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rcoDE 012400t 0
FORM TP 201510s
CARIBBEAN
MAY/JUNE 2015
EXAMINATIONS
COUNCIL
CARIBBEAN SECONDARY EDUCATION CERTItr'ICATE@
EXAMINATION
PRINCIPLES OF BUSINESS
Paper 01 - General Proficiency
I
hour 15 minutes
27 MAY 201s (p.m.)
READ THE FOLLOWING INSTRUCTIONS CAREFULLY.
t.
This test consists of 60 items. You will have t hour and l5 minutes to answer them.
2.
In addition to this test booklet, you should have an answer sheet.
3.
Each item in this test has four suggested answers lettered (A), (B), (C), (D). Read each item
you are about to answer and decide which choice is best.
4.
On your answer sheet, find the number which corresponds to your item and shade the space
having the same letter as the answer you have chosen. Look at the sample item below.
Sample Item
The money that a business receives from the sale
of goods or services is called its
(A)
(B)
(C)
(D)
Sample Answer
@@o@
assets
capital
income
resources
The best answer to this item is "income", so (C) has been shaded.
ffi
WT
5.
If you want to change your answer, erase it completely before you fill in your new choice.
6.
When you are told to begin, turn the page and work as quickly and as carefully as you can.
you cannot answer an item, go on to the next one. You may return to that item later.
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DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO.
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Copyright @ 2013 Caribbean Examinations Council
All rights reserved.
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0r240010/F 2015
If
-2-
1.
Barter is BEST described as the
(A)
(B)
(C)
(D)
2.
purchase of goods and services
using cheques
process of exchange involving the
use of money
exchange of goods and services
using notes and coins
exchange of goods and services
without the use of money
7.
Which of the following types of business
environment is MOST typical of the
Commonwealth Caribbean?
(A)
(B)
(C)
(D)
3.
6.
The policies of a company are formulated
by the
(A)
(B)
(C)
(D)
Selecting the objectives and the procedures
for achieving goals is referred to as
(A)
(B)
(C)
(D)
planning
organizing
controlling
motivating
Corporate state
Mixed economy
Centrally planned
Perfectly competitive
8.
Which of the following are benefits of
written communication?
I.
WhichofthefollowingisNOTanobjective II.
of the public
(A)
(B)
(C)
(D)
auditors
directors
managers
shareholders
IIL
sector?
Instant feedback
Provides evidence
Useful for detailed messages
.
(A) I and II only
(B) I and III only
(C) II and III only
(D) I,II and III
Maximizing profits
Providing essential services
Regulating business activity
Promoting economic growth and
development
4.
9.
Which of the following organizations
Theterm'divisionoflabour'canbedefined is LEAST likely to use a management
as
the
information sYstem?
(A)
(A) organization oftasks in production
(B) assemblingofgoodsfordistribution (B)
(C)
(C) separation of tasks to complete a
job
(D)
(D) employment of different types of
The national bank
A shoe-shine shop
A deparhnQnt store
AbeautY suPPlies outlet
workers
5.
Which of the following is NOT a function
of money?
(A)
(B)
(C)
(D)
Indivisibility
Store of value
Measure of value
Medium of exchange
GO ON TO THE NEXT PAGE
-3Item l0 refers to the following diagram which shows a section of a typical vertical organizational
chart for a manufacturing company.
10.
The relationship between the highest level of management down to the various departrrents is
known as
(A)
(B)
11..
(c)
line
rank
staff
(D)
flow
TheMAlNpurposeofinstallingasuggestion
box in a company is to get workers'views
13.
about
(A)
(B)
(C)
(D)
(A)
(B)
(C)
(D)
each other
other companies
ways of improving the workplace
ways
of improving
Which of the following individuals benefit
from having 'limited liability status'?
Franchisees
Shareholders
Ordinary parfirers
Debenture holders
economic
conditions
14.
Which ofthe following are functions ofthe
entreBreneur?
12.
JB Auto Company decided to export
car engines from Barbados to Trinidad.
Whichofthe following modes is BEST for
transporting the engines?
(A)
(B)
(C)
(D)
Air
Sea
Rail
Land
I.
U.
Ensuringthatworkersareunionized
Co-ordinating the factors of
m.
production
Undertaking risks by anticipating
demand
(A)
(B)
(C)
(D)
I and II only
I and III only
II and III only
I, II and III
GO ON TO THE NEXT PAGE
-415.
The condensation of the business plan is
contained in the
(A)
(B)
(C)
(D)
16.
feasibility plan
marketing plan
keynote summary
executive summary
Cash used to secure a loan at the bank is
referred to as
(A)
(B)
(C)
(D)
20.
Which of the following factors prevents an
agreement from being considered a valid
contract?
(A)
(B)
(C)
(D)
21.
The term 'human resources'refers to
(A)
collateral
fixed assets
current assets
fixed deposits
(B)
(C)
17.
