MB0043, set2 : Q.1 Explain Wage Administration policy.

What are the ways by which wages and salaries are managed in India?

Answer: Wage and salary administration revolves around designing and managing
policies and methods of disbursing employee compensation. Traditionally it includes such areas as job evaluation, maintenance of wage structures, wage surveys, incentives administration, wage changes and adjustments, supplementary payouts, profit sharing, control of compensation costs, and other related pay items. Salaried often implies a status distinction, because those who are on salary are generally whitecollar, administrative, professional, and executive employees, whereas wage-earners are designated as hourly, non-supervisory, or blue-collar. Wage-earners in some organizations do receive full wage if they are absent for such reasons as sickness, whereas salaried employees, especially at the lower levels, often receive overtime pay when they work over the standard work week. Compensation/ salary systems are designed to ensure that employees are rewarded appropriately depending on what they do and the skills and knowledge (intellect) required for doing a specific job. It must therefore provide for the following key factors in order to be effective: The following factors may be helpful to raise the effectiveness of employees

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MB0042 set2 : Q1. Define Pricing Policy. Explain the various objective of pricing policy.

Answer: Pricing policy refers to the policy of setting the price of the product or
products and services by the management after taking into account of various internal and external factors, forces and its own business objectives. Pricing Policy basically depends on price theory that is the corner stone of economic theory. Pricing is considered as one of the basic and central problems of economic theory in a modern economy. Fixing prices are the most important aspect of managerial decision making because market price charged by the company affects the present and future production plans, pattern of distribution, nature of marketing etc. Above all, the sales revenue and profit ratio of the producer directly depend upon the prices. Hence, a firm has to charge the most appropriate price to the customers. Charging an ideal price, which is neither too high nor too low, would depend on a number of factors

and forces. There are no standard formulas or equations in economics to fix the best possible price for a product. The dynamic nature of the economy forces a firm to raise and reduce the prices continuously. Hence, prices fluctuate over a period of time. Generally speaking, in economic theory, we take into account of only two parties, i.e., buyers and sellers while fixing the prices. However, in practice many parties are associated with pricing of a product. They are rival competitors, potential rivals, middlemen, wholesalers, retailers, commission agents and above all the Govt. Hence, we should give due consideration to the influence exerted by these parties in the process of price determination. Objectives of the Price Policy

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MB0041 set2 : Q.1 Explain the tools of Management accounting?

Answer: Tools of Management Accounting
Management Accounting uses the following tools or techniques to fulfill its responsibilities and duties towards management. • Financial Statement Analysis • Funds Flow Analysis • Cash Flow Analysis • Costing Techniques that includes marginal costing, differential costing, standard costing, and responsibility costing • Budgetary control • Management Reporting. Financial Statements are indicators of two significant factors that include profitability and financial soundness. Analysis and interpretation of financial statements enables full diagnosis of the profitability and financial soundness of the firm. Analysis means methodical classification of the data given in the financial statements. Methodical classification enables comparison of the various interconnected figures with each other. Interpretation explains the meaning and significance of the data.

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MB0040 Set2 : Q1. What do you mean by Statistical Survey? Differentiate between “Questionnaire” and “Schedule”.

Answer: A search for knowledge by analysing numerical data is known as Statistical
Survey or Statistical Investigation. A Statistical survey is a scientific process of collection and analysis of numerical data. Statistical surveys are used to collect numerical information about units in a population. Surveys involve asking questions to individuals Surveys of human populations are common in government, health, social science and marketing sectors. Statistical surveys are categorised into two stages – planning and execution. The figure 2.1 shows the two broad stages of Statistical survey Planning a Statistical Survey: The relevance and accuracy of data obtained in a survey depends upon the care exercised in planning. A properly planned investigation can lead to best results with least cost and time.

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MB0039 Set–II Q1 Explain with the help of specific examples, four different ways in which positive non verbal communication can create a better work environment.

Answer:
1. Proxemics – Proxemics is derived from the word “proximity” or closeness and is the communication term for personal space and distance. The space and distance which we choose to keep from people is also part of non-verbal communication. Each of us has our own inner and outer circles, which differ for different people. Our inner most circle is an “intimate space”, into which we generally admit only select people such as family and close friends. Next comes a “personal space” which might include other friends and colleagues or coworkers. These two spaces involve communication of an informal nature. Most of us also have a “social and public” space, which includes official or workplace relationships, where

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assign the worker’s task accordingly. Frederick Taylor’s main emphasis was on finding one best way of doing each job. 5. His scientific principles of management stressed the following principles: 1. Monitor worker performances to ensure that appropriate work procedures are followed and that appropriate results are achieved. Shift all responsibility for the organization of work from the worker to the manager. He favored wage plans to motivate the workers. . leaving the workers with the task of implementation. Semester 1 MB0038 set2 Q. 4. His scientific approach called for detailed observation and measurement of even the most routine work. Train the worker to do the work efficiently. managers should do all the thinking relating to the planning and design of work. He insisted the use of time-and-motion study as a means of standardizing work activities. Answer: The Classical Era We see this trend to continue in what is called as the classical era which covers the period between 1900 to mid 1930s. Henri Fayol. the first general theories of management began to evolve and the main contributors during this era were Frederick Taylor. Use scientific methods to determine the most efficient way of doing work. 2. Max Weber. train them to do it precisely in one best way.0 comments Labels: MB0039. Select the best person to perform the job thus designed. Mary parker Follet and Chester Barnard. He stressed on selecting the right people for the job.1 Write a note on classical era for evolution of Organization behaviour. specifying the precise way in which the work is to be done. to find the optimum mode of performance. 3. Taylor was one of the first to attempt to systematically analyze human behavior at work.

With passing time. Discipline: this is essential for the smooth running of business and is dependent on good leadership. published in 1916. 5. new organizational functions like personnel and quality control were created. such as size and the capabilities of the personnel. clear and fair arguments. Unity of direction: a group of activities concerned with a single objective should be co-coordinated by a single plan under one head. 7. encourage effort. order. Authority and responsibility: authority is the right to give orders and entails enforcing them with rewards and penalties. Unity of command: for any action whatsoever. in breaking down each task to its smallest unit to find what Taylor called „„the one best way‟‟ to do each job. a mining engineer and manager by profession.The results were dramatic. Division of work: tasks should be divided up with employees specializing in a limited set of tasks so that expertise is developed and productivity increased. 6. 3. Remuneration of personnel: this may be achieved by various methods but it should be fair. . Henri Fayol. and not lead to overpayment. with productivity increasing significantly. Centralization: the extent to which orders should be issued only from the top of the organization is a problem which should take into account its characteristics. he laid down what he called 14 principles of management. General and Industrial Management. authority should be matched with corresponding responsibility. This theory is also called the Administrative Theory. The principles of the theory are: 1. defined the nature and working patterns of the twentieth-century organization in his book. Subordination of individual interest to general interest: individual or group goals must not be allowed to override those of the business. an employee should receive orders from one superior only. discipline. In it. and stability are threatened. 4. otherwise authority. 8. Of course. Hence he lay the ground for the mass production techniques that dominated management thinking in the first half of the twentieth century. 2. the effect was to remove human variability. and the judicious application of penalties.

