OSUN STATE UNIVERSITY, OKUKU CAMPUS

COLLEGE OF MANAGEMENT AND SOCIAL SCIENCES

FACULTY OF MANAGEMENT SCIENCES
HARMATTAN SEMESTER 2020/2021 EXAMINATION
B. Sc. EXAMINATION
......................................................................................................................................................
COURSE CODE: BUS 103
COURSE TITLE: INTRODUCTION TO BUSINESS I
COURSE UNITS: 3
TIME ALLOWED: 21/2 HOURS
INSTRUCTIONS: ATTEMPT ANY FOUR QUESTIONS
......................................................................................................................................................
1. (a) Define the term “business” and discuss the roles it plays in contemporary society. (71/2
Marks)
(b) “No business can survive without the use of resources.” Identify and explain the main resources
that are available for the use of a business organisation. (10 Marks)

2. (a) The problems of Nigerian business enterprises are multi-dimensional despite the enormous
blessing of both human and non human resources. Discuss. (10 Marks)
(b) List and discuss five major ways of minimising the problems faced by business organisations
in Nigeria. (71/2 Marks)

3. (a) Using a well labelled diagram only, explain the term “business environment”.(5 Marks)
(b) Identify and explain the various elements in the business external environment. (71/2 Marks)
(c) Differentiate between sole proprietorship and partnership forms of business. (5 Marks)

4. (a) List and discuss any four functions of management. (6 Marks)

(b) Using the vertical dimensions, explain the three levels of management. (6 Marks)
(c) What are the regulatory roles of government in business? (51/2 Marks)

5. (a) What is business ethics? (4 Marks)

(b) List and explain any five principles of ethical decision making in business. (71/2 Marks)
(c) Define ethical dilemma any explain three ethical issues within the contemporary Nigerian
environment. (6 Marks)

6. (a) Give a working definition of corporate social responsibility and explain any two theories of
corporate social responsibility. (10 Marks)
(b) Discuss the arguments for and against social responsibility by business organisations. (71/2
Marks)

1
 MARKING GUIDE FOR BUS 103 2020/2021 SESSION

1. (a) Define the term “business” and discuss the roles it plays in contemporary society.
(71/2 Marks)
Definition of Business: Business is defined as all institutional arrangements involved in the
creation and provision of the desired goods and services necessary for enhancing the quality of life
of a society at a profit. (21/2 Marks)
Roles of Business in Contemporary Society
(i) Business provides the raw materials from which goods are produced. These materials resources
are then converted into finished goods that satisfy and meet the needs of consumers. (ii) The
fundamental questions of what to produce, how to produce, and for whom to produce are answered
by business which produce and distribute goods and services in order to satisfy human wants.
(iii) Business performs the major function of providing goods and services to the society at large.
Thus, it helps to improve the standard of living and quality of life of the people of a nation.
(iv) Business also provides services aimed at making life more comfortable for individuals and
businesses. For example, insurance firms and banks provide services for firms and individuals.
(v) Generation of employment. Business provides employment for a vast majority of people to
earn a living. Many people are involved in one form of business activity or the other.
(vi) Business organisations involve in corporate social responsibility by providing infrastructural
facilities and social amenities for the local communities in which they operate.

(b) Resources that are available for the use of a business organisation. (10 Marks)
(i) Man: This refers to the human resource commonly called labour. This resource involves the
use of human efforts in the production process. Human efforts can be mental, physical, acquired
or inherited. Human efforts are necessary inputs for production to take place.
(ii) Money: Money is an important resource needed for production to take place. The reason is
that all other resources are acquired with the help of money. Money comes in form of capital and
can be in form of short-term fund or long-term fund. It can be described as man-made productive
assets used for the creation\ of further wealth.
(iii) Materials: These are the most visible part of production. They are the resources that are
needed to facilitate the production of goods and services. In fact, production is seen as the
conversion of input materials into finished goods and/or services.
(iv) Machines: These are used to represent technical equipment and facilities from the most simple
to the very sophisticated that are used in the conversion of inputs to outputs. In this wise, a broom
is regarded as a machine just as cranes, conveyor belts, fork lift vehicle, appliances and other tools
that are needed to transform raw materials into finished goods.
(v) Method: This relates to the skills that are broad to bear in the process of determining resources,
the magnitude and the direction of resources that are deployed for conversion. Consideration
should also be given to the best technique to be used in the process of transforming the inputs to
outputs.
(vi) Market: In the context of business management, a product makes sense only if there is
demand for it. Market here refers to all potential buyers and the opportunities presented by the
environment in which the business operates.
TOTAL MARKS = 171/2

