CAMS LEVEL I

PRINCIPLES OF ENTREPRENEURSHIP AND MANAGEMENT

MONDAY: 5 December 2022. Morning Paper. Time Allowed: 2 hours.

This paper is made up of fifty (50) Multiple Choice Questions. Answer ALL the questions by indicating the letter (A, B, C OR
D) that represents the correct answer. Do NOT write anything on this paper.

1. Which type of entrepreneur adopts to change only when it is important for survival?
A. Drone
B. Imitative
C. Fabian
D. Innovative (2 marks)

2. Select the statement that describes an intrapreneur.

A. A person who detects an untapped opportunity to make own income
B. A person who buys products at a certain price with a view to sell them at a higher price
C. An individual who brings factors of production together to start a business
D. An employee who uses entrepreneurial skills to generate profit for the venture (2 marks)

3. Which of the following is a role of entrepreneurship in economic development?

A. Reduce the level of exports in the country
B. Promote balanced regional growth
C. Formulating favourable regulations
D. Providing an enabling environment (2 marks)

4. Choose a benefit attained by a country with high levels of entrepreneurial activity.

A. High levels of business formation
B. High levels of cyclical unemployment
C. High levels of business opportunities
D. High levels of government intervention (2 marks)

5. Which of the following is a characteristic of an executive summary in a business plan?

A. Summarises every chapter in the business plan.
B. Prepared first before all other components
C. Summarises the content of a marketing plan
D. Appears on the cover page of a business plan (2 marks)

6. Which of the following is a role of business incubation?

A. Generate business idea
B. Controlling business ideas
C. Enhance business success
D. Lower business capacity (2 marks)

7. Select the set of qualities that describes a good business opportunity.

A. Attractive, high gains, short cycle and minimal resources
B. Durable, abnormal profits, long cycle and unique market
C. Anchored on product, profitable, short cycle and timely
D. Attractive, durable, anchored on product and timely (2 marks)

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8. Choose the statement that describes a business idea.
A. A thought or impression that may or may not become an opportunity
B. A window of opportunity that meets the criteria for start-up
C. An opportunity that meets the needs and demands of customers
D. A notion containing factors that contribute to business success (2 marks)

9. Which business entry option could provide an entrepreneur exclusive rights to operate within a certain geographical
region?
A. Franchise
B. Sole proprietorship
C. Company
D. Joint venture (2 marks)

10. Which of the following is a benefit of buying an existing business?

A. Enables partnering with existing owners
B. Helps to avoid challenges of running a business
C. Allows easy implementation of changes and innovation
D. Facilitates evaluation of business performance (2 marks)

11. Which of the following activity could an entrepreneur undertake before choosing a market entry strategy?
A. Acquire finances
B. Sales promotion
C. Product distribution
D. Market research (2 marks)

12. Select an advantage of running a sole proprietorship business.

A. It is not easy to dissolve after registering
B. It is very expensive to create the business
C. Owner maintains complete control of it
D. The losses are redistributed by the owner (2 marks)

13. What term is used to refer to collecting and analysing first hand data for decision making?
A. Customer surveys
B. Primary research
C. Windshield research
D. Industry research (2 marks)

14. Which of the following is a source of short-term finance?

A. Share capital
B. Equity finance
C. Trade credit
D. Debentures (2 marks)

15. Which of the following explains the meaning of retained earnings?

A. Unpaid interest
B. Profits earned
C. Undistributed dividends
D. Income from investment (2 marks)

16. Identify a service provided by microfinance institutions.

A. Business appraisal
B. Savings and credit
C. Business registration
D. Business identity (2 marks)

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17. Identify a factor that venture capitalists could consider before investing in a business.
A. Low profitability and low returns
B. An average working capital
C. Slow growth in the industry
D. Strong management team (2 marks)

18. Why is it important for an entrepreneur to choose a suitable business location?

A. Identify customer needs
B. Market proximity
C. Allow faster production
D. Reduce distribution of goods (2 marks)

19. Which of the following increases customer engagement with a business?

A. Customer analysis
B. Selling quality products
C. Use of technology
D. Hiring competent employees (2 marks)

20. Choose the benefit realised by embracing social media marketing.

A. The ability to obtain marketing financing
B. The ability to market business at low cost
C. The ability to borrow at low rates of interest
D. The ability to make market differentiation (2 marks)

21. What name is given to a person who accomplishes objectives by directing the efforts of other people?
A. Manager
B. Entrepreneur
C. Intrapreneur
D. Director (2 marks)

22. Which management function involves putting together required resources in order to execute plans?
A. Planning
B. Controlling
C. Staffing
D. Organising (2 marks)

23. Which of the following is an interpersonal role of a manager?

A. Monitoring role
B. Spokesperson role
C. Negotiation role
D. Liaison role (2 marks)

24. Identify a way in which a manager performs the leading function in an organisation.
A. Tasks and resources allocation
B. Monitoring and evaluating performance
C. Setting long and short-term goals
D. Motivating and influencing people (2 marks)

