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Q1. Planning is primarily concerned with which of the following?
Answer: A — Planning is fundamentally about advance decision-making regarding objectives and action courses, not about monitoring (which is controlling) or recruitment (which is staffing).
Q2. Which of the following is NOT a benefit of planning?
Answer: C — Planning reduces overlapping activities and improves coordination, but it does not eliminate the need for coordination—coordination remains essential and planning facilitates it.
Q3. A manufacturing company decides to produce 10,000 units in Q1, allocates ₹50 lakh for raw materials, and assigns responsibility to the production manager. This is an example of which type of plan?
Answer: D — The allocation of specific financial resources (₹50 lakh) for a defined time period (Q1) is a budget, which is a single-use plan created for non-recurring resource distribution.
Q4. A company establishes that 'all customer complaints must be resolved within 48 hours.' This statement represents which type of plan?
Answer: B — A 48-hour complaint resolution deadline is a mandatory action directive applicable to all customer complaints repeatedly, making it a rule—a standing plan with required compliance.
Q5. Which statement best explains the relationship between planning and controlling?
Answer: B — Planning establishes predetermined goals and standards; controlling then measures actual performance against these planning-set benchmarks to identify deviations.
Q6. IOCL has announced a target of net-zero operational emissions by 2046 with an investment of ₹2 lakh crore in renewable and green energy. Which feature of planning is BEST demonstrated here?
Answer: B — IOCL's 2046 net-zero target is a long-term objective with financial commitment that provides strategic direction to the entire organisation and prepares it for future sustainability challenges.
Q7. A bank implements a new policy stating 'All loan applications above ₹10 lakh must be approved by the regional manager.' Which statement is correct regarding this plan?
Answer: B — This is a policy (standing plan) because it provides recurring, repeated guidelines for handling loan approvals—not a one-time activity but an ongoing operational directive.
Q8. Which of the following statements is MOST correct? (A) Planning always creates rigidity and should be avoided in dynamic markets. (B) Planning must remain flexible and adaptable, though it provides a framework for decision-making.
Answer: C — Statement B is correct—planning should be flexible and responsive to changing conditions; Statement A is a common misconception that rigid planning is always harmful when actual practice shows flexibility within planning frameworks.
Q9. A manager is developing a 5-year growth strategy involving expansion into three new markets, product line diversification, and capacity upgrades. In the planning process, what should be the FIRST critical step before formulating detailed action courses?
Answer: C — Before generating alternatives or implementing, the manager must set clear objectives (what markets, what products, what capacity) and develop premises (assumptions about market conditions, competition, demand), which form the foundation for all subsequent planning steps.
Q10. An organisation's five-year plan states: Objective = 'Increase market share to 25%'; Strategy = 'Expand distribution network in tier-2 cities'; Policy = 'All marketing expenditure must be approved by Head Office'; Procedure = '1. Identify city 2. Conduct feasibility study 3. Establish partnerships.' Which statement BEST describes the relationship between these plan types?
Answer: B — The hierarchy flows from objective (what to achieve: 25% share) → strategy (how: tier-2 expansion) → policy (approval guideline, recurring) → procedure (step-by-step implementation), showing how different plan types interconnect to guide action from intent to execution.
What is the definition of planning in management?
Planning is setting objectives for a given time period, formulating various courses of action to achieve them, and selecting the best alternative from available options.
Name two benefits of planning for an organisation.
Planning provides direction to all employees and reduces the risks of uncertainty by enabling managers to anticipate changes in advance.
What is the first step in the planning process?
Setting objectives and establishing clear targets that the organisation wants to achieve.
Distinguish between single-use plans and standing plans.
Single-use plans are created for one-time, non-recurring activities (programme, budget), while standing plans are used repeatedly for recurring activities (policy, procedure, rule).
How does planning reduce wasteful activities?
Planning serves as the basis for coordinating activities across departments and individuals, eliminating redundant work and ensuring smooth workflow without interruptions.
What is the relationship between planning and controlling?
Planning establishes goals and standards against which actual performance is measured during the controlling function.
Give two limitations of planning.
Planning may create rigidity and inflexibility in dynamic environments, and it requires accurate forecasts which are often difficult to predict.
What does 'time frame' mean in planning?
A specified duration or period for which a plan is made, recognising that time is a limited resource that must be used wisely.
How does planning promote innovative ideas?
Because planning is the first management function, new ideas can be shaped into concrete plans that guide future actions leading to business growth.
Name one example of a standing plan.
Policy, procedure, rule, method, objective, or strategy—any plan that is used repeatedly for recurring organisational decisions or activities.
Define planning and state any two reasons why it is essential for an organisation. [2 marks]
Definition must include: setting objectives + formulating action courses + selecting best alternative. Two reasons from: provides direction, reduces uncertainty, cuts wasteful activities, promotes innovation, facilitates decisions, establishes control standards.
Explain the relationship between planning and controlling. How does planning help in the controlling function? Give one example from IOCL case. [5 marks]
State that planning sets predetermined objectives and standards; controlling measures actual performance against these standards. Use IOCL's net-zero 2046 target as benchmark—actual emissions reduction will be measured against this planned objective to identify deviations.
Distinguish between single-use plans and standing plans. Classify the following into correct types: (a) Annual budget, (b) Customer service policy, (c) New product launch programme, (d) Leave approval procedure. Explain why different types of plans are necessary in an organisation. [6 marks]
Single-use: one-time, non-recurring (budget, programme). Standing: recurring, repeated use (policy, procedure). Classifications: (a) single-use budget, (b) standing policy, (c) single-use programme, (d) standing procedure. Explanation: different situations need different plan types—one-time projects need budgets/programmes; recurring decisions need policies/procedures for consistency and standardisation.
