MBA 701 Module 4 Self Assessment | Questions and Answers |
2026 Update | 100% Correct - LSUS. - 203 Questions
This exam assesses deep conceptual understanding of management functions and roles, including planning,
organizing, leading, controlling, and managerial roles as per Mintzberg's framework. Questions require synthesis
of theoretical models and application to complex organizational scenarios. It contains 203 multiple-choice
questions, each with four distractors and a fully worked rationale that explains why the keyed answer is correct.
Content is organized into 10 focused sections: Management Functions and Roles, Decision Making and Problem
Solving, Organizational Structure and Design, Leadership Theories and Styles, Motivation and Performance,
Communication and Interpersonal Skills, Control Processes and Systems, Ethical Decision Making and Corporate
Social Responsibility, Globalization and Cross-Cultural Management, Innovation and Change Management.
Targeted learning outcomes include: Analyze the interplay between managerial roles and organizational
effectiveness.; Evaluate decision-making models in uncertain environments.; Critique leadership styles in
cross-functional teams.; Apply control systems to balance autonomy and accountability.. Every item has been
reviewed for clinical accuracy, current guidelines, and clarity so that students can study with confidence and
self-correct as they work through the bank. Use it as a high-yield review immediately before the exam, or as a
structured practice tool during the unit - the rationales double as concise teaching notes. The recommended
writing time is 2 hours, with a passing score of 70%. Aligned with American Assembly of Collegiate Schools of
Section 1: Management Functions and Roles (Questions 1-23)
1 A manager reallocates marketing funds to R&D after a competitor's
breakthrough, while maintaining current production schedules. Which
Mintzberg role is primary?
A) Resource allocator
B) Entrepreneur
C) Disturbance handler
D) Negotiator
Answer: A
Rationale: Resource allocator involves deciding who gets what resources. The
manager is shifting funds, not initiating a new project (entrepreneur) or
reacting to a crisis (disturbance handler).
2 In a matrix organization, a project manager has authority over project work
but not over team members' promotions. This violates which Fayol
principle?
A) Unity of command
B) Scalar chain
C) Division of work
D) Remuneration
,Answer: A
Rationale: Unity of command states each employee should receive orders from
only one superior. In a matrix, employees have two bosses (functional and
project), violating this principle.
3 A CEO uses real options analysis to delay a factory expansion until market
uncertainty resolves. This approach best exemplifies which management
function?
A) Planning
B) Organizing
C) Leading
D) Controlling
Answer: A
Rationale: Planning involves setting objectives and determining courses of
action. Real options analysis is a strategic planning tool for decisions under
uncertainty, not organizing, leading, or controlling.
4 A team leader adjusts communication style-directive with novices,
participative with experts. This behavior aligns with which leadership
model?
A) Situational leadership
B) Transformational leadership
C) Servant leadership
D) Trait theory
Answer: A
Rationale: Situational leadership (Hersey-Blanchard) posits leaders adapt style
based on follower readiness. Directive for low readiness, participative for high
readiness matches the scenario.
5 A multinational corporation uses transfer pricing to minimize tax liability,
affecting divisional performance metrics. This activity falls under which
controlling function subtype?
A) Feedforward control
B) Concurrent control
C) Feedback control
D) Bureaucratic control
,Answer: C
Rationale: Feedback control uses after-the-fact information to adjust operations.
Transfer pricing affects reported profits, which are used for performance
evaluation and corrective actions.
6 In a non-profit, a manager securing funding from donors while coordinating
volunteers and reporting to a board exemplifies which set of Mintzberg
roles?
A) Interpersonal and informational
B) Informational and decisional
C) Decisional and interpersonal
D) Interpersonal, informational, and decisional
Answer: D
Rationale: Securing funding (decisional: negotiator), coordinating volunteers
(interpersonal: leader), reporting to board (informational: spokesperson)
requires all three role categories.