Q. As mentioned earlier. 11. even today. Initiative: all employees should be encouraged to exercise initiative within limits imposed by the requirements of authority and discipline. but sideways communication between those of equivalent rank in different departments can be desirable so long as superiors are kept informed. organizing. 10. Semester 1 MB0043 . Organizations are constantly evaluating the selections tools they use to hire and keep innovating to ensure they hire quality candidates. generally long and multiple. The following are popular methods commonly used: 1 Initial or preliminary interview . consisted of planning. Stability of tenure of personnel: rapid turnover of personnel should be avoided because of the time required for the development of expertise.9. 14. 13. 0 comments Labels: MB0038. that Fayol stated.2 Explain the various techniques and methods used in selecting employees. people must be suited to their posts so there must be careful organization of work and selection of personnel. Scalar chain (line of authority): communications should normally flow up and down the line of authority running from the top to the bottom of the organization. cocoordinating and controlling. Answer: There is no shortcut to fair and accurate evaluation of a candidate. the hiring procedures are therefore. 12. Equity: personnel must be treated with kindness and justice. Esprit de corps: efforts must be made to promote harmony within the organization and prevent dissension and divisiveness. list these functions as the core of their activities. The management functions. Many practicing managers. commanding. Order: both materials and personnel must always be in their proper place. Fayol was also one of the first people to characterize a commercial organization‟s activities into its basic components.

and other items such as names and addresses of previous employers. The objectivity of the test results make it especially popular and a fair assessment of the individual. personal items. and by using a reference form. These templates generally carry information on biographical data. It serves as a excellent qualifying criteria and in jobs that are dependent on a skill or a specific competency it is very useful. 4 Skill / Psychological tests. 3 Check of references. If the applicant appears to have some chance of qualifying for existing job openings. However. he or she is given the application blank to complete. Most of the larger companies that can afford to . later reference. This initial interview is usually quite short and has as its object the elimination of the obviously unqualified. there is a direct relationship between the size and firm and the use of such tests in hiring. Checks on references are made by mail or telephone. It also is a excellent document to share with the manager and with the interviewers and is a useful device for storing information for. Many firms do not bother to initiate any paperwork at this early stage. The objective is to obtain evaluation of prior employers and professional colleagues. In many instances it is a over-telephone / short face-to-face interview conducted at a desk. references etc. The use of tests is common and most popular in the lower levels in an organization. 1. who have known the candidate in a professional capacity. This enables the recruiter to qualify the candidate to the next level in the selection process and is used extensively subsequently during the selection process. widely accepted template for getting information from a prospective applicant.2 Application blank or blanks. 7 Medical examination. educational attainment. It is a good means of quickly collecting verifiable basic historical data from the candidate. 4 Skill & Psychological Tests: The next step in the procedures outlined above is that of testing. 3 Check of References: The use of references is common in most selection procedures. 5 Employment interview 6 Approval by the manager. The facts and impressions collected are of the type generally obtained in an initial interview. and occasionally in person. It involves minimum of effort and time/money. salary. work experience. Most organizations do not use psychological tests. the more likely it is that a preliminary interview will be required. The blank aids in the interview by indicating areas of interest and discussion. 2 Application Blank: An application blank is a traditional. 8 Induction or orientation. Preliminary Interview: The more non-selective the recruitment programme.

and hobbies. unreliability. If handled properly. but places greater reliance upon the interview. Approval by the Manager: Following the outlined procedure. and (3) emotional maturity. The interviewer has certain clues and guidelines to areas which should be probed deeply and the interview also encourages the candidate to express the relevant information freely. health interest. academic qualifications. it can be a powerful technique in achieving accurate information and getting access to material otherwise unavailable. Organizations aware of the challenges of using interviews have come up with a variety of ways to overcome the subjectivity. certain factors lead to accurate predictions of the candidate’s suitability for a particular position. The use of multiple rounds of interview (even upto 8-10 rounds) and use of panel interviews are some common work-around. and therefore. The most important advantage of the stress interview is that helps to demonstrate important personality characteristics which would be difficult to observe in tension-free situations. 3. McCurry and others. is to be expected from interviewing when used as a tool of evaluation. A substantial amount of subjectivity. to keeping silent for an extended period of time. we should now be of the opinion that . It is the smaller company that frequently does not bother with tests. stressinducing must be done carefully by trained and skilled interviewers. However. 4. After the patterned interview is complete. 5 Interviewing: Interviewing is probably the most widely used single method of selection. The interview consists of interaction between interviewer and applicant. One advantage of a patterned interview is that systematic and chronological information is obtained. Stress interview: Stress interviews are deliberate attempts to create pressure to observe how an applicant performs under stress. and hence this yields to statistical analysis. the interviewer should evaluate the candidate on the basis of practical experience. These are: 1. This method saves the company’s time and money. (2) motivation. Depth interview: Depth interviews cover the complete life history of the applicant and include such areas as the candidate’s work experience.N. According to R.have a more detailed and accurate selection procedure do utilize some form of employment testing. Patterned interview: Patterned interviews are a combination of direct and indirect questioning of the applicant. It is an excellent method for executive selection. Methods used to induce stress range from frequent interruptions and criticism of an applicant’s opinion. Four kinds of interviews for selection have been identified. 2. The applicant is given job details during the interview to afford him freedom to decide whether the job will suit him. performed by qualified human resources. Preliminary interview: These interviews are preliminary screening of applicants to decide whether a more detailed interview will be worthwhile. 6. The factors are: (1) basic character traits.

