PRACTICE QUESTION BANK
COMPLETE COVERAGE OF ALL COURSE TOPICS WITH
DETAILED RATIONALES
1. What is the primary purpose of performance management?
A) To discipline underperforming employees
B) To ensure employees' activities and outputs contribute to
organizational goals
C) To determine annual bonuses
D) To create job descriptions
Correct Answer: B
Rationale: Performance management is defined as the process through
which managers ensure that employees' activities and outputs
contribute to the organization's goals, serving strategic, administrative,
and developmental purposes.
2. Which of the following is NOT one of the three broad purposes of
performance management?
A) Strategic
B) Administrative
,C) Financial
D) Developmental
Correct Answer: C
Rationale: The three broad purposes of performance management are
strategic (helping achieve business objectives), administrative
(providing info for day-to-day decisions), and developmental (basis for
developing employee knowledge and skills).
3. In the performance management process, what is the first step?
A) Evaluate performance
B) Provide support and ongoing performance discussions
C) Define performance outcomes for company division and department
D) Identify improvements needed
Correct Answer: C
Rationale: The performance management process begins with defining
performance outcomes for the company, division, and department,
followed by developing employee goals, providing support, evaluating
performance, identifying improvements, and providing consequences.
4. How does the traditional performance management model differ
from the modern approach?
A) Traditional model has more frequent feedback
B) Traditional model uses fewer goals that may be vague
C) Traditional model emphasizes employee development
D) Traditional model includes 360-degree feedback
,Correct Answer: B
Rationale: The traditional model typically has few goals that may be
vague, relies on job descriptions, provides little feedback from
supervisors, and uses annual appraisals, unlike modern approaches with
ongoing feedback.
5. Which type of performance measure involves written accounts of
performance?
A) Graphic rating scales
B) Behavior checklists
C) Essays
D) Critical incidents
Correct Answer: C
Rationale: Essays are written accounts of employee performance,
providing narrative descriptions rather than numerical ratings.
6. What is a critical incident in performance measurement?
A) A major company crisis
B) A written account of something excellent and something that didn't
go well
C) A mandatory training event
D) An annual performance review meeting
Correct Answer: B
Rationale: Critical incidents involve documenting specific examples of
excellent performance and areas needing improvement, providing
concrete behavioral evidence.
, 7. Which comparative performance evaluation method ranks
employees from highest to lowest performer?
A) Forced distribution
B) Paired comparison
C) Simple ranking
D) Alternating ranking
Correct Answer: C
Rationale: Simple ranking requires managers to rank employees in their
group from the highest performer to the poorest performer, though it
doesn't define what specifically is good or bad.
8. What is a disadvantage of the forced distribution method?
A) It is too specific
B) It assumes employee performance is normally distributed
C) It encourages too much teamwork
D) It is always popular with employees
Correct Answer: B
Rationale: Forced distribution assumes performance follows a normal
distribution, which may not be accurate if an organization has mostly
top performers. It can also discourage teamwork and increase
competition.
9. Which method lists traits and provides a rating scale for each?
A) BARS
B) MBO