(D)
The monthly payments collected by an
insurance company on behalf of its policy
Consideration
Legalpurpose
Misrepresentation
Offer and acceptance
materialsandgoodsmadebyhuman
beings
capital invested by shareholders in
a company
raw materials used in the
manufacture of goods
persons available forproductive and
professional services
holders are known as
(A)
(B)
(C)
(D)
r8.
deposits
premiums
instalments
endowments
22.
The movement of educated, skilled people
to settle in other industrialized countries is
referred to as
(A)
(B)
(C)
(D)
Which of the following types of cheques
allows an individual to receive cash on
migration
brain drain
unemployment
underemployment
demand?
(A)
.(B)
(C)
(D)
19.
Kiki
Open
Crossed
Certified
Banker's
23.
The amount of labour available for
productive activity is known as
(A)
(B)
(c)
sustained burns while at work at a
(D)
employment
labour force
labour movemgnt
efficiency of labour
local fast food restaurant. Under which
of the following insurance policies is she
LIKELY to be compensated?
(A)
(B)
(C)
(D)
Public liability
Fidelity guarantee
Properfy guarantee
Employers'liability
GO ON TO THE NEXT PAGE
-524.
Productivity can be measured by
(A)
(B)
(C)
28.
producers and consumers?
Inputs
Outputs
(A)
(B)
(C)
(D)
Inputs
Revenue
29.
(A)
(B)
(C)
Which of the following is a product of the
manufacturing industry?
(A)
(B)
(C)
(D)
Car
Gold
Tourist
Lumber
Which of the following is an activity
involved in marketing
Outputs
lnputs
25.
(D)
30.
Product, price, promotion and place are
components of a
(A)
(B)
(C)
(D)
27.
(B)
(C)
market study
marketing mix
market research
sales promotion
a product?
Issuing bulletins on staffmatters
Distributingcommoditiestooutlets
Publicizingadvertisementsfornew
staff
Ensuring that workers are given
fringe benefits
Market equilibrium exists when
(A)
26.
Oligopoly
Monopoly
Perfect market
Imperfect market
Revenue
OutputS
(D)
Which of the following terms describes
a market consisting of a large number of
(D)
buyers pay reasonable prices for
goods
sellers are satisfied with the prices
paid for their goods
at the ruling market price, buyers
do not want to add to the stock
of goods they already have
at current prices, the amount buyers
wish to buy equals the amount
sellers want to sell
In the Caribbean, many people are hired
for sugar cane farming and very little
equipment is used. This industry can BEST
be described as
(A)
(B)
(C)
(D)
labow intensive
capital intensive
having low capital input
having high capital input
31.
Which of the following is NOT a function
of the retailer?
(A)
(B)
(C)
(D)
Preparing goods for resale
Selling in small quantities
Providing a local supply of goods
Transporting goods to suitable
storage facilities
GO ON TO THE NEXT PAGE
-632.
Which of the following gives.identity to a
specific producer's goods?
(A)
(B)
(C)
(D)
33.
Label
Patent
(c)
(D)
(A)
(B)
(C)
(D)
Copyright
the business cenft e ofthe
35.
Which of the following operations is an
38.
36.
39.
Printing money
Selling stocks and bonds
Controlling the supply of money
Accepting deposits from customers
A debenture holder is one who
(A)
Warehousing
Free sampling
Servicing goods
(B)
Gathering information
(C)
(D)
is paid a fixed rate of interest
if the.
company makes profits
must be paid any amounts owing
to him in the following year
has first claim on any profits and is
paid a fixed rate of dividend
is entitled to a fixed rate of interest
whether or not the company
makes profits
Parnrerships
Public companies
Private companies
Co-operative societies
Tom invests his savings by buying shares
in a company. From this investment, Tom
expects to receive
(A)
(B)
(C)
(D)
standing orders
acting as trustees
Which ofthe following services is provided
by commercial banks?
(A)
(B)
(C)
(D)
Which of the following entities can have
its shares taded on the stock exchange?
(A)
(B)
(C)
(D)
overdrafts
letters of credit
community
a specific place where buyers and
sellers meet
aplace where intangible goods are
bought and sold
a situation which exists when buyers
and sellers influence the price of
goods
example of sales promotion?
(A)
(B)
(C)
(D)
MrJones has several bills offixed amounts
to pay each month. His bank manager
agreed to pay them monthly from Mr Jones,
account. This service, provided by the bank,
refers to
Brand
A'market'in economic terms is defined as
(A)
(B)
34.
37.
profits
interest
revenue
dividends
40.
Invesfinent can be defined as
(A)
(B)
(C)
(D)
the stock of goods in a country
- additions to the capital stock of a
country
the amount of money available at
a given time
the amountofcapital owned by the
government
GO ON TO THE NEXT PAGE
-7 -
41.
