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Business Studies Class 12 Chapter 7 Directing – MCQs with Answers

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Key MCQs and Answers for Directing in Business Studies Class 12

MCQs for Business Studies Class 12 Chapter 7 focus on the vital topic of "Directing", one of the main functions of management in the CBSE curriculum. Understanding this topic is essential for performing well in school Board exams, competitive entrance tests, and developing real-world business skills.


Main Concept Explanation Real-world Example
Directing Instructing, guiding, inspiring, and overseeing employees to achieve organizational goals. A manager motivating staff to increase sales.
Leadership Influencing and guiding others towards organizational success. Using democratic style to involve teams in decision making.
Motivation Encouraging employees by fulfilling their needs and providing incentives. Rewarding performers with bonuses.
Communication Sharing information for effective coordination. Regular team meetings and feedback systems.

MCQs for Business Studies Class 12 Chapter 7: Directing

Directing is a key function of management that includes providing guidance, leadership, motivation, and effective communication. It ensures that employees work efficiently to fulfill organizational objectives. MCQs on this chapter test conceptual clarity and practical application.


Key Subtopics of Directing

  • Nature and importance of directing
  • Elements of directing: Supervision, Motivation, Leadership, Communication
  • Maslow’s Need Hierarchy Theory
  • Financial and non-financial incentives
  • Types of leadership styles: Autocratic, Democratic, Laissez-faire
  • Barriers to effective communication
  • Assertive questions: Assertion and Reasoning

Important MCQ Practice for Class 12 Business Studies Chapter 7

Practicing MCQs for Business Studies Class 12 Chapter 7 helps students gain confidence, improve accuracy, and manage time in board exams. Here are some representative questions with answers and explanations:


  1. Basic Physiological Needs are concerned with ____________.
    (a) Shelter
    (b) Hunger
    (c) Thirst
    (d) All of These
    Answer: (d) All of these
    These are the basic requirements for survival in Maslow's Need Hierarchy.

  2. Which of the following statements is true about directing?
    (a) Directing is necessary at planning stage.
    (b) Directing is needed at every level of management in each department.
    (c) Directing is initiated at lower level of management.
    (d) Directing is the least important function of management.
    Answer: (b) Directing is needed at every level of management in each department
    All managers, at all levels, practice directing in their own teams or processes.

  3. Which leadership style emphasizes group input?
    (a) Autocratic
    (b) Democratic
    (c) Laissez-faire
    (d) Authoritative
    Answer: (b) Democratic
    This style values team feedback in decision-making.

  4. Which of the following is a financial incentive?
    (a) Productivity linked wage incentive
    (b) Status
    (c) Organisational climate
    (d) Job enrichment
    Answer: (a) Productivity linked wage incentive
    Financial incentives provide direct monetary benefits.

  5. Downward communication refers to information flow from ________.
    (a) Superior to subordinate
    (b) Subordinate to superior
    (c) Same level employees
    (d) Client to manager
    Answer: (a) Superior to subordinate
    Downward communication starts at the management and flows downwards.

To download a more exhaustive set of MCQs for Business Studies Class 12 Chapter 7 with answers, click here for PDF.


Tips for Solving MCQs in Board Exams

  • Read all options carefully before choosing your answer.
  • Focus on keywords like "always", "most", and "only", which may change the meaning.
  • Time yourself during practice to improve speed.
  • For assertion-reason questions, analyze both statements critically.
  • Review your textbook and sample papers regularly.

Directing in Management: Real-world Use and Exam Significance

The topic of directing is not only important for CBSE Board exams but is also often included in business entrance and government job competitive exams. Understanding the types of leadership, barriers to communication, and motivation theories helps in real workplace scenarios, such as team management and conflict resolution.


Interlinked Important Business Studies Concepts


Why Practicing MCQs for Business Studies Class 12 Chapter 7 Matters

MCQ-oriented practice helps students identify knowledge gaps, reduce confusion in similar terms (like leadership vs. motivation), and boost confidence. At Vedantu, we simplify Commerce topics to help you understand and apply these concepts effectively in both exams and daily life.


In summary, mastering MCQs for Business Studies Class 12 Chapter 7 enables you to tackle Board and entrance exam sections efficiently, build managerial understanding, and apply theoretical principles to real-world workplace situations. Consistent practice and clear conceptual grasp are keys to success.

