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ZIMSEC O Level · 7103/1 · J2004

Commerce Paper 1 June 2004

Questions
40
Time allowed
75 min
Syllabus code
7103/1

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Questions
40
Pass mark
24
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Answer every question in the printed order, get marked at the end, then see the answers.

The questions

Question 1

Production
Which of the following contributes to the satisfaction of human wants?
  1. Agoods only
  2. Bgoods and services
  3. Cservices only
  4. Dnone of the above

Question 2

Production
A commercial worker
  1. Aprovides finished goods.
  2. Bproduces raw materials.
  3. Cproduces semi-finished goods.
  4. Dprovides services.

Question 3

Production
The effort to organise, co-ordinate and control other factors of production is referred to as
  1. Acapital.
  2. Benterprise.
  3. Clabour.
  4. Dland.

Question 4

Production
Which is not an advantage of division of labour?
  1. Aincreasing skill
  2. Blowering prices
  3. Creducing boredom
  4. Dsimplifying processes

Question 5

Trade
Which activity is not a form of trade?
  1. Aentrepôt
  2. Bexporting
  3. Cretailing
  4. Dfranchising

Question 6

Trade
What is electronic commerce (e-commerce)?
  1. Athe buying and selling of goods between two or more countries
  2. Bthe marketing of goods and services on the internet
  3. Cthe sending and receiving of messages through computers
  4. Dthe trade conducted between distant company executives

Question 7

Retail trade
Which retail outlet offers self-selection?
  1. Adepartment store
  2. Bhypermarket
  3. Cmail order shop
  4. Dmultiple shop

Question 8

Marketing
Which one is an advantage of branding goods?
  1. AGoods advertise themselves.
  2. BIt makes goods easy to handle.
  3. CPerishable goods are protected from deterioration.
  4. DThere is less damage from customer handling.

Question 9

Business units
A business person would choose to become a franchisee because he
  1. Aenjoys all the profits earned in the business.
  2. Bhas greater chances of success by dealing in an established product.
  3. Cis free to choose how to manage the business and sets own standards.
  4. Duses own name and trains own self.

Question 10

Trade
A middleman who buys goods from a manufacturer and sells them on his own behalf is a
  1. Abroker.
  2. Bdel credere agent.
  3. Cfactor.
  4. Dmerchant.

Question 11

Business documents
Which document is used when goods are being delivered using hired transport?
  1. Aadvice notice
  2. Bconsignment note
  3. Cdelivery note
  4. Dpro-forma invoice

Question 12

Business documents
Under what circumstance would a trader not use a credit note?
  1. Awhen empties are returned
  2. Bwhen goods are undercharged
  3. Cwhen goods are undersupplied
  4. Dif damaged goods are returned

Question 13

International trade
Why is international trade important to Zimbabwe?
  1. Ato ensure that the country achieves self-sufficiency
  2. Bto protect its local industries from foreign competition
  3. Cto provide quality goods at lower prices for its citizens
  4. Dto reduce the variety of goods available in the country

Question 14

International trade
Customs and excise authorities are responsible for
  1. Achecking people's travel documents.
  2. Bissuing import licences to importers.
  3. Cproviding warehousing for imported goods.
  4. Dcollecting revenue for the state.

Question 15

Consumer protection
Which one is not a voluntary organisation set up to protect consumer rights?
  1. Athe Advertising Media Association of Zimbabwe
  2. Bthe Consumer Council of Zimbabwe
  3. Cthe parliament of Zimbabwe
  4. Dthe Standards Association of Zimbabwe

Question 16

Business units
Which business unit is the odd one out?
  1. Apartnership
  2. Bprivate limited company
  3. Cpublic corporation
  4. Dpublic limited company

Question 17

Business units
What makes a limited partnership different from other partnerships?
  1. AAll partners take part in the running of the business.
  2. BAt least one partner should have unlimited liability.
  3. CThe business is run according to the Partnership Act.
  4. DThe partners are limited to twenty only.

Question 18

Business units
Which information would be found on a memorandum of association?
  1. Athe borrowing powers of the company
  2. Bthe rules for calling company meetings
  3. Cthe nature of business the company intends to carry out
  4. Dthe powers and duties of the company directors

Question 19

Business units
What can public limited companies do which cannot be done by private limited companies?
  1. Aengaging in profit-making activities
  2. Bkeeping the affairs of the business private
  3. Cregistering the business with the Registrar of Companies
  4. Dselling shares to the members of the public

Question 20

Business finance
The following are ways of raising capital by a sole trader except
  1. Adebentures.
  2. Bhire purchase.
  3. Cleasing.
  4. Dtrade credit.

