Business Studies Questions and Answers - Form 2 Term 1 Opener Exams 2023

1. Match the following activities with the levels of production.                    (4 marks)
   

   Articles	Levels of Production
   a) Fishing
   b) Transporting Sugar
   c) Refining crude oil
   d) Mining soda ash

2. Give four advantages of operating a supermarket. (4 marks)
3. Outline four factors that should be considered in an office layout. (4 marks)
4. State four factors that may lead to business success. (4 marks)
5. State four ways in which forests serve as economic resources in Kenya. (4 marks)
6. Highlight four factors that should be considered when evaluating a business opportunity.   (4 marks)
7. Give four way in which production activities may in negatively  impact a community.(4 mrks)
8. State four ways in which the utility of a commodity can be increased. (4 marks)
9. The following description relate to some documents used in name trade. (4 marks)
   

   Statement	Document
   a) A document seeking information on the availability of products and their prices
   b) A document showing product and quantity required
   c) A document describing items for sale and their prices
   d) A document sent to a specific buyer  detaining the availability of product and their prices

10. State four advantages of using a franking machine in an office. (4 marks)
11. Outline any four ways in which a society benefits from indirect production. (4 marks)
12. Outline any four services offered by a wholesaler to a producer (4 marks)
13. State four problems that limit the growth of small scale retail business in the country.  (4 marks)
14. Highlight four way in which electronic filing system  would benefit an organization.(4 marks)
15. Outline four ways I which a country benefit from income trade. (4 marks)
16. Outline four factors that may limit the exploitation of natural resources in a country.(4 mrks)
17. Highlight four causes of business success in Kenya. (4 marks)
18. List down four factor gaps that exist in the needs of a market that may assist entrepreneurs to identify. (4 marks)
19. State four elements that comprise external environment of a business. (4 marks)
20. Outline factor that should be considered when selecting a means of reproducing documents. (4 marks)
21. Highlight four factors that may limit the use of land as natural recourses for production.  (4 marks)
22. Outline four factors that may limit an individual’s ability to satisfy human wants. (4 marks)
23. Outline four advantages of buying goods on hire purchase. (4 marks)
24. Highlight four qualities of a good office manager. (4 marks)
25. State four components of a business plan. (4 marks)