FAQs on Business Studies Class 12 Chapter 7 Directing – MCQs with Answers

1. What key topics from Chapter 7, Directing, are tested in these MCQs for the CBSE 2025-26 session?

The MCQs for Chapter 7, Directing, primarily test your understanding of its core concepts as per the Class 12 Business Studies syllabus. You can expect questions on:

  • The meaning and importance of Directing as a managerial function.
  • The four key elements of Directing: Supervision, Motivation, Leadership, and Communication.
  • Motivation theories, with a special focus on Maslow’s Need Hierarchy Theory and its application.
  • Different types of financial and non-financial incentives.
  • Leadership styles, including Autocratic, Democratic, and Laissez-faire.
  • The communication process and barriers to effective communication (e.g., semantic, psychological, organisational).

2. Why is practising MCQs on Directing important for the CBSE Class 12 board exam?

Practising MCQs is crucial for scoring well in the Business Studies exam. MCQs on Directing help you to:

  • Test conceptual clarity on topics like leadership styles and motivation theories, which often have subtle differences.
  • Improve speed and accuracy, as a significant portion of the paper consists of one-mark questions.
  • Quickly revise the entire chapter by covering a wide range of topics in a short time.
  • Identify knowledge gaps and areas that require further study before the final exam.

3. What is the benefit of reviewing detailed explanations with each MCQ on Directing?

Reviewing detailed explanations for each answer is more beneficial than simply checking the correct option. It helps you understand the underlying logic behind the answer, clarifying why other options are incorrect. This process reinforces your knowledge of concepts like Maslow's hierarchy or communication barriers, helping you tackle even complex or twisted questions in the board exam.

4. What is an effective strategy for answering MCQs from the Directing chapter?

To effectively answer MCQs from Chapter 7, first, read the question carefully to identify keywords. For scenario-based questions, try to pinpoint the specific element of directing being discussed—is it a leadership style, a motivational incentive, or a communication barrier? Eliminate options that are clearly incorrect. For example, if a scenario describes a manager who involves subordinates in decision-making, you can immediately rule out the 'Autocratic' leadership style.

5. How do MCQs on Maslow's Need Hierarchy theory test a student's practical understanding?

MCQs on Maslow's theory often move beyond simple definitions. They typically present a real-world business scenario about an employee and ask you to identify their active need. For example, a question might state, 'An employee has a stable job and good salary but desires recognition from peers and management.' You would need to apply your understanding to identify this as an Esteem Need. This tests your ability to apply the theoretical framework to practical situations, not just memorise the five levels.

6. What is a common point of confusion between 'Motivation' and 'Leadership' that MCQs on Directing often target?

A common trap in MCQs is distinguishing between a leader's action and a motivational tool. Leadership is the broad process of influencing behaviour, while motivation is the internal stimulus that drives an individual to act. An MCQ might describe a manager giving a 'promotion' (a non-financial incentive under motivation) and ask you to identify the concept. Students may confuse this with a leadership action, but it is specifically a technique used for motivation within the broader leadership framework.

7. Are the concepts tested in these Directing MCQs also relevant for entrance exams like CUET?

Yes, absolutely. The core principles of management covered in Chapter 7—such as leadership, motivation, and communication—are fundamental topics in the business aptitude and general test sections of major entrance exams, including the Common University Entrance Test (CUET). Practising these MCQs helps build a strong foundation that is valuable not only for your Class 12 board exams but also for these competitive exams.

8. What is the main difference between financial and non-financial incentives as tested in MCQs?

MCQs often test your ability to differentiate between these two types of incentives. Financial incentives are those that can be measured directly in monetary terms, such as pay, bonuses, and profit-sharing. In contrast, non-financial incentives satisfy psychological and social needs, like status, job security, employee recognition, and career advancement opportunities. A typical MCQ will provide an example and ask you to classify it correctly.

9. Why is 'Laissez-faire' leadership not always the best style, a concept often tested in HOTS MCQs?

While Laissez-faire leadership provides maximum autonomy, it is not universally effective. High-Order Thinking Skills (HOTS) MCQs test this by presenting scenarios where it would fail. This style is only successful when subordinates are highly skilled, experienced, and self-motivated. For a team of new or inexperienced employees, it can lead to a lack of direction, missed deadlines, and chaos, making a more structured style like Democratic or Autocratic more appropriate in that context.