NAB Exam Updated Study Guide Questions
and Answers (2026) | Focused Revision Pack
| Grade A+
• Major schools of thought regarding source of authority are . Answer: formal and
subordinate acceptance
• The scope of authority in the operation of the nursing facility is greatest at which level .
Answer: Ownership
• Ultimate authority in a private corporate nursing facility is with the . Answer: Board of
directors
• Managerial authority is power . Answer: to command, issue orders or exact action by
subordinates
• Decentralized authority is characterized by . Answer: process of delegating authority
• Centralized authority is . Answer: vesting decision making in top managment
• Authority vested in a supervisory nurse is . Answer: middle management authority
• Decision making authority is when a supervisor . Answer: hires, fires and makes
judgmental decisions
• Concepts of modern management recommend that an effective administrator will
delegate . Answer: operational authority
• Unity of command refers to . Answer: reporting to one supervisor
• Which of the following forms of business is considered the oldest form of business .
Answer: sole proprietorship
• The term proprietorship as it relates to the nursing facility industry means . Answer:
privately owned
• The majority of nursing facility beds in the united states are owned by . Answer:
corporations
• Which of the following forms of ownership must have articles drawn up and reduced to
writing? . Answer: corporation
• Under which form of ownership would the administrator have the greatest latitude of
authority and decision making? . Answer: Sole proprietorship
,• All but one are considered advantages of sole proprietorship . Answer: Unlimited
liability
• All but one are considered disadvantages of a partnership . Answer: Retention of
valuable employees
• A corporation is . Answer: a legal entity created by law to carry on a business or
profession
• Which one of the following forms of business ownership is considered the most
important? . Answer: Corporation
• A nonprofit corporation is one which . Answer: makes a profit but returns it to the
operation of business
• Pursuant to the Code of Federal Regulations, 42 CFR part 483, a facility wishing to
participate in medicare must have . Answer: a governing body
• The role of the governing body pursuant to the Code of Federal Regulation 42 CFR
Part 483 is to . Answer: establish and implement policies regarding management and
operation of the facility
• The Code of Federal Regulations 42 CFR part 483 requires that the facility disclose .
Answer: officers, directors, agents, or management employees
• The role of the administrator in a modern nursing facility is to . Answer: advise the
governing body and carry out their decisions
• According to the Code of Federal Regulations 42 CFR Part 483 the administrator
appointed by the governing body must be . Answer: licensed by the state and
responsible for the management of the facility
• An objective may be defined as . Answer: organizing
• The first step in planning is . Answer: setting the objectives of the organization
• Effective management is best carried out by following which method? . Answer:
management by objectives
• Management by objectives involves . Answer: plurality of objectives
• Which of the following objectives would be considered first in establishing a new
nursing facility? . Answer: Type of facility
,• An administrator of a proprietary nursing facility should be primarily concerned with
which one of the following objectives? . Answer: Quality of care
• Which one of the functions of management would be accomplished first? . Answer:
planning
• Relative to setting objectives, which task listed below would be of primary importance
for the administrator to accomplish? . Answer: constantly review and reassess
objectives of the nursing facility
• Which one of the following statements is true? . Answer: Every department in the
nursing facility should have goals or objectives
• Since there is a plurality of objectives in a nursing facility, the facility should concern
itself with . Answer: long and short term goals
• Planning is primarily concerned with . Answer: use of facts to determine course of
action for the future
• Strategic planning . Answer: helps the facility to re evaluate its mission and identify its
long term goals.
• Planning on a broad scale is carried on primarily by a . Answer: administrator
• Planning involves all but one of the following . Answer: personnel decisions
• Which of the following is not a function of the administrator? . Answer: ultimate
approval of all policies (governing board does that)
• Planning at the top level of management is best characterized as . Answer: broad, far-
reaching, and basic
• In the process of planning, which guideline should be followed? . Answer: involve as
many managers as possible
• Considering the functions of management such as: directing, organizing, coordination,
controlling and planning, which of these functions would be first? . Answer: planning
• The technique of forecasting is important in the modern nursing facility. The accuracy
of the administrator's forecasts will affect the success of planning. Forecasts are
expected to be . Answer: a reasonable estimate of what reality will be in the future
• In the process of planning, the administrator should . Answer: constantly check,
recheck, and modify the plan if necessarry
• A short range plan covers which time period? . Answer: 1-2 years
, • A long range plan covers . Answer: 3-5 years
• The function of management called organizing is best described as . Answer: the
process of grouping various activities of a similar nature and establishing authority
relationships
• At which operational level in a nursing facility does organizing take place? . Answer: at
all dept levels within the organized structure
• The mission statement of a nursing facility . Answer: explains the goals and objectives
to the facility
• Span on management is the . Answer: number of employees a supervisor can
effectively handle
• The schematic drawing representing the functional operation of a nursing facility
structure is called the . Answer: organizational chart
• Service departments of a nursing facility can best be described as . Answer:
departments that facilitate, aid and assist other departments
• An example of a service department in a nursing facility is the . Answer: personnel
office
• Line authority structure is best described as a situation in which . Answer: a superior
delegates authority to a subordinate who, in turn, delegates his or her authority forming
a line from the top to the bottom level of the organization
• A line authority position exists when the executive . Answer: makes final decisions
regarding departmental functioning
• An example of a line authority position in a nursing facility is the . Answer:
administrator
• An example of a staff authority position in a nursing facility is the . Answer:
administrative assistant
• The primary function of a staff authority position is . Answer: aid, assist, and advise the
department heads
• All but one of the following would be considered contractual services in a nursing
facility . Answer: Nursing director
• A standing committee is one which . Answer: permanent in nature
and Answers (2026) | Focused Revision Pack
| Grade A+
• Major schools of thought regarding source of authority are . Answer: formal and
subordinate acceptance
• The scope of authority in the operation of the nursing facility is greatest at which level .
