Chapter 07 - Management and Leadership

TEST PLANNING TABLE FOR CHAPTER 7

Learning Objective

1. Describe the
changes occurring today
in the management
function.

2. Describe the four
functions of
management.

3. Relate the planning
process and decision
making to the
accomplishment of
company goals.

4. Describe the
organizing function of
management.

5. Explain the
differences between
leaders and managers,
and describe the various
leadership styles.

6. Summarize the five
steps of the control
function of management.

LL:1
Knows Basic
Terms and Facts

LL:2
Understands
Concepts and
Principles

LL:3
Applies Principles

1,2,3,4,5,6,7,8,
156,157,158

9,10,11,
159,160

12,13,
161

14,15,16,17,18,19,20,21,
22,23,
162,163,164,165,166,167,
168


24,25,
169,170,171,172,173,
174

26,27,28,29,
175,176,
275

30,31,32,33,34,35,36,37,
38,39,40,41,42,43,44,45,
46,47,48,49,50,51,52,53,
54,55,56,57,58,59,60,61,
62,63,
177,178,179,180,181,182,
183,184,185,186,187,188,
189,190,191,192,193,194,
195,196

64,65,66,67,68,69,
197,198,199,200,201

70,71,72,
202,203,204,205,206,
207,208,209,210,
276,277,
285*

73,74,75,76,77,78,79,80,
81,82,83,84,85,86,87,88,
89,90,91,92,

211,212,213,214,215,216,
217,218,219,220,221,222,
223,224

93,94,95,96,97,98~,
225,226,227

99,100,101,102,103,
228,229,230,231,232,
233,234,
279,
285*

104,105,106,107,108,109,
110,111,112,113,114,115,
116,117,118,119,120,121,
122,123,124,125,126,127,
128,129,
235,236,237,238,239,240,
241,242,243,244,245

130,131~,
246,247,248,249,250,
251~

132,133,134,135,136,
137,138,139,
252,253,254,255,256,
257,258,259,260,
278,280,

281*,282*

140,141,142,143,144,145,
146,147,148,149,150,151,
261,262,263,264,265

152,
266,267,268

153,154,155,
269,270,271,272,273,2
74,
284*

Total number of test items: 285
True/false questions are in plain text.
Multiple choice questions are in bold text.
Questions on boxed material are in bold text with a tilde~.
Essay questions are in bold underlined text.
Minicase questions are in bold with an asterisk*.

Chapter 07
7-1


Chapter 07 - Management and Leadership

Management and Leadership Answer Key

True / False Questions


1. The main job of managers today is to watch over people to be sure they do what the
manager asks of them.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

2. The best way to get people to do what a manager wants is for the manager to reprimand
those who don't do things correctly.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

3. Managers in progressive firms of all kinds tend to be friendly, and treat employees as
partners.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

4. Managers must earn the trust of their employees.
Answer: True

AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

5. Because of their importance and skills, few managers lost their jobs in the recent
economic crisis.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember

7-2


Chapter 07 - Management and Leadership
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

6. A modern manager's main job is to issue orders, then follow up to make sure employees
do as they were told.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

7. Managers in progressive organizations tend to emphasize teamwork and cooperation

rather than discipline and giving orders.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

8. Despite all of the changes in the business environment, the basic way a manager performs
his or her job has remained remarkably constant.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 1 Easy
Topic: Definition of Management

9. Given the lack of discipline and short attention spans of today's workers, modern
managers must watch their workers closely, set strict rules, and vigorously enforce
policies.
Feedback: Today's managers emphasize teamwork and cooperation rather than discipline and
order giving. Managers now guide, train, support, motivate and coach employees.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 2 Medium
Topic: Definition of Management

7-3



Chapter 07 - Management and Leadership

10. In most high-tech industries, the best way to respond quickly to rapid technological
changes is to keep most authority and responsibility in the hands of a few key managers
who provide precise, detailed directions to the workers.
Feedback: Managers of high-tech firms realize that workers often know much more about
technology than they do. Thus, most progressive managers emphasize teamwork and
cooperation rather than discipline and order giving.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 2 Medium
Topic: Definition of Management

11. Due to the fact that employees today often know much more about technology and the
technical aspects of their jobs than their managers do, progressive managers emphasize
teamwork and cooperation as a strategy for getting work done.
Feedback: Managers of high-tech firms realize that workers often know much more about
technology than they do. Thus, most modern managers emphasize teamwork and cooperation
rather than discipline and order giving.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 2 Medium
Topic: Definition of Management


