Answer ALL questions

1. An entrepreneur, having invested large sums of money in a business enterprise can expect
to receive
(a) Interest on his investment
(b) Salary or wages on his investment
(c) Profit on his investment
(d) Rent on his investment

2. The term SCARCITY means that

(a) Human desires cannot be satisfied at all
(b) Human desires for a product far exceed what is really available
(c) Conditions affect only the poor in the society and not the rich
(d) A country will never be able to raise the standard of living of its people because of
the nature of scarcity

3. The opportunity cost of a good is

(a) The alternative(s) given up in order to obtain the good
(b) The price for which you could exchange it for other goods
(c) The original cost of the factors of production
(d) The cost of producing the good

4. Which of the following are characteristics of the private sector?

i. Ownership and control of business by private individuals
ii. Control of goods and services produced by the state
iii. Ownership of some business enterprises by foreign investors
iv. Personal supervision to ensure effective operation
(a) i only (c) i, ii and iii only
(b) i and ii only (d) i, iii and iv only
5. The major difference between the private sector and the public sector is
(a) The motive which directs each sector’s activities
(b) Insignificant since they are both pursuing similar goals
(c) Of little importance to Caribbean nations
(d) The profit motive of the public sector

6. The greatest disadvantage of the sole trader is that

(a) It is not easy to terminate the business
(b) Government requirements for the start up of the business are the same as those for a
public company
(c) The owner may lose all personal assets in the event that the business fails
(d) The owner has no restrictions at all on any services or goods he/she wishes to provide

7. The best definition of an entrepreneur is:

(a) Anyone in business who takes a risk
(b) A worker who invests money into shares in a company
(c) A risk taker who set up a new business
 (d) A director of a large public limited company

8. Which one of the following personal qualities or traits would help an entrepreneur set up
a successful business?
(a) Self-confidence (c) Arrogance
(b) Shyness (d) Laziness

9. One reason an entrepreneur is more likely to set up a new business in car repair than in
car manufacturing is:
(a) Uninterested in cars
(b) Lack of capital
(c) No knowledge of cars
(d) No car manufacturers make a profit

10. One reason an entrepreneur might set up a new business rather than work as an employee
(a) Employees are always paid low wages
(b) Employees never have job security
(c) Setting up a business is less risky than working as an employee in a secure company
(d) Owners of new businesses have more independence than employees

11. Self-actualisation means:

(a) A worker earns as much as possible
(b) An individual is able to satisfy all basic and mental needs
(c) The individual has a high level of self-confidence
(d) The entrepreneur works alone and has no employees

12. One reason why an entrepreneur should do market research before setting up a business
is:
(a) The research will guarantee the success of the business
(b) A business plan will not have to be produced if the research seems positive
(c) It reduces the chances of the new business failing
(d) Market research is always free so it does not add to business costs

13. One claimed benefit of market research is:

(a) It is less expensive than secondary research
(b) It is always completely accurate
(c) It can be obtained quickly from data that already exists
(d) It is more up to date than most secondary data

14. Which of the following would be done by the production department?

(a) Raising capital for a new workshop
(b) Deciding on the best way to make the product
(c) Setting the price for the product
(d) Deciding which workers to employ
15. One claimed benefit of borrowing from friends and family to start a business is:
(a) There is no interest on the loan
 (b) The loan will always be repaid
(c) They can always offer business experience too
(d) The interest payable is often at a lower rate than that charged by banks

16. In which department would you most likely find a salesperson?

(a) Finance (c) Production
(b) Marketing (d) Personnel

17. One of the main functions of the personnel department is to:

(a) Order stocks
(b) Recruit staff
(c) Arrange loans
(d) Arrange stock displays

18. Which of the following are functions of management?

i. Controlling iii. Producing
ii. Planning iv. Motivating
(a) ii, iii and iv (c) i, ii and iv
(b) i, ii and iii (d) i, and iv