its structure. Organization Vision / Mission and Objectives statement. First. The second objective of the examination is to protect the company against unwarranted claims under workers’ compensation laws. proper orientation can do much to reduce this problem and its accompanying costs 0 comments Labels: MB0043. structure of the teams/divisions. In the selection procedure the physical examination has at least three basic objectives. Overview of the HR policies and processes and introduction to the Facilities team. 7. It can vary from a very comprehensive examination and matching of an applicant’s physical capabilities to job requirements to a simple check of general physical appearance and well-being. JV’s. 8 Induction: Induction is concerned with introducing or orienting a new employee to the organization. its history. the emphasis tends to switch toward more specifically job oriented worker characteristics such as training and relevant past experience. . the emphasis tends to be more on formal qualifications and general suitability. When the manager takes over.Q. focus on the division the employee/s is/are joining 3. Common objectives of an Induction program can be listed as covering: 1. Overview of the organization. In executing the recruitment unit screening functions. In as much as various firms report that over half of their voluntary resignations occur within the first 6 months.1Trace the phases of evolution of human resource management. its hero’s and important stories in the life of the firm so far like mergers. Medical Examination: The medical examination is an employment step found in most businesses. hierarchy of the top and the senior management. Organizations also build processes by which the new employee provides feedback on the on boarding experience and use this information to improve the Induction process. or against lawsuits for damages. 4. And the final objective is to prevent communicable diseases from entering the organization. expansion in new countries etc… 2. IT team and other relevant teams per the location of joining.a candidate who has successfully completed all steps so far should be hired. acquisitions. Organizations could have induction programs of duration of 1-3 days and even up to 1/3/6 months. it serves to ascertain the applicant’s physical capabilities. Semester 1 MB0043 . Handover to the manager and induction at a team level on specificities related to the job and its responsibilities.

an AT&T subsidiary. in their book titled Human Resources Management. One group received increased illumination. the scientific system. they have characterised the history of HRM as having evolved through four broad phases. productivity also increased when the level of illumination was decreased almost to moonlight levels. A preliminary finding was that. the human relations or behavioral school of management began in 1927 with a group of studies conducted at the Hawthorne plant of Western Electric. The Craft system refers to early trends noticed in Egypt and Babylon. It’s only in the past 100 odd years that the techniques and study of human behaviour at work has become formal and structured with certain basic practices established as core and a host of other practices left to each organization to design and implement as per their individual business driven practices. By the 13th century. which later Fredrick Taylor (1856-1915) pioneered based on the philosophy that employees wanted to be used efficiently and money being the primary motivator. while the other did not. Two groups were studied to determine the effects of different levels of illumination on worker performance. Surprisingly to the engineers. medical program and employee grievance systems. subsequently the trend was noticed in Europe and later craft guilds evolved to ensure not only the skill acquisition but regulate the conditions of employment. these engineers were applying research methods to answer job-related problems. Over a period of time this was proved wrong as employee dissent grew and union issues surfaced. The Scientific Management approach was a key part of the industrial revolution typical of the nineteenth and early twentieth century. The Hawthorne Studies: As described in virtually every book written about management.Answer: The historical background to the management techniques of human resources are in vogue since ancient times. This rapidly emerged as the assembly line approach to managing workflow. level of skill and improved production techniques. It was instilled in the principles of mass production and organization of work – simple work skills and supervisory/managerial skills. the human relations approach and the prevalent organizational science-human resources approach. the level of performance also increased. Most relevant in the domestic industry where generations of skilled workers trained and became experts in a particular skill. when illumination was increased. The Human Relations approach was an outcome of the famous studies undertaken by US social scientist Elton Mayo and Fritz Roethlisberger at the Western Electric’s Hawthorne plant in Chicago. Schonfeldt and Shaw. these studies were prompted by an experiment carried out by the company’s engineers between 1924 and 1932. Following the scientific management tradition. they reacted positively . Curiously. It was during this phase that employee welfare as a key HR practice emerged which redressed employee issues like recreational facilities. where skills based training was provided to people to ensure a steady flow of craftsmen required to build huge monuments. the Craft system. One interpretation made of these results was that the employees involved in the experiment enjoyed being the centre of attention. As per Fisher.

For instance. Leadership Style and Practices: As a consequence of the Hawthorne Studies. global work assignments and internal job postings and world class workplace infrastructures from in-campus cricket grounds to gymnasiums for employee wellbeing. Such a phenomenon taking place in any research setting is now called the Hawthorne effect. The reason for the increase in the production was not the physical but the psychological impact of the employee’s attitude towards the job and towards the company. to understand the impact of pay on performance. The conclusions they reached served as the bedrock of later developments in the human relations approach to management.Explain the price output determination under monopoly and oligopoly. you also have to understand the climate that exists in the work group and the leadership style of the superior. • Leadership practices and work-group pressures profoundly influence employee satisfaction and performance. 0 comments Labels: MB0043. Semester 1 MB0042 . Finally the Organizational Sciences approach to human resources management has brought the focus to the scientific process within organizations that can impact employee experience. Roethlisberger from Harvard conducted a lengthy series of experiments extending over a six year period. and less on just the individual. • Any factor influencing employee behaviour is embedded in a social system. later to be called the Institute for Social Research. As a result of these preliminary investigations. A notable development of the nature occurred shortly after World War II at the University of Michigan. Today’s organizations focus on building their processes and policies and compete to emerge as ‘preferred employers’ (best employer).J. This is the HR that we now see around us.because management cared about them. It is not uncommon for competing organizations to woo the employees through advertising more and better employee-friendly initiatives like work-from-home jobs. A group of social scientists formed an organization. morale. a team of researchers headed by Elton Mayo and F. careers for married couples. to study those principles of leadership that were associated with highest productivity. Among their key findings were the following: • Economic incentives are less potent than generally believed in influencing employees to achieve high levels of output. worker attitudes. Answer: Price – Output determination under Monopoly Assumptions .Q2. and group influences became a concern of researchers.

It is referred. It is completely free from Govt. import possibilities. we can think of three popular types of pricing under oligopoly. each firm is aware of the fact that what it does would be closely watched by other oligopolists in the industry. potential competition. 2. However. A firm generally accepts the “Going price” and adjusts itself to this price. However. as any effort to do so may create uncertainty. controls. When goods produced by different firms are different in nature (differentiated oligopoly). the market forces of demand and supply do not work freely in the determination of equilibrium price and output in case of the monopoly market. he has to charge a relatively lower price. In this case. it may not endeavor to change this price. So long as the firm earns adequate profits at this price. the monopoly firm generally considers the following important aspects. He may fix the price of his product and allow supply to be determined by the demand conditions or he may fix the output and leave the price to be determined by the demand conditions. The monopoly firm aims at maximizing its total profit. 6. there will be a tendency for the firms to fix a common pricing. It would be more beneficial to the monopolist to fix the price of the product rather than fixing the supply because it would be difficult to estimate the accurate demand and elasticity of demand for the products. The monopolist can either fix the price of his product or its supply. While determining the price. He cannot fix the price and control the supply simultaneously. each firm will be following an independent pricing policy as in the case of monopoly. the monopolist has to consider the conditions of demand. government control policies etc. c. It charges a single & uniform high price to all customers. He should charge the most reasonable price which is neither too high nor too low. Pricing policy followed by a firm depends on the nature of oligopoly and rivals reactions. 1. 4. 3. he can charge a relatively higher price and if the demand is elastic. He can sell larger quantities at lower price or smaller quantities at a higher price.a. They are as follows: Independent pricing: (non-collusive oligopoly) When goods produced by different oligopolists are more or less similar or homogeneous in nature. As output and supply are under the effective control of the monopolist. It is necessary to note that the price output analysis and equilibrium of the firm and industry is one and the same under monopoly. to as . 7. If the demand for his product is inelastic. 5. cost of the product. Price – Output Determination under Oligopoly It is necessary to note that there is no one system of pricing under oligopoly market. While fixing the price and output. due to product differentiation. possibility of the emergence of substitutes. a firm follows what is called is “Acceptance pricing” in the market. each firm has some monopoly power. Hence. The most ideal price is that under which the total profit of the monopolist is the highest. b.