12. John is the general manager of a retail outlet. By emphasizing teamwork and acting in a
role of coach rather than boss, John is considered to be a modern manager.
Feedback: Most modern managers tend to be more progressive. They choose to guide and
support their employees instead of giving orders.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 3 Hard
Topic: Definition of Management

7-4


Chapter 07 - Management and Leadership

13. As an office manager, Sylvie consistently tells her employees what to do, watches over
their tasks, and reprimands those who don't listen to her orders. Sylvie is a modern
manager.
Feedback: Most modern managers tend to be more progressive. They choose to guide and
support their employees instead of giving orders.
Answer: False
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 3 Hard
Topic: Definition of Management

14. Managers make decisions about how to use organizational resources to accomplish goals.
Answer: True

AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

15. Financing is one of the four key functions of management.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

16. The four key management functions are planning, organizing, leading, and controlling.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

17. One trend of the leading management function is to empower employees, giving them as
much freedom as possible to become self-directed and self-motivated.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management


7-5


Chapter 07 - Management and Leadership

18. Leading is the management function of designing the structure of the organization so that
everyone can function together.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

19. As a management function, the main focus of controlling is to keep complete and up-todate records of the organization's financial transactions for tax and regulatory purposes.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

20. The management function that involves guiding, training, and motivating others to work
toward the achievement of an organization's goals is called leading.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy

Topic: Functions of Management

21. In many smaller firms the manager's role is to direct the employees, telling them exactly
what to do.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

22. Planning is the function of management that includes anticipating future trends and
determining the best strategies and tactics to achieve an organization's goals and
objectives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

7-6


Chapter 07 - Management and Leadership

23. Planning is a key management function because other management functions depend on
having a good plan.
Answer: True
AACSB: Reflective Thinking

Bloom’s: Remember
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

24. Managers focus on making efficient use of their organization's human resources, but leave
decisions about the efficient use of other resources such as buildings, machinery, and
supplies to engineers and accountants.
Feedback: Managers must practice the art of getting things done through organizational
resources including people, financial resources, information and all types of equipment and
assets.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-01 Describe the changes occurring today in the management function
Level of Difficulty: 2 Medium
Topic: Functions of Management

25. Today's progressive organizations are designed around the needs of the customer. The idea
is to organize systems to be responsive to customer needs.
Feedback: Organizing includes designing the structure of the organization and creating
conditions and systems in which everyone and everything work together to achieve the
organization's goals and objectives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 2 Medium
Topic: Functions of Management


26. Beth has spent the last two hours going over some consumer surveys to see how well her
company is achieving its goal of improving customer satisfaction. Beth's efforts are an
example of the controlling function of management.
Feedback: Controlling is the function concerned with determining whether or not an
organization is progressing toward achieving its goals and objectives.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 3 Hard

7-7


Chapter 07 - Management and Leadership
Topic: The Four Functions of Management

27. Jack, a manager with Tiny Tots Toy Company, has just participated in a meeting that
looked at future trends in the toy industry, and identified new challenges and opportunities
for Tiny Tots. Jack's participation in this meeting was part of the organizing function of
management.
Feedback: Jack's activities are part of the planning function. Planning involves anticipating
future trends and identifying business opportunities and challenges.
Answer: False
AACSB: Analytical Thinking
Bloom’s: Analyze
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 3 Hard
Topic: Functions of Management


28. Harold is a no-nonsense boss who believes that the best way for an organization to
achieve its goals is for workers to follow their boss's orders. Thus, he tells workers exactly
what to do and how to do it. Harold's approach is an example of directing.
Feedback: Directing involves telling workers exactly what to do. This approach is still
common among managers in small companies, but managers in larger firms tend to rely more
on leading rather than directing.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 3 Hard
Topic: Functions of Management

29. Rita is a manager of a medium-sized service company. She is currently involved in
redesigning her department to ensure that employees and other resources can respond
more quickly and efficiently to the needs of its customers. Rita's efforts are part of the
organizing function of management.
Feedback: Organizing involves designing the structure of the organization so that resources
can efficiently achieve the organization's objectives. One of the key objectives today is to find
ways to organize businesses so that they please the customer.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-02 Describe the four functions of management
Level of Difficulty: 3 Hard
Topic: Functions of Management

7-8



Chapter 07 - Management and Leadership

30. Planning involves setting the organizational vision, goals and objectives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: Functions of Management

31. Progressive managers consider planning to be of little importance in today's rapidly
changing business environment.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

32. Goals tend to be broad and focus on the long term while objectives tend to be specific and
more short term in their focus.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

33. A vision is a detailed set of specific steps that a firm must take to achieve its short-run
objectives.

Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

34. A statement about why an organization exists and what it is trying to achieve is called the
organization's directive.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

