Professional Documents
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Pob Past Q Amp A
Pob Past Q Amp A
(b) Explain the differences between the types of economic systems listed in (a) above. (4mks)
(c) Suggest two ways by which the government of your country can control business activity. (4mks)
Total 10 marks
Before reading the discussion and guidelines to answering the question, you may wish to plan an answer
that you would give to the question. Remember, there may be other possible answers than the ones
suggested.
(a) Any two types of economic systems can be listed, for example, the free economic system and the
planned economic system. This part of the question does not require any expansion or explanation.
(b) The characteristics or features of the economic systems listed can be used to show the differences
between them.
Conjunctions such as whereas, on the other hand, while and however should be used to indicate your
reference to the opposite feature for the other economic system. For example, in the free economy,
most of the scarce resources are owned and allocated by private individuals and firms while in the
planned economy, scarce resources are owned and allocated by the government.
The marks allotted for this part of the question would indicate that a minimum of two differences is
required.
(c) Governments’ control of business activity can come in many forms including:
* Price controls Government stated maximum prices for selected goods and services
* Nationalisation
Nationalisatio n Direct ownership and control of industries by the Government, for example, where
monopolies are exploiting consumers.
* Increased taxation
taxation To reduce monopoly profits.
Registration
Registration and other legal requirements for setting up of businesses.
* Employment of inspectors to monitor the affairs of businesses e.g. price inspectors and sanitary
inspectors.
* Setting up of government agencies such as The Bureau of Standards to monitor the quality of goods
produced and imported.
Remember,
Remember, you are asked to suggest only two ways.
2) Now let’s move on to another question. CXC past paper May/June 2003 (General), Question 1.
(i) Partnership
(ii) Public Limited Company
(iii) Co-operative (4 marks)
(c) State TWO advantages which the Public Limited Company has over the Partnership type of business.
(4 marks)
Total 10 marks.
Partnerships are normally required to sign a Deed of Partnership and register with the Registrar of
Companies.
(c) The advantages which the Public Limited Company has over the Partnership type of business includes
the fact that:
* A larger number of part owners, since the Public Limited Company has a minimum of seven
shareholders and no maximum.
* More capital can be raised than in a partnership since an appeal can be made to the general public
through the Stock Exchange.
* The Public Limited Company is a separate entity from the shareholder owners, therefore, the
individual shareholders cannot be sued, the company must be sued.
* The Public Limited Company has a Board of Directors elected by the shareholders.
Remember,
Remember, you are asked to suggest only two ways.
2) Now let’s move on to another question. CXC past paper May/June 2003 (General), Question 1.
(i) Partnership
(ii) Public Limited Company
(iii) Co-operative (4 marks)
(c) State TWO advantages which the Public Limited Company has over the Partnership type of business.
(4 marks)
Total 10 marks.
Partnerships are normally required to sign a Deed of Partnership and register with the Registrar of
Companies.
(c) The advantages which the Public Limited Company has over the Partnership type of business includes
the fact that:
* A larger number of part owners, since the Public Limited Company has a minimum of seven
shareholders and no maximum.
* More capital can be raised than in a partnership since an appeal can be made to the general public
through the Stock Exchange.
* The Public Limited Company is a separate entity from the shareholder owners, therefore, the
individual shareholders cannot be sued, the company must be sued.
* The Public Limited Company has a Board of Directors elected by the shareholders.
Remember, you are asked to state only TWO advantages of the Public Limited Company over the
Partnership.
Tom Phillip who lived 20 miles away, drove to the address on the date specified with the intention of
purchasing the minibus.
On arrival, he was told by the auctioneer that the minibus was no longer available and was removed
from the items to be auctioned.
Tom Phillip became furious, threatened to sue for breach of contract and demanded a refund of his
traveling expenses
(c) What do you understand by ‘vehicle will be sold as is where is’? (2 marks)
(ii) State ONE way in which a court may settle a breach of contract.
