Danho
ZIMSEC A Level · N2018

Business Studies Paper 2 November 2018

Questions
22
Total marks
250

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Questions
22
Pass mark
14
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Answer every question in the printed order, get marked at the end, then see the answers.

The questions

Question 101

[1 marks]investment appraisal, business ownership
In investment appraisal, what is the name of the technique that measures the length of time needed for the net cash inflows from a project to recoup its initial capital cost?

Answer this when you sit the paper.

Question 102

[1 marks]investment appraisal, business ownership
E & K Fisheries is appraising a new branch requiring an initial investment of $300,000. The branch is forecast to generate net cash flows of $120,000 in Year 1, $130,000 in Year 2, $100,000 in Year 3 and $90,000 in Year 4. Using discount factors at 10% of 0.91, 0.83, 0.75 and 0.68 for Years 1 to 4 respectively, calculate the Net Present Value (NPV) of the branch.

Answer this when you sit the paper.

Question 103

[1 marks]investment appraisal, business ownership
Emma and Kero currently run E & K Fisheries as a partnership but are considering incorporating it as a private limited company to raise the $300,000 needed for a new branch. Which of the following is a genuine benefit they would gain from incorporating?
  1. AThe owners' personal assets are protected from the company's debts through limited liability.
  2. BThe company would be completely excused from paying any tax on the profits it earns each year.
  3. CThe owners would no longer need to keep any financial accounting records for the business at all.
  4. DEvery partner would automatically retain an equal and unquestioned say in all major decisions.

Question 201

[1 marks]delegation and management
What management term describes a manager passing some of their authority and responsibility for a task down the management hierarchy to a subordinate, while remaining accountable for the outcome?

Answer this when you sit the paper.

Question 301

[2 marks]motivation and workforce involvement
The management of a manufacturing company is concerned about the motivation of its workforce. Which of the following explains why motivation matters to the business?
  1. AMotivated workers raise the price that customers are willing to pay per unit
  2. BMotivated workers remove the need for a business to set targets for the year
  3. CMotivated workers reduce the capital a business has to invest in its machinery
  4. DMotivated workers produce more, so more output comes from the same workforce

Question 302

[2 marks]motivation and workforce involvement
A company suffers high absenteeism and loses many of its staff each year. How would improving motivation help it?
  1. AOutput quality falls because motivated staff work faster and check less closely
  2. BLabour turnover falls, so less is spent recruiting and training replacements
  3. CAbsenteeism rises because motivated staff take more time off to attend training
  4. DThe wage bill rises sharply because motivated staff demand overtime every week

Question 303

[2 marks]motivation and workforce involvement
Small groups of workers who meet regularly to identify and solve quality problems in their own area of work are known as what?

Answer this when you sit the paper.

Question 304

[3 marks]motivation and workforce involvement
Which of the following describes a works council in a business?
  1. AA forum where managers and elected worker representatives discuss workplace matters
  2. BA government body that sets the minimum wage payable in each industry each year
  3. CThe panel of directors that approves the company's published annual accounts
  4. DThe trade union office that collects subscriptions from its members at work

Question 305

[2 marks]motivation and workforce involvement
A company gives its employees shares in the business as part of its reward package. How is this likely to affect their involvement?
  1. ATheir reward is tied to company performance, so they act with an owner's interest
  2. BThe shares take the place of the wages the company would otherwise pay them
  3. CThe company's debts pass to them in proportion to the pay that each receives
  4. DThe company has to pay a dividend in every trading year whatever its results

Question 306

[2 marks]motivation and workforce involvement
A company consults its whole workforce before making operational decisions. What is a drawback of this approach?
  1. AWide consultation stops managers from delegating authority to their subordinates
  2. BWide consultation removes the directors' legal responsibility for the company
  3. CWide consultation takes time, which slows decisions that need a quick response
  4. DWide consultation raises the wage bill because each worker consulted is paid a bonus

Question 307

[2 marks]motivation and workforce involvement
A manager asks a subordinate to take on a task and gives them the authority to carry it out. Which statement about this delegation is correct?
  1. ABoth the authority and the final accountability for the task pass to the subordinate
  2. BThe manager completes the subordinate's other work while the task is being done
  3. CThe subordinate carries out the task, but the manager remains accountable for it
  4. DThe task is contracted out to an outside specialist recruited for the purpose

Question 401

[1 marks]marketing mix and pricing
A business claims that 'price is the single most important factor in the marketing of a product.' Besides price, which group of elements makes up the rest of the traditional marketing mix used to evaluate this claim?
  1. APackaging, branding and place.
  2. BProduct, promotion and place.
  3. CProduction, promotion and profit.
  4. DProduct, positioning and packaging.