Answer: Ownership
• Ultimate authority in a private corporate nursing facility is with the . Answer: Board of
directors
• Managerial authority is power . Answer: to command, issue orders or exact action by
subordinates
• Decentralized authority is characterized by . Answer: process of delegating authority
• Centralized authority is . Answer: vesting decision making in top managment
• Authority vested in a supervisory nurse is . Answer: middle management authority
• Decision making authority is when a supervisor . Answer: hires, fires and makes
judgmental decisions
• Concepts of modern management recommend that an effective administrator will
delegate . Answer: operational authority
• Unity of command refers to . Answer: reporting to one supervisor
• Which of the following forms of business is considered the oldest form of business .
Answer: sole proprietorship
• The term proprietorship as it relates to the nursing facility industry means . Answer:
privately owned
• The majority of nursing facility beds in the united states are owned by . Answer:
corporations
• Which of the following forms of ownership must have articles drawn up and reduced to
writing? . Answer: corporation
• Under which form of ownership would the administrator have the greatest latitude of
authority and decision making? . Answer: Sole proprietorship
,• All but one are considered advantages of sole proprietorship . Answer: Unlimited
liability
• All but one are considered disadvantages of a partnership . Answer: Retention of
valuable employees
• A corporation is . Answer: a legal entity created by law to carry on a business or
profession
• Which one of the following forms of business ownership is considered the most
important? . Answer: Corporation
• A nonprofit corporation is one which . Answer: makes a profit but returns it to the
operation of business
• Pursuant to the Code of Federal Regulations, 42 CFR part 483, a facility wishing to
participate in medicare must have . Answer: a governing body
• The role of the governing body pursuant to the Code of Federal Regulation 42 CFR
Part 483 is to . Answer: establish and implement policies regarding management and
operation of the facility
• The Code of Federal Regulations 42 CFR part 483 requires that the facility disclose .
Answer: officers, directors, agents, or management employees
• The role of the administrator in a modern nursing facility is to . Answer: advise the
governing body and carry out their decisions
• According to the Code of Federal Regulations 42 CFR Part 483 the administrator
appointed by the governing body must be . Answer: licensed by the state and
responsible for the management of the facility
• An objective may be defined as . Answer: organizing
• The first step in planning is . Answer: setting the objectives of the organization
• Effective management is best carried out by following which method? . Answer:
management by objectives
• Management by objectives involves . Answer: plurality of objectives
• Which of the following objectives would be considered first in establishing a new
nursing facility? . Answer: Type of facility
,• An administrator of a proprietary nursing facility should be primarily concerned with
which one of the following objectives? . Answer: Quality of care
• Which one of the functions of management would be accomplished first? . Answer:
planning
• Relative to setting objectives, which task listed below would be of primary importance
for the administrator to accomplish? . Answer: constantly review and reassess
objectives of the nursing facility
• Which one of the following statements is true? . Answer: Every department in the
nursing facility should have goals or objectives
• Since there is a plurality of objectives in a nursing facility, the facility should concern
itself with . Answer: long and short term goals
• Planning is primarily concerned with . Answer: use of facts to determine course of
action for the future
• Strategic planning . Answer: helps the facility to re evaluate its mission and identify its
long term goals.
• Planning on a broad scale is carried on primarily by a . Answer: administrator
• Planning involves all but one of the following . Answer: personnel decisions
• Which of the following is not a function of the administrator? . Answer: ultimate
approval of all policies (governing board does that)
• Planning at the top level of management is best characterized as . Answer: broad, far-
reaching, and basic
• In the process of planning, which guideline should be followed? . Answer: involve as
many managers as possible
• Considering the functions of management such as: directing, organizing, coordination,
controlling and planning, which of these functions would be first? . Answer: planning
• The technique of forecasting is important in the modern nursing facility. The accuracy
of the administrator's forecasts will affect the success of planning. Forecasts are
expected to be . Answer: a reasonable estimate of what reality will be in the future
• In the process of planning, the administrator should . Answer: constantly check,
recheck, and modify the plan if necessarry
• A short range plan covers which time period? . Answer: 1-2 years
, • A long range plan covers . Answer: 3-5 years
• The function of management called organizing is best described as . Answer: the
process of grouping various activities of a similar nature and establishing authority
relationships
• At which operational level in a nursing facility does organizing take place? . Answer: at
all dept levels within the organized structure
• The mission statement of a nursing facility . Answer: explains the goals and objectives
to the facility
• Span on management is the . Answer: number of employees a supervisor can
effectively handle
• The schematic drawing representing the functional operation of a nursing facility
structure is called the . Answer: organizational chart
• Service departments of a nursing facility can best be described as . Answer:
departments that facilitate, aid and assist other departments
• An example of a service department in a nursing facility is the . Answer: personnel
office
• Line authority structure is best described as a situation in which . Answer: a superior
delegates authority to a subordinate who, in turn, delegates his or her authority forming
a line from the top to the bottom level of the organization
• A line authority position exists when the executive . Answer: makes final decisions
regarding departmental functioning
• An example of a line authority position in a nursing facility is the . Answer:
administrator
• An example of a staff authority position in a nursing facility is the . Answer:
administrative assistant
• The primary function of a staff authority position is . Answer: aid, assist, and advise the
department heads
• All but one of the following would be considered contractual services in a nursing
facility . Answer: Nursing director
• A standing committee is one which . Answer: permanent in nature
