. Customers
Od Product
The marketing mix which marketing managers need to investigate awareness from
customer's side is
O a. Promotion
Ob Place
Oc Price
Od Product
Which one is not among the primary criteria of supplier evaluations?
O a. Quality
O b. Cost/price
Oc. Delivery
Od. Quantity
Which one of the following is not favorable condition to increase productivity of
particular organization?
O a less motivated workforce
Ob. Improved labor force
Oc. Better Management
Od Technological advancement
Which one of the following is not among assumptions of LPM?
Oa. Linearity
Ob. Certainty
Oc. Continuity Od. Uncertainty
is on the job training method, by which human resources manager focuses on
listing each job's basic tasks, along with key points, in order to provide systematic
training for employees.
O a. Job rotation
Ob. Special projects
O c. Job instruction
Od. Internship
Unwelcomed behavior of a sexual nature perpetrated upon one individual by
another is
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

O a. Discrimination
O b. Grievance
Oc Harassment
Od. Bribery
Which one of the following best describes abstract form representation of linear
programming problems?
O a. Statistical model
O b. Linear programming model
Oc Linear function model
Od. Mathematical model
From the data below, what is the mean class for the statistical distributions table?
Class Mark 1-5 6-10 11-15 16-20 Frequency 4312
O a 3rd class
O b. 1st class
Oc 4th class
Od. 2nd class
From the following statements, which one is not favorable condition for
centralized purchasing approach?
O a. Is more appropriate if technical aspect is not required
Ob. Is more appropriate if knowledge is not important
Oc is more appropriate for large organization in terms of size
Od. Is more appropriate for small organization in terms of size
Among product development cycle, the stage by which product will offer for the
market is
Oa. Market testing
O b. Concept development
O c. Idea development
Od. Commercialization
Which of the following ratio indicate the degree to which assets of the firms
employed efficiently?
O a. Liquidity ratio
Ob. Debt management ratio
O c. Profitability ratio
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Od. Activity ratio

Which one of the following is a set of moral principles that distinguish what is
right from what is wrong?
O a Legal
Ob. Ethics
Oc. Principle
Od. Rules
The result of Environmental Analysis indicates that projects are promising and for
further work to be justified. The next step will be.
O a Pre-feasibility study
Ob. Feasibility study
Oc. Preliminary screening
Od. Identification
Which of the following clearly states the reasons why individuals separated from
the organization or employer?
O a. Privileges
Ob. Retirement
Oc. Layoffs
O d. Discharge
Among the different type of leverage ratios, which one measure the earning
power of a firm with respect to given level of sales, total assets, and owner's
equity?
O a. Return on investment Ob. Fixed charges coverage O c. Profitability ratio Od.
Return on Asset
Which one of the following ethical theory focuses on and view duties as it have a
good or bad morality regardless of the outcomes they produce?
a. Teleological theory
Ob. Deontological theory
Oc. Egoism theory
Od. Relativism theory
Which staffing function is difficult task for human resource manager in the
condition of high unemployment rate?
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

O a. Orientation
O b. Selection
Oc Procurement
Od. Training
Which one of the following comes first in the business purchasing process?
O a. Key sourcing
Ob. Need recognition
Oc. Providing requisition
O d. Supplier selection
Finance function involves
O a. Procurement of finance only
O b. Procurement and effective utilization of fiancé
c. Expenditure of funds only
O d. Safe custody of funds only
Based on World Bank classification of project life cycle, after promising project
ideas has been selected and pre- feasibility study completed; the next step will be
critically reviewing different aspects of the project. From this, which one is among
the different aspect of the project priority area of World Bank?
O a. Commercial aspect
Ob. Technical aspect
Oc. Environmental aspect Od. Financial aspect
Which one of the following is not the reason for small business success?
O a Managerial incompetency
O b. Adequate Credit Assistance Oc. Conducive Environment
Od. Markets and Marketing Support
When product and service design are in every functional area of an organization.
Mainly which functional area involved more?
O a. Marketing and finance
O b. Marketing and purchasing
Oc. Finance and purchasing
Od. Operation and finance
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Comprehensive business mission is significant for all of the following except

O a. Enduring statement of purpose
Ob. Effective establishing of objectives
Oc Declares the firm's reason for being
Od. Encourage potential competitors
Among the basic goals of financial management, which one can be considered as
modern approach?
O a. Maximization of profits
O b. Current revenue Maximization
Oc. Ensuring financial discipline in the organization
Od. Maximization of shareholders' wealth
During project screening phase, project ideas are accepted if
O a. the project idea must be compatible with promoter interest
O b. project goal is inconsistent with national goals and priorities
Oc. the current size of the market must offer the prospect of inadequate sales
volume
O d. capital requirements of the project is beyond manageable limits
A report prepared in a prescribed form and presented according to an established
procedure is termed
as
O a. Informal report
O b. Statutory report
Oc General report
Od. Formal report
Among the following data, which one cannot be considered as statistics?
O a. The percentage of undergraduates attending AAU
Ob. The number of death due to HIV AIDS
Oc. Student's attitude toward cost sharing
Od. The number of car accidents occurred
Competitive advantage is anything that can advance a certain business
organization has over their competitors. Which one is, rarely considered as
competitive advantage?
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

