Principles of Business

Form 5 Exam

1. Small businesses are an integral part of Caribbean economies. They can be found
around many corners in rural villages.
a. According to CARICOM what is a small Business?
b. Discuss Two benefits of small business to the local economy
c. Explain the concept of Cottage industry, state an example
d. Differentiate between a small business and a Cottage industry

2. As a business grows, it will experience both internal and external growth; this growth
will have many effects on a business.
a. Identify four areas of a business its growth will affect
b. Discuss any two of the areas listed above
c. Identify two ways a firm may grow internally and how a firm may grow
externally
d. As the firm grows they experience Economies of scale, which is the benefits of
large scale production, Explain two types of economies of scale that can be
experience as the business grows.

3. Linkage industries have an important role to play in propelling Caribbean industry.

Discuss the two forms of linkages that exist. Identify ONE benefit and ONE challenge of
Linkage industries. Provide an example of ONE of the two forms stated above.

4. You are interested in starting a business, explain three factors you will consider before
making the decision of where to locate your business. Differentiate between Capital
Intensive and Labor Intensive production