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BM/APR 2009/ETR300

UNIVERSITI TEKNOLOGI MARA FINAL EXAMINATION

COURSE COURSE CODE EXAMINATION TIME

FUNDAMENTALS OF ENTREPRENEURSHIP ETR300 APRIL 2009 2 HOURS

INSTRUCTIONS TO CANDIDATES 1. This question paper consists of four (4) parts : PART A (20 Questions) PART B (20 Questions) PART C (3 Questions) PART D (2 Questions)

2.

Answer ALL questions from PART A, PART B, PART C and one (1) question from PART D : i) ii) iii) Answer PART A in the Objective Answer Sheet, Answer PART B in the True/False Answer Sheet Answer PART C and PART D in the Answer Booklet. Start each answer on a new page.

3.

Do not bring any material into the examination room unless permission is given by the invigilator. Please check to make sure that this examination pack consists of: i) ii) iii) iv) the Question Paper an Answer Booklet - provided by the Faculty a True/False Answer Sheet - provided by the Faculty an Objective Answer Sheet - provided by the Faculty

4.

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

This examination paper consists of 9 printed pages
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PART A

1.

The following is a step in the process of identifying, evaluating and selecting a business opportunity EXCEPT: A. B. C. D. E. Identifying the needs and wants of customers Scanning the environment Identifying the business risk Screening of business opportunities None of above

2.

Self evaluation involves all of the following, EXCEPT: A. B. C. D. E. Working experience Knowledge and skill Financial capability Self interest Legality

3.

En. Faizal has allocated RM2,100 to hire a new marketing executive for his advertising business. The allocation is inclusive of basic salary, 13% contribution to EPF and 2% contribution to SOCSO. Calculate the maximum basic salary he can offer to the new staff. A. B. C. D. E. RM RM RM RM RM 1,826 2,415 2,100 1,800 1,785

4.

A business plan should include all of the following items EXCEPT: A. B. C. D. E. Overview of business purpose and highlight of key elements of the plan. Nature of the industry, including economic trends, important legal or regulatory issues, and potential risks. Product characteristics, distribution, promotion, pricing and market research. Description of the organization's decision making process. Explanation about the management plan for the proposed business venture.

5.

The term "ENTREPRENEUR" refers to: A. B. C. D. E. The process that leads to the setting up of a business entity. The competencies that should be possessed by a successful person. The characteristics of a successful person. The person who manages a business The person who undertakes to organize, manage, and assume the risk of a business.
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6.

The following are characters of a small business, EXCEPT: A. B. C. D. E. Size of business is small relative to industry Management is independent Area of operation is mainly local The business is operating with limited resources The business is formed as only sole trader or sole proprietor

7.

Symbols in the Operation Plan describe: A. B. C. D. E. The symbol is used when in process materials or finished products are stored in the storage The symbol is used when in process material is restrained in a location waiting for next activity. Transport activities occur when materials are transported from one point to another Activity that measures standard of the in process material, finished product or service Activities that modify transform or give values to the input

8.

In planning the operation's manpower needs, the following information is required i) ii) iii) iv) v) A. B. C. D. E. Rate of production Standard time to produce a unit of product Man productive hours Process flow chart Layout plan i, ii and iv only ii, iii and iv only i, ii, and iii only iii, and iv only All of the above

9.

Which of the following is NOT part of a production / operation plan? A. B. C. D. E. Description of the production process Description of the product Acquisition of machinery and equipment Operations budget Material requirement planning

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10.

The following factors should be considered when selecting business location i) ii) iii) iv) v) A. B. C. D. E. Distance from source of materials Workers productive hour Costs of transportation Number of output Availability of labour i, ii, iii and iv i, ii, iii and v i, ii and iii i, ii and v i, iii and v

11.

Which of the following statement is TRUE? A. B. C. D. E. The cost incurred to register a business is not included in the project implementation cost schedule Working capital includes all expenses needed to finance day-to-day operation of a business The pro forma cash flow statement shows the amount of expected profit the business could achieve The external sources of fund refer only to financial assistance extended by commercial banks All of the above

12.

Which of the following is NOT considered as an element of cash outflow in a pro-forma cash flow statement? A. B. C. D. E. Payment for deposits Collection of receivable Purchase of fixed assets Hire purchase repayment Miscellaneous expenses

13.

