part yourmame onthe in blo nt att cate in angulation. rest cove 01240010 FORM TP 2016105} ———————— CARIBBEAN EXAMINATIONS CARIBBEAN SECONDARY EDUCATION CERTIFICATE” EXAMINATION PRINCIPLES OF BUSINESS Paper 01 — General Proficiency T hour 15 minutes 25 MAY 2016 (p.m.) READ THE FOLLOWING INSTRUCTIONS CAREFULLY, MAY/JUNE 2016 COUNCIL This test consists of 60 items. You will have 1 hour and 15 minutes to answer them. In addition to this test booklet, you should have an answer sheet. ~ - eeeaignt wat % shade the space sm below.1 ‘The term trade’ refers 10 ices (A) the selling of goods and servi ‘on the stock market (B) the movement of immigrants from fone country roanother any commercial activity involving (C) Mihe exchange of goods 8m services the negotiation process between a trade unions and management Which of the following types of business Pe pbecocnts is MOST typical of the Commonwealth Caribbean? Which of the following is NOT an actiy; ity the planning process? Yin (A) __ Setting goals (B) _ Establishing policies (©) __ Identifying resources (D) _Delegating responsibility Item 7 refers to the following informati, Mr Lloyd, manager of LM Ltd hols, regular staffmeetings to listen to ideas fron, employees before making decisions that would affect the future of the company. What leadership style does Mr Lloyg employ? (A) Autocratic (B) Democratic (©) Charismatic (D) Laissez faire Selecting the objectives and the procedures for achieving goals is referred to as (A) planning (B) organizing (© controlling (D) motivating Which of the following demonstrates the characteristics of a good leader? I. Inspiring workers Il. _ Delegating responsibilities I. Making intelligent decisions (A) Land Ionly (B) Land Il only (©) Mand Ii only 1, Wand IlWhich of the following is NOT an example ‘ ‘ assis: Be ar i of or caployes tl? of an unethical business practice? benefit A) Money laundering (3) Dusrallowance ® ‘Nonpayment of taxes © wases and salaries (C)__ Misleading advertisements o (D) _ Retrenching inefficient workers (D) Workers’ compensation _ Whichofthe followingactivitiescarriedout 46, A post-dated cheque is one which ina firm will NOT be under the supervision (A) was written no longer than six months ago (B) _ isdatedtoagree with the date of the document requesting payment (©) _ isdated for paymentata future date (D) _ isdated by the bank on the day the cheque is presented for payment 17. Which of the following reasons can be used for voiding a contract? I. There was no consideration. I. There was no meeting of minds. II. The agreement was not in writing. (A) and Il only (B) Land Il only (©) Mand iI only @) 1, Mand mm A contract may be discharged by A) breach (B) change of mind inconsideration _ misappropriation ‘ friends went to the cinema, Fred fell and was injured, ice Would protect th ; e Against claims madei of cheques 28h a go eae ash oO | demand? (A) Open (B) Crossed (C) Certified (D) Banker's 21. To which of the following industries does ‘firm involved in food processing belong? to go to the USA in search of life. This movement is referred to <4 24. 25. 26. _ product of the manufacturing industry? feature of capital intensive firms i, ‘One they irge amounts of capital (A) Fae ge capital for other firms (B) _Provroremachinery andless (© Gremorepenpleand Iessmaching, i i ditions wou} fh of the following con i wi utealinkagebetween two industries) (a) Two firms manufacture similar ‘goods. (B) _Onefirmsharesthe use of machinery with another firm. (© __ Two firms are responsible for the ‘manufacture of different kinds of goods. (D) The output of one industry of the ‘economy becomes the input of another industry. Which of the following results is LEAST likely to occur from growth in an organization? (A) Greater productivity (B) More division of labour (©) _ Increased communication (D) Increased capital investment Which of the following commodities isa29, Under which of the following conditions trade discount used? (A) Bulk purchases : (B) Prompt payment (© Payment by cash (D) First-time buyers Which of the foli is NOTa terms of flat. lowing is terms of (A) Cash — B) Credit Shares Hire purchase ‘of the following factors is LEAST 10 influence consumer behaviour? 34. 35. 36. 