price of goods will be high in the place where taxes are imposed. prejudices and needs. On the contrary. price-wars etc. However. different rates may be charged depending upon the nature of consumption. it may lead to Price-wars between different firms and each firm may fix price at the competitive level. The actual price fixed by a firm may fall in between the upper limit laid down by the monopoly price and the lower limit fixed by the competitive price. 4. Time: Special concessions or rebates may be given during festival seasons or on important . 0 comments Labels: MB0042. For e. Semester 1 MB0042:1. independent pricing in reality leads to antagonism. It may be similar to that of the pricing under monopolistic competition. Place: Markets may be divided on the basis of entry barriers. produced under a single control without corresponding differences in cost. 2..g. A firm tends to charge prices even below their variable costs. This leads to pricing under collusion. It is due to cut-throat competition in oligopoly. Price Discrimination May Take The Following Forms: (Basis Of Price Discrimination) 1.monopoly behavior of the Oligopolist. Price will be low in the place where there are no taxes or low taxes. Personal differences: This is nothing but charging different prices for the same commodity because of personal differences arising out of ignorance and irrationality of consumers. In other words independent pricing can be followed only for a short period and it cannot last for a long period of time. for e. preferences. It encourages a tendency to come together. rivalry. Answer: The policy of price discrimination refers to the practice of a seller to charge different prices for different customers for the same commodity. which may bring undesirable changes in the market. The Oligopolist may realize the harmful effects of competition and may decide to avoid all kinds of wastes. 3. heating and productive purposes in industry and agriculture. different rates may be charged for the consumption of electricity for lighting. What is Price Discrimination? Explain the basis of Price Discrimination. Different uses of the same commodity: When a particular commodity or service is meant for different purposes. infighting. They occur as a result of one firm cutting the prices and others following the same. friction.g.

When small quantities are purchased. 7. Quantity of purchase: When customers buy large quantities.g. Special classification of consumers: For E. A doctor may charge higher fees for rich patients and lower fees for poor patients.. discount may not be offered. In this case. special rooms and ordinary rooms in hotels etc.g. 10. For example. 13. for e.g. dumping – charging lower price in the competitive foreign market and higher price in protected home market. 9. Age: Cinema houses in rural areas and transport authorities charge different rates for adults and children.. Different charges for I class and II class traveling. Special orders: When the goods are made to order it is easy to charge different prices to different customers.. Discrimination on the basis of income and wealth: For e. railway department charge higher prices for carrying coal and luxuries and less prices for cotton. 14. discount will be allowed by the sellers. Different brands will be sold at different prices even though there is not much difference in terms of costs..occasions. charge lower rates per KM if the distance is long and higher rates if the distance is short. Distance: Railway companies and other transporters. 8.g. . particular consumer will not know the price charged by the firm for other consumers. 11. necessaries of life etc. 6. ordinary coach and air conditioned coaches. Nature of the product: Prices charged also depends on nature of products e. Geographical area: Business enterprises may charge different prices at the national and international markets. Social and or professional status of the buyer: A seller may charge a higher price for those customers who occupy higher positions and have higher social status and less price to common man on the street. Transport authorities such as Railway and Roadways show concessions to students and daily travelers. Preference or brands: Certain goods will be sold under different brand names or trade marks in order to attract customers. 5. 12.

to Cash a/c 5.2 Pass journal entries for the following transactions 1.Q. namely – business entity concept. There are five basic concepts of accounting. Goods a/c Dr. producers may discriminate between male and female buyers by charging low prices to females. Discrimination on the basis of sex: In selling certain goods. If price differences are minor. 70000 2. Capital a/c Dr. Semester 1 MB0041 . Purchased goods on credit 14000 3. to Creditors a/c. 2. . Peak season and off peak season services 0 comments Labels: MB0042. 0 comments Labels: MB0041. 17. customers do not bother about such discrimination. to Cash a/c. Convenience of the buyer: If a customer is in a hurry. Wages a/c Dr.15. to Cash a/c. Goods purchased for cash 12000 5. Paid wages 5000 Answer: 1. higher price would be charged. Goods a/c Dr. Semester 1 MB0041 . 18. concepts are the basic assumptions or conditions upon which the science of accounting is based.1 Explain the Various accounting Concepts and Principles? Answer: Concepts: Concepts take the form of assumptions or conditions. Drawings a/c Dr.Q. to Cash a/c 4. Types of Accounting Concepts As said earlier. which guide the accountants while preparing accounting statements. 3. Madan commenced business with cash Rs. Otherwise normal price would be charged. 16. Withdrew for private use 3000 4.

Accrual Concept: Profit earned or loss suffered for an accounting period is the result of both cash and credit transactions. There is no reason why an enterprise should be promoted for a short period only to liquidate the business in the foreseeable future. Periodicity Concept: The time interval for which accounts are prepared is an important factor even though we assume long life for a business. The accounting period could be half year or even a quarter. So also a balance sheet is prepared to depict the financial position of the business. Each concept is discussed below. The financial statements should be prepared at the end of each accounting period so that income statement shows profit or loss for that accounting period. Principle of Income Recognition: According to this concept. revenue is considered as being earned on the date on which it is realized. Unrealized revenue should not be taken into . going concern concept. This enables the business to segregate the transactions of the company from the private transactions of the proprietor(s). cannot be accounted in the books of accounts. Accounting Principles: Accounting Principles are the rules basing on which accounting takes place and these rules are universally accepted. An event or a transaction that cannot be expressed in money terms. Business Separate Entity Concept: The essence of this concept is that business is a separate entity and it is different from the owner or the proprietor.which is also termed as separate entity concept. Going concern concept: The fundamental assumption is that the business entity will continue fairly for a long time to come. This concept forms the basis for the distinction between expenditure that will yield benefit over a long period of time (Fixed Assets) and expenditure whose benefit will be exhausted in the short term (Current Asset). This assumption is called “going concern concept”. the date on which goods and services are transferred to customers for cash or for promise.. It is possible that certain incomes are earned but not received and similarly certain expenses incurred but not yet paid during an accounting period. periodicity concept and accrual concept.e. Similarly liabilities are classified as short term liabilities and long term liabilities. money measurement concept. It is an economic unit which owns its assets and has its own obligations. only revenue which is actually realized should be taken to profit and loss account. In effect. It should further be noted that it is the amount which the customers are expected to pay which shall be recorded. Money Measurement Concept: All transactions of a business are recorded in terms of money. i. But it is relevant to consider them while computing the financial results just because they are related to the specific accounting period.