Question 501

[1 marks]operations management and production
An Operations Manager wants to improve capacity utilisation without buying new machinery. Which of the following actions would achieve this?
  1. ASubcontracting some of the excess production work to another producer.
  2. BReducing the number of quality control checks performed on finished output.
  3. CIncreasing the selling price charged for every unit produced.
  4. DReducing the number of supervisors employed on the factory floor.

Question 502

[1 marks]operations management and production
A cellphone manufacturer produces its handsets mainly using automated machinery and robotics, with relatively few production workers involved. This type of production process is best described as...
  1. Acapital extensive.
  2. Blabour intensive.
  3. Ccapital intensive.
  4. Dlabour extensive.

Question 601

[1 marks]financial accounts and stakeholders
What term describes the practice of presenting a firm's financial accounts in a way designed to make its financial position look better than it actually is, for example to attract investors or secure loans?

Answer this when you sit the paper.

Question 701

[1 marks]elasticity of demand
A manufacturer of kitchen appliances finds that demand for one of its models is price inelastic. If the manufacturer raises the price of this model, what will happen to its total revenue?
  1. ATotal revenue will fall, because a price rise always reduces the quantity that customers are willing to buy overall.
  2. BTotal revenue will stay exactly the same, because inelastic demand means quantity demanded never changes at all.
  3. CTotal revenue will rise, because the percentage fall in quantity is smaller than the percentage rise in price.
  4. DTotal revenue will fall, because inelastic demand means customers switch easily to close substitute appliances.

Question 801

[1 marks]network analysis and critical path analysis
In a network diagram used for critical path analysis, what is the name given to the longest path through the network, which represents the minimum time needed to complete the whole project?

Answer this when you sit the paper.

Question 802

[1 marks]network analysis and critical path analysis
In a network diagram, an activity is found to have three days of spare time: it could be delayed by up to three days without affecting the overall completion date of the project. What is this spare time called?
  1. Athe critical path, which is the longest route through the whole network diagram.
  2. Bthe earliest start time, marking when an activity can begin at the soonest.
  3. Ca dummy activity, used only to show a logical dependency between activities.
  4. Dfloat, the spare time an activity has before it affects the project.

Question 901

[1 marks]business size and multinational companies
What term describes a small, specialised segment of a market that is often too small or specific to attract investment from large firms, but which a small business can serve profitably?

Answer this when you sit the paper.

Question 902

[1 marks]business size and multinational companies
A multinational company operating in Zimbabwe earns profits there and then sends a large share of those profits back to its home country rather than reinvesting them locally. What is this practice called?
  1. Acapital injection, used to expand the multinational's local operations.
  2. Brepatriation of profits, sent back to the multinational's home country.
  3. Cforeign direct investment, made by the multinational into the host country.
  4. Dprofit diversification, spread across the multinational's different markets.

Question 1001

[1 marks]market research and data presentation
A business wants to present data visually in a way that shows whether a correlation exists between two variables, such as advertising spend and sales revenue. Which method of visual presentation is most appropriate for this purpose?
  1. Aa histogram, which shows the frequency distribution of a single variable.
  2. Ba pie chart, which shows how a total is divided into separate proportions.
  3. Ca bar chart, which compares totals across several separate categories.
  4. Da scatter diagram, which plots paired values to reveal any relationship.

Question 1002

[1 marks]market research and data presentation
A business wants to present data visually in a way that shows how its monthly sales revenue has changed over the past two years. Which method of visual presentation is most appropriate for this purpose?
  1. Aa scatter diagram, which plots paired values to reveal any relationship between them.
  2. Ba line graph, which plots values over successive time periods to reveal trends.
  3. Ca pie chart, which shows how a fixed total is divided into different proportions.
  4. Da histogram, which shows the frequency distribution of a single continuous variable.

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