37. In a Caribbean territory there is only one supplier that provides electricity 9 alt hemes, businessesand communities. What trarket structure does this BEST illustrate? (A) Duopoly (B) Oligopoly {C) Monopoly (D)__ Perfect competition Which of the following terms is associated with a stock market? (A) Costs and prices (B) _ Risks and benefits (©) Rentand investment (D) Premium and reward Tom invests his savings by buying shares ina company. From this investment Tom expects to receive (A) profits (B) interest (C) revenue (D) — dividends Mr Jones has several bills of fixed amounts to pay each month. His bank agreed to pay them monthly from MrJones’account. This service, provided by the bank, is refered (A) an overdraft (B) a fixed deposit (©) astanding order aletter of credit stocks and shares deposit accounts ce loans and advancesrefer to the following diagram ‘which represents the market for pears. original demand curve is DD. 42. 8) can influence business vernment’ 2 Governments 0) reducing activity positiv (A) taxes (B) grants (©) spending (D) _ subsidies Which of the following is NOT regarded asa role of taxation? (A) To raise revenue for governments (B) To influence the distribution of incomes and wealth (C) To influence the investment decisions of publicly owned enterprises (D) To influence total expenditure on goods and services Which of the following actions by government is MOST likely to lead to an improvement in the standard of living? (A) Printing more money (B) Increasing the income tax rate (©) Abolishing taxes on low incomes (D) _ Giving tax incentives to businesses Which of the follow: octira : g statements ly describes taxation as a means of redistributing incomes? (A) The rich Pay tax not. ‘es and the poor do Tax is used to distribute income more i ae perccully throughout thewould ractices E th and which of the following BE: Reece tax"? BEST explains a 49, Which of the following Pr contribute to the economic BF development of a country? (A) Therate of tax increases as income mer importation of const! increases. (B) The same rate of tax is paid at all (A) __ Increase ; Higherine levels, ) Fcteeameggge eco ce 2 centage ofincone sina, natural resources eae oom in tax then (©) Exporting skilled personnel to oe amos tries perc i developed count ae ower: ere ety o larger (D) Provision of loans and technical higher ir ge of income in tax than eraistance for establishing local Bein businesses em? refers to the following information 0, Export licences are issued MATNLY t© whichshows figures taken fromacountry’s wa (A) encourage local businesses to produce more goods for export (B) enable the government to control the flow of goods being exported (©) _ indicate to the importing country that the goods are of a high standard (D) _ indicate to the importing country the price at which the goods are to be sold 51. A measure which limits the quantity of goods that citizens ofa country are allowed to buy from overseas is known as an. (A) import duty (B) export duty (C) _ export quota (D) _ import quota Which of the following does NOT contribute toanimproved standard ofliving ofacountry? An increase in capital goods An increase in disposable income | An increase in the country’s population An increase in ij investment i technology Ss-8- ge of CARICOM is to f Es tee t ol mber states 0 collaborg £3. Which of she following is an examle ~ atlow me Saal realite “ we (B)Fetsmmon services (A) Excise duties . igethetransferoftechnolog, (B) Proper taxes co eneetnin the region (©) Custom duties allow for unrestricted movemen, (D) Value added taxes (Dy MMM persons among the teritorig, wing organizations woulg 4. 5 i between ich ofthe follo Visible trade examines the difference gg, Whichof' mong banana-producing a country’s : ‘a dispute a di itis Of the Caribbean and Central (A) imports and exports of goods only ‘America over preferential agreement wiqh (B) __importsandexportsof services only the European Union? (©) currentaccount and capital account (D) output method and expenditure World Trade Organization (WTO) A) method ei Caribbean Development Bank (cbB) Ee sean rarsc Gantiom’ refbre 10 20 (©) CARICOM Single Market ang Economy (CSME) ‘economy in which one sector is (A) highly dependent on local capital highly dependenton foreign capital ‘overpopulated while the other 15 55 19 periods of inflation, the ability to raise oo additional capital for expansion is MOST likely to be a problem for () Organization of Petroleum Exporting Countries (OPEC) (A) sole traders (B) partnerships © companies (D) multi-national corporations 60, Industrialization is an important strategy in the fight against poverty. Which of the following is a benefit of an increase in the development of industries? (A) at Areduction in the level of ‘exports an Feduction in the level of imports i increase in the level of migration M increase in the rate of unemployment ON THIs TEST. ae