19. The best definition of the span of control in an organization’s structure is:
(a) The number of people that a manager is responsible for
(b) The number of levels of management
(c) The amount of control that a manager has over a worker
(d) The number of managers that a worker has

20. If the chain of command in a business increases then:

(a) Communication is likely to improve between workers and managers
(b) There will be fewer managers employed
(c) Each worker is likely to be delegated more authority
(d) Communication is likely to be less effective between managers and workers

21. An authoritarian/autocratic leader is one who:

(a) Listens carefully to the views of all workers
(b) Takes decisions after considering the opinions of workers
(c) Takes decisions without consulting others
(d) Always takes decisions that are in the best interests of workers

22. A democratic/participative leader is one who:

(a) Takes decisions without consulting other workers
(b) Allows workers to be involved in decision making
 (c) Never communicates with other managers or workers
(d) Takes decisions centrally but always in the best interests of workers

23. One claimed benefit of computer-based management information system is:

(a) They cost less to set up than manual card-based systems
(b) They do not require expensive staff training
(c) They allow more effective decision making
(d) They can be operated by anyone

24. An example of satisfying a social need at work is:

(a) Pay allows workers to meet at the local social club
(b) Giving workers interesting and varied jobs to do
(c) Promoting workers to a management position
(d) Mixing with other workers to gain acceptance and friendship

25. An entrepreneur, having invested large sums of money in a business can expect to receive
(a) Interest on his investment
(b) Salary or wages for his investment and effort
(c) Profit on his investment
(d) Rent on his investment

26. A system of exchange in which wealth is exchanged for wealth is called a

(a) Financial group exchange system
(b) Monetary system
(c) Financial exchange system
(d) Barter system

27. Workers of XYZ Corporation are always involved in decision making. Management has
adopted a/an
(a) Authoritarian style of management
(b) Charismatic style of management
(c) Participative style of management
(d) Functional style of management

28. One of the following is NOT a function of a trade union

(a) Securing equal rights for all female workers
(b) Working to achieve high levels of compensation for workers
(c) Assisting workers who suffer from stress on the job
(d) Giving advice to workers who have social welfare problems

29. The manager of CSL wishes to inform an acting group director officially of his recent
appointment to group director. What method of communication should he adopt?

(a) Non-verbal communication

(b) Visual communication
 (c) Written communication
(d) Oral communication

30. The planning process involves ALL of the following EXCEPT

(a) Setting objectives to be achieved
(b) Formulating policies and procedures
(c) Establishing action plans to get the job done
(d) Performing the activities planned

31. The organizational principle, which states that there should be a limit to the number of
workers that a single manager can efficiently supervise is
(a) Span of control
(b) Chain of command
(c) Unity of command
(d) Functional management and control

32. One of the functions of money is:

(a) To give everyone what they want
(b) To act as a medium of exchange
(c) To allow barter to take place
(d) To allow government to collect tax revenue

33. One of the differences between a sole trader and a private limited company is:
(a) A sole trader business has no employees
(b) A sole trader business has no shareholders
(c) A sole trader business has only one customer
(d) Only a sole trader business offers limited liability to its owner

34. A common reason for a company becoming a multinational corporation is to:

(a) Benefit from bigger markets abroad
(b) Reduce the risk of poor communication
(c) Sell the same products to different countries even though cultures may be different
(d) Make the business easier to manage and control
35. Which of the following is a function of money?
(a) To reduce poverty
(b) To be a measure of value
(c) To allow businesses to make a profit
(d) To allow workers to receive payment

36. Which type of company can sell shares through the stock exchange?
(a) Private limited companies
(b) Public limited companies
(c) Nationalized industries
(d) Franchises

37. Which of the following are claimed to be benefits of a franchised business?

i. It has a lower risk of failure than an independently operated business
ii. The franchised business is much cheaper to set up than an independent business
iii. The franchised business name is already well known
iv. The business buys supplies from the franchisor and this gives consistent quality
wother franchised outlets