2
2. (a) The problems of Nigerian business enterprises are multi-dimensional despite the enormous blessing of both human
and non human resources. Discuss. (10 Marks)
(i) Problem of Infrastructural Facilities: Inadequate, inefficient, and at times, non-functional infrastructural facilities such as
road, water, electricity, transportation, communication facilities needed for the operation of business are not readily available.
(ii) Poor Implementation of Government Policies: Bureaucratic bottlenecks and inefficiency in the administration of incentives
and support facilities provided by the government.
(iii) Inadequate Capital: Many business enterprises operating in Nigeria are faced with the problem of insufficient capital. This
can be traceable to many factors such as (i) low level of national income and low per capital income which discourage savings.
(iv) Unfair and Unethical Business Practices: These are characterised by dumping and importation of substandard goods by
unscrupulous businessmen. This situation is currently being aggravated by the effect of globalisation and trade liberalisation, which
make it difficult for indigenous business enterprises to compete even in local/home markets. In addition, smuggling is causing great
damage to the existence and survival of indigenous firms.
(v) Uncooperative Attitude of Banks: The discriminatory and unfriendly attitude of banks in granting loans to prospective
businessmen. This discrimination from banks is averse to the risk of lending to business enterprises especially start-ups.
(vi) Lack of Enabling Environment: The political atmosphere in the country is not stable. This political instability usually leads
to changes in economic framework which can be a problem to all forms of business enterprises.
(vii) Multiplicity and Inconsistent Government Policies: In many cases policies are made without consulting the institutions
directly affected such that inconsistencies often exist in their interpretations. There could be unfair policies and regulations from
local, state, and federal governments. These policies and regulations may not only be unfair, they may be inconsistent with one
another.
(viii) Constraint of Raw Materials: There is often problem of shortage of needed raw materials in the local markets. Most of the
basic raw materials needed by these business organisations are sourced from foreign markets in developed countries. The fates of
many enterprises are tied to availability of foreign exchange to secure needed raw materials.
Any 5 Points. 2 Marks for Each Point. (1/2 Mark for Mentioning, 11/2 Marks for Correct Explanation of the Points) Total
Marks = 10

2. (b) Various Ways of Minimising the Problems Faced by Business Organisations in Nigeria.
(i) Tax Incentives to Industries: All pioneer industries should be given tax holiday. Tax holiday is the period in which pioneer
industries will not pay tax. Under the Act—Company Income Tax Act (CITA), business classified under pioneer industries would
be given tax holiday for 3 to 5 years.
(ii) Political Stability: The creation of a more stable political climate is a prerequisite for providing solution to the problems of
business management in Nigeria. Political stability will lead to the direction of efforts towards projects which will help to stimulate
economic development. In addition, a politically stable economy will attract both local and foreign investors to a country.
(iii) Provision of Infrastructural Facilities: Government should make every effort to make available the necessary infrastructural
facilities such as electricity, water, transportation and communication facilities needed for the operation of business enterprises.
(iv) Protection of Infant Industries: Industries which are at the early stage of development have to be protected against well-
established industries in advanced countries. This is because the local industries are not in position to produce commodities which
would compete effectively with those produced by long-established industries in advanced countries. This protection can take the
form of trade restrictions such as tariffs, quotas and outright bans of foreign made products.
(v) Manpower Training and Development: Business promoters should inculcate the habit of training and developing their
management and staff in order to build capacity for meeting the challenges of the time and embrace and take advantage of
developments in information and telecommunications technology and other technological areas.
(vi) Favourable Government Policy: The need for a good policy which will be creating a more favourable environment for small
business investment will be of great advantage to business promoters.
(vii) Furthermore, government should offer programmes in partnership with universities and other vocational institutions in training
business owners on how to manage business especially in the arrears of finance, product quality, marketing strategies and book
keepings among others.
Any 5 Points. 11/2 Marks for Each Point. (1/2 Mark for Mentioning, 1 Marks for Correct Explanation of Each Point) Total
Marks = 71/2
Grand Total Marks = 171/2