7-9


Chapter 07 - Management and Leadership

35. A vision is the overall explanation of why an organization exists and where it is trying to
head.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning


36. A vision gives the organization a sense of purpose and a set of values that unite employees
toward a common destiny.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

37. A mission statement outlines the fundamental purposes of an organization.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

38. Today, a mission statement should also address social responsibility.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

39. Goals are broad, long-term accomplishments an organization wants to achieve.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals

Level of Difficulty: 1 Easy
Topic: The Importance of Planning

40. While goals are measurable, objectives are not.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals

7-10


Chapter 07 - Management and Leadership
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

41. Goals are developed and agreed to by management so that the workers can follow them.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

42. Objectives should be expressed as broad, general principles rather than as specific shortterm results.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy

Topic: The Importance of Planning

43. Continuous planning is not necessary, because plans that worked well in the past are likely
to continue to work well in the future.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

44. Planning is a continuous process.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

45. The SWOT analysis helps firms identify competitive threats and market opportunities.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

7-11



Chapter 07 - Management and Leadership

46. An analysis of the business environment helps managers identify threats and opportunities
that face their firm.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

47. Strategic planning is now much easier than it used to be because managers have access to
very reliable computerized forecasting tools.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

48. Tactical planning deals with setting long-range goals, while strategic planning develops
the specific strategies needed to achieve the organization's operational goals.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

49. Strategic planning determines the major goals of the organization.

Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

50. Today's business environment changes so rapidly that strategic planning is becoming more
difficult and subject to change.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

7-12


Chapter 07 - Management and Leadership

51. Managers or teams of managers at the lower levels of an organization normally develop
strategic plans, but top managers do most of the tactical planning.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning


52. Contingency planning involves developing alternative courses of action to be used if the
primary plans do not achieve the desired results.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

53. Operational planning looks at the organization as a whole, while strategic planning
focuses on specific departmental actions.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

54. One example of tactical planning is setting annual budgets and deciding on other details
and activities necessary to meet the strategic objectives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

55. Many cities and businesses are now developing contingency plans to respond to potential
terrorist attacks.
Answer: True

AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

7-13


Chapter 07 - Management and Leadership

56. Instead of creating detailed strategic plans, the leaders of market-based companies
(companies that respond quickly to environmental changes) set flexible directions so as to
allow for change and seize opportunities when they come.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

57. Decision making occurs in all management functions.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

58. The first step in the rational decision-making model is to identify alternative solutions.

Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

59. The last step in the rational decision-making model is to determine whether the decision
was a good one and follow up.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

60. One step in the rational decision-making model is to develop alternatives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

61. Brainstorming is coming up with as many solutions as possible in a short period of time
with a focus toward not censoring anyone's ideas.
Answer: True

7-14



Chapter 07 - Management and Leadership
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

62. Problem solving is more formal than using the rational decision-making model.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

63. PMI is a problem-solving technique that involves listing pluses, minuses and
implications.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 1 Easy
Topic: The Importance of Planning

64. A mission statement should provide a detailed explanation of how a company will
achieve its objectives.
Feedback: A mission statement is an outline of the organization's fundamental purposes, not a
detailed explanation of what is to be done and who is to do it. Figure 7.2 shows an actual
mission statement for Starbucks that clearly illustrates this.

Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 2 Medium
Topic: The Importance of Planning

65. The SWOT analysis focuses only on the internal activities of the firm, while a PERT
analysis is used to review the external environment in which the firm operates.
Feedback: SWOT stands for strengths, weaknesses, opportunities and threats. While the
strengths and weaknesses part of SWOT analysis focuses on internal aspects of the
organization, the opportunities and threats part of SWOT looks at the external environment in
which the organization operates.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 2 Medium

7-15


Chapter 07 - Management and Leadership
Topic: The Importance of Planning

66. Tactical planning involves making decisions about which customers to serve, what
products or services to sell, and the geographic areas in which the firm will compete.
Feedback: The fundamental nature of the topics described in this question would be
considered in the strategic planning process.
Answer: False

AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 2 Medium
Topic: The Importance of Planning

67. Contingency planning is most important in markets where conditions are relatively stable
and market growth is predictable.
Feedback: Contingency planning is the process of preparing alternative courses of action that
may be used if the primary plans don't achieve the organization's objectives. The need to
implement contingency plans is more likely to arise in markets where there is a great deal of
rapid change and uncertainty.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 2 Medium
Topic: The Importance of Planning

