Eng B Mashura 0773279596 0715493173

ADVANCED LEVEL

BUSINESS STUDIES ESSAY QUESTIONS

AUTHOUR Eng. B MASHURA

1a). Why is the management of stock important? (10)

b). Outline a stock control system which a business might use to control levels of stock.
(10)

c). Under what circumstances would you advise holding high levels of stock? (5)

2a). With aid of appropriate examples, distinguish between ‘private’ and ‘social’ costs of
production, and explain why such information is needed. (9)

b). Why, and how, might a manager use Marginal Costing techniques? (16)

3a). What is meant by Elasticity of Demand? (9)

b). Why might a Marketing Manager attempt to influence the elasticity of demand for a
product?[16]

4. R & B Records have 300 employees, the majority of whom are unskilled production line
workers.

Over the past year there has been a significant increase in the number of products rejected,
levels of materials wastage, and in the complaints from customers. A study, carried out by
independent consultants, has revealed that poor training is the main cause of these problems.

Write a report to the Managing Director of R & B, outlining the advantages of having a well-
trained workforce, and giving a full explanation of how such training might be undertaken
and evaluated.(25)

5a). How might domestic manufacturing industry be affected by an appreciation in the

exchange ate of its country’s currency? (13)
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b). In what ways would the use of tariffs, by government, help or harm domestic producers?
(12)

6. How, and to what extent, can the needs of an individual be met through work? Give
examples where appropriate. (25)

7. The owner of a small business cannot understand why, having made a profit of $70, 000 in
his first year of trading, he has a bank balance of only $10, 000.

a). What reasons can you suggest for the difference between the profit figure and the bank
balance? (9)

b). Explain how you would use ratio analysis to monitor the liquidity position of the
business, and what action you would take to remedy any problems you might find. (16)

8a). Outline and evaluate the methods of communication between management and the
workforce. (15)

b). What do you understand by ‘leadership style’, and how does it affect communication
flow within an organization? (10)

9. The Directors of two small companies located within 30 miles of each other, engaged in
the same industry and at the same stage of production, are proposing a merger.

a). If you were a Director of one of the companies, what arguments would you put forward in
support of the merger? (9)

b). How might the proposal be viewed by each of the following:

i. middle management

ii. shop floor workers

iii. shareholders

iv. government (16)

10. A major international car manufacturer is considering locating a new factory in your
country. The cars to be produced will be exclusively for export.

a). Briefly outline the factors that the company should consider before making a final
decision. (10)
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b). Assume that the company decides to proceed with its plans. How could Network Analysis
be used as an aid to controlling the overall duration of the project? (15)

11a). Why do firms need objectives? (6)

b) With the aid of an appropriate example, distinguish between ‘strategic’ and ‘tactical’
objectives. (6)

c). ‘The primary objective of all firms is the pursuit of maximum profits.’ Discuss. (13)

12a). Why do firms need to develop new products? (9)

b). Explain what you understand by the term ‘value analysis’ (value engineering), and discuss
its usefulness when developing a new product. (16)

13a). „Superiors use delegation to avoid work and responsibility.‟ How

accurate is this statement? (12)

b). Evaluate the role played by an effective communication system in an

organization. (13)

14. „A pricing policy which is based on costs only can be inappropriate.‟ Discuss. (25)

15a). Zimbabwe Steelers Private Limited is short of working capital.

Suggest the alternatives that may be open to the company so as to increase its working
capital. (12)

b) Discuss the factors which might influence management’s choice of sources of funds.
(13)

16a). Explain why firms should be concerned with the quality of their products. (10)

b). Evaluate any three methods of quality control. (15)

16. “All businesses‟ only aim is to maximize their profits.” Discuss. (25)

17. With reference to financial ratios, discuss the usefulness of financial statements of a
business to its managers and external stakeholders. (25)

18a). Discuss the main differences between formal and informal organisations. (10)

b). Evaluate the role played by informal groups in an organization. (15)

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19a). Explain why firms develop new products. (10)

b). Assess the role of research and development in marketing a product. (15)

20a). Explain the importance of branding in the marketing strategy of any business. (10)

b). Evaluate the role played by middlemen in the marketing efforts of a business. (15)

