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Unit 1 CAPE Management Of Business Paper 1 - 2008 Past Paper (WARNING: Rough Scan)
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Wtrich of the following entities eq>ericnceunlirnitcd liability?
(A) L-ocal aurhorities(B) Parurerships(C) Public corporatiorrs(D) Pubtic tirnitcd comparues
Which of tl.c following is a featurc ofa freemarket system?
(A) State provides both goods andservices for all in sociegr.
(B) Discussiorrs regarriing production arebased oe people's necds.
(C) Government has rotal control overpolh*icrr.
(D) Cornpetition and innovation isencouraged-
One advantagc of a planned economy is
(A) moreequitabledisu-ibutionofinc<rme(B) efhsient provision of products by
state cortrpanies(C) ircrcased standard of living(D) moreefficierrtallaationof resqrrccs
'ftre MAIN brancb ofCARICOM responsibiefor impiemcrrtingpolicics is the
(A) HeadsofC:overr."unentConferErrce(lJ) CorrmronMarketCotrncil((:) lnstir'don of MinistersO)) CARICOMSecrerariat
An organisation described as having anadapdve culture is one that
(A) emphasises close relations *-ithcuslomers
(B) focuses on cenrralised decisionmaking
(C) discourages employees frorn takingrtsks
(D) ncverchangcs
Globalisation is a factor w.hich
(A) promotes Caribbean regionalintegration
(B) hinders Cari b bean regiona I
intcgrafion(C) prcvents 'brain-drain' frorn the
Caribbean(D) causes Caribbean goods ro be
expensive
Which of tl.e following is an advantageof afi-arrchise to a fi-anchisee?
(A) T-he initial capital investrnent isrelatively low.
(B) Royalties are received from the&'anchisor.
(C) Research and developnrent supportis provided by the franchisor.
(D) The fanchisee exercises totel ccnto!over the ft-anchise.
A firm practises ethical behawiotr when
(A) it delays paying its supplicr in orderto iryrove its liquidiryposition
(B) its social costs are subordinatc toprofits
(C) it recalls a qrecific batch ofproductsbecause of flaws in a few
G)) its executives are paid large s.lariesduring a redundancy exmise
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Which of the following statements can beconsidsrcd a corporate objecriv€?
tA) To be the mosr successful mobilecsmmunications group
To iacrease rnarketshare by l}Yoperyear
To mcet cusiomers'needs inboth thedomestic and regional areas
To provide a caring a:rd supponiveenvironment inthe service indust-y
l4
A multinational corporation has decided torelocate to a Caribbean country. Which of&e following is a potential benefit to tbe hostcountry?
(A) Increase in foreign exchangeeamirgs
(B) Lowcr transportation costs for rhefinishodp,rodrrcr 15
(C) Better access to local naturalresources
(D) Better knowledge of consumers,- taste
Wtrich ofthe following facrors is thc MAINcaus€ of conlliict in an orgarrisation?
Although a firm may be expcriencingdiseconomies of scale, it may wish to contirnreto expand. The MOST LII(ELy reason is to
(A) increase its present ouput(B) become the marker leader(C) provide berter dividends ro its
shareholders(D) maxirnizeitsprofis
Which of the following BEST illustrates abenefit of the 'brain drain' to the Caribbean?
(A) A reduction in *re level of irnports(B) A rcduction in the training cost(C) A posirive effbct on the balance of
paymcrrts(D) An increase in trade
The objective of Khan and Sorx t,td is..roincrease market share by 15 percent in thenext year." Wbat typ€ of objective isprojected by Khan and Soru Ltd?
(A) Medium-terrn(B) Tactrcal(C) Short-term(D) Long-term
The classical writers placed emphasis onworlg management and rationa.l behaviour.
Which of ttre following theorists is NOTassociated with the classical school?
(A) F.W.Taylor(B) H" Fayot(C) S. Adams(D) M- weber
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(B)
(c)
(1D)
I1.