68. The top managers at the Sax Department Store find that their employees do not really
share a common sense of purpose or have a common set of values. This suggests that top
management has not provided a clear vision for the firm.
Feedback: A vision is a broad statement of why an organization exists and what it seeks to
accomplish. It is intended to give the organization a sense of purpose and provide workers
with a set of values and a sense of direction.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 2 Medium

Topic: The Importance of Planning

7-16


Chapter 07 - Management and Leadership

69. In order to ensure effective implementation, managers should make only one set of plans
and carefully follow them to ensure that the organization's objectives are achieved.
Feedback: Economic and competitive conditions change so rapidly that it is wise to have
alternative plans available in the event the primary plan does not achieve its objectives. This
is the idea behind contingency planning.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 2 Medium
Topic: The Importance of Planning

70. Lucy is part of the top management team at Cloudy Daze Rain Gear, a company that
produces umbrellas, raincoats, hats and all-weather shoes. As a member of top
management, Lucy is more likely to be involved in strategic planning than in tactical
planning.
Feedback: Top management normally carries out strategic planning, while lower-level
managers are usually responsible for tactical planning.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 3 Hard

Topic: The Importance of Planning

71. Jamika is a manager at a well-known retail store. Each morning she determines the order
in which store projects are performed; she sets work schedules for employees and
standards that must be met. These activities suggest that Jamika is involved in operational
planning.
Feedback: Operational planning is the process of setting work standards and schedules that
are necessary to carry out tactical plans.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 3 Hard
Topic: The Importance of Planning

7-17


Chapter 07 - Management and Leadership

72. Sharon needed to solve a problem quickly, so she called together the work team in her
department and asked them to list as many possible solutions as they could come up with
in a short period of time. During the process she encouraged responses and avoided
censoring what her workers said. Sharon is utilizing a problem-solving technique known
as brainstorming.
Feedback: Brainstorming is a problem-solving technique that encourages a group of people to
come up with as many suggestions for solving the problem as possible in a short period of
time, and with no censoring of ideas.
Answer: True
AACSB: Knowledge Application

Bloom’s: Apply
Learning Objective: 07-03 Relate the planning process and decision making to the accomplishment of company goals
Level of Difficulty: 3 Hard
Topic: The Importance of Planning

73. After management has created a plan of action, the focus turns to the controlling function
to recheck and often redo the plan.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

74. Organizing involves allocating resources, assigning tasks, and establishing procedures for
accomplishing the organizational objectives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

75. The visual illustration of the relationships among the people within an organization that
shows who is accountable for the work and who reports to whom is called a Gantt Chart.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy

Topic: Functions of Management

76. Branch and plant managers and division heads are classified as first-line managers.
Answer: False

7-18


Chapter 07 - Management and Leadership
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

77. A CEO is often the president of the firm and is responsible for developing the strategic
plans.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

78. The recent recession eliminated many middle managers giving the remaining managers
more employees to supervise.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management

Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

79. Supervisory managers are those who directly oversee the activities of workers and
evaluate their daily performance.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

80. Middle managers usually are responsible for tactical planning and controlling.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

81. The CIO, COO, and CFO are classified as top management positions.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

7-19



Chapter 07 - Management and Leadership

82. In this day of rapidly changing technology, technical skills are the most important skills
for all levels of management.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

83. Conceptual skills refer to the ability of a manager to perform the tasks associated with a
specific discipline or department.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

84. First-line managers typically spend less time on conceptual tasks and more time on
technical skills.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles


85. Most of a top manager's time is devoted to conceptual and human relations activities.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

86. The ability to plan, coordinate, and delegate are among a manager's most basic technical
skills.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

7-20


Chapter 07 - Management and Leadership

87. A person who is a good first-line manager is automatically likely to be a good middle or
top manager.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles


88. Human relations skills include those associated with leadership, coaching, morale building
and supportiveness.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

89. The question of how to implement change within an organization is the responsibility of
the firm's CEO.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

90. Staffing involves recruiting, hiring, motivating, and retaining the best people available for
the organization.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

91. Due to the growth of the Internet, recruiting is less important today than in the past.
Answer: False

AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

92. Staffing is a less important management function today than in the past.
Answer: False

7-21


Chapter 07 - Management and Leadership
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 1 Easy
Topic: Functions of Management

93. Organizing involves developing a structure or framework that relates all workers, tasks
and resources to each other.
Feedback: Operationally, organizing means allocating resources, assigning tasks, and
establishing procedures for accomplishing the organizational objectives.
Answer: True
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 2 Medium
Topic: Functions of Management