(1 mark)
(e) State TWO ways by which a contract can be terminated or discharged (4 marks)
(f) (i) Should John Brown refund Tom Phillip’s traveling expenses? (1mark)
(ii) Give ONE reason for your answer to (f)(i) above. (2 marks)
(g) (i) Advise Tom Phillip whether he will succeed in court against John Brown. (1 mark)
(ii) Give ONE reason for your advice in (g)(i) above. (2 marks)
Total 20 marks
* (a) You must be careful to define a contract, and not an agreement. A contract is defined as a legally
binding agreement or an agreement that is created with legal intentions.
If you state that a contract is an agreement without stating any legal aspect, you may only score half of
the marks, since all contracts are agreements, but not all agreements are contracts.
* (b) (i) The answer to this part of the question is simply NO.
(ii) The vehicle was not offered for sale, therefore, one cannot accept an offer that was not made. An
acceptance MUST be to a firm offer.
* (c) This means that the vehicle is to be sold in the condition that it is presently in at the place or
physical locality that it is at.
(d) (i) Breach of contract means that a party or parties to the contract fail to keep their part or parts to
the contract.
(ii) The court can rule that the party that has breached the contract be forced to abide by their side of
the contract. Or, with the injured parties agreement, the existing contract can be terminated and a new
one can come into existence that satisfies all parties.
* (e) There are a number of ways in which a contract can be discharged or terminated. You are asked to
state TWO ways. Some ways are suggested below:
* By frustration, which means that something, which was possible at the time the contract was made,
now becomes impossible .
* By breach. However, in this case the contract can only be terminated with the permission of the
injured party.
* By law. This is when something that was legal at the time the contract was made now becomes illegal
by law. Therefore, the contract must come to an end.
* (f) (i) No, John Brown should not refund Tom Phillip?s traveling expenses.
Tom Phillip took it upon himself to make the journey to the auction and so the cost of doing so must fall
on his own shoulders
(g) (i) Tom Phillip will NOT succeed in court against John Brown.
(ii) There was no contract and there was no breach of contract. He would win the case if an existing
contract had been breached.
Tasty Fruit Ltd. is a manufacturer of several types of exotic tropical fruit juices. Without consultation,
Mr. Albert, the general manager, took a decision that with immediate effect all breaks would be reduced
from 15 minutes to five minutes. He claimed that the change became necessary to enable the factory to
process a larger amount of fruit juices daily.
(a) What type of leadership style did Mr. Albert appear to be practising? (2 marks)
(ii) Describe ONE of the leadership styles you named in (b)(i) above. (2 marks)
(c) Identify TWO situations that can result from the action taken by Mr. Albert. (4 marks)
(ii) Give an example to show how lack of one of the qualities you mentioned at (d)(i) above can affect
the operation of the factory. (2 marks)
Total 20 marks
(b) (i) Any TWO of the following can be named: laissez-faire/free reign leadership style, democratic
leadership style, charismatic leadership style.
(ii) Laissez-faire individuals are given the broad outlines, but left on their own to carry out the major
aspects of the decisions.
Democratic those who will be affected by the decision are consulted before the decision is taken,
though the leader still reserves the right to make the final decision.
Charismatic the leader leads by virtue of his/her personality or charisma. Any ONE of the leadership
styles can be described.
(c) The following situations may result: poor management-worker relationship; industrial action may be
taken by workers; resignations by workers; workers may become discontented; poor self-esteem of
workers and reduced productivity of workers. Any TWO situations may be used.
(d) (i) The qualities of a good manager include: honesty, flexibility, ability to carry out management
functions and responsibilities, show genuine concern for employees and customers, ability to motivate
workers, be adaptable to various situations, able to work on own initiative, ability to use Management
Information Systems, be aggressive, but not too aggressive, be reliable etc.
(ii) If for example the manager is unable to motivate his employees, they will become lax and
productivity will fall. The business will end up loosing profits.