MARKING SCHEME

1.  
   1. Primary
   2. Tertiary 
   3. Secondary
   4. Primary    4 x 1 = mks
2.  
   • Reduced wage bill due to few workers employed
   • Increase in sales due  lower prices and more customers
   • Higher profits are made due to economies of scale
   • Owner can insure business against losses since they have large capital   4 x 1 = mks
3.  
   • Employees to be accommodated 
   • Legal  requirement 
   • Supervision 
   • Work flow
   • Communication
   • Working space
   • Proximity to equipment
   • Office appearance      4 x 1 = mks
4.  
   • Availability of capital at low rates of interest
   • Improved and efficient infrastructure 
   • Healthy competition in the market 
   • Availability of skilled labour
   • Favourable government policies towards business
   • Removal of  bureaucracy of  red tape
   • Use of modern technology
   • Increase in consultancy institutions     4 x 1 = mks
5.  
   • Provide wood fuel
   • Provide pulp for manufacture of paper
   • Forest prevent soil erosion 
   • Source of timber used in the construction of industry
   • They attract tourism
   • Source of traditional medicines
   • Forests preserve water catchment areas    4 x 1 = mks
6.  
   • Its profitability 
   • The size  of the market 
   • Break –even period
   • Its potential growth 
   • The legal requirements 
   • It’s competitive advantage    4 x 1 = mks
7.  
   • Air pollution causes air borne diseases
   • Water pollution causes water born diseases
   • Noise pollution causes ear born problems
   • Solid waste pollution causes many diseases
   • Congestion created  as many people look for jobs
   • There is pressure an available health resources /facilities
   • There is environmental degradation 
   • Social evils e.g immorality
   • Occupational hazards e.g. accidents
   • Unhealthy  products may be sold to the public      4 x 1 = mks
8.  
   • Changing the form of a commodity to suit the needs of the consumer 
   • Transporting the commodity to where it is needed
   • Storing the commodity until it is required
   • Selling  or exchanging the commodity      4 x 1 = mks
9.  
   1. inquiry letter
   2. Order
   3. Catalogue /price list
   4. Quotation        4 x 1 = mks
10.  
    • It saves time on stamping postage on mail
    • It minimizes pilferage on postage stamps 
    • It is easy to keep record of postage stamps
    • An advertisement for the organization can b incorporated at low cost     4 x 1 = mks
11.  
    • It leads to quality goods being produced
    • A wider variety of goods is available to the society 
    • It leads to a higher output of the goods to the society 
    • There is better utilization of resources 
    • It facilitates exchange of goods /services 
    • It leads to higher standards of living
    • It creates employment in the society 
    • It leads to specializations thus leading to acquisition of better skills     4 x 1 = mks
12.  
    • They act as a link between producer and retainer
    • Offer storage facilities thus ensuring continuous production
    • Break the bulk
    • Stabilize prices of goods
    • Finance producers by making payments
    • They advertise producer’s products 
    • They prepare goods for sale by branding, packaging and labeling the goods
    • Relieve the producer of risks such as fall in prices, bad debts, thefts, fire and spoilage      4 x 1 = mks
13.  
    • Low demand for goods due to low incomes of people
    • Poor entrepreneurial culture among Kenyans
    • Limited managerial skills among owners
    • The subsistence lifestyle of the people limits their buying habits
    • Inadequate capital to start a business in rural areas
    • Poor infrastructure 
    • Inadequate security
    • Cultural taboos and beliefs
    • Inability to compete with well established businesses.      4 x 1 = mks
14.  
    • Easy access
    • Reduction of labor costs
    • Less storage facilities
    • Update with ease
    • Less paper work
    • Environmental friendly
    • Use of network
    • Less time taken
    • It is safe
    • Production safety   4 x 1 = mks
15.  
    • Exchange of ideas, thus promoting goods relations
    • Revenue to government in form of  taxes
    • Earning of income/profits
    • Creation of employment
    • Provision of a variety of goods and services
    • Disposal of surplus, goods/services
    • Allow greater specialization
    • Brings goods nearer to consumers       4 x 1 = mks
16.  
    • Low population
    • Inadequate capital resources
    • Inadequate security 
    • Use of inappropriate technology 
    • Poor infrastructure 
    • Government restrictions
    • Limited market  for the resources     4 x 1 = mks
17.  
    • Availability of credit at cheap rates
    • Proper planning /marketing
    • Fair competition
    • Efficient management of the business
    • Availability of skilled  manpower
    • Use of modern technology 
    • Favourable government policies /support
    • Availability  of markets due to high population
    • Proper pricing of products 
    • Political stability  and security
    • Appropriate products for the intended market 4 x 1 = mks
18.  
    • The quality of the products
    • Quantity of the products 
    • The level of services 
    • The prices of goods /services
    • Types of products      4 x 1 = mks
19.  
    • Political 
    • Economical
    • Socio cultural 
    • Technological
    • Legal structure
    • Geographical 
    • Demographical
    • Suppliers 
    • Competitors
    • Customers
    • Intermediaries
    • Lobby groups        4 x 1 = mks
20.  
    • No of copies
    • Quality required
    • Cost of the means
    • Urgency of copies
    • Availability of means
    • Impression  required
    • Type of documents
    • Personnel to operate means    4 x 1 = mks
21.  
    • Poor climate conditions
    • Lack of improved technology for utilization of land
    • Absence of required natural r resources from land
    • Low population, leading to limited use of land
    • Poor land tenure system    4 x 1 = mks
22.  
    • Low incomes or unemployment
    • Poor health of an individual 
    • High prices of goods /services
    • Scarcity of goods / services
    • Political instability        4 x 1 = mks
23.  
    • Buyer can afford a vide variety of goods 
    • Buyers can afford expensive goods 
    • Buyer can use goods as he pays for than
    • Since the installments are known buyer can plan or budget     4 x 1 = mks
24.  
    • Necessary education /training
    • Ability to control tamper
    • Leadership qualities
    • Ability to organize
    • Self control and the required enthusiasm to handle the job        4 x 1 = mks
25.  
    • Business description (Executive summary)
    • Organization plan
    • Marketing plan 
    • Financial plan
    • Operational plan        1 x 4 = mks