(a) i, ii and iv only (b) i and iii only (c) ii, iii and iv only (d) i, iii and iv

38. Which of the following is one of the main government departments?

(a) Private sector
(b) Public sector
(c) Health
(d) Nationalized industry

39. Factors of production include:

(a) The customer
(b) The supplier
(c) Raw materials
(d) The finished product

40. Capital as a factor of production includes:

(a) Finance invested in stocks of raw materials
(b) The site the factory is built on
(c) The owner of the business
(d) The most skilled workers
41. The supply of labor in a country would increase if:
(a) The length of the working week was cut
(b) Emigration increased
(c) More women were encouraged to work
(d) The school leaving age was increased

42. An example of fixed capital for a manufacturing business is:

(a) Cash in the bank
(b) Stocks of finished goods
(c) A long-term loan
(d) A packing machine

43. A definition of productivity is:

(a) Total output from a factory
(b) Increased output after more workers have been employed
(c) The amount produced per week
(d) The increase in output from last year

44. The productivity of workers is likely to increase if:

(a) More raw materials are bought
(b) Workers’ motivation increases
(c) More workers are employed
(d) The labor supply increases

45. A possible benefit of net migration of workers out of a country is:

(a) The labor supply of that country increases
(b) Money is sent back to the country by the workers
(c) The unemployment rate will not be affected
(d) All of these workers will eventually return to their home country

46. When a country has reached a subsistence level of production it:

(a) Produces just enough for its population to meet their basic needs
(b) Increases its exports of surplus production
(c) Import large quantities of basic products to meet the needs of the population
(d) Has a very high standard of living

47. ‘Linkage of industries’ means that:

(a) Industries are always located close to each other
(b) The road links between the industries are good
(c) One industry supplies goods and services to another industry
(d) The industries share the same workers

48. That stage of production in which raw materials are transformed into finished or
unfinished goods is called
(a) Extractive production
 (b) Secondary production
(c) Mass production
(d) Tertiary production

49. That stage of production which is involved in the transfer of goods or services from
producers to consumers is called
(a) Transportation
(b) Distribution
(c) Tertiary production
(d) Primary production

50. Which of the following types of workers are included as primary producers?
i. Taxi drivers iii. Farmers
ii. Miners iv. Typists
(a) i, ii and iv only
(b) ii, iii and iv only
(c) i and iii only
(d) ii and iii only

51. Farmers are producers who belong to the

(a) Private sector
(b) Primary sector
(c) Public sector
(d) Working class sector

52. Services may best be described as being

(a) Tourism
(b) Intangible goods
(c) Tangible goods
(d) Mass produced goods

53. Bankers, insurers and advertisers are engaged in providing which one of the following?
(a) Money
(b) Advertisements
(c) Services
(d) Insurance premiums

54. Bauxite is found in which of the following two countries?

(a) Trinidad and Tobago
(b) Belize and Grenada
(c) Barbados and St Vincent
(d) Guyana and Jamaica
 55. The most important resource in any country is
(a) Capital (c) Land
(b) People (d) Money

56. Productivity depends mainly on the

(a) Social status of the workers
(b) Height and strength of the workers
(c) Color and speech of the workers
(d) Skill and experience of the workers

57. Buildings, machinery and tools are examples of

(a) Plant and machinery
(b) Fixed capital
(c) Circulating capital
(d) Financial capital

58. The production of goods with the use of mainly human labor is known as
(a) Labor intensive production
(b) Labor extensive production
(c) Capital intensive production
(d) Mechanized production

59. Industries which are related so that by-products or raw materials from one are used to
make other finished goods are called
(a) Subsidiary industries
(b) Commercial industries
(c) Related industries
(d) Linkage industries

60. A trade union’s main function should be to

(a) Get higher wages for its members
(b) Seek after the general welfare of all its members
(c) Confront management over all matters
(d) Go on strike whenever possible for any reason

END OF EXAMINATION