Future Business Leaders of America (FBLA) Business Management Practice Test

Which theory examines the effect of a leader's behavior on performance and job satisfaction?

1. Path-goal

2. Power-affiliation

3. Universal

4. Trait

The correct answer is: Path-goal

The Path-goal theory is specifically designed to analyze how a leader's behavior influences their subordinates' performance and job satisfaction. This leadership theory posits that a leader's role is to define goals, clarify the path for achieving those goals, remove obstacles, and provide support, thereby enhancing employee motivation and satisfaction in the workplace. Path-goal theory identifies several leadership styles, such as directive, supportive, participative, and achievement-oriented, and suggests that the effectiveness of these styles depends on the needs of the team members and the work environment. Leaders adapt their style to best fit the situation and the followers' expectations, thus directly impacting performance and job satisfaction. In contrast, other theories like the power-affiliation theory focus on the dynamic between leaders and followers regarding power and relationships rather than directly linking behavior to performance outcomes. Universal theories attempt to identify certain traits or behaviors that can be applied across all situations but do not specifically examine the impact on job satisfaction or performance. Trait theory focuses more on inherent characteristics of leaders rather than the effects of their behavior in relation to those they lead. Hence, Path-goal theory is the most appropriate framework for this inquiry into leadership behavior and its direct effects on both performance and job satisfaction.