21. How would you assess the effectiveness of the management team of a business? (25)

22. Discuss the uses of i). Break even analysis, and

ii). decision trees

as aids to management’s decision making process. (25)

23a). Explain why, despite continued losses, a government may continue to support
parastatals. (10)

b). Discuss the continued existence of small firms and the problems they face in an
environment dominated by big businesses. (15)

24a). Explain how some government policies can assist, and others constrain the growth of
small firms. Use examples to support your answer. (10)

b). Evaluate the role of small firms to the economy of your country. (15)

25a). Analyse the likely causes of high labour turnover in an organization. (12)

b). Discuss why management should worry about a high rate of labour turnover. (13)

26a). Using examples, distinguish between market size and market share. (7)

b). Discuss the benefits of market segmentation to each of the following:

i). Production Manager

ii). Marketing Manager (18)

27. A fast food firm wishes to raise $10 million to finance the acquisition of a new plant.
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a). How might a bank manager use information contained in the firm’s financial statements
in order to lend the sum required? (10)

b). Evaluate the possible sources of finance which the firm might use to finance this long
term capital expenditure. (15)

28. Why and how might management encourage greater co-operation between supervisors
and their subordinates? (25)

29a). Why might a profitable business have liquidity problems? (10)

b). Evaluate the contribution of budgetary control to the success of a business. (15)

30. Evaluate the appropriateness of using a time rate system to reward and motivate workers.
(25)

31. Your country is going through a period of foreign currency shortage.

a. Explain the likely effects of this shortage on business in your country. (12)

b. Evaluate the policies the government of your country might adopt to address this foreign
currency problem. (15)

32. Evaluate the significance of privatization to the economy of your country. (25)

33. Discuss the economic and social constraints experienced by businesses in Zimbabwe.
(25)

34. Evaluate the extent to which manager can use motivation theories to ensure the success
of any business. (25)

36. Assess the importance of the following activities in an organization:

a). manpower planning (9)

b). performance appraisal (9)

c). training (8)

37.a. Why might a pricing policy based on ‘mark- up’ on cost be inappropriate? (12)
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b). Assess the role of value engineering/ analysis in production. (13)

38a). Explain the distinction between primary and secondary research. (5)

b). Evaluate any four data collection methods used in market research. (20)

39a). How might the government assist new businesses? (8)

b). Discuss the view that government assistance should not be given to new businesses.
(17)

40a. Discuss the factors managers would consider when changing from a ‘job’ to a ‘flow’
production process. (12)

b. What arguments are there for using critical path analysis in decision-making? (13)

41a). Discuss the usefulness of budget to managers. (15)

b). “A balance sheet has sufficient information for use in decision making.’ Discuss. (10)

42a). Why may firms segment markets for their products? (10)

b). Assess the role played by distribution and promotion in a business’s marketing strategy.
(15)

43. Analyse possible causes and effects of employee poor performance in a business
suggesting solutions that management can implement. (25)

44a). Evaluate the benefits of using the following costing methods in a business:

i. standard costing (6)

ii. absorption costing (6)

b). How many informal groups contribute towards the overall performance of a business?
(13)

45a). Analyse the effects of changes in exchange rates on exports and imports. (12)

b). Discuss why governments may need to restrict international trade. (13)

46a) Why is it important for businesses to plan? (10)

b). Explain the concept of management by objectives and discuss its importance to business
organizations. (15)
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47a). Discuss the contribution made by economies of scale to an organization of your choice.
(10)

b). Explain how and why the government of Zimbabwe might influence the growth of
business. (15)

48a). Evaluate any two investment appraisal methods that can be used by a financial
manager. (15)

b). Why should managers not rely on quantitative information? (10)

49. A newly appointed Personnel Manager has announced that there is had industrial
relations within the business organization.

a). Discuss the symptoms he might have observed before making the announcement. (10)

b). If you were part of the management team, how would you try to promote good industrial
relations within the organization? (15)

50. Evaluate the contribution made by branding and packaging to an organization’s

marketing effort. (25)