Double Aspect Principle: This concept is the most fundamental one for accounting. Principle of Materiality: While important details of financial status must be informed to all relevant parties. A business entity is an independent unit and it receives benefits from some and gives benefits to some other. Such less significant facts are not regarded as material facts. The expenses and the goods purchased are shown at the value at which they are incurred. it should not be changed. Likewise if the firm chooses to depreciate assets under diminishing balance method. The value of the assets is constantly reduced by charging depreciation against their cost to present their book value in the balance sheet. Principle of Historical Costs: This is called ‘cost’ principle. A payment becomes expenditure or an expense only when such payment is revenue in nature and made for consideration. the amount can be rounded off to the nearest ten and fraction does not matter. Principle of Full Disclosure: The business enterprise should disclose relevant information to all the parties concerned with the organization. Principle of Expense: Expenses are different from payments. it should continue to do so year after year. whether the expenditure is paid during that period or not. What is material and what is not material depends upon the nature of information and the party to whom the information is provided. Principle of Consistency: Consistency is required to help comparison of financial data from one period to another. This is matching cost and revenue principle. amount outstanding during a particular period. Any change in the accounting methods should be informed to . While income has to be shown for income tax purposes. The statement of account sent to a debtor contains all the details regarding invoices raised. need not be communicated. For instance if stock is valued under FIFO method in first year it should be valued under the same method in the subsequent years also.consideration for determining the profit. Here costs are reported as expenses in the accounting period in which the revenue associated with those costs is reported. The information on debtors furnished to Registrar of Companies need not be in detail. Modifying Principle: The modifying principle states that the cost of applying a principle should not be more than the benefit derived from. All assets are recorded at the cost of acquisition and this cost is the basis for all subsequent accounting for the assets. This is called cost-benefit principle. then that principle should be modified. Principle of Matching Cost and Revenue: Revenue earned during a period is compared with the expenditure incurred to earn that income. Benefit received and benefit given should always match and balance. Once a method of accounting is adopted. There should be flexibility in adopting a principle and the advantage out of the principle should over weigh the cost of implementing the principle. which is important to find out the profit earned for that period. insignificant facts which do not influence any decisions of the investors or any interested group. unless the management takes a policy decision to change the depreciation method. If the cost is more than the benefit. It means that any information of substance or of interest to the average investors will have to be disclosed in the financial statements.

Answer: The objectives of tabulation are to: i. Bring out trends and tendencies vi. Present data in minimum space iv. Facilitate further analysis Marital Status Sex Age: Male Educated Below 20yrs 2040 Above 40 Non-Educated Below 20yrs 2040 Above 40 Married Femal e Male Unmarried Femal e 1 comments . Facilitate comparison v.2. then provision should be made by charging profit and creating investment fluctuation fund. Whenever risk is anticipated sufficient provision should be made. The value of investments is normally taken at cost. even if the market value is higher than the cost. Principle of Conservatism or Prudence: Accountants follow the rule “anticipate no profits but provide for all anticipated losses “. iii) sex . This is the principle of conservatism and it does not mean that the income or the value of assets should be intentionally under stated 0 comments Labels: MB0041. Explain the purpose of tabular presentation of statistical data. and iv) marital status. Draft a form of tabulation to show the distribution of population according to i) Community by age.the concerned authorities with justification. Highlight important characteristics iii. If the market value expected is lower than the cost. ii) Literacy . Simplify complex data ii. Semester 1 MB0040 .

frequency and frequency distribution. Arithmetic mean is used when: a. It is a single value which represents all units. shoe and readymade garment manufacturers will like to know the modal size of the people to plan their operations. However. Arithmetic mean is defined as the sum of all values divided by number of values and is represented by X. In depth study of the variable is needed b. it is that value corresponding to highest frequency. Mode: Mode is the value which has the highest frequency and is denoted by Z. This single figure is the measure which can be found at central part of the range of all values. graphs provide us only an overview and thus may not be used for further analysis.Q1.Labels: FALL 2010. Modal value is most useful for business people. we have to be familiar with the terms such as discrete data. Measure of central tendency or average of first order describes the concentration of large numbers around a particular value. In other words. geometric mean. The variable is continuous and additive in nature c. which are used in this unit. Appropriate Situations for the use of Various Averages 1. to analyse the data. Semester 1 MB0040 – STATISTICS . Before we study how to compute arithmetic mean. Mass data. For discrete data with or without frequency. Statistical Averages: The commonly used statistical averages are arithmetic mean. Median is denoted by ‘M’. For example. Hence. Median: Median of a set of values is the value which is the middle most value when they are arranged in the ascending order of magnitude. A systematic presentation of the values taken by variable together with corresponding frequencies is called a frequency distribution of the variable. classified. Hence. is analysed further to bring its size to a single representative figure. The number of occurrences of each value of the data set is called frequency of that value. Why it is necessary to summarise data? Explain the approaches available to summarize the data distributions? Answer: Graphical representation is a good way to represent summarised data. It is the one which represents the entire data set. MB0040. which is collected. then the data is said to be discrete data. the tendency of data to cluster around a figure which is in central location is known as central tendency. we use summary statistics like computing averages. If the number of values is finite. The data are in the interval or ratio scale . tabulated and presented systematically. harmonic mean. this is called the measure of central tendency.

The variable is discrete b. ratios and percentages are to be studied b. The study is related to speed. The variable is of multiplicative nature 5.d. time b. The rate of growth. The distribution is skewed d. The characteristics studied are qualitative f. Similarly. There exists abnormal values c. The variable is discrete b. When the distribution is symmetrical 2.Q 3 List out and briefly explain five “do”s and “don’t’s” for each of participants and chairperson of a meeting. MB0040. Mode is used when: a. The characteristics studied are qualitative 4. 0 comments Labels: FALL 2010. Semester 1 MB0039 . ten or hundred or any other number of equal portions. we can divide a given distribution into four. Harmonic mean is used when: a. Geometric mean is used when: a. Answer: Before the Meeting As pointed out earlier. in the form of a memo. Average of rates which produce equal effects has to be found 4. There exists abnormal values c. The answers to the following questions would help to decide whether a meeting is necessary in the first place – -Can the matter be decided or discussed over the telephone? -Can the matter be expressed in writing. The extreme values are missing e. Median is used when: a. Before any planning can be done however. The data are on the ordinal scale 3. a basic question to be asked is whether to hold a meeting at all.9 Positional Averages Median is the mid-value of series of data. The distribution is skewed d. or an email message? . meetings need to be planned in advance. The extreme values are missing e. so that they are successful. It divides the distribution into two equal portions.