(A)(E)(c)(D)
Absenteeism among workersHigh rate of staff turnoverAn authoritative style of leadershiplnequitabtc allocation ofresowces
16.
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Which of thc following facrors will influencea country's exchange rate if it uses *re floatingexchange rate q;stern?
Cer*ral BankpolicyDcrnand for foreign goodsSupply offoreign goodsDernand for local goods
(A)fB){c)(D)
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A 'paternalistic' leaderis one who
(A) involves zubordinates and makesdecisionsjointly
(B) guidcs ernployees sd tends to decide
for them(C) looks bcyond his or hcr self-interest
and instead places the goals oltheoryanisation first
etnphasizes the technical or taskaspects ofajob
At what stage of tealn development is *reMAIOR emphasis on task accomplishment?
(A) Founiry(B) P€rforming(() Achioring(D) Norming
Which of the following is NOT a bcnefit ofteamwork?
(A) Allows new ideas to bs created
(B) krcreases responsibility(C) hrcreases podttctivity
@) EncouragessPscializatien
Commrurication between people on the same
level ofa business organisation is classifiedas
bcrizontalverticaltechnicalequilateral
Which of the following isNOT an objectiveofoccrpational safety ud health legislation?
(A) 'Io educate management on theirreryonsfoifities
To prevent accidents in thewor$lace
To ensure that worksrs are properlyaained
To irnpose a fine on managemenl ifthey fail to prevent accidents
\\trich of the following is LEAST likely toinfluence the orgarrisational structure of a
business?
Views of the owners or leadcrshipstyl€s
The activities of informai groupswithin the organisation
Governrnent rcgulations and conholChangesin tcchnologl
Which of the following stalements BESTdescribes a feature of centralizedorganization?
(A) Employees are empowered to makedccisions.
(B) Decisioo*naking lics within thc ryperlevels of the oryanisation.
Autonomy is given to those at thelowerlevels-
Managers delegate tasks to thepcriphery.
2t.t7.
(B)
(cl
(D)(D)
(A)
(B)
tc)tD)19.
ttr8.
23.
20.
(c)
(D)(A)(B)(c)(D)
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26.24. Tbe MOST likely reason for establishingtcams is to
(A) form frierrdships and support(B) solveproblernsardinprovedeciskrn-
malqqg(C) developncw ideas(D) increase leaming of individual
members
Thc Board of Direcrors of a Public LimitedCompany needs to inform shareholders of aspecial general meeting to discuss plaas foran intendcd merger. Which nredium ofcommunication is BEST suited in thissihntion?
(A) Personal menro(B) E-mail mcssage(C) Newspapr(D) Conpaay'sbulletinboard
A Personnel Manager gives her staffinstructioru on how to perform atask. Whatform of communication flow does thisrepres€nt?
(A) Downwald(B) Upward(C) I-atcral(D) Horizontal
Human Rcsource Management is importantto all organisations because
(A) it is a legal roquirement(B) they must engage in collective
bargaining with t-ade unions(C) it enables them to have open lines of
comrrsnication(D) peoplc determine the levels of
efficicncy
25.
Irera 28 refers to thc following diagraru ofan organization stucrure.
Wbat type oforganisational structure is illustrated in the diagram above?
I\4atrixIodcpcndenceBurcaucraticEntrepreneurial
tA)(B)(c)(D)
28.
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A high-ly skilled group of w'orkers at agarme{rt facmry is NOT satisfied with the ciosesupervision of their manager The ProductionManager is not satisfied with their level ofprodrrctivity. Whichofthe fotlowir4l is MOSTlikely to irr,prove this sitr.ration?
A statement that gives the value of assets,liabilities and ow-nerb equity in a business ata specified date is referred to as the
(A) Trial Bala*cc(B) BalanceSheel(C) TradingAccount(D) WorkingCapital
The preparation of a company's arrnualoperatioual budgca begins with a
(A) sales forecast(B) competitors'analysis(C) corporate objectivc(D) variance analysis
Wtrich of the foUowing BEST explains theu-se of the tcrm "internal rate of refirm"?