O a New product & technology

O b. Suitable location
Oc. Managerial skill
O d. Knowledge
Why do you think that the message sent is not always the same as the meaning
attached to the message?
Oa. Wrong sender
O b. Wrong medium.
Oc Faulty message
Od. Inaccurate decoding
In which of the following cost leadership strategy will be effective?
O a. Buyers have insignificant bargaining power
Ob. Switching cost for buyer high
Oc Few number of buyers in the market
Od. Market place is dominated by price competition
The source of power which authorizes managers from occupying certain
managerial position in the organizational hierarchy and direct resources toward
the achievements of common goal is
O a. Legitimate
O b. Reward
Oc Expert
Od. Coercive
Which one of the following is categorized in dilemmas of business ethics?
O a. Transparency
O b. Accountability
Oc. Profanity
Od. Optimization
For effective inventory control, decision has made that which inventory items are
little things and which need more careful control. From ABC inventory class, which
inventory item, needs tight control?
O a. B items
O b. A items
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

O c. Citems
O d. A&B items
Which of the following condition is not expected for the existence of research
problem?
O a. Existence of difficulty facing organizations
Ob. Environments pertaining difficulty
Oc. Existence of difficulty facing individuals
Od. Realized objectives of organizations

The component of marketing concept which describes desires of specific satisfiers

of needs is
O
a Product
O b. Need
Oc Demand
Od. Want
A formal document that presents the research objectives, design of achieving
these objectives, and the expected outcomes/deliverables of the study is called
O a. Research report
Ob Research hypothesis
Oc Research proposal
Od Research design
The most recommended strategy for business firms internally weak and facing full
threat firm external environment will be
O a concentric strategy
Ob. vertical integration strategy
Oc. retrenchment strategy
Od growth strategy
Among the beneficiaries of entrepreneurial wealth, which one contribute for
physical and mental labor?
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

O a. Employees
O b. Government
Oc. Supplies
Od. Society
Which of the following is not among problem identification process in research
work?
O a. Review of existing literature
Ob. Management decision making
Oc Theoretical foundation and model building
Od. Discussion with subject experts
Which one of the following variable is considered as leaving variable in solving LPP
when simplex approach employed?
O a The variable with a value in quantity column
Ob. The with minimum positive RR value
Oc. The variable with maximum positive value in C-Z row
Od. The variable with s value in C-Z row

Identify the correctly sequenced market segmentation from general to specific.

a. Mass marketing_ Micro market_ Niche marketing- Segment marketing
b. Mass marketing--- Segment marketing-- Niche marketing--Micro marketing
Oc Mass marketing--- Niche marketing-- Segment marketing-- Micro marketing
O d. Mass marketing--- Segment marketing-- Niche marketing--Micro marketing
All are attributes of standardization in business world except
O a. Increase quality
O b. Allow customization
O c. Enable mass production
O d. Increase inventories
The strategic management approach which gives great weight for internal capacity
of the organization in strategy formulation and implementation is
O a Resource based
Ob. Industrial based
Oc. Competition based
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Od. Organizational based

Which one of the following can be considered as the dominant reason for small
business failures in Ethiopia?
O a. High level of taxation
O b. Lack of adequate finance and credit
Oc Low commitment
Od. Low demand
The director of the PHD program at Addis Ababa University has 16 applications for
admission. The composite scores of the applicants out of 40 mark are: 15 32 26 27
29 27 25 25 29 30 31 32 34 35 32 32 16 29 25 29 32 10 27 32 30 31 32 33 32 33 34
33 Then, how many classes would you recommend for above statistical
distributions?
O a. 6 classes
Ob. 3 classes
Oc 5 classes
O d. 4 classes

Which adjusting capacity strategies are appropriate when demand exceeds

expectations for the final products?
O a. Subcontracting strategy
Ob. Chase demand strategy
Oc. Subcontracting strategy
Od. Level Production strategy
Among the following aspect of a project, all belongs to technology, except
O a. Access to technical know
Ob Building a new plant
Oc Emergence of new technologies
Od. Purchasing power
The flow of information through Management Information System is
O a. Organizational dependent
Ob. Need dependent
Oc. Management dependent
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Od. Information dependent

Which one of the following is not among the types of purchasing?
O a. Hand to mouth purchasing
O b. Forward purchasing
Oc Backward purchasing
Od. Speculative purchasing
The informal type of communication transmitting the message from one individual
to all members to minimize
information distortion is
O a. Single stand chain
Ob. Cluster
Oc Probability chain
Od. Gossip chain

Consider the following transportation problem and if LCM is used to find solution
of the problem, what will be the total transportation cost?
O a.15,750
O b. 14,000
Oc 12,900
O d. 13,900
Managers are expected to play varieties of roles for the wellbeing of their
organization and communities and activity based resource allocation is among
these roles. If so, in which management role you categorize it?
a. Informational role
b. Decisional role
Oc. Monitor role
Od. Interpersonal role
Among statistical data collection process, the stage in which data classification,
arrangement and editing takes place is termed as,
O a. Data Analysis
O b. Data presentation
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Oc. Data organization

Od. Data collection
What are the major competing inventory costs in material management?
Oa. Order and holding costs
O b. production and marketing costs
Oc. Salary and overhead costs
Od. Promotion and distribution costs
One of the following is not among quality assurance contrasted with control in
that purchase assurance includes all the activities associated with the attainment
of quality.
O a. Motivation of all concerned
O b. Design and specification
Oc. Inspection and testing
Od. Assessment of buyers
The dean of the Master's program at St. Mary's University has 16 applications for
admission. The composite scores of the applicants out of 40 marks are: 15 32 26
27 29 27 25 25 29 30 31 32 34 35 32 32 16 29 25 29 32 10 27 32 30 31 32 33 32 33
34 33 Therefore, what is the median class from the above statistical distribution?
a.2nd class
Ob. 3rd class
O c. 4th class
Od. 1st class

Determina on of the number, type and future requirement of personal refers to

O a. Human resource planning
O b. Action Plans
Oc Manpower Inventory
Od. Procurement function
All of the following are decision making techniques in risky situations except
O a. Expected value of Breakeven analysis
O b. Expected value of perfect information Oc. Expected opportunity loss
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Od. Expected monetary value

The skills required by managers to undertake planning process to come up with
goals to be realized with appropriate courses of action is,
O a. Communication skill
O b. Technical skill
Oc Forecasting skill
Od. Interpersonal skill
Which one of the following best describes a summary of educational and
academic backgrounds as well as experience, awards, honors and affiliations of an
individual?
a. History
Ob. Application letter
Oc. Curriculum vitae
Od. Resume

is the linear programming assumption which states that the value assigned to
each parameter of a linear programming model is assumed to be known constant.
Oa. Centrality
O b. Certainty
Oc. Proportionality
Od. Non negativity
Which group of buyers mainly purchases the product for resale?
O a. Governmental Institutions
O b. service manufacturing firms
Oc Governmental agencies
Od Business organization
Which one of the following is not among objectives of Management Information
System?
O a. Support decision making
Ob. Facilitating decision making process
Oc. Recruit people for system
Od. Provide requisite information at any management level
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

The comprehensive managerial system that integrates key managerial activities in

a systematic manner and consciously directed toward the effective and efficient
achievement of organizational and individual objectives
O a. Centralized system
O b. Focus group discussion
O c. Management by objectives
Od. Establishment of objectives
Which one of the following criterion is not effective in market segmentation?
O a. Substantiality
O b. Measurability
Oc Partiality
Od. Action-ability

Which location is suitable for service giving organization?

Oa. Resource
O b. Near terminal
O c. low labor cost
O d. Near to market
All of the following are forms of scientific methods except
O a Functional
Ob Induction
Oc Structural
Od. Comparative
Among the different promotional mix elements, which one can be appropriate if
the goal of the organization is to influence buyers to buy the product?
O a public relation
O b. personal selling
O c. Advisement
Od. sales promotion
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Which one of the following is not considered to evaluate supplier's management

capability?
Oa Labor-management relation practices
Ob. Purchase requisitions
Oc Commitment to total quality
Od. Strategic sourcing
The business strategy affecting the whole units of business operations and
developed by top or general managers of the organization is,
O a corporate level strategy
O b. operational level strategy
Oc global level strategy
O d. business level strategy

Which of the following equate the quantity consumers are willing and able to buy
with the quantity suppliers are willing and able to supply?
O a. Break even analysis
Ob. Market research
Oc. Cost-out put relations
Od Market equilibrium
Mr. Abebe is considering a capital investment for which the initial outlay is
Br100,000: 00 Net annual cash inflows (before taxes) to be predicted to be Br
20,000 for 10 years. Straight-line depreciation used with an estimated salvage
value of zero. By ignoring income taxes how many years it takes to cover initial
investment cost? Computed the payback period.
O a. 10 Years
O b. 5 Years
O c. 9 Years
O d. 8 Years
BUSINESS MANAGEMENT MODEL EXAMINATION WITH ANSWER

Which one of the following is not the nature of programmed decision?

O a. Solutions are predictable
Ob. Standard procedures
Oc. Routine activities
Od. Unstructured procedures
Which one of the following is not the option that operation manager use to make
productivity ratio large?
O a. Make the output larger for the same input
O b. Increase input and output with the proportion
Oc. Increase the output while decreasing the input
d. Make the inputs smaller for the same output
Consider a manufacturer that has a fixed cost of Birr 100,000 and a variable cost
of Birr 30 per unit made and sold
at selling price of Birr 50 per unit. Then, what is the manufacturer profit if 4000
items produced and sold?
O a 200,000
Ob. -20,000
O c 220,000
Od. -50,000