Once the need for a meeting has been determined. where the numbers could be larger. “A meeting without an agenda is like a ship at sea without a destination or compass: no one aboard knows where it is or where it is headed. or the person who calls the meeting. In the words of Adler and Elmhorst. Opening the Meeting – The manner in which the meeting is opened is important. the type and number of participants should be decided. The second and most important step in planning a meeting is to indicate the purpose or agenda of the meeting to the participants in advance. background information and expectations of the participants. There are several techniques to encourage participation – .-Are key people available to attend the meeting and are they prepared? -Is the time allotted for the meeting sufficient? If the answers to the first two questions are yes and the answers to the other two questions are no. it is best to sum up what has been stated in the agenda – including the goals. the next step is to start planning the meeting. An exception to this is an information sharing meeting. It is also a good idea to provide an outline of how the meeting will proceed. There are different ways of opening a meeting. Encouraging Balanced Participation – It is also the responsibility of the chairperson to encourage silent members to contribute to the meeting and to moderate the dominant members. who are the owners of the company. so that a maximum number of people benefit from the information.” An agenda is prepared by the Chairperson of the meeting. A problem solving meeting should include representatives from all departments. and solving problems creatively. 2. During the Meeting: The task of conducting and moderating the meeting rests with the chairperson. Shareholders. as well as a time budget. We shall discuss each of these procedures in detail. concluding the meeting and managing time efficiently. there is no purpose in calling a meeting. In terms of numbers. 1. He or she must be well versed with the procedures for opening the meeting. First of all. Generally. encouraging balanced participation. An agenda is essentially a list of topics that will be discussed during a meeting. since a good opening will ensure that the rest of the meeting will proceed smoothly. so that they do not “hijack” the meeting. the size of the group could be anywhere between seven and eleven members. should also be included. since the decision would otherwise be incomplete.

along with a specified deadline. it is the responsibility of the chairperson. depending on the agenda and ensure adherence to the time limit. the decisions and the actions to be taken. Sometimes meetings may be concluded before the closing time.• Encourage Participation in the Reverse Order of Seniority – This means getting the junior members to speak or air their opinions first. the chairperson should set a time budget for the meeting. 8. 7. when key decision makers are not present. Keeping the Meeting Focused – Often. In such situations. • Nominal Group Technique – In this method. they may feel suppressed or be afraid to disagree with their superiors. Ensuring “Convergence” – Convergence means hearing the points of view of all the members and then arriving at a decision. since it will influence the follow-up action taken on decisions made during the meeting. The chairperson should know when and how to conclude the meeting. Generally. 6. The meeting should normally be concluded at the scheduled closing time. problem-solving meetings will take longer than other routine meetings. Summing Up – This means summing up the different points of view. 4. identifying the role of each person on each item of the agenda. 5. It is again the responsibility of the chairperson to bring the meeting to a point where an opinion emerges on each item of the agenda. Managing Time – There is no prescribed length for a meeting. a lot of time is wasted during meetings by going off track and by discussing topics that are irrelevant. or the person moderating the discussion to make sure that the discussion remains focused on the topics mentioned in the agenda. This should be done by the chairperson. Concluding the Meeting – The way a meeting is concluded is as important as the opening. The duration of a meeting will depend on the type and purpose of the meeting. unless important issues still remain to be discussed and members are willing to extend the meeting. If the senior people speak first. In any case. Keeping “Minutes” of the Meeting – Since meetings are called to take important decisions . Example – Chris will take the responsibility of contacting the media and sending material for advertisements and press releases by March 13th. or when important information such as cost figures are not available. the meeting participants are encouraged to work and contribute their ideas independently 3.

MB0039. slang and metaphors c)Use of simple vs.000 jobs in August. Is it well or poorly written. Semester 1 MB0039 . which can be referred to at a later stage. It is the chairperson’s responsibility to make a note of the items that have not been discussed and to schedule the next meeting. 2. trading was expected to remain light. to ensure that the deadlines are met. or serve as a guide for action.S. jobs report eased fears that the global economy could slip back into recession. after the meeting is over. complex words. Follow-up may involve the following steps – 1. . added 67. along with a fresh agenda. Do your own Groundwork – Apart from monitoring the progress of meeting participants. Plan for the Next meeting – Very few meetings is conclusive and cover all the items in the agenda completely.S. more than analysts expected. in your opinion? Attach a copy of the article with your response. Evaluate it in terms of :a) Appropriate level of readability b) Use of jargon. it is important to monitor their progress every now and then. All participants must be informed that a follow-up meeting is being planned. Therefore. With Wall Street closed for a holiday. Such a record is known as “minutes” of the meeting and may be done in an informal or formal manner. unless proper follow-up measures are taken to ensure that the goals are fully accomplished.Q 2. Answer: World Markets Rise As Double-Dip Fears Ease: World stock markets advanced modestly Monday as investors rode momentum from Friday. it is important to maintain a permanent written record of the proceedings. Check Progress on Follow-up Actions – Members of the meeting may have been assigned different responsibilities and deadlines for completion of tasks. however. depending on the type of meeting. 0 comments Labels: FALL 2010. it is also important that you as the chairperson finish any pending work before the next meeting. Select a business article from any business publication.concerning the organization. Markets took heart after official data last week showed private employers in the U. 3. After the Meeting: A meeting that proceeds smoothly will still not be successful. when an upbeat U.

8 percent at 4.2880 from $1.27 yen on Friday.S.93 on Friday.153. the first time that has happened in a month. The euro was slightly lower at $1. Shares in the U.3 percent at 5. steady and below-trend global recovery continues." analysts from Rabobank said in a report. the stronger-than-expected jobs data on Friday helped calm investors' frayed nerves after weeks of worrying indicators.792.3 percent to 1.301. Britain's FTSE 100 index was up 0.24 yen from 84.17. . particularly as the U.32 and South Korea's Kospi rose 0. Because the U. The broader Standard & Poor's 500 Index rose 1.20.19. "The renewed flight to safety we have witnessed over the past month is overdone and risks an equally large reversal when the worries over a double dip subside.31 and France's CAC-40 was up 0. slows down quickly. will maintain a slow but steady recovery from last year's recession and avoid another economic contraction later this year.42. it's important not to confuse it with a double dip recession.355.The figure bolstered optimism that the U.8 percent to 21.7 percent to 1.51. Australia's S&P/ASX 200 gained 0.104." Japan's benchmark Nikkei 225 stock index climbed 2. ended the week in the positive. By mid-afternoon in Europe.S. Indonesia and Singapore were also higher. economy is the world's largest and consumer spending there accounts for a fifth of global economic activity.3 percent at 3. With most major governments reining in economic stimulus measures and many pushing through austerity spending cuts to reduce deficits. The Dow Jones industrial average jumped 1. Taiwan. investors worry the global economy would be pushed into a double dip recession.77. "As the unexciting. when shares fell on doubts about the global economic recovery. India. Markets in mainland China. The early gains in September mark a stark turnaround from August trade.50. Germany's DAX was 0. Hong Kong's Hang Seng index added 1.446. to 9.2895.575.684.3 percent higher at 6.1 percent.447. Asian indexes closed higher and trading on Wall Street was to remain shut for Labor Day weekend after closing higher on Friday.S.S. or 187.2 percent to close at 10. The dollar fell to 84.