TOTAL MARKS = 171/2

3. (a) Using a well labelled diagram only, explain the term “business environment”.(5 Marks)
3
 IC
M

PO
NO
O

LITI
N CU
EC
ITIO STO

CA
P ET ME

L-LE
M RS
CO EMPLOYEES

GA
L
ORGANIZATIONAL CULTURE

TS
SUPPLIERS

NTRAN
PRODUCTION
MARKETING

HIC
NEW E
FINANCE

AP
GR
OWNERS
SUBSTITUTES MO
DE

STAKEHOLDERS

SOCIO-CULTURAL
5 Marks

(b) Identify and explain the various elements in the business external environment. (5 Marks)
(i). Economic: The economic dimension of a business general environment is the overall health of the economic
system in which the business operates which is reflected by a number of economic variables such as savings, i.e.
personal savings and business savings, interest rates, money supply, prices, wages, productivity, inflation rate,
consumer etc
(ii). Socio-Cultural: This consists of institutions, customs, mores, values, attitudes, norms, and beliefs of people of the
society in which the business operates. Astute managers make decisions that take into account the present and
anticipated socio-cultural forces.
(iii). Political-Legal: The political and legal dimension of the general environment consists of governmental laws,
rules, and regulations that govern the affairs of business organisations in a given economy.
(iv). Demographic: The demographic environment is essentially the descriptive elements and measure of various
characteristics of the people in the society such as the absolute size of the population, average age, birth rate, gender,
family size, income, literacy level, occupation, total workforce available, and possible effects of future increase in
population.
(v). Technological: Technological elements reflect the application of scientific knowledge regarding the production
of goods and services. Technology consists of the process by which the organisation converts inputs (materials,
machines, information, energy, capital etc) into outputs (goods and services). Technological force can have positive
or negative effects on business.
(vi). Ecological: This is the natural environment and consists of our natural surroundings. The ecological problems of
energy shortages, toxic wastes, deforestation, pollution and abuses to the natural environment are generated as a by
product of producing goods and services.
(vii). International: All managers irrespective of the size of their organisations should pay attention to the international
environment. The importance of international forces varies depending on the organisation’s size and scope of business.
The international environment offers the domestic firms opportunities that are not always available in the domestic
economy.
Any 5 Points. 11/2 Marks for Each Point. =71/2 Marks.

(c) Differentiate between sole proprietorship and partnership forms of business. (71/2 Marks)
(i) Sole proprietorship is a business concern established, owned, operated, financed and controlled by one person
with the sole aim of making profit. It is otherwise known as one-man business. (21/2 Marks)

A partnership is an association of two or more persons who carry on as co-owners of a business for profit. It can also
be defined as the relationship that exists when two or more persons contribute skill, money or money’s worth in order
to establish, own and manage business organisation with the sole aim of making profit and jointly responsible for any
losses. (21/2 Marks)
TOTAL MARKS = 171/2

4. (a) List and discuss any four functions of management. (6 Marks)

4
(i) Planning: Planning is defined as the conscious selection of appropriate organisational goals and diligent
determination of courses of action to achieve the desired goals. It is the process that managers use to identify and
select appropriate goals and courses of action for an organisation.
(ii) Organising: Organising is concerned with the arrangement and division of work among individuals or groups in
the organisation. It involves breaking down of the organisation into parts in such a way that each part contributes to
the organisation’s goals.
(iii) Coordination: This involves seeing that all groups and persons work efficiently and economically, in harmony,
towards the common objectives. It is the process of bringing together a number of separate elements to form an
organised and coherent unit with the aim of contributing their quota towards the accomplishment of overall goals-in
the most efficient way.
(iv) Directing: Directing involves guiding and motivation employees to accomplish the company’s objectives
(v) Controlling: Controlling is the work a manager performs to assess and regulate work in progress and completed.
It is the monitoring of the performance of organisational members to ensure that events conform to plans and prompt
detection and correction of any deviation.
Any 4 Points, 11/2 Marks for each point = 6 Marks

