2017 PAPER 2- POB

MS S PERSAD
 Question 1 a)
i) Enterprise- a business that has been created (1) by aspiring individuals (1)
ii) Entrepreneurship- Entrepreneurship is the ability and willingness to develop, organize and
run a business enterprise (1), along with any of its uncertainties in order to make a profit (1).
Question 1 (b)
i) Economic benefits- Pay tax, Create employment (1 mark each)
Social benefits- Provide a wider variety of goods, sponsors community activities (1 mark each)
ii) Owners (1) - They oversee the setting up and ongoing management of a business (1). They
provide start-up capital invested (1).
Consumers (1) - Purchase goods and services (1). They also report unethical practices (1).
Question 1 c)
HIGHER COSTS (1) - By fulfilling its ethical roles (eg paying taxes, disposing of waste properly)
the business will forgo a percentage of its profit to meet the laws implemented in the country
(1). EG Corporation tax is deducted from profits and therefore less cash will be available for use
in the business (1).
LOWER DEMAND (1) - It is often time consuming to put policies in place to ensure ethical roles
are followed (1). Eg research needs to be done to develop a biodegradable packing which will
not harm the environment. Due to this delay competitors may get ahead and demand and
profits will fall (1).
QUESTION 2 a)
i) Marketing- development of a promotion strategy, determination of a price (1 mark each)
Production- converts raw materials into finished products, use resources efficiently (1 mark
each)
ii) The finance department is responsible for securing funds for the business (1), keeping
accounting records and recording the costs of a business (1).
On the other hand , the HR department is responsible for areas such as recruitment, training (1)
and managing disciplinary systems (1).
QUESTION 2 b)
i) Delegating- means handing over responsibility to others and carrying out specific tasks and
activities (1). Good delegation enables more work to be completed with better results (1).
ii) Motivating- involves getting others to work for you, for themselves and for the organization in
a dynamic and driven way (1). It involves providing interesting work tasks and opportunities for
promotion (1).
Iii) Coordinating- This involves bringing together the various elements of a plan or an
organization in such a way that they work together harmoniously (1). Coordination is about
different departments coordinating their efforts in an integrated way (1).
QUESTION 2 C)
i) CUSTOMERS
Providing a good quality product (1) - Management cannot sell products that are off inferior
quality as this will lead to customer dissatisfaction (1). Management must ensure that the
customers are not taken advantage off and they receive goods worth their price (1).

ii) EMPLOYEES
Providing good working conditions (1) - management has the role of ensuring employees are
safe and comfortable in their workplace (1). By ensuring safety standards eg gloves etc are
followed employees will be kept safe and their motivation and job satisfaction will increase (1).
QUESTION 3 (a)
(i)
ATM (Automated teller machine), MIS (Management Information System), CAD (Computer
Aided Design) (1 mark each for any three)
ii)
IMPROVING SPEED OF OPERATIONS (1)- Operations can be carried out much faster, for eg a
customer’s order can be transmitted online and immediately processed for dispatch. Payment
can be made online as well. (1)
ENABLING AUTOMATION TO TAKE PLACE (1)- Automation minimizes human error and is quick,
For eg a modern bakery can use automation to make adjustments for features such as size,
flavor and colour. (1)
QUESTION 3 B)
i) To create employment, To provide services that larger firms are not willing to provide, To cater for niche markets. 3 points- 1 mark each
ii) CHALLENGES-
MORE COMPLICATIONS- Managing the larger enterprise get more complicated as more resources must be organized. (1)
THE SPAN OF CONTROL MAY WIDEN- This can result in more levels can be added. This is s challenge as the managers have more employees
to supervise. (1)
BENEFITS-
ECONOMIES OF SCALE- As a firm grows, a fall in costs per unit be experienced. (1)
POTENTIAL FOR EXPORT- AS a business grows, surplus may be produced and can be exported to earn valuable foreign exchange. (1)
QUESTION 3 c)
THE SPAN OF CONTROL WILL EXPAND(1)
- As a business grows more employees will be hired and this will lead to an increase in the
amount of employees a supervisor may have to manage(1) . For eg: 2 new cashiers may be
employed and the supervisor will have to also oversee them (1)

SPECIALIST STAFF CAN BE HIRED(1)

