Paper 2 · Forms of Enterprise
A local authority pays a private firm to collect refuse that its own workers previously collected. This is an example of
Aa management buyout by the directors
Bcontracting out
Ca share flotation
Dnationalisation
Explanation: Under contracting out the service stays a public responsibility and is still paid for from public funds, but a private contractor delivers it under a competitive tender. No assets change hands, which is what distinguishes it from a sale of the enterprise itself.
Derived from ZIMSEC Business Enterprise Skills Paper 2, Specimen Paper, Q2