Midterm test – Colombo South International College

Grade 10,11 Commerce Time: one hour Total marks 20

1. Source of finance can be divided into short term and long term.

For each source of fiancé below. Identify if it is short term or long term by putting a cross in the correct box

Source Short term Long term

Debentures

Debt factoring

Overdrafts

Retained profits

Preference shares

2. Identify two reasons why notes and coins are used as a means of paying for goods

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3. Suggest two reasons why exchange rates might change

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4. Explain one factor the bank will take into account when deciding if it will give a loan to a customer

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5. Explain the role of the insurance broker in arranging insurance

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6. Why does furniture wholesaler need a warehouse

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7. Explain why wholesalers do not operate retailing businesses

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8. What is the meaning of ‘limited’ in the term ‘public limited company’

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9. Why do limited companies need to be registered with the registrar of companies

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10. Describe two features of bonded warehouses

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11. Describe one different between ordinary shares and preference shares

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12. Give two reasons why credit card statements are sent to customers

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13. What is the different between tariffs and quotas

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14. Why do many countries want to join trading blocs

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15. Apart from fire insurance, name two other risks that companies could insure against

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