The negative effects of the lack of any of the qualities you listed in (d)(i) can be explained.
(e) Responsibilities of managers to employees include: to treat them fairly, to give them safe, clean
environment to work in, to allow them the freedom to join trade unions, to support their desires to be
educated and trained, to pay fair wages and salaries, to honour leave entitlement, to give adequate
compensation for injury on the job etc. Any THREE responsibilities can be stated.
Recently, the employees of the telephone company have engaged in various industrial activities in
support of their trade union. The trade union was involved in ‘collective bargaining’ with the
management of the company for a new three-year industrial agreement for its members. The
management retaliated by taking certain actions against the employees who charged that their rights
were being violated.
(a) Give FIVE examples of industrial activities which the employees could have engaged in without
striking. (5 marks)
(b) Identify TWO actions the management could have taken in retaliation against the industrial activities
by the workers. (2 marks)
(e) Apart from ‘collective bargaining’, outline THREE other functions of a trade union. (6 marks)
Total 20 marks
(b) The action that management could have taken includes: lockouts, black-listing, suspensions,
termination of work contracts, deductions of salary etc.
(c) Collective bargaining refers to the trade union function in which the trade union representing the
workers and the employer or employers’ association discuss issues relating to employees with a view to
settlement which is suitable to both sides.
(e) Other functions of the trade union include: securing better wages and fringe benefits for workers,
securing better work environment, job security, ensuring that workers get the leave they are entitled to,
ensuring that workers are not exploited in any way, education of members as to the role of trade
unions, scholarships to members and family etc. The THREE points chosen should be expanded on by
brief explanations and /or examples.
Many governments throughout the Caribbean region have been encouraging persons to become
entrepreneurs.
(e) Outline how an entrepreneur may overcome any ONE of the problems discussed in (c) above. (2
marks)
(f) List FOUR ways in which governments may assist entrepreneurs. (4 marks)
Total 20 marks
(a) The entrepreneur is a human factor of production that is responsible for organising the other factors
of production and bearing the risks in production.
(b) Among the reasons why entrepreneurship is being encouraged are: entrepreneurship provides
opportunity for self employment, it also reduces unemployment, it increases the production of goods
and services, increases the variety of goods and services produced, Gross National Product is increased,
makes use of idle skills, and uses up local raw materials. Any THREE reasons may be suggested.
(c) The characteristics of a successful entrepreneur are many and varied. They include: ability to work
hard, ability to take calculated risks, ability to make effective decisions, ability to organise, ability to
motivate and the ability to think quickly and clearly in any situation. Again, any THREE characteristics
may be listed.
(d) The problems of the entrepreneur include: problems in sourcing capital, lack of managerial skills, lack
of suitable collateral, inability to assess market potential, inability to evaluate competition, lack of
appropriate technology and the inability to procure suitable machinery and equipment.You should
expand on the TWO problems you choose to discuss by explaining them and giving examples.
(e) You should begin this part of your answer by stating the problem selected and then outline your
suggestion for overcoming the problem. For example, if you select the problem of the difficulty in
sourcing capital, you could suggest that the entrepreneur explore several sources of capital and that he
even combine different sources of capital, such as his own savings, along with a loan from a bank or
credit union.
(f) The ways in which governments can assist entrepreneurs include: providing them with ‘soft loans’
(loans with little or no interest), providing education and training on enterprise management, giving tax
incentives, providing entrepreneurial consultants to monitor and assist entrepreneurs, providing factory
shells for them to operate their businesses in, and providing markets for their goods and services. Any
FOUR ways can be listed.
For many years, persons from Caribbean territories have migrated to Europe and North America. Very
often these persons only return for holidays or upon retirement.
(b) State THREE negative effects of migration on the labour force in your country.
(3 marks).
(c) Explain TWO positive effects migration may have on your country (4 marks).
(d) Identify ONE measure your country uses to encourage nationals to return.
(1 mark).