(b) Using the vertical dimensions, explain the three levels of management. (6 Marks)
(i) First-Line Managers: These are managers at the lowest level of the management pyramid. They are largest number
of managers in most organisations. They are responsible for the work of operating employees who produce a
company’s goods and services. They are the only set of managers who don’t supervise other managers. They are
responsible for the day-to-day supervision of the non-managerial employees who work assiduously in pursuit of
organisational goals. They also serve as a link between the middle level managers and rank-and-file.
(ii) Middle Managers: They occupy the middle level of management hierarchy between top managers and the first
line managers. They are responsible for (a) setting objectives that are consistent with top management’s goals and
implementing subunit strategies for achieving these objectives; (b) planning and allocating resources to meet
objectives; and (c) they serve as coordinators and link groups, departments, units, and division within the organisations
so that they operate in harmony with one another.
(iii) Top Managers: These are managers at the apex level of the organisational hierarchy. They are responsible for
overall direction of the entire organisation. Top managers have the following responsibilities: (a) the establishment of
organisational goals; (b) development of overall strategies (c) formulation of operating policies; (d) responsible for
assisting their subordinates develop a sense of commitment to the business amongst others.
2 Marks for Each Point = 6 Marks
(c) What are the regulatory roles of government in business? (51/2 Marks)
(A) Government Regulatory Role: Government involvement in business is also that of a regulator by providing
rules, laws, and regulations that ensure compliance to standard and conformity to the rules of the land. This regulation
covers among others the following. (11/2 Marks)
(i) Business Registration: The first regulation that every business has to comply with is that of registration. All
business organisations are expected to register, by law with the Corporate Affairs Commission.
(ii) Patent Right: This is an exclusive right given by government to protect right of the inventor (from his invention
been infringed upon). It gives the inventor exclusive right to own, use and benefit financially from his inventions.
(iii) Copyright: This is the right given by government to protect intellectual properties. It provides exclusive right to
print, publish, and copy one’s own work. No individual can copy or infringe on such work without the permission of
the owner of the work copyrighted.
(iv) Trade Mark: This is a distinctive symbol, title or design that readily identifies the company or its product. The
major benefit of the trademark is that it is the first evidence of the registrant’s exclusive right to use the symbol.
(v) License: Is a document authorizing one who wants to establish a new business enterprise by local, state or federal
government or other authorized bodies, e.g. off and on license for alcoholic drinks.
Any 4 Points. 1 Marks for Each Point. Total Marks = 51/2

TOTAL MARKS = 171/2

5. (a) What is business ethics? (4 Marks)

Business ethics is simply the application of general ethical rules to business behaviours. (4 Marks)
5
(b) List and explain any five principles of ethical decision making in business. (7 1/2 Marks)
(i) Principle of Utilitarian Benefits: This principle simply states that the morally correct action is the one that results
in the greatest good for the greatest number of people. It is based on the premise that actions that promote happiness
are right and actions that cause unhappiness are wrong.
(ii) Principle of Moral Rights: The moral rights approach to ethical decisions focuses on an examination of the moral
standing of actions independent of their consequences. It holds that some principles are simply right or moral,
independent of consequences. When we are confronted with two courses of action both of which have moral standing,
then the consequences – both positive and negative-- should determine which of them is more ethical.
(iv) Principle of Golden Rule: The golden rule is a name given to Jesus teaching as found in the Holy Bible and has
been a popular guide for centuries. Simply put, it is: “Do unto others as you would have them do unto you.” (Matthew
7:12). This approach requires identifying various courses of action and choosing the one that treats others the way you
would wants to be treated.
(v) Principle of Justice: This principle demands that decision makers be guided by fairness and equity, as well as
impartiality (Kahn, 1990). It focuses on how equitable the costs and benefits of actions are distributed as the principal
means of judging ethical behaviour.
(v) Principle of Individual Rights: According to this approach, ethical codes or standards are based upon the primacy
of a single value, which is liberty. This principle holds that one should never take any action that infringes on others’
agreed-on rights. This means that rights protect people against abuses and entitle them to important liberties. Thus, a
particular decision should be avoided if it interferes with the rights of others.
(vi) Principle of the Mean: This principle of ethics was propounded by Aristotle. It demands of virtue through
moderation. Right actions, according to this principle, are found in the area between extreme behaviour’s continuum
which are labelled excess on the one hand and deficiency on the other.
Other principles are (vii) Principle of Enlightened Self-Interest and (viii) Principle of Personal Virtue

