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CSEC POB June 2003 P1

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1. Which ofthe following statements describe 5. A' line relationship' in an organisation Is one
the functions ofa business unit? which

l. Production of goods and services (A) exists between a senior officer and.
II. Creation of jobs - his subordinate
Ill. Maximization of sales (B) is not connected by intermediary
IV. Education of workers officers or other senior personnel
(C) exists between the manager and is
(A) I, II and Ill only connected directly to his employ-
(B) I, II and IV only ees
(C) I, III and IV only (0) involves only one superior officer
(D) II, III and N only

6. What is the BEST suggestion to a sole trader

2. Which of the following conditions oper- whose business is expanding too rapidly for
ated under the barter system? him to control?

(A) All households were self-sufficient (A) Purchase more cash registers.
(B) The rate of exchange was fixed (8) Institute a self~service system.
(C) Goods were. used as a means of (C) Increase the stock available.
exchange (0) Set up departments with managers.
(0) Oeterminingthe value ofan item was
easy
7. In a large organization if workers are dis-
satisfied about working conditions the trade
3. Broad policies for Public and Private Com- union representatives' first action would
panies in the Private Sector are formulated be to
by the
(A) have discussions with the person-
(A) shareholders nel officer
(B) board of directors (8) advise employees to adopt go slow
(C) company secretary tactics
(0) managing director (C) plan for strike action
(0) request a meeting with the board of
directors
4. In a public limited company the ordinary
shareholders collect their dividends
8. Which of the following methods can be
(A) before those holding preferred used to improve the communication flow
shares in an organisation?
(B) before those holding debentures
(C) after those holding deferred shares l. Suggestion schemes
(0) after those holding preferred shares II. Films and film strips
II I. Staff members
IV. Notice boards

(A) I, II and III only

l (B) I, II and IV only
r (C) II, III and IV only
(0) . I, Iii llf lllld' IV ~
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Items 9 - 11 are based on the diagram below which shows a section of a typical vertical
organisational chart for a manufacturing company.

BOARD OF DIRECTORS (1)

MANAGING DIRECTORS (2)

PRODUcnON MANAGER MARKETING MANAGER CHIEF ACCOUNTANT

• (4) (5) (6)

9. The relationship between the highest level 10. The managerial function performed at level
of management down to the various de- 2 is BEST described as
partments is known as the
(A) judicial
(A) rank (B) delegatory
(B) line (C) procedural
(C) staff (D) promotive
(D) flow
11. The managerial function performed at level
3 is BEST described as

(A) disseminatory
(B) communicative
(C) executive
(D) consultative

12. Which of the following statements describe 13. Mr Gyma, the General Manager of Z Co. is
the functions of management? always too busy to discuss problems with
workers and to listen to suggestions from
I. Co-ordinating the work ofemploy- his employees. His leadership style can be
ees described as being
II. Delegating work to subordinates
III. <;:ontrolling employees and raw (A) authoritarian
"materials (B) democratic
IV. Ensuringthatemployeesjoinatrade (C) laissez-faire
union (D) bureaucratic

(A) I and II only

(B) II and Ill only
(C) ~ U ~ U,J Oflir
(0) . D. Wand IV !>flly
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14. Which of the following policies adopted 17. According to the law of contracts, a con-
by management is MOST LIKELY to tract has NOT been effected until
ensure worker morale?
(A) there has been an exchange of money
(A) Employees should take part in de- between the contractual parties
cision-making on an ongoing ba- (B) the acceptance ofthe offer has been
sis since every employee has du- made before witnesses
ties and responsibilities. (C) consideration has been made with
(B) Supervisors should make decisions respect to the contract
when they have been directed to (D) both parties have received copies
do so by the general manager. of the contract document
(C) The general manager should make
all the decisions because he is
responsible for the performance 18. Which ofthe following contracts MUST be
of all employees. evidenced in writing?
(D) Decisions made by the top man-
ager and his advisers must be- (A) Purchase of a bus-ticket
I carried out by employees as di- (B) Purchase of a radio
rected to ensure that there will be (C) Purchase of a lot of land-
r no breakdown in work p,oce- (D) Purchase of a car for cash
I
dure.
I 19. Which of the following is NOT a natural
/ , 15. Which ofthe following elements is NOT a
I , resource of the Caribbean?
requirement of a simple contract?
(A) Gold
(A) Consideration
(B) Bauxite
(B) Legalisation ,
(C) Coal
(C) Acceptance
(D) Timber
(D) Offer

16. Which of the following situations would 20: The money used for the day-to-day opera-
occur if a contract for the sale of goods tions of a business is called
becomes void?
(A) fixed capital
I. The prospective buyer becomes (B) nominal capital
the owner. (C) floating capital
II. The seller has the right to keep any (D) working-capital
money or goods which have been
given to him in this transaction.
III. The prospective buyer does not 21. A switch to capital intensive methods of
become the owner. production in a country might, in the short
IV. The seller must return any money run, result in
or goods given to him by the
prospective buyer for the trans- (A) increased unemployment
action. (B) increased output
(C) reduced output
(A) II and III only (D) reduced unemployment
(B) III and IV only
(C) I and IV only
(D) I, ll and IV oniy
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22. Wealth set aside for the production of fur- 26. Which of the following are classified as
ther weal th is termed Rrimary industries?

