Free CXC Principles of Business Paper 1 May/June 2008 past paper from 2008. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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CSEC Principles of Business Paper 1 May/June 2008 - Free CXC Past Paper with Answers
Free CXC Principles of Business Paper 1 May/June 2008 past paper from 2008. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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Every question from this paper as text. See the answers and worked solutions. Questions are the property of the Caribbean Examinations Council; Caribbean AI is not affiliated with CXC.
Which of the following is NOT a function of money?
Indivisibility
Store of value
Measure of value
Medium of exchange
In a competitive market situation, which of the following is LEAST likely to influence consumer demand?
Taste
Price
Brand loyalty
Consumers' income
Subsidised meals for employees would fall under which of the following categories?
Fringe benefits
Duty allowance
Wages and salaries
Workmen's compensation
Private enterprise is run MAINLY to
provide jobs for more people
distribute goods and services
reduce inflation
create profits for owners
Which of the following are functions of a business unit? I. Production of goods and services II. Creation of jobs III. Maximization of sales IV. Education of workers
I, II and III only
I, II and IV only
I, III and IV only
II, III and IV only
Which of the following is LEAST likely to result from growth in an organization?
Greater productivity
More division of labour
Increased communication
Increased capital investment
Which of the following characteristics of the sole trader form of business enterprise is NOT advantageous to the owner?
Secrecy
Unlimited liability
Ownership of all profits
Low operational cost
The MAIN purpose of installing a suggestion box in a company is to get workers' view about
each other
other companies
ways of improving the workplace
ways of improving economic conditions in the country
In a public limited company, the losses are borne by the
staff
directors
community
shareholders
Which of the following is MOST likely to occur when a member of a partnership dies?
The business is closed down
A new partner is brought in
The government takes over the business
The business becomes a joint stock company
In a firm with a departmentalized structure, which department performs the four duties listed below?
I. Receiving the goods purchased II. Reporting on the quality of goods received III. Applying the principles for costing goods IV. Keeping an inventory
Finance
Purchasing
Stock control
Marketing
Profit may NOT be the main objective of a business which is
finding cheaper raw materials
increasing the salaries of its directors
increasing the price of goods and services
expanding factory space to increase production
An entrepreneur may reduce his risk of loss by
planning ahead
securing bank loans
cleaning offices regularly
purchasing additional fixed assets
Cash used to secure a loan at the bank is referred to as
collateral
fixed assets
current asset
fixed deposit
The condensation of the business plan is contained in the
feasibility plan
marketing plan
key note summary
executive summary
Which of the following is NOT a feature of a business plan?
Demonstrates a clear compelling vision
Provides clear and realistic projections
Gives information about the target market
Outlines financial institution from which business may get funding
Which of the following describes an essential feature of a valid contract?
The offer has been communicated to the offeree.
A counter offer has been made by the offeree to the offeror.
The offer is made in writing by the offeror.
The offer has been accepted by the offeree either in writing or orally.
Which of the following are functions of management?
I. Co-ordinating the work of employees II. Delegating work to subordinates III. Controlling employees and raw materials IV. Ensuring that employees join a trade union
I and II only
II and III only
I, II and III only
II, III and IV only
Which of the following factors prevents an agreement from being considered a valid contract?
Offer and acceptance
Misrepresentation
Legal purpose
Consideration
Which of the following situations would occur if a contract for the sale of goods becomes void? I. The prospective buyer becomes the owner. II. The seller has the right to keep any money or goods which have been given to him in this transaction. III. The prospective buyer does not become the owner. IV. The seller must return any money or goods given to him by the prospective buyer for the transaction.
I and IV only
II and III only
III and IV only
I, II and IV only
The money used for the day-to-day operations of a business is called
fixed capital
nominal capital
floating capital
working capital
The factor of production which earns interest is
land
labour
capital
enterprise
Which of the following is a fixed asset?
Bicycle for private use
Motor car for family use
Washing machine for resale
Motor lorry for delivery of goods
The term 'human resources' refers to
materials and goods made by human beings
raw materials used in the manufacture of goods
persons available for productive and professional services
capital invested by shareholders in a company
The movement of educated, skilled people to settle in other industrialised countries is called
migration
brain drain
unemployment
underemployment
Which of the following is the BEST example of capital as a factor of production?
Money
Shares
Machinery
Debentures
To which of the following industries does a firm involved in food processing belong?
Service
Extractive
Constructive
Manufacturing
Which of the following can be described as a marketing activity?
Issuing bulletins on staff matters
Distributing commodities to outlets
Publicising advertisements for new staff
Ensuring that workers are given fringe benefits
All persons can be called consumers because they
use goods
buy goods
have want
satisfy themselves
Which of the following BEST describes the term 'loss leaders'?