Question 21

Business finance
Which type of preference shares will entitle the holder to an additional dividend?
  1. Aall preference shares
  2. Bcumulative preference shares
  3. Cparticipating preference shares
  4. Dredeemable preference shares

Question 22

Stock exchange
On the stock exchange, a bull is a speculator who expects share prices to
  1. Afall and buys now in order to sell later.
  2. Bfall and sells now in order to buy later.
  3. Crise and buys now in order to sell later.
  4. Drise and sells now in order to buy later.

Question 23

Banking
Cheques are not legal tender because they
  1. Acan be altered.
  2. Bcan be dishonoured.
  3. Ccan be endorsed.
  4. Dcannot store value.

Question 24

Banking
Which account allows withdrawals only after seven days' notice has been given?
  1. Abudget account
  2. Bcurrent account
  3. Cdeposit account
  4. Dsavings account

Question 25

Money
Which characteristic of money requires that it does not wear out quickly?
  1. Adivisibility
  2. Bdurability
  3. Cstability
  4. Dportability

Question 26

Banking
What information appears on a specially crossed cheque but not on a generally crossed cheque?
  1. Adrawer's name and signature
  2. Bname and branch of drawer's bank
  3. Cname and branch of payee's bank
  4. Dpayee's name and signature

Question 27

Banking
The liquid assets of a commercial bank consist of
  1. Acash and cheques only.
  2. Bcash, treasury bills and bills of exchange.
  3. Ccustomers' current accounts.
  4. Dloans and advances.

Question 28

Insurance
Which risk would an insurance company accept to cover?
  1. Aa risk that can be measured
  2. Ba risk that has no past records
  3. Ca risk that occurs too frequently
  4. Da risk that occurs too infrequently

Question 29

Insurance
In which case would the principle of proximate cause prevent the insured from being compensated?
  1. AA field of wheat covered against fire is destroyed in a veld fire.
  2. BA vehicle insured against accident is stolen and damaged by thieves.
  3. CA warehouse insured against theft loses goods to burglars.
  4. DGoods covered by an "all risks" policy are destroyed by fire.

Question 30

Insurance

A manufacturer insures his delivery vehicles for $500 000 with insurance company X. He insures the same vehicles with insurance company Y. One of the delivery vehicles worth $100 000 is destroyed in an accident.

How much compensation will he receive from both insurance companies?

  1. A$100 000
  2. B$200 000
  3. C$400 000
  4. D$1 000 000

Question 31

Insurance

A manufacturer insures his delivery vehicles for $500 000 with insurance company X. He insures the same vehicles with insurance company Y. One of the delivery vehicles worth $100 000 is destroyed in an accident.

Which insurance doctrine would have been used to compensate the manufacturer?

  1. Aaverage clause
  2. Bcontribution
  3. Cinsurable interest
  4. Dsubrogation

Question 32

Communications
A postal service which requires the addressee to obtain a licence from the post office is
  1. Aair mail.
  2. Bbusiness reply.
  3. Ccash on delivery.
  4. Drecorded delivery.

Question 33

Communications
Which is not a reason for paying more when using registered post?
  1. AAdditional care is provided in handling such mail.
  2. BSome compensation is offered in case of loss.
  3. CSuch mail is delivered faster than ordinary mail.
  4. DThe sender is issued with a certificate of posting.

Question 34

Communications
Which one is an advantage of both a telephone and a telegram?
  1. AA written record is left for future reference.
  2. BInformation can be abbreviated or coded.
  3. CMessages are transmitted very fast.
  4. DThere is immediate response through dialogue.

Question 35

Transport
The greatest advantage of using road transport in carrying goods is that it
  1. Acan offer a door-to-door delivery service.
  2. Bcan transport bulky loads in one consignment.
  3. Cis cheap for deliveries over long distances.
  4. Dis fast because there is no congestion.

Question 36

Transport
Both rail and air transport
  1. Aare cheap for bulky goods over long distances.
  2. Bare fast over long distances.
  3. Care not affected by bad weather conditions.
  4. Dhave low insurance charges.

Question 37

Transport
The terms 'dead freight' and 'lay days' are used in connection with
  1. Aa bill of exchange.
  2. Ba bill of lading.
  3. Ca charter party.
  4. Dan airway bill.

Question 38

Warehousing
A warehouse which is used to store a farmer's inputs is
  1. Aa bonded warehouse.
  2. Ba producer's warehouse.
  3. Ca public warehouse.
  4. Da wholesaler's warehouse.

Question 39

Advertising
Competitive advertising is mainly aimed at
  1. Ainforming customers of a company's products.
  2. Bpersuading customers to buy a specific brand of goods.
  3. Cpromoting all goods of one type from different manufacturers.
  4. Dproviding accurate information on product price and quality.

Question 40

Advertising
Which is the correct order in which advertising agents operate?
  1. AThey create, produce and place an advertisement.
  2. BThey place, create and produce an advertisement.
  3. CThey produce, create and place an advertisement.
  4. DThey produce, place and create an advertisement.

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