QUICK QUESTIONS WITH ANSWERS FOR REFERENCE

Reasons for popularity of WhatsApp as a trend in communication. (4mks) It offers unlimited messaging It has no hidden costs It offers international messaging It is simple to use Video calling available It is possible to send documents Virus-free. www.avast.com

Sources of capital to public limited companies. (4mks) Sale of shares Sale of debentures Profits ploughed back Loans from financial institutions Renting and leasing out property Disposal of assets Purchase of goods on credit Virus-free. www.avast.com

The following is a table of activities. Name the utility that is created by each activity answers (i) Form (ii) Possession (iii) Place (iv) Place    Virus-free. www.avast.com

Reasons why a producer may prefer to sell directly to consumers. Financial strength. Can use own retail outlets established in the market. Number of established /regular customers. If the established number is low, then direct sales are viable. Perishable goods. There is need to reach customers fast to avoid spoilage. Technical goods. So that he can demonstrate how they are used. Feedback required.  In order to get quick response from the customer about their feelings on the product. Scale of production. When the producer has a small amount of output can sell directly Need to keep prices low. Producers may want to control prices and keep them low by avoiding middlemen. Customer specification. If customers order goods directly, then direct sales are done. Concentrated markets. Where large markets are concentrated and accessible, then direc

Reasons why the government trains potential traders. Expose them to modern developments in management. Educate them on efficient methods of operating business. Expose business people to problems facing them and their possible solution. Impart proper business ethics. Educate them on how to use available resources to minimize costs and maximize profits. Inform them on various available profitable business opportunities in their environment. Expose them to government policies regarding business activities in the country. Virus-free. www.avast.com

Reasons why most organizations prefer locating their offices in the outskirts of town. To get ample parking space. Enough space for future expansion. Avoid traffic jam. To avoid noise interruptions associated with CBD. Cuts on rental charges/cost. Virus-free. www.avast.com

Outline four ways in which a good business structure is of benefit to a business organization(4mks) Facilitates easy control of workers Facilitates easy evaluation of workers Reduces confusion among workers Enhances teamwork Virus-free. www.avast.com

Reasons for the shift of supply curve to the left. Increase in the cost of production Shortage of factors of production Decrease in the levels of technology Unfavourable government policies such as an increase in tax Future expectation of an increase in price Unfavourable natural factors e.g. floods Wrong timing. E.g agricultural products are only available during certain times. Withdrawal of firms from the industry Virus-free. www.avast.com

K Ltd a manufacturing firm has been performing poorly in the recent past. Highlight four measures that they can take  to improve their profitability Improve on personnel management Locate the business where customers are many Manage finances properly Improve on public relations Being more creative and innovative Managing debts carefully Getting more capital to finance operations Should invest in more research to find out better production method Virus-free. www.avast.com

Benefits of youthful population to an economy. Provide large and cheap labour force Market for products demanded by the youth Greater invention and innovation Provide a large tax base for the country Provides a more mobile labour force Virus-free. www.avast.com

Features of the oligopoly market structure Has few large sellers and many buyers. The firms are interdependent among themselves especially in their output and pricing. Non-price competition, firms are in a position to influence the prices. However, they try to avoid price competition for the fear of price war. There is barriers to entry of firms due to reasons such as; requirement of large capital, Ownership of production rights, control over crucial raw materials,  Restrictive practices etc High cost of selling through methods of advertisement due to severe competition. Products produced are either homogeneous or differentiated. Uncertain demand curve due to the inter-dependence among the firms. Hence the shifting of the demand curve is not definite. There is price rigidity i.e. once a price has been arrived at in an oligopolistic market, it ten

The essential elements of transport The way The unit of carriage Method of propulsion Terminals Virus-free. www.avast.com

Level of production that matches the following occupations Virus-free. www.avast.com

Assumptions in the circular flow of income in a two sector economy Existence of two sectors only. It is assumed that the economy has only two sectors that is households and firms. The households provide the factors of production while firms are involved in the production of goods and services. Total spending by households. It is assumed that the households spend all their income on the goods and services produced by the firms i.e. no savings. Total spending by the firms. It is assumed that the firms spend the money received from the sale of goods and services to pay for the rewards of production factors. Lack of government intervention. The government does not influence how the firms and households carry out their activities. Such interventions are in the form of taxes, price controls among others. Closed economy. Exports and imports

Define the following principles as used in insurance Indemnity During compensation, insurance aims to reinstate the insured back to the financial situation he/she was just before the risk occurred Utmost good faith When taking an insurance policy or making a claim, the insured is expected to disclose all material facts to the insurer. Subrogation Once the insured has been compensated appropriately, any other benefits that he/she may get will revert to the insurer. Contribution In case of double insurance, any compensation due to an insured will be paid by the insurers in an agreed proportion so as to conform to the principle of indemnity Virus-free. www.avast.com

Reasons why shelter is considered a basic want. Shelter protects us from wild animals. It prevents diseases. For purpose of privacy Provides space for relaxation and sleeping. Provides warmth to the body. Protects man against adverse weather conditions. For storage of basic wants. Virus-free. www.avast.com

Advantages of a public warehouse to a trader. A trader can get a short-term loan by using goods stored in the warehouse as security. Goods are stored against risks such as damage by fire. Traders do not incur the high initial cost of constructing their own warehouse. Trader can look for the market for goods while they are still in the warehouse. Virus-free. www.avast.com

Importance of entrepreneurship in an economy. Creation of employment to the owner and others Formation of capital from profits made and salaries and wages paid to workers Raising standards of living due to access to varieties of goods and services Encourages utilization of local resources that could have been left idle. Improving infrastructural facilities like roads, security etc Savings on imports Reducing foreign dominance of the economy Promotion of technology/promotion of innovation, research and development Promotion of entrepreneurial culture/helps in the creation of role models It contributes to government revenue It promotes economic growth It may promote self-actualization and esteem. Virus-free. www.avast.com

Ways in which internal business environment may affect business negatively. (4mks)        Poor business structure may lead confusion. Inadequate finances hampering resource acquisition. Poor business culture leading to wastage of time. Non-committal owner leading to poor management. Unskilled personnel leading to poor implementations of decisions. Lack of innovation and invention leading poor quality production Virus-free. www.avast.com