a. The principles of management provide the managers with useful insights into real life situations. The principles add manager’s knowledge, ability and understanding of managerial situations and circumstances which helps them to solve problems quickly and increase managerial efficiency.
b. Management principles help in thoughtful decision-making. They are based on logic rather than blind faith. Management decisions taken on the basis of principles are free from bias and prejudice. They are based on the objective assessment of the situation.

Rule of thumb

Principle of Taylor is referred in the given case is  'Rule of thumb'

There are three different business-level strategies: (1) cost leadership, (2) differentiation, and (3) integrated cost leadership and differentiation. All three of these business-level strategies involve choices related to differentiation and cost leadership. The three dimensions of changesare: the scope of change, the level of change and the intentionality of change.

Explanation:

• The principles of management are used for creating situations that relate between the cause and effect situations which can be used in different situations and cases. The main focus of the cause and effect relationship is to have situations which would be similar for the the kind of effect expected.
• This is not possible since the managerial situations and environment can be different in some circumstances, so there cannot be the same cause and effect situations in these cases. This is because human behavior are different in situations with people where  they cannot be compared for establishing the cause and effect.
• The management principles are helpful to the management in creating a better understanding of human behavior also for influencing the behavior of the people. These principles are needed for achieving the goals of the organisation

1. The level of the nearness of the actual result with planned result is Effectiveness.
2.Effectiveness is ‘to do perfect things’.
3.The long run is the point of view of Effectiveness.
4. Efficiency is yield-oriented. Unlike Effectiveness, which is result oriented.
5.  Effectiveness of strategies is measured which are made by the organisation.

The capital invested in current or working assets such as stock of materials and finished goods, accounts receivable, bills receivable, short-term securities and cash or bank balance for meeting day-to-day expenses is known as working capital or current capital.
It represents investment for a short period. The term ‘working capital’ is used in two senses, namely gross working capital and net working capital.
(i) Gross working capital It is the total value of current assets… The amount of gross working capital indicates the total funds available for financing the current assets. It is a quantitative concept, which fails to reveal the true financial position of a company.
(ii) Net working capital It represents the excess of current assets over current liabilities. Net working capital is a qualitative concept and it reveals the soundness of current financial position. It shows a firm’s ability to meet its current obligations as they fall due for payment.

Economic growth refers to the growth of the economy in terms of real GDP. Expansion is the phase in the business cycle in which this economic growth is occurring.  

The costs of inflation means that the price level increases. This then reduces the purchasing power of a dollar and thus effectively lowers the incomes of households, since they can no longer purchase the same amount of stuff they once could with the same amount of money. It also causes erosion of personal savings, since the money is not worth as much any more.

An organisation consists of several departments who work together to achieve a common goal. If they do not work together the activities will not be carried out efficiently and effectively and the goal will not be accomplished. 

Hence, the values such as co-operation, co-ordination and work with the help of each other are essential for all departments to work together and achieve the objective.

1. Coordination integrates group efforts by integrating the activities performed by the individual towards a common direction. 

2. Coordination is a continuous function as it is never ending because manager works continuously to achieve coordination and maintain coordination because without it the organization cannot function efficiently. 

3. Coordination is an all pervasive function: Coordination is a universal function because it is required at all the levels of management, in all the departments and to perform all functions due to interdependence of various activities on each other. 

4. Coordination is a deliberate function as every manager tries to coordinate the activities of the organization to avoid confusion and chaos in the organization. 

5. Coordination is the responsibility of all managers and not just the top level management in an organisation. 

1. Coordination integrates group efforts by integrating the activities performed by the individual towards a common direction. 

2. Coordination is a continuous function as it is never ending because manager works continuously to achieve coordination and maintain coordination because without it the organization cannot function efficiently. 

3. Coordination is an all pervasive function: Coordination is a universal function because it is required at all the levels of management, in all the departments and to perform all functions due to interdependence of various activities on each other. 

4. Coordination is a deliberate function as every manager tries to coordinate the activities of the organization to avoid confusion and chaos in the organization. 

5. Coordination is the responsibility of all managers and not just the top level management in an organisation. 

Proper understanding of principles is the base of training, research, and development in the field of management. Management is taught on the basis of these principles which help the management institutes prepare future managers. These Principles help managers to take decisions and actions in the right manner. Originally identified by Henri Fayol as five elements, there are now four commonly accepted functions of management that encompass these necessary skills: planning, organizing, leading, and controlling.

  Main social objectives of management are included in the following list:
(i) To make available employment opportunities.
(ii) To save environment from getting polluted.
(iii) To contribute in improving living standard.
                           

Dimensions of or the agents forming the business environment involve economic, social, legal, technological and political circumstances which are contemplated properly for decision-making and enhancing the achievement of the trading concern. There are five dimensions of the business environment that influence many firms. These dimensions include the economic environment, the social environment, the political environment, the legal environment, and the technological environment.

Planning is needed both in the business and non-business organizations. Some people think that planning is based on the future anticipations and nothing can be said with certainty about future. Therefore, it is a useless process.

Following are the limitations of planning:

(1) Planning Creates Rigidity:

Although the quality of flexibility is inherent in planning, meaning thereby that in case of need changes can be brought in, but it must be admitted that only small changes are possible. Big changes are neither possible nor in the interest of the organisation.

(2) Planning Does Not Work in a Dynamic Environment:

Planning is based on the anticipation of future happenings. Since future is uncertain and dynamic, therefore, the future anticipations are not always true. Therefore, to consider planning as the basis of success is like a leap in the dark.

(3) Planning Reduces Creativity:

Under planning all the activities connected with the attainment of objectives of the organisation are pre-determined. Consequently, everybody works as they have been directed to do and as it has been made clear in the plans.

(4) Planning Involves Huge Costs:

Planning is a small work but its process is really big. Planning becomes meaningful only after traversing a long path. It takes a lot of time to cover this path.

(5) Planning is a Time-consuming Process:

Planning is a blessing in facing a definite situation but because of its long process it cannot face sudden emergencies. Sudden emergencies can be in the form of some unforeseen problem or some opportunity of profits and there has been no planning for all these situations beforehand and which now requires immediate decision.

(6) Planning Does Not Guarantee Success:

Sometimes the managers think that planning solves all their problems. Such thinking makes them neglect their real work and the adverse effect of such an attitude has to be faced by the organisation.

The following are the differences between Stock and Flows:

Stocks:

1. Stocks associate to a point of time.

2. It does not have any dimension of time.

3. Stocks are influenced by flows for example, the higher is the saving, and the higher is the stock of wealth.

Flows:

1. They are associated with a span of time.

2. They hold a dimension of time.

3. Stocks effect flows.