An item which the retailer gives away to customers
A product which is sold cheaply to attract customers
A good which has no real market value
A product which the retailer is unable to locate
Which of the following activities carried out in a firm will NOT be under the supervision of the marketing manager?
Packaging
Advertising
Distributing
Purchasing
Which of the following is LEAST likely to be described as good public relations for acompany?
The offering of scholarships
Sponsorship of a steel band
Reduction in price to retailers
Hosting of an annual sport event
Which of the following is NOT a function of the retailer?
Transporting goods to suitable storage facilities
Providing a local supply of goods
Preparing goods for resale
Selling in small quantities
The variables of a marketing mix can easily be remembered by referring to the four P's which are
product, price, place, promotion
product, publicity, purchase, price
product, promotion, package, price
product, package, place, promotion
A court order requiring an employer to deduct money from an employee for payment of his debts is known as
demand
revenue
withdrawal
garnishment
A post-dated cheque is one which
was written no longer than six months ago
is dated to agree with the date of the documentrequesting payment
is dated by the bank on the day it is presented for payment
is dated for payment at a future date
One of the MAJOR functions of a central bank is to
issue notes and coins
issue stocks and shares
accept deposit accounts
make loans and advances
The monthly payments collected by an insurance company on behalf of its policy holders are known as
deposits
premiums
instalments
endowments
Which of the following CANNOT be used as collateral for obtaining a loan from a financial institution?
A mortgaged home with insurance coverage
An insurance policy with a cash value
Money in a fixed deposit account
Property not covered by insurance
The MOST important use of collateral security to the lender is that it
can be sold if the borrower fails to pay
gives the banker an idea of the state of the business
establishes the financial position of the borrower
improves the borrower's chance of getting a loan
A country will restrict importation of certain items in order to I. assist local industries. II. prevent similar items from being consumed by its citizens. III. encourage use of local resources. IV. alter the life style of its citizens.
I only
I and III only
II and III only
II and IV only
Governments can influence business activity positively by
reducing taxes
reducing grants
reducing spending
budgeting for a surplus
Which of the following measures are used by government to redistribute income?
Customs duties and levies
Consumption tax and tariffs
PAYE and National Insurance
Excise duties and Value added tax
Tax paid on wages and salaries is referred to as
excise duty
income tax
customs duty
corporation tax
Which of the following forms of taxation could be classified as 'direct'?
Excise duty
Income tax
Customs duty
Purchase tax
Which of the following is included in protection of the environment?
Food legislation
Social insurance
Competition policy
Deforestation laws
Which of the following can be considered as incentives to industries?
Increasing coporation tax
Increase in insurance premiums
The training of employees
The devaluation of the local currency
A country has a favourable balance of trade when
it sells more than it buys
it buys more than it sells
imported goods are cheaper
there are no restrictions to trade
Which of the following practices would NOT contribute to the economic development and growth of a community?
Increased use of the country's natural resources
Increased importation of consumer goods
Provision of loans and technical assistance for establishing local businesses
Provision of more infrastructure within the country
To correct an adverse balance of payments position, a government may
reduce credit
increase exports
reduce income tax
increase the money supply
Which of the following are likely to affect the standard of living in a country? I. Widespread pollution II. A low literacy rate III. A high crime rate IV. Advertisements
I and III only
II and III only
I, II and III only
I, III and IV only
In National Income Accounting, students' grants and retirement pensions are examples of
national income
transfer income
personal income
disposable income
Which of the following indices is the BEST measure of the economic growth of a country?
Economic stability
High standard of living
Changes in the gross national product
Changes in the gross domestic product
The balance of payments account comprises
I. current account II. total currency flow III. gross national income IV. official financing
I and III only
II and III only
I, II and III only
I, II and IV only
Which of the following are MAJOR economic problems facing Caribbean countries? I. High levels of unemployment II. Adverse balance of payments III. Low productivity in manufacturing IV. Lack of capital for investment
I and II only
II and III only
I, II and IV only
I, II, III, and IV
Which of the following methods may government use to reduce unemployment in the long run?
Employment levy on firms
Increases in income tax
Deflation of the economy
Increased interest rates on borrowers
The following policies are barriers to international trade EXCEPT
quotas
subsidies
embargoes
custom duties
The PRIMARY function of the Caribbean Basin Initiative is to give concessions on
traditional products entering the Canadian market
traditional products entering the US market
non-traditional products entering the US market
non-traditional products entering the Canadian market
Investment can be defined as
the stock of goods in a country
additions to the capital stock of a country
the amount of money available at a given time
the amount of capital owned by the government
Which of the following can be classified as benefits of nationalisation? I. Profits will remain in the country. II. Essential industries will be state owned. III. Employment will be provided for citizens. IV. The enterprise will have joint ownership.
I, II and III only
I, II and IV only
I, III and IV only
II, III and IV only