51. Evaluate the contribution made by early management theorists to modern day
management approaches. (25)

52a). Why is it important for businesses to plan? (10)

b). Explain the concept of management by objectives and discuss its importance to business
organization. (15)

53a). Discuss the contribution made by decisions by economies of scale to an organization of

your choice. (10)

54a). Evaluate any two investment appraisal methods that can be used by a financial
manager. (15)

b). Why should managers not rely on quantitative information only? (10)

55. A newly appointed Personnel Manager has announced that there is bad industrial
relations within the business organization.

a) Discuss the symptoms he might have observed before making the announcement. (10)
Eng B Mashura 0773279596 0715493173

b). If you were part of the management team, how would you try to promote good industrial
relations within the organization? (15)

56. Evaluate the contribution made by branding and packaging to an organization’s

marketing effort. (25)

57. Evaluate the contribution made by early management theorists to modern day
management approaches. (25)

58. Explain, with the aid of an appropriate diagram, how a decision tree can be used in
decision making. How useful is such a model to managers? (25)

59. Assess the contribution made by a work study programme to a manufacturer of shoes.
(25)

60a). ‘A balance sheet reflects a true and fair worth of a business at a given date.’ To what
extent is this statement true? (10)

b). With the aid of examples, explain how each of the following would affects the reported
profits of a business;

i. The first –in – first- out (FIFO) method of stock valuation. (7)

ii. The straight line and diminishing balance methods of depreciation. (8)

61. Evaluate the statement that ‘assisting small businesses is uneconomic because it goes
against economies of scale’. [25]

62. (a) Explain why and how the concept of market segmentation may be of value to the
marketing department of a large business. [10]

(b) Evaluate the importance of packaging in the marketing of a product. [15]

63. Evaluate the usefulness of any three investment appraisal techniques that might be used
by a firm when choosing between two investment projects. [25]

64. (a) In your opinion, is knowledge of price elasticity of demand of any business relevance
to farmers? [10]

(b) Evaluate the effectiveness of any three pricing strategies that can be used by a marketing
manager when launching a new product. [15]
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65. A construction company has been contracted to build a factory shell in Gwanda. How
and to what extent can network analysis be useful in managing the project? [25]

66. (a) Explain how leadership styles can affect communication in an organization.
[10]

(b) Evaluate the view that ‘financial incentives constitute the most important factor in
determining worker performance’. [15]

67. (a) Of what importance are the gearing ratios to the management team and potential
investors of a company? [10]

(b) A soft drink manufacturer wishes to acquire a new distribution truck.

Evaluate any three possible sources of finance that the firm can use to acquire the truck.
[15]

68. Assess the likely effects the following might have on reported profits:

(i) straight line and diminishing balance methods of depreciation, [9]

(ii) LIFO and FIFO methods of stock valuation, [9]

(iii) accruals concept. [7]

70. (a) Discuss the legal and ethical constraints experienced by businesses in your country.
[12]

(b) Evaluate the contribution made by multinational companies to the economy of your
country.[13

71a). Explain the need for effective communication in business. (10)

b). To what extent might the use of information technology improve effectiveness of
communication in business? (15)

72a). Discuss the factors that might influence an organization’s culture. (12)

b). Why might the workforce resist management’s efforts to change an organization’s
culture? (13)

73a) Examine the circumstances in which training and re- training might be needed. (13)
Eng B Mashura 0773279596 0715493173

b). Assess the importance of performance appraisal to a firm in the service industry. (12)

74a) Why might profitable businesses experience liquidity problems? (10)

b). To what extent are budgets useful to large businesses? (15)

75a). Explain how you would use the following techniques in forecasting:

i. time series analysis (7)

ii. the Delphi method. (5)

b). Evaluate the usefulness of forecasting to large businesses. (13)

76. A construction company is considering an expansion programme involving large capital

investments.