- As a business grows it may be able to afford specialist staff who will utilize their expertise to
ensure better decisions are made for the company(1) . For eg a management consultant or
accountant specialist may be hired(1) .
QUESTION 4 a) i), ii), iii)
i) The brand name can be a combination of words, letters and numbers(1) which can be spoken
or verbalised(1) .
ii) Paper boxes, plastic containers (1 mark each)
iii) Enhances the appearance of the product, preserves the life of the product (1 mark each)
QUESTION 4 b) i)
SALES STAFF (1)
Sales people need to be perceived as credible and apply techniques and present themselves in
such as way that customers will believe they are being made a genuine offer in good faith. They
often use an approach known as FAB (features, advantages and benefits) (1) .
MERCHANDISING (1)
This is an important way to encourage sales, and relates to the way in which products are
arranged and displayed in a physical store or a virtual store(1) .
4) b) ii)
ADVERTISING(1)
Advertising can be described as informative, persuasive or competitive. It can take many forms
eg television commercials, newspaper and magazine advertising and direct mail(1) .
PUBLIC RELATIONS (PR) (1)
This involves managing the flow of information from an organization to its public in order to
build up the reputation and image of the company. E sponsoring prestigious events, sporting
events(1) .
QUESTION 4 c)
Copyright refers to the legal ownership by persons of certain kinds of material, particularly
literary, dramatic and artistic work.
THE WAY THE WORK IS USED CAN BE CONTROLLED (1) - The producer can use the copyright to
prevent unauthorized copying(1) . Consumers cannot reuse the information without gain
permission from the producer or referencing where they got it from(1) . This will limit the
amount of individuals who can duplicate the said work.

LEGAL ACTION CAN BE TAKE BY THE PRODUCER (1) - If the copyright is infringed by an
individual such as a consumer an injunction can be claimed thorough the courts and damages
can be claimed from the offender(1) . The producers can make money from the sales of their
work or from money paid by persons caught stealing their ideas(1) .
QUESTION 5 a) b)
a) Standard of living- a measurement of the goods and services(1) that an individual is able to
purchase and enjoy with his or her income (1) (including access to education and health
services).
b) i) Quality of life- level of crime, availability of health facilities, diet and nutrition, life
expectancy (1 mark each for three points)
ii) Standard of living- level of consumption of goods and services, access to modern technology,
Level of investment in research and technology (1 mark each)
QUESTION 5 C)
Scholarship programmes (1) - The government should increase the amount of programs which
they offer scholarships for. This will allow citizens who do not have the available funds to have an
opportunity to educate themselves(1) .
The more educated an individual is the greater will be their innovation. Economic growth and
development will result as their ideas are implemented (1) .
Agricultural and entrepreneurship programmes (1) - Many Caribbean countries have large
amounts of agricultural land and opportunities to export raw materials. Unfortunately there are
not enough educational faculties/courses which train individuals on managing and expanding
agricultural business(1) .
Economic growth and development will result as the primary and secondary sectors develop in
addition to foreign exchange earnings (1) .
QUESTION 5 D)
3 WAYS OF MEASURING NATIONAL INCOME
1) THE FACTOR-EARNINGS OR INCOME APPROACH (1) :
This involves adding income from employment to incomes from profits plus net factor income
from rents plus income from abroad. This would result in gross national product. Depreciation
must then be subtracted and national income is the result. (1)
FORMULA:
Income from employment + Profits + Rents + Net factor income from abroad = GNP
GNP-Depreciation = National income (1)
QUESTION 5 D)
3 WAYS OF MEASURING NATIONAL INCOME
2) THE EXPENDITURE METHOD (1) :
In the expenditure method of measuring the national (1) output, it may help to view this as the sum
of all the money spent on output produced in a year.
The demand for output (goods and services) can be neatly summed up as :C + I+ G+ (X-M)= GDP
Adding subsidies minus indirect taxes plus net factor incomes from abroad results in GNP.
Depreciation is then removed, resulting in national income.
FORMULA:
Consumption expenditure (C) + Investment expenditure (I) + Government spending (G) + Net exports
(X-M) + Subsidies - Indirect taxes - Net factor incomes from abroad = GNP
GNP- Depreciation= National income. (1)
QUESTION 5 D)
3 WAYS OF MEASURING NATIONAL INCOME
3) THE OUTPUT APPROACH:
Another measure of national income used is the output approach, in which the value of the
final output of all sectors is added up, making the necessary adjustments to prevent double
counting by adding in the final output of goods or services.
For example, inputs,e.g. lumber, cannot be counted with finished furniture (output) so only the
final value is tallied. So, very simply, the output approach uses the final output of the different
sectors (primary, secondary, tertiary), added up.
FORMULA:
Total domestic product + Net factor income from abroad = GNP
GNP- Depreciation= National income