{A) banking I. Farming

(B) commerce II. Services (direct and commercial)
(C) capital III. Manufacturing
(0) saving IV. Mining

(A) I and II only

23. What is the MOST LIKELY effect on a (B) I and IV only
developing economy when professional and (C) II and IV only
skilled labour migrate to developed coun- (0) I. II, III and IV
tries?

(A) Unski.lled labourers can demand 27. Which of the following are examples of
higher wages. extractive industries?
{B) The demand for skilled labour and
• professional services will de- I. Mining
crease., II. Refining
(C) Unskilled labourers can work III. Fishing
harder. IV. Agriculture
(D) Production levels of goods and serv-
ices wilJ decrease. (A) I, II and III on] y
(B) I, II and IV only
(C) I, III and IV only
' 24. The person responsible for bringing to- (D) II, III and IV only
gether and organising the factors of pro-
duction is the
28. Which of the following is an example of an
(A) trade unionist extractive type industry?
(B) entrepreneur
(C) manager (A) Transport
(D) financier (B) Fishing
(C) Tourism
(D) Refining
25. Which of the following LEAST affects the
location of an extractive industry?
29. In the Caribbean, many people are hired for
(A) Proximity to sources of raw mate- sugar-cane farming and very little equip-
rials ment is used. This industry can BEST be
(B) Availability of an abundant Jabour described as
supply
(C) Proximity to large shopping areas (Al labour intensive
(D) The presence of good roads and (B) having low capital input
·. drainage (C) having high capital input
(0) capital intensive

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30. Which of the following activities are in- 34. A firm expands to achieve internal econo-
volved in the field of marketing? mies of scale because it wants to

I. Sales promotion - (A) increase costs of production

II. Public advertising - (D) increase worker's wages
III. Packaging and selling (C) decrease the quantity of goods it
IV. Distribution and decisions produces
(D) decrease its costs per unit
(A) I and II only .
(B) III and IV on! y
(C) II, III and IV only 35. In which of the following types of trade can
(D) I, II, III and IV· the hire purchase method of buying be
used?

31•. Which of the following documents gives (A) Wholesale trade

the name of the ship and fuII particulars of (B) Retai 1 trade
th~ shipment of goods? (C) Import trade
(D) Foreign trade
(A) Bill of Sale
(B) Bill of Lading
(C) Way Bill 36. All persons can be called consumers be-
(D) Broker's Bill cause they

(A) use goods

32. Which of the foilowing is LEAST likely to (B) have wants
be described as good public relations for a (C) satisfy themselves
company? (D) buy goods

(A) The offering of scholarships

(B) Reduction in price to retailers 37. In which of the foIIowing situations would
(C) Sponsorship of a steel band a credit note be sent to the buyer?
(D) Hosting of an annual sport event
L The buyer is overcharged.
II. The buyer is undercharged.
33. Which of the following is a 'hire purchase III. Some of the goods are damaged.
agreement'? IV. Some of the goods are returned.

(A) ·An individual has a record player (A) I and III only
he plans to use at dances for a (B) II and III only
fee. (C) II and IV only
(B) An individual contracts to rent a (D) I, III and IV only
television for three years.
(C) An individual pays a portion of the
cost of an article, possesses it
and continues to pay a stated sum
at specific periods.
(D) An individual buys an article, pays
part of the cost, and gets the
article when the final balance is
paid.

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38. In which order in the marketing process 42. Which of the following refers to the type of
would the following MOST likely occur? iflsurance taken out by a firrn specifically
to cover it against theft by er,nployees?
I. Advertising
II. Preparation of production (A) Group insurance
III. Market research (B) Fidelity bond insurance
IV. Sales. (C) Marine insurance
(D) Comprehensive cover insurance
(A) I. II. III. IV
(B) III, II, I, IV
(Cl III, II, IV, I 43. Which of the following are MAJOR func-
(D) IV, II, III, I tions of a central bank?