Evaluate the significance of investment appraisal techniques the company could use to
choose between available capital investment projects. (25)

77. Assess the methods that a business might use to improve productivity. (25)

78. Explain how each of the following might benefit an organization:

a. lean production (9)

b. the Stock Exchange (9)

c. standard costing (7)

79. Discuss how knowledge of product life cycle might assist a manufacturer of cellphones
when developing an appropriate marketing mix for his products. (25)

80a). Discuss the argument for the government’s continued ownership of public enterprises.
(10)

b). Assess the benefits of privatization in your country. (15)

81a). Discuss the view that informal groups may be favourable to an organization. (12)

b). Critically examine the advantages of decentralization. (13)

82a). “60% of newly introduced products fail.” Discuss the reasons for this. (10)
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b). Evaluate the factors that might influence a marketing manager’s choice of a distribution
channel. (15)

83a). Discuss the reasons that might influence a firm’s decision to relocate to another
country. (12)

b). Evaluate the methods that might be used by a floor polish manufacturing firm to improve
its capacity utilization. (13)

84. The directors of Suthani Restaurant are proposing to undertake a major expansion of the
restaurant. Evaluate the methods that management might use to motivate its staff to accept
the heavier workload. (25)

85a). Discuss the contribution of market research to a newly established tobacco processing
firm. (12)

b). Evaluate the techniques that the firm might use to collect the market research data. (13)

86a). Discuss the usefulness of a cash flow forecast to a new farmer. (10)

b). Evaluate the possible ways a firm might use to improve its cash flow. (15)

87. Evaluate the importance of keeping accurate business accounts. (25)

89. Evaluate methods that might be used to present statistical data. (25)

90. (a) Discuss the contribution of ration analysis to the effective management of working
capital. [10]

(b) Evaluate the methods a business might use to improve its liquidity. [15]

91. With reference to appropriate theories, evaluate the importance of strategies management
might use to improve the productivity of workers. [25]

92. (a) Explain how ethical issues might influence business objectives. [10]

(b) To what extend is Management by Objectives important as a means of ensuring and

developing a more effective management team? [15]

93. Two giant supermarkets have proposed to merge.

Eng B Mashura 0773279596 0715493173

(a) Discuss the factors the two supermarkets might have considered before making the
decision to merge. [10]

(b) Critically discuss the likely impact of the merger to each of the following stakeholders;

(i) government,

(ii) workers,

(iii) customers. [15]

94. Discuss how changes in technology might affect businesses in your country. [25]

95. (a) Discuss the factors a firm might consider when choosing a source of finance.
[10]

(b) Evaluate the possible methods a firm might use to finance the purchase of machinery.
[15]

96. (a) Why might a manufacturer not be keen to use flow production techniques?

[10]

(b) Evaluate how value analysis might affect the success of a business. [15]

97. A clothing manufacturer is considering entering the fashion market.

(a) Discuss the factors that might influence the manufacturer’s marketing strategy.
[10]

(b) Evaluate the methods the manufacturer might use to collect the information from the
fashion market. [15]

98. (a) Assess the importance of bench marking as a method of ensuring quality. [10]

(b) Evaluate the contribution of product quality to the success of a business. [15]

99. (a) Discuss the effectiveness of an autocratic leadership style to a large business
organization. [10]

(b) Evaluate the appropriateness of schemes management might implement to involve

workers in decision-making. [15]
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100. Evaluate the view that ‘multinational companies are parasitic to the host country so they
should be discouraged’. [25]

101. (a) Explain the effect on the role of individual managers of reducing the levels of
authority in a tall organization. [12]

(b) Evaluate the effectiveness of matrix organizational structures. [13]

102 (a) Discuss the importance to a business of holding large quantities of stock. [10]

(b) Evaluate two methods a business might use to manage and control its stock.
[15]

103. Evaluate the usefulness of ratio analysis to stakeholders when making decisions. [25]

104. (a) Explain the criteria a marketing manager might use to decide on the advertising
budge. [10]

(b) To what extent is advertising an important element of a firm’s marketing effort?

[15]

105. (a) Distinguish between debt and equity financing. [10]

(b) Evaluate the appropriateness of loan capital to a business. [15]

107. Evaluate the impact of exchange rate fluctuations on businesses in your country.

[25]

108. Discuss how each of the following might be useful to an organization:

(a) linear programming; [7]

(b) decision trees; [9]

(c) computers. [9]