Which of the following financial statement shows the firm's cash position? A. B. C. D. E. Financial Plan Budget Cash Flow Statement Income Statement Balance Sheet Profit and Loss Statement

14.

Which of the following is NOT considered as financial risks? A. B. C. D. E. Loans Credit Liquidity level Financial Linkages Foreign Exchange

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15.

These are the primary users of a business plan EXCEPT, A. B. C. D. E. Employees Marketers Suppliers Entrepreneur Bankers

16.

The design of an organization structure depends on all the listed factors EXCEPT: A. B. C. D. E. Numbers of workers Shifts Organization target profit Functions Products

17.

A workable Business Plan normally be supported by valid or reliable information. Which of the following is not a source of information? A. B. C. D. E. Speculation Research Annual Report Daily newspaper Journal

18.

To manage the business, entrepreneurs must: A. B. C. D. E. Outline the activities that are necessary to achieve and stated goals of the organization Divide and coordinate the tasks and responsibilities into departments, section or units Control operations by comparing actual results with plans or budgets, and take corrective actions, if necessary Inspire the workers to work harder All of the above

19.

refers to any entity that has the purchasing power to acquire goods and services to fulfill its needs and wants. A. B. C. D. E. Market segment Market share Market penetrations Target market Market size

20.

Aisyah Nabilah completed her project earlier and at a lower cost. Her action can be considered as an example of the following entrepreneurial competency. A. B. C. D. E. Commitment to work contract Efficiency orientation High quality of work Problem solving Persistence
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PARTB

1.

The third process of identifying, evaluating and selecting a business opportunity is a screening of business opportunity. It is quite unethical for entrepreneur to translate social problems into business opportunities. A financial plan is prepared after all expenses pertaining to marketing, operations and administrative activities are identified. Entrepreneur should only use primary information when preparing a business plan as secondary information is usually incorrect. Uncertainty of stocks prices due to foreign exchange rate is an example of financial risks in business. To prepare a process chart, an entrepreneur will first identify all the product activities required for the production of the product or for delivering the service. An increase in disposible income can lead to lower purchasing power and customer unaffordability. Business opportunity cannot be realized if it goes beyond the law. A customer could be one of the audiences for a business plan. Business plan should be prepared after an entrepreneur identifies the viability proposed business venture. Uncertainty of stocks prices due to foreign exchange rate is an example of financial risks in business. Capacity planning is a method to calculate machinery and manpower requirements so that production demand based on based on sales forecast can be met. Operations costs include costs of direct material, indirect labor and overheads. Jazz Event Sdn Bhd is preparing a Business Plan to obtain additional financing to expand their existing business. They want to show the Letter of Agreement between them with a new strategic partner to undertake a big project together. The copy of the Letter of Agreement will be placed as Appendices in the Business Plan. A business plan can be used as a communication tool to convince potential investors of the viability of the new venture.

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8. 9. 10.

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13. 14.

15.

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16. 17. 18. 19.

Factors influencing choice of business will be included in the operation plan. Elements of project cost include provision for emergencies. Remuneration of manpower will be listed under Administrative Plan. The purpose of preparing a Business Plan is usually to express the message that the entrepreneur wanted to convey to its audience. Description of the production process is not part of an operation plan.

20.

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PARTC

QUESTION 1 Financial plan is a very important part of a good business plan to determine the financial requirement of a new venture. State five (5) objectives of financial plan. (5 marks) QUESTION 2 Financial analysis is a technique of examining financial statements in order to determine financial position and performance of the business. Discuss the significance of liquidity ratios and profitability ratios (5 marks) QUESTION 3 Identified and briefly explain the basic management functions of successful business organization. (5 marks)

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PARTD

QUESTION 1 Briefly explain the following five (5) criteria of self assessment in the process of identification, evaluation and selection of business opportunities. a) b) c) d) e) Experience Knowledge and skills Capital Interest Networking. (25 marks)

QUESTION 2 a) What is layout? List and discuss three (3) types of layout (10 Marks) b) It is important for the entrepreneur to choose the right location for the business because a strategic location can contribute to the success of the business. Briefly explain five (5) factors that influence the choice of location. (15 marks)

END OF QUESTION PAPER

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