(c) Define ethical dilemma any explain three ethical issues within the contemporary Nigerian
environment. (6 Marks)

An ethical dilemma is a predicament in which a businessperson must resolve whether an action,

although benefiting the organisation, the individual, or both, may be considered unethical. (2
Marks)

(i) Bribery.
(ii) Inside dealings.
(iii) Lying.
(iv) Misleading advertisements.
(iv) Under and overpricing of invoice.
(v) Illegal campaign contributions.
(vi) Disrespect for the people’s culture.
(vii) Fraudulent financial reports.
(viii) Disregard for the rule of law.
(ix) Disrespect for property and dignity of man.
(x) Brown envelops.
Any 2 points with correct explanations 2 Marks for each point

TOTAL MARKS = 171/2

6. (a) Give a working definition of corporate social responsibility and explain any two theories of
corporate social responsibility. (10 Marks)

6
Corporate social responsibility refers to a manager’s duty or obligation to make decisions that nurture,
protect, enhance, and promote the welfare and well-being of stakeholders and society as a whole. 2 Marks

Two Theories of Corporate Social Responsibility

(i) The Shareholders’ Theory: This theory holds that the only responsibility of business organisation is to
use its resources and engage in activities designed to maximise profit for the shareholders through open and
free competition, and without deception and fraud. This position is based on the argument that business
organisation is an economic institution whose legitimate function is economic performance and not social
activity. 4 Marks

(ii) The Stakeholders’ Theory: The stakeholder theory holds that business organisation must play an
active social role in the society in which it operates. That is, managers must satisfy a variety of constituents
(e.g. investors and shareholders, employees, customers, suppliers, government and local community
organizations etc) who can influence firm outcomes. 4 Marks

(b) Discuss the arguments for and against social responsibility by business organisations. (7 1/2 Marks)
Argument for CSR
(i) Public Expectations Social expectations of business have increased dramatically over the years. Thus,
public opinion now supports business pursuing social as well as economic goals.
(ii) Public Image Social responsibility behaviour will create a positive public image for business. This will
result in increased sales, attraction of good employees, access to financing, and other benefits.
(iii) Better Environment Business involvement in social responsibility can help solve difficult social
problems, helping to create a better quality of life and a more desirable community, which will be more
conducive for business activities both now and in the future.
(iv) Avoidance of Government Regulation If business is perceived to be meeting its social obligations,
costly and restrictive government regulations can be avoided.
(v) Balance of Responsibility and Power Since business already has a great deal of social power, its social
responsibility should be equally great. When power is significantly greater than responsibility, the
imbalance encourages irresponsible behaviour such as abuse of power that works against the public good.
(vi) Possession of Resources Business Organisations have the financial resources, technical experts, and
managerial talent to support public and charitable projects that need assistance.
Any 3 points 11/2 Marks for Each point. = 41/2 Marks

Argument Against CSR

(i) Violation of Profit Maximisation Diverting resources from the firm to socially responsible programmes
undermines the principles of competitive marketplace, and denies shareholders of their rightful economic
gain.
(ii) Cost of social obligations can be very expensive, and may cause firms to forgo attractive business
investments, or even to go out of business.
(iii) Most businessmen do not have the skills and training to effectively tackle social problems.
(iv) Dilution of Purpose: The pursuit of social goals may dilute the economic productivity of the firm.
(v) Concentration of Too Much Power in Business Business is already one of the most powerful sectors
of our society. If it pursues social goals, it will have even more power, which may be undesirable.
Any 2 Points. 11/2 Marks for Each Point = 3 Marks.

TOTAL MARKS = 171/2