Total 10 marks
(b) The negative effects of internal or external migration or both may be given. Internally, the negative
effects of migration include: shortage of labour in one area and surplus of labour in another area,
overpopulation in one area with resulting social disorders, e.g., crime, etc. External migration results in
negative effects such as ‘the brain drain’, families abandoned and left to fend for themselves by
migrants, lower standard of living, etc. Any three negative effects will be accepted.
(d) Governments may encourage nationals to return by offering attractive and affordable housing, jobs
for those who require them, by allowing them to return with their personal effects without having to
pay duties, or only requiring them to pay small amounts of duty, by ensuring that their country is as
close to crime-free as possible, etc. Any one measure properly stated will be accepted.
Rapid structural change is being experienced throughout the world, bringing with it a growing
importance of the contribution of small firms/businesses to economic development in every country.
Many industries and firms are now buying and selling goods via the computer through a system called
the Internet.
(b) Given the following sectors in the Caribbean, indicate which FOUR are most likely to be dominated
by small businesses:
(i) bauxite production
(ii) retailing
(iii) agriculture
(iv) petroleum refining
(v) finance and banking
(vi) personal services
(vii) fishing. (4 marks).
(c) Discuss FOUR ways through which small businesspersons can use the Internet to assist them in their
business goals. (8 marks).
(d) Suggest THREE reasons why the government of your country should encourage the growth of small
businesses as a way to promote economic development. (6 marks).
Total: 20 marks
(a) There are a number of acceptable definitions of the small firm. You may wish to use any of the three
definitions from Trinidad and Tobago, or any other definition that you are comfortable with. The
Trinidad and Tobago definitions are:
* A firm whose total assets excluding land and buildings does not exceed TT$500,000.
* According to The Central Statistical Office, a small business is a business that employs less than 10
workers.
* A firm that employs only one top manager who should manage the business and perform other
functional duties as well.
Generally speaking, a small firm is one with virtually no middle management, i.e., there is hardly any
supervisors or subordinate managers.
(b) The FOUR sectors most likely to be dominated by small businesses are retailing, agriculture, personal
services and fishing.
(c) The Internet allows small business persons to: communicate with others in the same field, get
information and ideas that are current in their field, advertise their products, source raw materials and
goods at reasonable prices, source markets/outlets for their goods and services, get access to Internet
buying and selling which boosts sales, etc. The points must be discussed fully to show how the small
business benefits from the Internet in order to gain the full eight marks.
* They provide healthy competition to larger firms and force them to sell at more reasonable prices.
* They produce goods and services that people want and this will increase standard of living.
* They provide linkages to other firms so they can be certain of their sources of raw materials and/or
their outlets.
(b) Identify three types of productive activities that are carried out in the Caribbean and list the country
in which each is carried out. (6 mks)
(c) (i) State five factors which determine the location of an industry. (5 mks)
(ii) Discuss three economic and social implications of technological developement. (6 mks)
Total: 20 mks
(a) There are four types of productive activities: extraction, construction, manufacturing and service
activities. Any three of the four can be used for the answer.
(b) A number of activities and countries can be used for this answer. Consider the following:
Agriculture Jamaica
Fishing Barbados
Mining Guyana
Construction Trinidad
Manufacturing Trinidad
Tourism Jamaica
Communication Barbados
You should note that other activities and countries may be considered, however, you should identify
three different productive activities and the countries in which the activities are observed.
(c) (i) The factors that influence the location of industry include: land, nearness to markets, nearness to
raw materials, nearness to a suitable labour supply, nearness to power, climate, infrastructure and the
government.
(ii) The economic and social implications of technological development include: increased output,
improved standard of living or quality of life, greater speed in producing, improved quality of
production, structural unemploy-ment, physical impairment and stress and alienation.
Note that the points discussed can be economic or social in nature and may also be positive or negative.
Each implication must be discussed, not listed, for full marks.
10) Now for the second and final question for this lesson.