I. Acting as the government's bank

39. Which of the following documents would II. Keeping deposits of all commer-
have been used by a ship owner who agreed, cial banks
for a sum of money, to provide a ship to III. Givingloans to private individuals
carry a shipment of cargo from one port to and companies
another? IV. Helping to regulate the money sup-
ply of a country
(A) Import .licence
(B) Bill of lading (A) I, II and III only
(C) Charter party (B) I, II and IV only
(D) Airway bill (C) I, III and IV only
(D) II, III and IV only

40. Which of the following documents would

give title to goods? 44. Which of the following CANNOT be used
as collateral for obtaining a loan from a
I. A bill of sale financial institution?
II. A bill of materials
III. A bill of lading (A) A mortgaged home with insurance
IV. A bill of sight coverage
(B) An insurance policy with a cash
(A) III only value
(B) I and III only (C) An amount in a fixed deposit ac-
(C) II and IV only count
(D) III and IV only (D) Wife/husband's legally owned
property not covered by insur-
ance
41. The bank account which allows acustomerto
make payments by cheque is the

(A) q1rrent account

(B) savings account
(C) deposit account
(D) capital account

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Items 45 - 47 refer to the following forms 50. When the demand for a commodity de-
of taxation a government uses to raise creases and the supp.ly increases the price
revenue: should

(A) Preference duty (A) increase

(B) Customs drawback (Bl decrease
(C) Excise duty (C) remain constant
(D) Excise drawback (D) exceed cost

Which of the above forms of taxation is 51. The price of an article is usually high when
there is a -
45. imposed on goods produced in a country?
(A) large quantity for sale and few peo-
46. a refund on duty collected on goods im- ple wanting to buy
ported into a country for manufacture and (B) small quantity for sale and few
exported after manufacture? people wanting to buy
(C) small quantity for sale and many
47. a refund of taxes imposed on goods pro- people wanting to buy
duced in a country but subsequently ex- (D) large quantity for sale and many peo-
ported from it? ple wanting to buy

48. Which of the following is an example of 52. Browne· s store sells. pencils at 15¢ each.
indirect taxation? White has opened a store about 200 metres
away and sells the same brand of pencils at
(A) Income tax 12¢ each. What are the LIKELY effects on
(B) Consumption tax Browne's business?
(C) Estate duty
(D) Water rate · I. Customers will decrease.
II. Capital will decrease.
Ill. Ge'neral stock will increase.
49. Market equilibrium exists when IV. Turnover will increase.

(A) buyers pay reasonable prices for (A) I and II only

goods (B) I and III only
(B) sellers are satisfied with the price (C) I and IV only
paid for their goods (D) II and III only
(C) at the ruling market price, buyers
do not want to add to the stock of
goods they already have
(D) at current prices, the amount buyers
wish to buy equals the amount sell-
ers want to sell

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53. Which of the following situaiions is NOT a 57. Most English speaking Caribbean territo-
benefit of international trade? ries are members of ALL of the following
organizations EXCEPT ··
(A) A greater variety of goods is ob-
tained from overseas. (A) COB
(B) Political links are developed with (B) OPEC
other countries. (C) CARI COM
(C) Import restrictions can be imposed (D) ACP
on foreign items.
(D) Producers are able to increase their
market size. 58. Which of the following types of business
environment is MOST typical of the Com-
monwealth Caribbean area?
54. International trade owes its origin to
(A) · Corporate state
(A) countries with large populations not (B) Mixed economy
having sufficient goo<j'.; (C) Centrally planned
(B) the varying resources of different (D) Perfectly competitive
·regions
(C) the fact that countries desired to
have greater contact with each 59. Which ofthefollowing trading agreements is
other Barbados promoting when itsel Is furniture to
(D) the great need for foreign exchange Jamaica?
by most countries
(A) OECS
(B) CARJCOM
55. Which of the following practices would NOT (C) GATT
contribute to the economic development and (D) NAFTA
growth ofa community?

(A) Increased use of the country's natu- 60. Which ofthe following services are national-
ral resources · ised in MOST CARI COM territories?
(B) Increased importation ofconsumer
goods I. Food production
(C) Provision of loans and technical IL Water
assistance for establishing local 111. Communication
businesses rv. Electricity
(D) Provision of more infrastructure
within the country (A) [and II only
(B) II and [([ only
(C) [, [([ and IV only
56. A country can raise foreign exchange by (D) IL [([ and IV only
ALL o~.the following EXCEPT

(A) foreign loan

(8) grants from foreign countries
(C) bilateral trade
(D) domestic trade

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IP' VOtl , . . . BtPQ'~ TIME IS CALLED, CHECK VOURWORK ON THIS TEST.
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