(A)(B)
(c)(D)
It comparcs profitable invesunents.It comparcs the size of net
invcsfircnts.It compares retums under dsk.It compares tirning of cas5z flows.
a1
(A)(B)(c)
(D)
Increa-sing piece ratesLess supervision of workersEncouraging autonomous work
grouPsGlwing workers time-off
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A Sports Car Company purchased a race carfor $ I OO, OO0. In 5 years tirne the car willhave a salvage value of $2O, OOO. What isthe anmral depreciation?
35(A) $16,000cB) s20,000tc) $25.000(D) SAs,0Oo
Which of the following BEST' defines adebetture?
(A) A longterm loan with fixed interestrate
A short terrn loan with the principalpaid at maturity date
A long term loan with variableinterest rate
A bar* Ioan with fixed interest rate
Ttre buying ard selling of shares on the stockmarket bascd on a prcdictcd change inpricesis refcred to as
marketpricespeculationcross-listed stockmarketorder
Wtrich of thc following are examples of theMAJOR accorff ing concepts?
I. DoublcentryII" AccnralsIil. Posting entriesIV- Goingconccrn
(A) II and fVonly(B) I, tladlVonly(C) I, III and IV only(D) Il, III and IV only
36.
(B)
(c)
(D)
(A)(B)(c)(D)
32.
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37 Tbe Managers of TML Ltd are sourcingfi-nancc to devclop new products. Wharfactors should lhey consider before rnakingthedecision?
L SourceoffinalccII. Tirx implicati<rnsIIi. Competitorsf!'. Riskinvofued
(A) I, Il and lll only(B) I, II and IVonly(C) L III and fVonly(D) II, III artd [V only
Which of the following groups are MOSTlkely to use finaacial information to analysethe performance of the business?
I. GoverrnnertII. OwnersUI. Bankersry. Future investors
(A) I andII only(B) I, II and III only(C) I, II and rV only(D) Il, tII and IVonly
ln which ofthe followrng accouDts is int€festpaid on dcberrtures eharged?
(A) Ap,propriationAccountCB) CurrentAccount(C) TradingAccount(D) Profit and LossAccount
Which ofthe follow'ing cooditions indicates ahigNy gearcd company?
High l*els ofintercstIncreased bad debtsHighlcvels ofdebtorsIacrcased sales
Items 4l - 42 refer ro the graph below.
The graph illustrates the net preserrt valuesof an invesrneatt proj ect.
20 000
l5 000
10 {no
5 (X)0
o
(s fixl)
(roofir)
The discowrt rate at which the Internal Rateof Rchlm (l.R.R) occurs is
(A) 5vo(B) tu/o(c) tsys(D) l7o/o
What is the net pres€f,rt value of the investncntat arate of l5o/o?
(A) $ 5 OOO
(B) $ 6000(c) $l00ootD) $16000
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41.
39.
42.
(A)@)(c)(D)
I)iscount Rete (%)
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Thc following information is anextract &omthe {irm AIi and Sons Ltd at 3l December2W
CurrentAssets $160000I-ong terrn Liabilities $200000FixedAssets $300000Current liabilities $ 60 000
The firm.'s capital as at 31 Decernber, 2007is
(A) $200000(B) $260000(c) $360000(D) $s00000
The following information was extractedfrom the books of Jimmy's TradingEnterpriscs Ltd.
OpeningStockl/VA1 $ 600.00Purchases $6800.00Gross Profit $3 600.00
Sales $9 000.00
Closing Stock 3l/3/07 $t 400.00
What is the rate of turnover, to the nearestwhole number, forthe period?
2times3 times6times9tirnes
The extract below was taken from theTradingAccount of a business enterprise .
OpeningStockSales
Purchases
Closing Stock
The grossprofit of the firm is
$ 200.00$ 600.00$1000.00$r 600.00
;15.
(A)(B)(c)(D)
(A)(B)(c)(D)
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