(c) Identify four factors influencing the behaviour of consumers in their choice of local hamburgers over
foreign hamburgers. (8 mks)
(d) Discuss three methods a local business may use to promote local hamburgers. (6 mks)
Total: 20 mks
(a) A market refers to a situation in which buyers and sellers are in contact for the purpose of buying and
selling goods and services. Marketing, on the other hand, refers to everything that is done to get goods
and services to the right people at the right time and priced in the most efficient manner, while making
a profit.
Included are: market research, advertising, sales promotion, branding, distribution, sales, pricing; public
relations, research and development, marketing mix, etc.
(c) Taste, tradition, quality, price, brand loyalty, income, knowledge of the owners, convenience, the
way the good is advertised, etc.
(d) Methods of promotion that can be used include: advertising, sales promotions, publicity, public
relations and competitive pricing. Each method should be discussed, e.g., advertising may increase the
demand for local hamburgers. The business will sell more and make more profit.
Company XYZ Ltd. manufactures and markets a range of candles of different shapes and lengths. Since
its incorporation in 1989, sales volume has increased tenfold. In order to meet demand, the company
has had to expand its production capacity and support systems considerably.
(a) List FOUR internal economies of scale the company might experience. (4 marks)
(b) Identify FOUR diseconomies of scale the company might experience. (4 marks)
(c) (i) Explain FOUR benefits the company might experience because of mechanisation. (8 marks)
(ii) Discuss TWO negative effects the introduction of mechanisation might have on the company. (4
marks)
Total: 20 marks
(a) You will remember that economies of scale refers to advantage to a firm or company from going into
large-scale production. The economies of scale include:
Financial economies.
Social economies.
(b) Diseconomies of scale refers to the disadvantages to a firm or company from large-scale production.
The diseconomies include:
‘Red tape’, which is the elaborate and time-consuming procedures through which consumers
must pass.
Larger businesses often result in loss of coordination and lack of control, e.g. communication
between management and workers may slow down, wastages of factors, etc.
(c) (i) Recall that mechanisation means partially replacing human or animal muscle power by a machine,
e.g., a tailor buying a sewing machine instead of sewing by hand. The benefits of mechanisation include:
Output increases because work is speeded up and more can be produced in less time.
Fewer workers are needed as machines can do the work of a number of persons.
Costs are saved. These costs that are saved can be transferred to the market in the form of
lower prices to consumers.
It encourages more skilled workers to enter the workforce, i.e., workers who can operate
specific machinery etc.
Any FOUR benefits can be explained. For full marks, the benefits must be brought out clearly.
(ii) The negative effects of the introduction of mechanisation on the company might include:
Unemployment caused by the fact that less labour is required than when work is done entirely
by hand, therefore, the excess labour is normally laid off.
Some machines are of a technical nature and require skilled persons to operate them. In some
cases these skilled persons are hard to find.
Machines may be costly to maintain, as in some cases parts may have to be imported with the
use of scarce foreign exchange.
As in (c) (i) above, the negative effects of mechanisation must be properly discussed in order to gain full
marks.
The Caribbean island of Green Mountain is having problems with its financial institutions. Customers of
some banks are adding to the problems as many have withdrawn their deposits from the banks. The
government has asked the central bank to do all it can to prevent a collapse of the commercial banking
sector.
(c) For EACH of the functions mentioned above, explain what benefit customers obtain from using these
functions. (4 marks)
(e) Select THREE of the features of central banks you mentioned above, and explain how they help to
promote smooth operation of the banking system in your country. (6 marks)
Total marks: 20
(a) You must be careful not to confuse the characteristics of money with the functions of money.
The characteristics of money are the features of money. Money should be:
Generally acceptable
Durable or long-lasting
Homogeneous
Portable
(b) The functions or services offered by commercial banks today are many and varied. They include the
following:
Accept deposits from customers for safekeeping and makes these deposits available to
customers when needed.
Allow customers use of the banks’ safety deposit boxes and night safe facilities etc.
