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ESr coDE 02233010


FORM TP 201s241 MAY/JUNE 2OI5
CARIBBEAN EXAMINATIONS COUNCIL
CARIBBEAN ADVANCED PROFICIENCY EXAMINAT'ION@
MANAGEMENT OF BUSINESS

Unit2-Paper0l
I ltour 30 minutes
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26 MAY 2015 (a.m.)

READ THE FOLLOWING INSTRUCTIONS CAREFULLY.

l. This test consists of 45 items. You will have I hour and 30 minutes to answer them.
2. In addition to this test booklet, you should have an answer sheet.
3. Do not be concerned that the answer sheet provides spaces for more answers than there are
items in this test.
4. Each item in this test has four suggested answers lettered (A), (B), (C), (D). R.ead each item
you are about to answer and decide which choice is best.
5. On your answer sheet, find the number which corresponds to your item and shade the space
having the same letter as the answer you lrave chosen. Look at the sample item below.

Sanplsltslo
Which of the following actions CANNOT be taken by a trade union?
Sample Answer
(A) Picket
(B)
(C)
Strike
Go slow
@@c o
(D) Lock out

The best answer to this item is "Lock out", so (D) has been shaded.

6. If you want to change your answer, be sure to erase it completely before you fill in your new
choice.

7. Wherr you are told to begin, turn the page and work as quickly and as cprefully as you can.
lf you cannot answer an item, omit it and go on to the next one.
8. You may do any rough work in this booklet.
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9. You may use silent non-programmable calculators to answer questions.
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DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO.
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I Copyright @ 2013 Caribbean Examinations Council
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All rights reserved.
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1. Which of the following methods of 6. The term 'modularization' refers to the


production is MAINLY used on assembly
lines? (A) last stage of product development
(B) sharing of common data and
(A) Job processes
(B) Flow (C) designing of products in sections
(C) Batch and compartments
(D) Assembly (D) small-scale production of
mechanical and electronic
devices
2. One example of a quantitative method of
forecasting is
7. A company in the energy sector is in the
(A) market survey process ofconstructing new refinery tanks.
(B) panel consensus The MOST appropriate layout strategy for
(C) moving average the company is
(D) the Delphi method
(A) cellular
(B) process
3. The strategy of selecting the best (C) product
practices against which an organization's (D) fixed position
performance is compared is known as

(A) outsourcing 8. An electronics manufacturer is faced with


(B) benchmarking a number of options regarding the future
(C) continuous improvement of the business. A decision tree is LEAST
(D) total quality management likely to help him to determine

(A) whether or not to relocate the plant


4. Labour tum6ver mav BEST be defined as (B) the success or failure of a
the competitor's product
(C) whether or not a product should be
(A) recruitment and selection of launched
workers (D) the viability of an advertising
(B) rate of redundancy in the campaign
organization
(C) rate at which workers enter and
leave an organization 9. The efficiency of a company is LIKELYto
(D) number of workers who have been be negatively affected by
separated from the organization
(A) continuous work-in-progress
(B) precise planning of operations
Which of the following types of control is (C) wholehearted employee support
NOT a strategy in production? (D) close relations with external
suppliers
(A) Design
(B) Quality
(C) Materials
(D) Employee

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10. The decision to operate at fult capacity is 13. Which of the following diagrams indicates
influenced MAINLy bv NO linear relationship between x and y?
(A) accurate forecasting rnethods
(B) a measure ofthe quantity produced (A)
(c) the amount that can be produced
within the current budget
(D) a decision to reduce the size of
the staff by making people
redundant

x
ll. Which of the following factors is LEAST -------->
likely to be improved by benchmarking? (B)

(A) Efficiency
(B) Competitive edge
(C) Employee morale
(D) Level of profitability

12. The success of total quality management


(TQM) is NOT affecred by (c)

(A) quality standards


(B) patience to endure the problems
faced
(C) total employee commitment to the
process
(D) a recognition of quality in all
aspects of management
(D)

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02233010/CAPE 2015
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14. Which of the following types of layout is MOST suitable for large, bulky projects such as
ships
and buildings?

(A) Office
(B) Product
(c) Process
(D) Fixed position

Item 15 refers to the network diagram below.

15. The broken line on the network represents a

(A) tail
(B) head
(c) node
(D) dummy

16. Which of the following promotional tools 18. In which iype of sampling does every
involves the use of coupons, free samples member of the population have a known
and discounts to increase sales? chance of selection?

(A) Sales promotion (A) Probability


(B) Public relations (B) Convenience
(C) Advertising (C) Non-random
(D) Publicity (D) Non-probability

17. Which of the following strategies is NOT


apricing strategy?

(A) Price skimming


(B) Penetration pricing
(C) Contribution pricing
(D) Distribution based pricing

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t9. Which ofthe following sequences of terms 24. When a business sets very low prices,
BEST describes the order of the stages in which of the following pricing objectives
the life cycle of a product? is it seeking to achieve?