Which of the following are measures
to protect the environment?
I.
II.
il.
used 45.
Recycling
Deforestation
Water conservation
Which of the following actions by
govemment is MOST likely to lead to an
improvement in the standard of living?
(A)
(B)
(C)
(D)
(A) I and II only
(B) I and III only
(C) II and III only
(D) I,II and III
46.
Printing more money
Increasing the income tax rate
Abolishing taxes on low incomes
Giving tax incentives to businesses
Which of the following forms of taxation
can be classified as 'direct'?
42.
A'price control'may be defined
(A)
(B)
(C)
(D)
43.
as
(A)
(B)
(C)
(D)
a
tax on goods and services
government ban of imports
grant given to producers to reduce
their prices
government limit on the price of
goods or services
47.
(A)
(B)
(C)
(D)
economic
policies can be MOST effectively measured
by
The success of government's
roduction
Which of the following is a function of
Chamber of Commerce?
(A)
(B)
(C)
of social
services by
49
.
tax refunds
health clinics
education and training
transportation facilities
In the recent budget it was reported that
Sanfordlslandisanetimporter. Thismeans
that its
(A)
(B)
(C)
(D)
a
Creating employment
Protecting the environment
Assisting in securing markets for
- producers
The provision
government does NOT include
(A) an increase in the level of policies
(B) anincreaseinthestandardofliving 48.
(C) adecreaseinthelevelofemployment
(D) a decrease in the volume of
44.
Income tax
Excise duty
Purchase tax
Customs duty
exports are equal to imports
exports are less than imports
balance of trade is favourable
balance of payment is favourable
-
A country has a favourable balance oftrade
when
(D) Providingfinancialaidtohurricane (A)
(B)
victims
(C)
(D)
it sells more than it buys
it buys more than it sells
imported goods are cheaper
there are no restrictions to trade
GO ON TO THF, NEXT PAGF,
-8-
50. In calculating
'net national
depreciation refers to
(A)
(B)
(C)
(D)
51.
the
product', 54.
(A)
level
level
value
value
increase in the price
decrease in the price
increase in capital stock
decrease in capital stock
The'terms of trade'of
a country refers
Which of the following is NOT a benefit of
international trade?
(B)
(C)
to
market size.
Political links are developed with
other countries.
Import restrictions can be imposed
on foreign items.
(D) A greater variety of goods is
the rate
(A)
Producers are able to increase their
obtained from overseas.
at which the counfiry's population
grows
55. Which of the following represents the
(B) oftumoveroflifeexpectancydue correct stages towards the development
to nutrition
of the CARICOM Single Market and
(C) of income a country obtains from
Economy?
(D)
increasing growth
at which one country's
goods
for
(A)
and services are exchanged
another's
52.
The difference between the value of
CARICOM
a
is referred to as the
53.
(D)
trade
balance of
per capita income
balance of paymerrts
product
Federation
-+ CARIFTA-->
--+ CSME
CARICOM
56.
Which of the following is a feature of economic dualism in the Caribbean?
(A)
(B)
(C)
(D)
Which of the following methods is NOT
used to measure a country's national
income?
(A)
(B)
(C)
(D)
CSME
(C) Federation-+CARICOM-+
CARIFTA -*
CSME
and
imports
gross national
*
(B) CARIFTA---+CARICOM+
Federation 4
CSME
countr5r's visible and invisible exports
the value ofits visible and invisible
(A)
(B)
(C)
(D)
CARIFTA+Federation
Small farming sector
Urban-rural migration
Rural-urban migration
Large manufacturing sector
Output
Income
Accounting
Expenditure
57.
Which of the following terms defines
a
continuous rise in the general level ofprices?
(A)
(B)
(C)
(D)
Inflation
Reflation
Deflation
Depression
GO ON TO THE NEXT PAGE
-958.
Which of the following countries are NOT
members of the Organization of Eastern
60.
(c)
(D)
59.
ganizations would
Anguilla, Grenada
Barbados, Jamaica
Montserrat, Saint Lucia
Dominica, Saint Vincent
(A)
(B)
World Trade Organization (WTO)
Caribbean Development Bank
(c)
(cDB)
CARICOM Single Market and
(D)
Organization
Economy (CSME)
The purpose of CARICOM is to
(A)
(B)
or
settle a dispute among banana-producing
countries of the Caribbean and Central
America over preferential agreement with
the European Union?
Caribbean States?
(A)
(B)
Which of the following
allow member states to collaborate
allow for unrestricted movement
of
Petroleum
Exporting Countries (OPEC)
of persons among the
territories
(c)
encourage the transfer oftechno lo gy
(D)
within the region
foster interregional trade and
common services
END OF'TEST
IF YOU FINISH BEFOR.E TIME IS CALLED, CHECK YOUR WORK ON THIS TEST.
0t240010tF 2015