(c) Whichever TWO functions you choose to explain, you must ensure that you properly explain the
benefits of them to the customer. For example:
The function of accepting deposits from customers benefits the customers in that it allows them to keep
their money in a safe place instead of keeping it at home. In addition, for most deposit accounts, the
customer earns interest on his deposits and this encourages him to save with commercial banks.
Commercial banks lend money to qualified customers by opening loan accounts, by means of overdrafts
and by discounting bills of exchange. Whatever the method, customers are granted loans and benefit
from large sums of money, which they perhaps could not save for, while they benefit in being able to
pay back loans in small installments. Customers benefit in getting loans for various purposes including
education, vacation and for purchasing cars and other assets.
Issuing notes and coins and recalling them from circulation when necessary.
Negotiating on behalf of the government in international financial agreements, e.g. with the
IMF, etc.
(e) Again, in explaining the THREE chosen features, you must be careful to show how they promote
smooth operations of the banking system. For example, in monitoring the commercial banks and other
financial institutions, the central bank ensures that governments’ monetary policies are carried out and
that they are not promoting the opposite policy which would cause chaos in the financial system and in
the country. You must explain THREE features in like manner.
The question, reproduced below, surrounds the topic of international trade and balance of payments:
The following information was taken from the final accounts of Tropicalo, a country in the Caribee Isles.
The figures are quoted in US ($M).
$US
Visible trade
Exports 24 000
Imports 26 000
Invisible (net)
Exports 20 000
Imports 15 000
(a) (i) Differentiate between a country’s te rms of trade and its balance of tr ade. (3 mks)
(ii) Calculate Tropicalo’s balance of trade using the figures given above. (2 mks)
(b) Calculate Tropicalo’s current account balance using the figures given above. (3 mks)
You are not required to explain the calculations in (a) (ii) and (b).
(c) Identify two ways in which a country may have a surplus on its current account. (4 mks)
(ii) Discuss three ways by which a country would be able to finance the deficit in its balance of
payments. (6 mks)
Total 20 marks
(a) (i) A country’s terms of trade refers to the rate at which its goods and services exchange for the
goods and services of another country. It is calculated as:
Whereas, a country’s balance of trade is the difference between the country’s imports and exports of
goods only. To properly differentiate between the two terms, the candidate should use terms such as
‘on the other hand’, ‘while’, ‘whereas’, etc.
24,000
- 26,000
-2,000 US ($M)
(b) The current account balance takes into consideration the visible trade balance and the invisible trade
balance. From (a) (ii) we found the visible trade balance (balance of trade) to be minus 2,000 US ($M).
The invisible trade balance is plus 5,000 US ($M). This is the difference between invisible exports and
invisible imports. The current account balance is plus 3,000 US ($M).
(d) (i) A country’s balance of payments is its annual record of trading with other countries in terms of
income from exports and expenditure for imports.
(ii) To finance a deficit is different from correcting the deficit. To finance the deficit, the country must
find ways to make the balance of payments balance by covering the deficit. This includes:
Loans from international financial institutions e.g., International Monetary Fund and the World
Bank.
Any short-term solution which results in the amount of money to cover the deficit, if properly discussed,
will earn two marks each.
Government has a responsibility to protect consumers as well as to provide a climate for businesses to
survive.
(b) Identify THREE ways in which the government of your country can ensure that consumers’ safety and
well-being are protected. (6 mks)
(c) Discuss THREE ways in which the government may help businesses to succeed. (6 mks)
(d) State TWO ways by which the government can ensure that businesses protect the environment. (4
mks)
Total : 20 marks
Now, for my discussion and guideline answers. I hope they will help you in getting a fair understanding
of the question.
In addition, consumers are not always able to make a good assessment of the goods they buy. They
cannot protect themselves and therefore need to be protected.
Candidates should state clearly any TWO reasons for consumer protection.