7 A manager implements a balanced scorecard with customer satisfaction,
internal processes, learning/growth, and financial metrics. Which planning
approach underpins this?
A) Strategic planning with multiple perspectives
B) Operational planning with efficiency focus
C) Contingency planning for crises
D) Tactical planning for short-term goals
Answer: A
Rationale: Balanced scorecard translates vision into strategy across four
perspectives, representing strategic planning. It goes beyond financials to
include customer, internal, and learning/growth.
8 During a merger, two departments resist integration due to differing cultures.
The CEO personally mediates conflicts and articulates a shared vision.
Which role dominates?
A) Leader
B) Liaison
C) Disturbance handler
D) Spokesperson
, Answer: A
Rationale: Leader role involves motivating and guiding subordinates. The
CEO's mediation and vision articulation directly influence people, overriding
liaison (external contacts) or disturbance handler (crisis response).
9 A company uses self-managing teams with rotating leadership and collective
decision-making. This organizational design conflicts most directly with
which classical management concept?
A) Chain of command
B) Division of labor
C) Standardization
D) Span of control
Answer: A
Rationale: Chain of command refers to a clear hierarchy of authority.
Self-managing teams flatten hierarchy and diffuse authority, undermining the
formal chain of command.
10 A manager sets a target of 10% cost reduction but allows teams to choose
methods. After six months, actual reduction is 8%. The manager
investigates variance. This sequence exemplifies:
A) Planning -> Organizing -> Controlling
B) Organizing -> Leading -> Controlling
C) Planning -> Leading -> Controlling
D) Controlling -> Planning -> Organizing
Answer: C
Rationale: Setting target is planning; allowing autonomy is leading
(empowering); investigating variance is controlling. Organizing is not directly
involved in the sequence described.
11 In a multinational corporation, the CEO decides to decentralize operational
decisions to regional managers to enhance responsiveness, while retaining
strategic decisions at headquarters. Which management function is most
directly being redefined by this action?
A) Planning
B) Organizing
C) Leading
2026 Update | 100% Correct - LSUS. - 203 Questions
This exam assesses deep conceptual understanding of management functions and roles, including planning,
organizing, leading, controlling, and managerial roles as per Mintzberg's framework. Questions require synthesis
of theoretical models and application to complex organizational scenarios. It contains 203 multiple-choice
questions, each with four distractors and a fully worked rationale that explains why the keyed answer is correct.
Content is organized into 10 focused sections: Management Functions and Roles, Decision Making and Problem
Solving, Organizational Structure and Design, Leadership Theories and Styles, Motivation and Performance,
Communication and Interpersonal Skills, Control Processes and Systems, Ethical Decision Making and Corporate
Social Responsibility, Globalization and Cross-Cultural Management, Innovation and Change Management.
Targeted learning outcomes include: Analyze the interplay between managerial roles and organizational
effectiveness.; Evaluate decision-making models in uncertain environments.; Critique leadership styles in
cross-functional teams.; Apply control systems to balance autonomy and accountability.. Every item has been
reviewed for clinical accuracy, current guidelines, and clarity so that students can study with confidence and
self-correct as they work through the bank. Use it as a high-yield review immediately before the exam, or as a
structured practice tool during the unit - the rationales double as concise teaching notes. The recommended
writing time is 2 hours, with a passing score of 70%. Aligned with American Assembly of Collegiate Schools of
Section 1: Management Functions and Roles (Questions 1-23)
1 A manager reallocates marketing funds to R&D after a competitor's
breakthrough, while maintaining current production schedules. Which
Mintzberg role is primary?
A) Resource allocator
B) Entrepreneur
C) Disturbance handler
D) Negotiator
Answer: A
Rationale: Resource allocator involves deciding who gets what resources. The
manager is shifting funds, not initiating a new project (entrepreneur) or
reacting to a crisis (disturbance handler).
2 In a matrix organization, a project manager has authority over project work
but not over team members' promotions. This violates which Fayol
principle?
