Mid Term Exam

Question 1

5 Forms of Business

Answer 1

Sole trader
Partnership
Companies
Franchise
Cooperative

Question 2

Type of economical system

Answer 2

Free market
Mixed economic
Planned economic

Question 3

Who is an entrepreneur

Answer 3

A person who is willing to take the risk setting up their own business enterprise

Question 4

Enterprise

Answer 4

A business that provides goods or services in exchange for money

Question 5

Reasons for establishing a business

Answer 5

Increase income
Financial independence
Increase control in working life

Question 6

Function of a entrepreneur

Answer 6

Planning
organizing
Accessing funds

Question 7

What is collateral

Answer 7

Collateral is something valuable that you give to a lender as a guarantee when you borrow money

Question 8

Types of collateral

Answer 8

Stocks
Property
Money
Moto vehicle

Question 9

What is a contract

Answer 9

A contract is a legally binding agreement between two or more people enforced by law

Question 10

Two types of contract

Answer 10

Simple and specialty contract

Question 11

Simple contract

Answer 11

A agreement between two parties, which can be done verbally, written or done in an action

Question 12

Specialty Contract

Answer 12

A deed or a contract under seal. It requires signing sealing and delivering

Question 13

Method of discharge

Answer 13

By performance
By breach of a contract
By mutual agreement

Question 14

Types of business documents

Answer 14

Delivery note
Credit note
Debit note
Purchasing order

Question 15

How can a business grow internally

Answer 15

When a company uses its own tools and resources to expand.
Launching new products

Question 16

How can a business grow externally

Answer 16

When two or more businesses join together as one business

Question 17

Factors of production

Answer 17

Land -natural resources
Labor -human resources
Capital -man made resources
Enterprise/ entrepreneur

Question 18

What is barter

Answer 18

The exchange of goods or services without the use of money

Question 19

Characteristics of money

Answer 19

Acceptability
Durability
Portability

Question 20

Functions of money

Answer 20

Medium of exchange
Store of value
Unit of account

Question 21

Employer

Answer 21

A person who hires and pays employees

Question 22

Three types of stakeholders

Answer 22

Consumers
Employees
Government

Question 23

What is profit

Answer 23

Profit is the money left over after all expenses have been paid

Question 24

Employee

Answer 24

A person who works for a employer

Question 25

What is a stake holder

Answer 25

A person who has interest or concern in a business

Question 26

What is feasibility study

Answer 26

Is an analysis to determine whether a proposed project is possible and makes sense to pursue

Question 27

Characteristics of a good leader

Answer 27

Flexibility Honesty Focus Truth worthiness

Question 28

Leadership styles

Answer 28

Democratic leaders Autocratic leaders

Question 29

Problems faced by a entrepreneur

Answer 29

Financing Lack of planning Making decisions

Question 30

How does entrepreneur contribute to the country

Answer 30

Creating new business Developing new products

Question 31

What is a business plan

Answer 31

A formal written document setting out the objectives of a business

Question 32

Importances of feasibility studies

Answer 32

Reduce risks Increase the chance of success

Question 33

What is production

Answer 33

Production is the process of manufacturing goods and products from raw materials or components

Question 34

What is marketing

Answer 34

the process of promoting and selling products or services to customers.

Question 35

Characteristics of cottage industry

Answer 35

Homes based Use local raw materials Use family member as labour

Question 36

What is a multinational company

Answer 36

a company that has business operations in at least one country other than its home country

Question 37

Function of management

Answer 37

Planning Organizing Controlling Directing Motivating

Question 38

Characteristics of an entrepreneur

Answer 38

Creative Flexible

Question 39

What is insurance

Answer 39

An agreement between an insurance company that gives you financial protection from losses that can occur during normal business operations

Question 40

Principles of insurance

Answer 40

Pooling of risks Indemnity Utmost good faith Contribution

Question 41

Two types of insurance

Answer 41

Life insurance Non life insurance

Question 42

What is productivity

Answer 42

Productivity is a measure of how efficiently a business is using all its resources

Question 43

Differentiate between production and productivity

Answer 43

Production is the act of creating or manufacturing something while Productivity is a measure of how efficiently a business is using all its resources

Question 44

What are the three levels of production

Answer 44

Subsistence Domestic Surplus

Question 45

What is market

Answer 45

A market is any situation made up of a group of individuals who interact in the process of buying and sell goods and services

Question 46

What is entrepreneurship

Answer 46

The skill in starting a new business especially when this involves seeing new opportunities