ANSWER ALL QUESTIONS
- State four service offered by a commercial bank to its customer (4mks)
- Outline four goals of development to a country (4mks)
- List four sources of public finances (4mks)
- Name the basic concepts in population described in the statements given below (4mks)
- Population size that is adequate for the pull utilization of available resources in a country
- The average number of births per one boy and woman in a gear
- When a country is experiencing higher death rates than birth rates
- Were a bigger proportion of the population is comprised of people who are above 55 years old
- State four benefit of a bonded warehouse to the government (4mks)
- Highlight four benefit of personnel selling to a trade (4mks)
- Highlight four factors that may cause the supply curve to shift to the right (4mks)
- Outline four measures that a country can take to reduce the level of inflation (4mks)
- Outline four characteristics of an efficient tax system. (4mks)
- State the meaning of the following form of sales as used in international trade (4mks)
- L O C O
- C I F
- F A S
- F O Q
- The following information was extracted from the books of Leila Traders on 31st July 2016
Fixed Assets 80,000
Cash in hand 20,000
Current liabilities 20,000
Net profit 15,000
- Capital owned (2mks)
- Acid test ratio (2mks)
- Highlight four circumstances under which a firm may be located near the source of raw materials (4mks)
- Give four assumptions that are associated with perfect completion (4mks)
- The equation below relate to quantity demanded and quality supplied at the equilibrium point
Qde =4p + 50
Qse = 8p +30
Determine the equilibrium price and quantity (4mks)
- Outline four features of liners in sea transport (4mks)
- List four characteristics of money (4mks)
- State four reasons why it may be necessary for a country to control imports (4mks)
- Outline four features of economic resources (4mks)
- State four methods used by government to control inflation (4mks)
- Give four reasons why government levy taxes on their citizens (4mks)
- Outline four benefits to a trader who operate a small retail outlet (4mks)
- Give four uses of a three-column cash book. (4mks)
- State four features of a good filing system (4mks)
- State four advantages that a business gets by maintain a current bank account (4mks)
- State four features of a chain store (4mks)
- Services offered by commercial bank to its customers
- Acceptance of deposits
- Safeguarding valuable items
- Advancing loans and overdrafts
- Advisory services on financial matters
- Trustee service
- Goals of development to a country
- Alleviation of poverty
- Provision of security
- Alleviation of unemployment
- Improvement of infrastructure
- Alleviation of illiteracy
- Maintenance of political sustainability .
- Sources of public finance
- Treasury bonds and bills.
- Basic concepts of population
- Optimum population
- Fertility rate/birth rate
- Declining population
- Ageing population
- Benefits of a bonded warehouse to the government
- Source of data for planning purposes
- Source of revenue
- Enable check of quality for goods
- Enable verification of documents for goods transit
- Benefits of personal selling to a trader
- Its personal nature, nothing is persuasive as personal communication.
- Flexible, marketer is able to meet the needs of each individual.
- Through asking and answering questions the sales person is able to clarify issues.
- Sales person can demonstrate the use of a product.
- Gives the buyer an opportunity to negotiate.
- Factors that may cause the supply curve to shift to the right
- Reduced cost of production
- Bumper harvest
- Increase in the price of complementary goods
- Government incentives
- Reduced prices of substitute goods
- Improved production methods.
- Entry of new firms to the market.
- Measures that a country can take to reduce the level of inflation.
- Increase in income taxes to reduce the disposable income available to consumers
- Reduce government expenditure
- Introduce compulsory saving schemes
- Reduced exports
- Enforce wage guidelines
- Increase interest rates on loans
- Characteristics of an efficient tax system
- Difficult to evade
- Meaning of the following forms of sales
- L O C O – The price of goods quoted at the exporters warehouse/premises.
- C I F – Cost insurance and Freight included up to the port of entry
- F A S – Free alongside shop- Cost incurred on goods up to the point where they are ready to be loaded into ship.
- F O Q – Free on Quay – means the price quoted included all costs incurred up to the quay.
- Capital owned
Capital owned = Initial capital + Net profit – drawing
90,000 + 15,000 – 5,000
- Acid Test ratio
Acid test ratio = Current Assets – Stock
40,000 – 20,000 = 1:1
- Capital owned
- Circumstances under which a firm may be located near the source of raw materials
- When raw materials are heavy and bulky and makes cost of transport high.
- The nature of raw materials
- Perishable raw materials
- If the raw materials are bulky
- If the raw materials are in the same location with the markets.
- If it is the government policy.
- Assumptions associated with perfect competition
- Large number of sellers and buyers exist in the market
- Production of identical (homogenous ) products by different firms.
- There is no government interference.
- There is free entry and exit from the industry
- Uniformity of buyers and sellers
- Equilbrium Price and Quantity
- Where Qde = 4p + 50 and Qse = 8p + 30
4p + 50 = 8p +30
50-30 = 8p-4p
Equilibrium Price = 5
Equilibrium Quantity = (5 x 4) + 50 = 70
- Where Qde = 4p + 50 and Qse = 8p + 30
- Features of liner
- Ferry passengers or cargo
- Follow a regular timetable or schedule
- Call at ports at regular intervals.
- Follow a regular route.
- Form associations and conferences to protect themselves against unfair competition.
- Charge fixed freightage and fare regardless of demand.
- Characteristics of Money
- Must have general acceptability
- Should be limited in supply
- Should be divisible into smaller units
- Should be portable.
- Should be durable enough to last a long time.
- Should be stable
- Should be easily recognisable.
- Reasons why it is necessary for a country to control imports
- In order to protect the infant domestic industries.
- To avoid dumping of goods into the country.
- To correct balance of payment deficit
- In order to raise revenue
- To protect key industries.
- Features of economic resources
- They are limited in supply.
- They have monetary value
- They have ability to create utility when combined.
- They are unevenly distributed from region to region, country to country etc.
- Some can be transferred from one person to another.
- Methods of controlling inflation
- High taxation
- Encouraging the public to save their money
- Monetary policy whereby the government reduces the amount of money in circulation.
- Credit squeeze through the central bank.
- Administrative control.
- Reasons why government levies taxes on citizens
- To raise government revenue
- To discourage consumption of certain commodities
- To discourage dumping
- To protect local industries from foreign competition.
- To discourage location of firms in certain areas.
- To bridge the gap between the rich and the poor.
- Benefits of operating a small retail outlet
- Small capital required
- Personal attention is given to customers
- Operations are flexible
- There are fewer legal formalities.
- Profits do no have to be shared
- Decision making is faster
- Business secrets can be maintained.
- Use of a three column cash book
- Records income received in cash or through the bank.
- Records payments in cash or through bank .
- Details discounts allowed and discount received.
- Show the opening and closing cash and bank balances.
- Features of a good filing system
- Should occupy less space (ie) should be compatible
- Should be simple and easy to understand (simplicity)
- Should protect documents from hazard such as theft, water fire and pests
- Should be capable of expansion(elastic)
- System should be appropriate to the organisation requirement
- The initial and maintenance costs should be affordable by the organisation.
- Should be cost effective.
- Advantages of a current account
- Bank overdraft can be enjoyed.
- Money can be deposited any time.
- Withdrawals can be made anytime.
- No minimum balance is required
- Cheque facilities are provided for making payment
- Features of a chain store
- Branches are coordinated from a head office.
- Have standardised prices in all branches.
- Purchasing of stock is done collectively for all branches
- Advertising is done collectively for all branches.