A) Unity of command
B) Scalar chain
C) Division of work
D) Remuneration
,Answer: A
Rationale: Unity of command states each employee should receive orders from
only one superior. In a matrix, employees have two bosses (functional and
project), violating this principle.
3 A CEO uses real options analysis to delay a factory expansion until market
uncertainty resolves. This approach best exemplifies which management
function?
A) Planning
B) Organizing
C) Leading
D) Controlling
Answer: A
Rationale: Planning involves setting objectives and determining courses of
action. Real options analysis is a strategic planning tool for decisions under
uncertainty, not organizing, leading, or controlling.
4 A team leader adjusts communication style-directive with novices,
participative with experts. This behavior aligns with which leadership
model?
A) Situational leadership
B) Transformational leadership
C) Servant leadership
D) Trait theory
Answer: A
Rationale: Situational leadership (Hersey-Blanchard) posits leaders adapt style
based on follower readiness. Directive for low readiness, participative for high
readiness matches the scenario.
5 A multinational corporation uses transfer pricing to minimize tax liability,
affecting divisional performance metrics. This activity falls under which
controlling function subtype?
A) Feedforward control
B) Concurrent control
C) Feedback control
D) Bureaucratic control
,Answer: C
Rationale: Feedback control uses after-the-fact information to adjust operations.
Transfer pricing affects reported profits, which are used for performance
evaluation and corrective actions.
6 In a non-profit, a manager securing funding from donors while coordinating
volunteers and reporting to a board exemplifies which set of Mintzberg
roles?
A) Interpersonal and informational
B) Informational and decisional
C) Decisional and interpersonal
D) Interpersonal, informational, and decisional
Answer: D
Rationale: Securing funding (decisional: negotiator), coordinating volunteers
(interpersonal: leader), reporting to board (informational: spokesperson)
requires all three role categories.
7 A manager implements a balanced scorecard with customer satisfaction,
internal processes, learning/growth, and financial metrics. Which planning
approach underpins this?
A) Strategic planning with multiple perspectives
B) Operational planning with efficiency focus
C) Contingency planning for crises
D) Tactical planning for short-term goals
Answer: A
Rationale: Balanced scorecard translates vision into strategy across four
perspectives, representing strategic planning. It goes beyond financials to
include customer, internal, and learning/growth.
8 During a merger, two departments resist integration due to differing cultures.
The CEO personally mediates conflicts and articulates a shared vision.
Which role dominates?
A) Leader
B) Liaison
C) Disturbance handler
D) Spokesperson
, Answer: A
Rationale: Leader role involves motivating and guiding subordinates. The
CEO's mediation and vision articulation directly influence people, overriding
liaison (external contacts) or disturbance handler (crisis response).
9 A company uses self-managing teams with rotating leadership and collective
decision-making. This organizational design conflicts most directly with
which classical management concept?
A) Chain of command
B) Division of labor
C) Standardization
D) Span of control
Answer: A
Rationale: Chain of command refers to a clear hierarchy of authority.
Self-managing teams flatten hierarchy and diffuse authority, undermining the
formal chain of command.
10 A manager sets a target of 10% cost reduction but allows teams to choose
methods. After six months, actual reduction is 8%. The manager
investigates variance. This sequence exemplifies:
A) Planning -> Organizing -> Controlling
B) Organizing -> Leading -> Controlling
C) Planning -> Leading -> Controlling
D) Controlling -> Planning -> Organizing
Answer: C
Rationale: Setting target is planning; allowing autonomy is leading
(empowering); investigating variance is controlling. Organizing is not directly
involved in the sequence described.
11 In a multinational corporation, the CEO decides to decentralize operational
decisions to regional managers to enhance responsiveness, while retaining
strategic decisions at headquarters. Which management function is most
directly being redefined by this action?
A) Planning
B) Organizing
C) Leading