Safety goggles will be made available at a small cost. By the time the message is passed down from the Chief to the lower level Executives. the reader of the article should have a certain amount of knowledge in the field of stock trading and world financial markets. The contract fell 42 cents to settle at $74. Semester 1 MB0039– BC . The CEO will deliver a short speech beforehand to give us all some information.Q 1. if you pay a moderate cost. however. Some of the technical terms mentioned above are “rode momentum. For a moderate cost. FTSE. Describe any situation that you experienced where the communication went wrong because the listening was faulty. Kospi. they will be made safe with goggles. etc. This is not something that can be seen everyday. Staff should meet in the lot at ten to eleven.20 a barrel in electronic trading on the New York Mercantile Exchange. This will be followed by a total eclipse of the sun. Analyze the situation by explaining the type of listening barrier. so much so that the original message is interpreted differently by each level in the organization. which will appear for 2 minutes.” More complex words and phrases are written in the above article and this reduces the level of readability when read by a common man.Benchmark oil for October delivery was down 40 cents at $74. when I will deliver a short speech introducing the eclipse. . Jargon refers to technical terms or specialized vocabulary. The above article is well written. calm investors' frayed nerves. This is when the sun disappears behind the moon for 2 minutes. CAC. This is something that cannot be seen everyday so staff will meet in the car park at ten or eleven. it is distorted completely. Memo from Manager to Department Head: Today at ten to eleven.60 on Friday. all staff should meet in the car park. MB0039. Memo from the Department Head to Floor Manager: The CEO will today deliver a speech to make the sun disappear for 2 minutes in the form of an eclipse. How could this barrier be overcome? Answer:The following example illustrates an organizational barrier to communication. . This will be safe. time will be allowed for employees to view the eclipse in the parking lot. DAX. As this is something that cannot be seen every day. Memo from CEO to Manager: Today at 11 o’clock there will be a total eclipse of the sun. and giving some background information. 0 comments Labels: FALL 2010.

This means using a combination of both oral and written channels. modify or completely change the message. Memo from Supervisor to Staff: Some staff will go to the car park today to see the CEO disappear. MB0039. where there are multiple “layers”. 3 comments Labels: FALL 2010. messages may have to pass through many levels before they finally reach the receiver. This means that each department in an organization functions in isolation and there is no co-ordination or communication between them. so much so that it becomes distorted by the time it reaches the intended receiver. Each level may add to. It is a pity this doesn’t happen everyday. in order to make sure that messages reach the intended receivers without fail. This barrier could be overcome by the following methods: 1. 3. Create a Climate of Openness – A climate of trust and openness can go a long way in removing organizational barriers to communication. Another type of organizational barrier is a departmental barrier. All subordinates or junior employees should be allowed to air their opinions and differences without fear of being penalized. there is likely to be loss of meaning and the message may not reach the receiver in the same way as it was intended by the sender. in a separate unit. and as usual it will cost you. where the CEO will eclipse the sun for 2 minutes. 2. Use Multiple Channels of Communication – Organizations should encourage the use of multiple channels of communication. It will be safe.4 What are the factors influencing perception? .Memo from Floor Manager to Supervisor: Ten or eleven staff are to go to the car park. that is.Q. Encourage Feedback – Organizations should try to improve the communication system by getting feedback from the messages already sent. Feedback can tell the managers whether the message has reached the receiver in the intended way or not. Semester 1 MB0038 . In other words. This does not happen everyday. Communication was filtered or misinterpreted because of the following barriers: Organizational Barriers – In organizations that are too hierarchical. as well as formal (official) and informal (unofficial) channels of communication. The types of channels will be discussed in detail later.

X is interviewing candidates for a very important position in his organization – a position that requires negotiating contracts with suppliers. For example. For example. that interpretation is heavily influenced by personal characteristics of the individual perceiver. most of whom are male. In contrast. A number of factors operate to shape and sometimes distort perception. d) Self-Concept: Another factor that can affect social perception is the perceivers’ self-concept. Mr X may feel that women are not capable of holding their own in tough negotiations. we gain information about properties and elements of the environment that are critical to our survival. Characteristics of the Perceiver: Several characteristics of the perceiver can affect perception. c) Motives: Unsatisfied needs or motives stimulate individuals and may exert a strong influence on their perceptions. Personal insecurity can be translated into the perception that others are out to "get my job". When in a positive mood. regardless of the intention of the subordinates. Through the perceptual process. Perception not only creates our experience of the world around us. Because our individual interests differ considerably. . a negative self-concept can lead a perceiver to pick out negative traits in another person. e) Interest: The focus of our attention appears to be influenced by our interests. in an organizational context. In addition. If you are preoccupied with a personal problem. we remember information that is consistent with our mood state better than information that is inconsistent with our mood state. An individual with a positive self-concept tends to notice positive attributes in another person. suppose Mr. We think differently when we are happy than we do when we are depressed. The major characteristics of the perceiver influencing perception are: a) Attitudes: The perceiver’s attitudes affect perception. the supervisor who has just been reprimanded by his boss for coming late is more likely to notice his colleagues coming late tomorrow than he did last week. we tend to evaluate others unfavourably. Greater understanding of self allows us to have more accurate perceptions of others. 1. When an individual looks at a target and attempts to interpret what he or she stands for. When in a negative mood. This attitude will doubtless affect his perceptions of the female candidates he interviews. it allows us to act within our environment. what one person notices in a situation can differ from what others perceive. ii) In the object or target being perceived or iii) In the context of the situation in which the perception is made. b) Moods: Moods can have a strong influence on the way we perceive someone. For example. These factors can reside: i) In the perceiver. you may find it hard to be attentive in class. a boss who is insecure perceives a subordinate’s efforts to do an outstanding job as a threat to his or her own position. we form more positive impressions of others.Answer: Factors Influencing Perception Perception is our sensory experience of the world around us and involves both the recognition of environmental stimuli and actions in response to these stimuli.