Q1. Assertion (A):
Planning is the first function of management that provides direction and guides all future organizational actions.
Reason (R):
Planning enables managers to set objectives, develop courses of action, and make decisions in advance, thus reducing uncertainty and providing a roadmap for achieving organizational goals.
Answer: A — Both A and R are true, and R is the correct explanation of A — Both the assertion and reason are true, and the reason correctly explains why planning is the first function. Planning precedes other functions (organizing, staffing, directing, controlling) because objectives must be set before any action can be taken. The reason directly supports the assertion by explaining how planning provides direction.
Q2. Assertion (A):
A plan without implementation and execution is a futile exercise that provides no value to the organization.
Reason (R):
Implementation requires the directing and controlling functions, which are independent of planning and operate separately.
Answer: C — A is true but R is false — The assertion is true—the study material explicitly states 'Planning will be a futile exercise if it is not acted upon or implemented.' However, the reason is false because directing and controlling are not independent of planning; they are interconnected with planning. All functions work together toward planned objectives. The reason does not correctly explain why unimplemented plans are futile.
Q3. Assertion (A):
Planning reduces the risk of uncertainty by enabling managers to anticipate changes and develop responses in advance.
Reason (R):
Planning eliminates all uncertainties and unforeseen events in the business environment.
Answer: C — A is true but R is false — The assertion is true—planning does help anticipate changes and prepare responses, which is listed as an importance of planning. However, the reason is false and represents a common misconception. The study material states that changes 'cannot be eliminated but they can be anticipated.' Planning reduces risk, not eliminates it. The overstated claim in the reason is incorrect.
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Case Study:
Ramesh, the owner of 'Desi Khana', a chain of five restaurants in Jaipur, noticed that his monthly expenses had increased by 25% over the last quarter while revenues remained stagnant. To address this, he set a target to reduce costs by 15% within the next three months without compromising food quality. He then identified specific actions, such as renegotiating supplier contracts and reducing electricity usage, and assigned responsibilities to his managers to implement these actions.
Q1. Identify the step in the planning process being performed when Ramesh set the target to reduce costs by 15% within three months.
Answer: A
Q2. After setting the target, Ramesh identified specific actions like renegotiating supplier contracts and reducing electricity usage. Which step of the planning process does this represent?
Answer: C
Q3. Ramesh assigned responsibilities to his managers for implementing the identified actions. This reflects which feature of planning?
Answer: C
Q4. Ramesh's decision to reduce costs by renegotiating contracts and cutting electricity usage, while keeping food quality unchanged, demonstrates which limitation of planning?
Answer: B
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Real CBSE board exam questions from past papers — free to attempt.
CBSE 2026 · Set 66/2/1 · 4 marks
(a) Explain the following limitations of planning: (i) Planning leads to rigidity (ii) Planning may not work in a dynamic environment
CBSE 2026 · Set 66/2/1 · 6 marks
Greener Organic is a company producing eco-friendly fertilizers and soil boosters. With the growing interest in organic farming, the company is planning to expand its operations across India. Greener sets its target to increase its sales by 25% in the next year. This gave all departments – sales, production, marketing and logistics – a common target to work. To achieve this, Greener made a comprehensive plan to enter Tier-2 and Tier-3 cities by working with local farmer groups. They also plan to promote their brand through on-line campaigns focused on eco-friendly farming. The company also laid down broad parameters within which the managers could function. All raw materials used had to be certified organic and preferably sourced from local farmers. This would improve quality, support local people and build trust with customers. The company allocated ` 50 lakhs for marketing, which included funds for regional newspaper advertisements, digital marketing, promotional events and dealer incentives. By quantifying future facts and figures, the company planned to control costs and evaluate performance. Identify and explain any four type of plans discussed in the above case.
CBSE 2026 · Set 66/2/2 · 4 marks
Explain the following limitations of planning: (i) Planning reduces creativity (ii) Planning involves huge costs
CBSE 2026 · Set 66/2/3 · 4 marks
(a) Explain the following features of planning : (i) Planning is futuristic. (ii) Planning involves decision-making.
CBSE 2026 · Set 66/1/1 · 1 mark
Identify the incorrect statement with respect to the importance of planning function of management:
CBSE 2026 · Set 66/1/1 · 1 mark
Identify the feature of planning which states that the purpose of planning is to meet future events effectively to the best advantage of an organisation:
CBSE 2026 · Set 66/1/1 · 4 marks
Explain the following points of importance of planning: (i) Planning establishes standards for controlling (ii) Planning reduces overlapping and wasteful activities
CBSE 2026 · Set 66/1/2 · 1 mark
'CARO Tech Solutions' aimed at development of a software system for the company's growing operations. The project was to be completed within six months with a budget of ` 12,00,000. The software development team successfully completed its project on time by outsourcing a part of the project, leading to an additional expense of ` 2,00,000. From the following, identify whether the software development team is:
CBSE 2026 · Set 66/1/2 · 4 marks
(a) Explain the following steps of the planning process: (i) Setting objectives (ii) Developing premises
CBSE 2026 · Set 66/1/3 · 4 marks
(a) Explain the following limitations of planning function of management: (i) Planning may not work in a dynamic environment. (ii) Planning reduces creativity.
CBSE 2026 · Set 66/3/1 · 6 marks
(a) Explain the following limitations of planning: (i) Planning leads to rigidity (ii) Planning may not work in a dynamic environment (iii) Planning involves huge costs
CBSE 2026 · Set 66/3/2 · 6 marks
(a) Explain the following points of importance of planning: (i) Planning reduces overlapping and wasteful activities, (ii) Planning reduces the risks of uncertainty, (iii) Planning provides directions
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