(b) Some of the ways in which the government can ensure that consumers? safety and well-being are
protected are:
By setting up consumer protection agencies such the Ombudsman, the Bureau of Standards and
the Consumer Affairs Commission.
Through the introduction of penalties for producers and sellers who show lack of regard for
consumers.
By passing legislation/laws that ensure consumer protection, e.g., processed food acts, Public
Health Act, The Standard Act and The Food and Drugs Act.
Allowing them subsidies and grants which result in the lowering of costs of production.
Reducing corporation tax which reduces overall costs and boosts profits.
Assisting businesses in finding markets and in the marketing of their products, etc.
For this part of the question, the THREE points selected must be properly discussed to score full marks.
(d) The protection of the environment has become increasingly important. The government can ensure
that businesses protect the environment by:
Taking over the production where businesses fail to protect the environment.
Having inspectors go around and ensure that practices are not damaging to the environment.
Giving warnings which if not adhered to, result in the business being taken to court or some
other action.
Encouraging the location of businesses in special areas where their production practices will not
harm the environment, etc.
2. The most important principle upon which barter trade depends is known as:
a) insurable interest
b) indemnity principle
c) utmost good faith
d) double coincidence of wants
3. Mary lives in a country in which the state makes all the decisions about economic activities. That
country has adopted the:
a) municipal authority
b) nationalised industries
c) public corporations
d) public limited companies
a) sole trader
b) manager
c) director
d) shareholder
9. What is the maximum number of share holders a private limited company can have?
a) two
b) five
c) fifty
d) eighty
10. The relationship between the highest level of management down to the various departments is
known as:
a) flow
b) rank
c) staff
d) line
11. If X offers Y a book for $5, but Y says that he can only pay $4.50 for it, this is an example of:
a) an offer
b) a counter offer
c) an invitation to treat
d) consideration
a) an offer
b) a counter offer
c) an invitation to treat
d) consideration
13. John buys goods to the value of $150, but is allowed 20% trade discount on the invoice, plus 5% cash
discount. He will therefore pay:
a) $112.50
b) $114.00
c) $126.00
d) $142.50
14. If you received less goods than was ordered and paid for, your supplier would send you:
a) a credit note
b) an invoice
c) a debit note
d) a bill of exchange
a) acceptability
b) durability
c) limited supply
d) portability
17. The only bank which can claim to be a lender of last resort is the:
a) merchant bank
b) central bank
c) commercial bank
d) trustee savings bank
18. The document that has details of the source of goods, the raw materials from which the goods are
made, is called the:
a) shipping note
b) certificate of origin
c) bill of lading
d) bill of exchange
20. A man insured his property for $80,000, but its true value was $100,000. A fire caused $10,000
worth of damage. The insurance will pay out:
a) $10,000
b) $8,000
c) $5,000
d) $6,500
2. Which one of the following will have the effect of reducing the supply of labour?
5. Which of the following does not have a direct effect on the efficiency of labour?
9. Each year, some high school graduates of the Caribbean rural communities move to the towns and
cities to live and work. The movement of such persons could be described as:
10. People who migrated from the West Indies in the early 1950′s went to all of the following countries
on a large scale except:
11. Unemployment that results from a ‘slump’ in the e conomy can be described as:
12. The ’4-H’ Club and the Lion’s Club are ex amples of`
(a) multinational companies
(b) community self-help organisations
(c) monopolies
(d) voluntary chain stores
(a) machinery
(b) shares
(c) debentures
(d) money
(a) money and inventory used to finance the day to day running of a business.
(b) Capital that changes from one form to another and back to its o riginal form
(c) The money paid to workers for maintaining day to day production.
(d) Any man-made item that assists in production.
(a) profit
(b) interest and dividends
(c) rent
(d) wages
20. A person responsible for bringing together and organising the factors of production is the
(a) entrepreneur
(b) trade-unionist
(c) manager
(d) financier
End of Test
1. The advantages of a sole trader over a partnership form of business include which of the following?
A) sole trader.