(A) Introduction, growth, saturation, (A) Business survival


maturity, decline (B) Market share leadership
(B) Introduction, growth, maturity, (C) Product quality leadership
(c)
saturation, decline (D) Current profit maximization
Introduction, maturity, growth,
saturation, decline
(D) Introduction, saturation, growth, 25. Consumers' MAIN concern about internet
maturity, decline shopping relates to

20. The expression,consumer buying (A) returns


behaviour' refers to the (B) delivery time
(c) reduction in disposal incomes
(A) business
(D) security of personal information
(B) target market
(C) final customers
(D) market segment
26. ThreeMAIN factors taken into consideration
when designing a sampling plan are

2t. Which of the following terms BEST (A) survey date, time and method of
describes the FIRST stage of the new data collection
product development process? (B) sample unit, research instrument
and survey data
(A) Idea screening (c) sample unit, sample size and
(B) Idea generation sampling procedure
(C) Concept testing (D) type of survey, method of data
(D) Business analysis analysis and time frame

7) Which of the following pricing methods 27. Firms seek to determine the demography
uses the buyer's point of view regarding of the market segment by asking questions
the worth of a product? about

(A) Cost-plus (A) age


(B) Going-rate (B) value
(C) Break-even (C) attitude
(D) Value-based (D) personality

23. The process of analysing data about


28. One advantage offocus group research over
customers in order to determine marketing
survey research is that fbcus group research
strategies may BEST be described as

(A) (A) uses secondary data


marketing mix
(B)
(B) market penetration
(c)
samples large populations
(C) marketing research
(D)
tends to suffer from interview bias
provides greater insight into
(D) market segmentation
customer needs

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022330r0tcAPE 2015
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29. In. which stage
of the product life cycle 33. Which ofthe following start-up information
is there the GREATEST probability of about a new business would be MOST
experiencing very little or no profits? important to a lending agency?

(A) Launch (A) Prinre time advertising slots


(B) Decline (B) Inexpensive techniques of
(C) Saturation advertisiprg
(D) Introduction (C) Expected fixed cost and variable
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cost of the business
(D) Direct comparisons with other ,l
30. Which ofthe fol lowing factors are LIKELY finns in the same market
to influence the choice of a distribution
channel?
34. One primary advantage ofsmall businesses
I. Wide market coverage to the Caribbean region is
II. Access to a firm's product
II I. Recognition of a firm's product (A) service to niche markets
(B) the creation of employment
(A) I and lI only (c) improved technological develop-
(B) I and III only ment
(c) II and Ill only (D) improved management training
(D) I, II and III

35. Economies of scale is LEAST affected bv


31. One problem faced by small firms is
(A) finance
(A) lack of flexibility (B) marketing
(B) poor staff relations (c) technology
(c) limited internal growth (D) competition
(D) Iack of economies of scale

36. What is the potential reward, to the


32. Which of the following features is a entrepreneur, his employees, the commun ity,
disadvantage of a planned economy? and the economy for venturing into
business?
(A) Allowance for long-term planning
(B) State support for consumer needs (A) Economic growth
(C) Very slowand bureaucratic decision (B) Minimum wage
making (C) Social cohesion
(D) Avoidance of duplication and (D) Rising costs
wasteful competition

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37. Which of the following is typical of 40. Alex, a young entrepreneur, operates his
the assistance given by small business business under an economic system where
associations to small firms? there is state ownership and control of the
economic resources. This type ofeconomic
I. Opportunity for training system is referred to as
II. Approval of loan application to the
bank (A) free market
III. Expert advice on specific areas of (B) market driven
weaknesses (C) mixed economy
(A)
(D) planned economy
I and II only
(B) I and III onty
(C) II and IIt ontv 4t. Jerry is in the process of seeking a loan from
(D) I, II and III Banks Ltd to start his own business. Which
of the following documents would be of
GREATEST interest to Banks Ltd?
Item 38 refers to the following information.
(A) A business plan
Mr Mike, a sole trader, was advised bv (B) A production plan
his friend to use the ,penetration pricinj' (C) A human resource plan
strategy for his new product. (D) An incentive payment plan
38. The term 'penetration pricing'refers to
42. Which of the following criteria is MOST
(A) adding a percentage of profits to the appropriate for measuring the size of a
total cost service provider?
(B) following the pricing strategies of
the market leader (A) Output
(C) reducing the price of a product to (B) Labour force
attract customers (C) Market share
(D) charging more than competitors for (D) Market expenditure
a status product

43. Many Caribbean countries are encouraging


39. By conducting sales forecast, an entrepren- entrepreneurship mainly to
eur is seeking to determine
(A) fuel econornic growth
(A) the fnaturity stage of the product (B) developthecitizens,potential,
(B) how successful the business will be (C) encourage,the survival of firms
(C) if there is sufficient demand for a (D) encourageincreasedtechnological
product development
\I if
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(D) the product will be popular
I among users
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02233010/0APE 2015
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44- A lpatent' is considered a strategic asset to 45, Mrs West added 30,o/o 'mark-up'to the cost
a business because it price of an item. What was the cost price
of the item if she sold it for $156'00?
(A) protects innovative new products
(B) advertises innovative new products (A) $ 46.80
(C) reduces the cost of innovative new (B) $ 109.20
products (C) $ 120.00
(D) allows other businesses to copy (D) $202.90
innovative new products

END OF TEST

IF YOU FINISH BEFORE TIME IS CALLED, CHECK YOUR WORI( ON THIS TEST.

02233010/CAPE 201s