94. Top management is also known as first-line management because it deals with key
managerial decisions on a priority basis.
Feedback: Top management consists of the president and other key company executives. On
the other hand, first-line managers are immediately above an organization's workers.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 2 Medium
Topic: Types of Managers and Leadership Styles

95. Supervisory managers usually work more with ideas than with people.
Feedback: Supervisory managers are responsible for assigning specific jobs to workers and
evaluating their daily performance. Their jobs often bring them into direct contact with the
workers they supervise. Figure 7.6 illustrates this by showing that first-line managers rely
more on human relations skills than on conceptual skills.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 2 Medium
Topic: Types of Managers and Leadership Styles

7-22


Chapter 07 - Management and Leadership

96. Because of the complex nature of their jobs, top managers spend most of their time
developing and using technical skills.

Feedback: Top managers spend most of their time on tasks requiring conceptual and human
relations skills.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 2 Medium
Topic: Types of Managers and Leadership Styles

97. The experience gained by first-line managers as they perform their jobs enables them to
acquire all the skills they will need when promoted to higher levels of management.
Feedback: Different skill sets are needed at different levels of management. First-line
managers tend to use technical skills extensively, but spend much less time using conceptual
skills. On the other hand top managers use very few technical skills, but often perform tasks
requiring exceptional conceptual skills. Thus, the skills learned by a first-line manager may
not be very useful at higher levels of management.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 2 Medium
Topic: Types of Managers and Leadership Styles

98. According to the Reaching Across Our Borders box, business leaders must strive to
thoroughly understand a nation’s culture and respect its strengths and challenges in order
to be successful in the global market.
Feedback: Business leaders need to study countries and the impact they have on business
functions. It’s critical they also thouroughly understand a nation’s culture and respect its
strengths and challenges.
Answer: True

AACSB: Reflective Thinking
Bloom’s: Understand
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 2 Medium
Topic: Types of Managers and Leadership Styles

7-23


Chapter 07 - Management and Leadership

99. Mark is a manager for Cable Connection. He spends most of his time scheduling the
specific service calls that each employee performs during the day, verifying job
completion, and evaluating employee performance on each call. These responsibilities
suggest that Mark is a middle manager.
Feedback: First-line managers typically carry out the tasks that Mark is performing. Middle
managers generally are more involved in tactical planning and controlling.
Answer: False
AACSB: Analytical Thinking
Bloom’s: Analyze
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 3 Hard
Topic: Types of Managers and Leadership Styles

100. Chris was recently promoted to a position as a first-line manager. At this level of
management, he will use human relations and conceptual skills as well as technical skills.
Feedback: Though they rely on technical skills more than managers at other levels, first-line
managers must also use human and conceptual skills to a certain degree. In fact, as Figure 7.6
shows, all three levels of management, to varying degrees, must use all three types of skills.
Answer: True

AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 3 Hard
Topic: Types of Managers and Leadership Styles

101. Liz is a first-line manager at her company, which is very traditional in its approach to
management. In her position, Liz probably spends a lot of time giving employees detailed
and specific instructions.
Feedback: First-line managers are directly responsible for supervising workers and evaluating
their performance.
Answer: True
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 3 Hard
Topic: Types of Managers and Leadership Styles

7-24


Chapter 07 - Management and Leadership

102. Fatma wants to become a manager. However, she is shy and avoids conversation with
strangers. She is very comfortable with computers and information technology and has
great technical skills in these areas. Fatma's personal traits make her a good candidate for
a top management position.
Feedback: Top managers typically use few technical skills. Instead, almost all of their time is
devoted to human relations and conceptual tasks.
Answer: False

AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 3 Hard
Topic: Types of Managers and Leadership Styles

103. Staffing is less important at Sony, IBM and other high-tech firms because these firms
sell technology.
Feedback: At most high-tech companies, like IBM and Sony, the primary capital equipment is
brainpower, so staffing is essential to obtain the best people available to accomplish these
companies' objectives.
Answer: False
AACSB: Knowledge Application
Bloom’s: Apply
Learning Objective: 07-04 Describe the organizing function of management
Level of Difficulty: 3 Hard
Topic: Types of Managers and Leadership Styles

104.

People who are good leaders also are almost always good managers.

Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-05 Explain the differences between leaders and managers, and describe the various leadership styles
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

105. Leadership is the management function of checking to determine whether or not an

organization is progressing toward its objectives, and taking corrective action if it is not.
Answer: False
AACSB: Reflective Thinking
Bloom’s: Remember
Learning Objective: 07-05 Explain the differences between leaders and managers, and describe the various leadership styles
Level of Difficulty: 1 Easy
Topic: Types of Managers and Leadership Styles

7-25