B) manager.
C) director.
D) shareholder.
A) careless partner.
B) active partner.
C) dormant partner.
D) general partner.
5. To comply with legal requirements to register a private limited company, the firm must provide at
least two documents. These are:
A) a prospectus and a certificate of origin.
B) a memorandum of association and articles of association.
C) a certificate of trading and tax file number.
D) a share certificate and a debenture certificate.
6. Those partners who, when their business goes bankrupt, stand to lose all their personal possessions
as well as their investments are known as:
7. The form of business where shares are allowed to be sold only to owners of the business or to their
relatives or employees is known as:
A) partnership.
B) private limited company.
C) public limited company.
D) multinational company.
9. Company A owns all these businesses: soft drink company, bakery, shipping company and motor-car
assembly company. Company A is an example of a:
A) conglomerate.
B) multinational.
C) private limited company.
D) partnership.
10. If one company, A, has or owns the majority shares in another company, B, then company A can best
be regarded as being a:
A) holding company.
B) partnership.
C) co-operative.
D) joint-stock company.
Now you can have a look at the answers to see how well you have done.
1. C 2. D
3. C 4. B
5. B 6. A
7. B 8. C
9. A 10. A
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1. Description of business – In this part you are required to give a brief description of your intended
business. The examiner should
(a) The name of your intended business e.g. Xtreme Graphics production
(c) What is the proposed business engaging in? e.g. production of local fruit juices
(d) The major aims or aims of your business e.g. To make 100% profit by ensuring customer’s
satisfaction.
(e) If possible you can give example(s) of the goods and/ services you will be producing.
(a) State the location of your intended business, e.g. 152 John Street
(b) Secondly, you will have to list and explain the factors which influence your choice of location. (Check
your textbook) e.g. Closeness to raw materials.
3. Selection of appropriate labour - as we already know labour is an important of production and if you
don’t select the most appropriate ty pe of labour then inefficiency would take occur and productivity will
decline. You are required to”
(a) List the type of labour you will enjoy employ. e.g. cleaner
(b) Then classify them under the three main categories of labour namely:
- Skilled
- Unskilled
- Semi-skilled
4. Sources of fixed and working capital - Capital refers to money and all other assets of a person,
company or industry that can be converted into money. PHYSICAL CAPITAL consists of fixed capital and
working or circulating capital. FIXED capital refers to capital that is of a lasting nature and which does
not change its form during the course of production, e.g., factory buildings, machines and tractors.
WORKING or CIRCULATING capital changes its form or state during the course of production, e.g., raw
materials and partly finished goods. You are required to identify the sources of these capitals. e.g. loans
5. Roles of the Entrepreneur - The entrepreneur is a other factors of production and bear risks. Human
factor of production whose main functions are to organize the other factors of production. The
entrepreneur consciously moves resources from an area of lower productivity and lower yield to an area
of higher productivity and higher yields. You are required to list and briefly explain the roles of the
entrepreneur. (Check Note book)
6. Type of production- Production refers to the combining of the factors to create goods and services to
satisfy people’s wants and needs. The types (stages) of production should not be co nfused with the
levels of production. You are required to state the type(s) of production your intended business will
engage itself in. ( Check Note Book/ Text book)
7. Levels of Production – The levels of production classify the amounts of goods and services produced
under three different headings:
subsistence
domestic
8. Quality control measures- in this part you should be able to define quality as it relates to your
business and then you will state the measures/ ways of ensuring quality in your intended business. E.g.
hiring only trained employees.
9. Use of technology- We all know that technology plays an important part in any business. If businesses
don’t adapts to changes in technology if ultimately lead to making a loss. You are required to show how
you will employ technology in your operations.
10. Linkages-. A linkage industry is an industry which is associated or connected to other industries in
such a way that the existence of one is dependent on the other, or it enhances the other ’s production
process. These industries are also referred to as ‘spin-off’ and ‘screwdriver’ industries. You will be
required to: