Human Resource Management (HRM) Practice Q&A Exam
Resource
For Business Management Students
Date: June 10, 2025
Instructions
This practice Q&A resource prepares Business Management students for HRM final ex-
ams, covering recruitment, training and development, performance management, com-
pensation, employee relations, strategic HRM, diversity, globalization, HR technology,
and ESG initiatives. It includes three sections: Multiple-Choice Questions (MCQs),
Short-Answer Questions, and Essay Questions. Answer all questions in the provided an-
swer booklet. Total marks: 100. Time allowed: 3 hours. Calculators are not permitted.
Answers should be clear, concise, and include business-relevant examples where required.
1 Multiple-Choice Questions (44 marks)
Each question is worth 2 marks. Choose the correct option and provide a brief justification
in the answer booklet.
1. What is the primary role of HRM in a business organization?
a) Maximize employee turnover
b) Align human resources with business strategy
c) Focus solely on administrative tasks
d) Eliminate training initiatives
Answer: b) Align human resources with business strategy
Justification: HRM integrates employee management with business goals to drive
organizational success.
2. How does HRM differ from Personnel Management in a business context?
a) HRM is task-oriented, while Personnel Management is strategic
b) HRM focuses on strategic employee development, while Personnel Management
is administrative
c) HRM only handles payroll, while Personnel Management focuses on training
d) There is no difference between the two
Answer: b) HRM focuses on strategic employee development, while Personnel Man-
agement is administrative
Justification: HRM aligns with business strategy, emphasizing growth, while Per-
sonnel Management handles routine tasks.
3. What is the initial step in the recruitment process for a business?
a) Conducting interviews
b) Identifying staffing needs
c) Advertising vacancies
d) Onboarding new hires
Answer: b) Identifying staffing needs
Justification: Recruitment starts by assessing business needs to align with strategic
1
, objectives.
4. Which tool supports Human Resource Planning (HRP) in forecasting workforce
needs?
a) SWOT Analysis
b) Markov Analysis
c) PESTLE Analysis
d) Balanced Scorecard
Answer: b) Markov Analysis
Justification: Markov Analysis predicts workforce transitions (e.g., promotions,
turnover) to support business planning.
5. What characterizes training in a business setting?
a) Long-term career growth
b) Short-term skill enhancement for current roles
c) Strategic workforce forecasting
d) Employee retention planning
Answer: b) Short-term skill enhancement for current roles
Justification: Training improves immediate job performance, unlike development,
which prepares for future roles.
6. What is a challenge of individual performance-related pay (IPRP) in businesses?
a) Encourages teamwork
b) May lead to biased appraisals
c) Simplifies performance evaluation
d) Increases employee retention
Answer: b) May lead to biased appraisals
Justification: Subjective evaluations in IPRP can result in unfair rewards, impact-
ing morale.
7. Employee Involvement and Participation (EIP) in a business primarily enhances:
a) Payroll accuracy
b) Organizational innovation
c) Recruitment costs
d) Legal compliance
Answer: b) Organizational innovation
Justification: EIP fosters employee ideas, driving business innovation and compet-
itiveness.
8. Which of the following is an ethical issue in business HRM?
a) Offering competitive salaries
b) Discrimination in hiring practices
c) Providing training programs
d) Conducting performance appraisals
Answer: b) Discrimination in hiring practices
Justification: Unfair hiring violates ethical and legal standards, harming business
reputation.
9. How does globalization impact HRM in multinational businesses?
a) Reduces workforce diversity needs
b) Increases complexity in managing diverse workforces
2
Resource
For Business Management Students
Date: June 10, 2025
Instructions
This practice Q&A resource prepares Business Management students for HRM final ex-
ams, covering recruitment, training and development, performance management, com-
pensation, employee relations, strategic HRM, diversity, globalization, HR technology,
and ESG initiatives. It includes three sections: Multiple-Choice Questions (MCQs),
Short-Answer Questions, and Essay Questions. Answer all questions in the provided an-
swer booklet. Total marks: 100. Time allowed: 3 hours. Calculators are not permitted.
Answers should be clear, concise, and include business-relevant examples where required.
1 Multiple-Choice Questions (44 marks)
Each question is worth 2 marks. Choose the correct option and provide a brief justification
in the answer booklet.
1. What is the primary role of HRM in a business organization?
a) Maximize employee turnover
b) Align human resources with business strategy
c) Focus solely on administrative tasks
d) Eliminate training initiatives
Answer: b) Align human resources with business strategy
Justification: HRM integrates employee management with business goals to drive
organizational success.
2. How does HRM differ from Personnel Management in a business context?
a) HRM is task-oriented, while Personnel Management is strategic
b) HRM focuses on strategic employee development, while Personnel Management
is administrative
c) HRM only handles payroll, while Personnel Management focuses on training
d) There is no difference between the two
Answer: b) HRM focuses on strategic employee development, while Personnel Man-
agement is administrative
Justification: HRM aligns with business strategy, emphasizing growth, while Per-
sonnel Management handles routine tasks.
3. What is the initial step in the recruitment process for a business?
a) Conducting interviews
b) Identifying staffing needs
c) Advertising vacancies
d) Onboarding new hires
Answer: b) Identifying staffing needs
Justification: Recruitment starts by assessing business needs to align with strategic
1
, objectives.
4. Which tool supports Human Resource Planning (HRP) in forecasting workforce
needs?
a) SWOT Analysis
b) Markov Analysis
c) PESTLE Analysis
d) Balanced Scorecard
Answer: b) Markov Analysis
Justification: Markov Analysis predicts workforce transitions (e.g., promotions,
turnover) to support business planning.
5. What characterizes training in a business setting?
a) Long-term career growth
b) Short-term skill enhancement for current roles
c) Strategic workforce forecasting
d) Employee retention planning
Answer: b) Short-term skill enhancement for current roles
Justification: Training improves immediate job performance, unlike development,
which prepares for future roles.
6. What is a challenge of individual performance-related pay (IPRP) in businesses?
a) Encourages teamwork
b) May lead to biased appraisals
c) Simplifies performance evaluation
d) Increases employee retention
Answer: b) May lead to biased appraisals
Justification: Subjective evaluations in IPRP can result in unfair rewards, impact-
ing morale.
7. Employee Involvement and Participation (EIP) in a business primarily enhances:
a) Payroll accuracy
b) Organizational innovation
c) Recruitment costs
d) Legal compliance
Answer: b) Organizational innovation
Justification: EIP fosters employee ideas, driving business innovation and compet-
itiveness.
8. Which of the following is an ethical issue in business HRM?
a) Offering competitive salaries
b) Discrimination in hiring practices
c) Providing training programs
d) Conducting performance appraisals
Answer: b) Discrimination in hiring practices
Justification: Unfair hiring violates ethical and legal standards, harming business
reputation.
9. How does globalization impact HRM in multinational businesses?
a) Reduces workforce diversity needs
b) Increases complexity in managing diverse workforces
2