or that are new or unusual. • People who accept themselves are more likely to be able to see favourable aspects of other people. meeting a manager in his or her office affects your impression in a certain way that may contrast with the . Others tend to focus more on central traits. Nonverbal communication conveys a great deal of information about the target. Verbal communication from targets also affects our perception of them. Characteristics of the Situation: The situation in which the interaction between the perceiver and the target takes place. If two employees of a department suddenly resign. the greater the probability we will tend to perceive them as a group. has an influence on the perceiver’s impression of the target. and posture all in an attempt to form an impression of the target . sound.f) Cognitive Structure: Cognitive structure. These four characteristics greatly influence how a person perceives others in the environmental situation. We listen to the topics they speak about. Characteristics of the Target: Characteristics in the target that is being observed can affect what is perceived. more readily. race and gender.As a result of physical or time proximity. size and other attributes of a target shape the way we see it. we often put together objects or events that are unrelated. For example. and their accent and make judgements based on this input. Extremely attractive or unattractive individuals are more likely to be noticed in a group than ordinary looking individuals. weight. • One’s own characteristics affect the characteristics one is likely to see in others. People. weight. also affects perception. Perceivers tend to notice physical appearance characteristics that contrast with the norm.The perceiver will notice the target’s physical features like height. The greater the similarity. they might be totally unrelated. E. such as height. The research findings of the study conducted by Sheldon S Zalkind and Timothy W Costello on some specific characteristics of the perceiver reveal • Knowing oneself makes it easier to see others accurately. that are intense. facial expressions. Some people have a tendency to perceive physical traits. Physical attractiveness often colours our entire impression of another person. an individual’s pattern of thinking. and appearance. The perceiver deciphers eye contact. Cognitive complexity allows a person to perceive multiple characteristics of another person rather than attending to just a few traits. expectations can distort your perceptions in that you will see what you expect to see. • Accuracy in perceiving others is not a single skill. g) Expectations: Finally. Motion. employees in a particular department are seen as a group. body movements. Physical appearance plays a big role in our perception of others. objects or events that are similar to each other also tend to be grouped together. their voice tone. Interviewers rate attractive candidates more favourably and attractive candidates are awarded higher starting salaries. or personality dispositions. estimated age.g. we tend to assume their departures were related when in fact.

This is the discounting principle in social perception.Q. and have a natural head for business or mechanics. Some situations provide strong cues as to appropriate behaviour. Thinking or feeling (T or F). This person tends to be resourceful in solving challenging problems but may neglect routine assignments. They usually have original minds and great drive for their own ideas and purposes. Perceiving or judging (P or J). They are characterized as skeptical. because of the influence of the situation. Individuals are classified as (McCrae and Costa.Q. independent. c. and seems genuinely interested in your taste in cars. In these situations. and in this particular situation. The strength of the situational cues also affects social perception. The ENTP type is a conceptualizer. versatile. He or she is innovative. and often stubborn. Semester 1 MB0038 . MB0038. INTJs are visionaries. logical. individualistic.3 Explain the classification of personality types given by Myers -Briggs. For example. Answer:The Myers-Briggs Type Indicator The MBTI classifies human beings into four opposite pairs (dichotomies). we assume that ±ie individual’s behaviour can be accounted for by the situation. This person is trying to sell you a car. had you met the manager in a restaurant. asks you about your work and hobbies. In MBTI. and that it may not reflect the individual’s disposition. • These classifications are then combined into sixteen personality types. critical.2 Discuss the methods of shaping behavior in detail. 1989) : a. Semester 1 MB0038 .Fall 2010 . Extroverted or introverted (E or I). b. ESTJs are organizers. MB0038. . decisive. 0 comments Labels: FALL 2010. They are realistic.impression you would have formed. and attracted to entrepreneurial ideas. b. base on their psychological opposites. he probably treats all customers in this manner. you may encounter an automobile salesperson who has a warm and personable manner. analytical. c. 0 comments Labels: FALL 2010. These four opposite pairs result into 16 possible combinations. They like to organize and run activities. For example: a. d. Can you assume that this behaviour reflects the salesperson’s personality? You probably cannot. determined. Sensing or intuitive (S or N).

They are as follows: 1. a scolding. if he/she achieves sales target. b) Apply punishment before the undesirable behaviour has been strongly reinforced. iv) Students will study to get good grades. good grades. are positive reinforces. For example. Terminating an unpleasant stimulus in order to strengthen or increase the probability of a response is called negative reinforcement. punishment is still the most common technique of behaviour control in today’s life. F. Punishment is causing an unpleasant condition in an attempt to eliminate an undesirable behavior. iii) Salesmen will increase their efforts to get rewards and bonuses. There are four methods of Shaping Behavior. Negative reinforcement – This is the process of having a reward taken away as a consequence of a undesired behavior. certain guidelines would make it more effective thus minimizing its dysfunctional consequences. 4. If a person does not behave as the society or law wants him to do. Example: Loss of pay for coming late to office. scholarship is withdrawn from the student who has not done well on the examination. The removal of a pleasant stimulus might consist of withholding affection and attention. Thus. or taking away a privilege such as watching television. Skinner. The added unpleasant stimulus might take the form of criticism. i) Bonuses paid at the end of a successful business year are an example of positive reinforcement. Extinction – An alternative to punishing undesirable behaviour is extension – the attempt to weaken behaviour by attaching no consequences (either positive or negative) to it. Positive reinforcement – This is the process of getting something pleasant as a consequence of a desired behavior. the punishment should immediately follow the undesirable behaviour. It is equivalent to . to strengthen the same behavior. According to B. 2. it is called shaping behavior. the rises. Punishment can be accomplished either by adding an unpleasant stimulus or removing a pleasant stimulus. suspending a driver’s license. Accordingly. ii) Employees will work hard for a raise or a promotion. When a child misbehaves. one get a commission. he is punished by arrest and jail. punish in private. or a prison sentence. in situations where punishment is desirable as a means of behaviour modification. 3. bonuses. This is the process of getting a punishment as a consequence of a behavior. promotions. he is spanked. a fine. a) Praise in public. c) The punishment should focus on the behaviour and not on the person.ANSWER: Shaping Behavior When a systematic attempt is made to change individuals’ behaviour by directing their learning in graduated steps. they also engage in behaviours to avoid or escape unpleasant conditions. For example. For example. Just as people engage in behaviours in order to get positive reinforces. and v) In these examples. a disapproving look. awards.

This means that if rewards were removed from behaviours that were previously reinforced. he will continue to exhibit that behaviour. Both punishment and extinction weaken behavior and tend to decrease its subsequent frequency . Both positive and negative reinforcement result in learning. They strengthen a response and increase the probability of repetition.the attention is given to him. However.ignoring the behaviour. then such behaviours would become less frequent and eventually die out. For example. he is probably asking for attention. This type of reinforcement is applied to reduce undesirable behaviour. some patience and time may be needed for it to be effective. especially when such behaviours were previously rewarded. The rationale for using extinction is that a behaviour not followed by any consequence is weakened. If . if a student in the class is highly mischievous and disturbs the class.

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