25. Which of the following is an objective of planning in the management process.

A. To ensure rational allocation of resources
B. To ensure quality control and assurance
C. To ensure the use of accurate standards
D. To ensure improvement is a priority (2 marks)

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26. Choose the role played by the top-level management in an organisation.
A. Design and implement policies
B. Set organisation schedules
C. Allocate operational resources
D. Formulate strategic goals (2 marks)

27. Which statement explains the meaning of leading as a function of management?

A. Responding to problems
B. Influencing behaviour
C. Forecasting future actions
D. Mobilising resourses (2 marks)

28. Which level of management is directly responsible to shareholders of a company?

A. Supervisory level
B. Middle level
C. Top level
D. Executory level (2 marks)

29. Which statement describes a job-specific knowledge needed to perform well in a specialised field?
A. Conceptual skills
B. Technical skills
C. Interpersonal roles
D. Decisional roles (2 marks)

30. Choose the first stage in the rational decision making.

A. State the problem
B. Identify the problem
C. Evaluate a problem
D. Examine a problem (2 marks)

31. Which skills should a manager have to be able to deal objectively and fairly with subordinates?
A. Communication
B. Delegation
C. Technical
D. Interpersonal (2 marks)

32. What term is used to refer to a projected course of action?

A. Decision
B. Alternative
C. Report
D. Plan (2 marks)

33. Which skills does a manager require to understand the overall working of the organisation and its environment?
A. Strategic thinking skills
B. Leadership skills
C. Conceptual skills
D. Directing skills (2 marks)

34. Why is a retention policy important in ensuring a good filing system?

A. To prevent unauthorised access
B. Ensure it is simple to understand
C. Ensure removal of outdated records
D. Ensure the system is capable of expansion (2 marks)

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35. The following steps are involved in handling mail.
(i) Distribution
(ii) Receiving
(iii) Storage
(iv) Recording
(v) Sorting

Which of the following represents the correct order of handling incoming mail?
A. (ii), (v), (iv), (i), (iii)
B. (i), (ii), (iv), (v), (iii)
C. (ii), (iv), (v), (i), (iii)
D. (iii), (ii), (i), (v), (iv) (2 marks)

36. Which of the following is an advantage of microfilming as a method of storing information?

A. Saves on space
B. Easy to make corrections
C. Fast retrieval
D. It is minimised (2 marks)

37. Which of the following could lead to inefficient filing?

A. Use of electronic filing
B. Not allowing access to everyone
C. Regular filing of documents
D. Inappropriate classification (2 marks)

38. Select the characteristic exhibited by a democratic leader.

A. Increases resistance to change
B. Long channels of communication
C. Decentralisation of authority
D. Utilises downward communication (2 marks)

39. Which statement describes the meaning of job analysis in management?

A. Minimum qualifications a person must have to perform the job successfully
B. To determine by examining and observing the basic elements of a job
C. To draw an effective organisation structure for the organisation
D. Minimum academic requirements to perform a specific technical job (2 marks)

40. Which of the following is an advantage of internal recruitment in an organisation?

A. It inspires and motivates employees within the organisation
B. It gives the organisation a competitive advantage
C. It enhances the reputation of the organisation
D. It provides the required returns on human capital (2 marks)

41. Choose a conflict handling style that provides solutions that benefit all parties.
A. Accommodating
B. Collaborating
C. Compromising
D. Dominating (2 marks)

42. Which of the following could contain a job description and a job specification?
A. Application for a specialised job
B. Advertisement of a vacant position
C. Curriculum Vitae of a job applicant
D. Invitation to an employment interview (2 marks)

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43. Which of the following is a responsibility of an employee with relation to health and safety issues?
A. Create and distribute a health and safety policy
B. Provide a safe working environment
C. Make proper use of tools and machinery
D. Provide training on health and safety issues (2 marks)

44. Which of the following could affect employee retention in an organisation?

A. Number of employees
B. Size of organisation
C. Leadership style
D. Levels of management (2 marks)

45. What is the purpose of holding job interviews?

A. Selection of right employees
B. Orientation of new employees
C. Presenting certificates and testimonials
D. Human resource planning (2 marks)

46. Choose the statement that represents a growth strategy in a competitive business.
A. Expanding into new products and services
B. Changing the ongoing business strategy
C. Engaging in a rationalisation process
D. Phasing out some of product lines (2 marks)

47. Which of the following occurs at the stabilisation stage of a business life cycle?
A. Business expansion
B. Employee retrenchment.
C. Business mergers
D. Constant sales (2 marks)

48. Which of the following is a demerit of a rapid growth in business?

A. Reduced product quality
B. Over-stretched staff
C. Market saturation
D. Constant productivity (2 marks)

49. Which of the following could be experienced at the maturity stage of a business life cycle?
A. Business decline
B. Sales growth
C. Slow growth
D. Low profit (2 marks)

50. At which stage of growth does a business experience negative cash flow?
A. Idea generation stage
B. Start-up stage
C. Stabilisation stage
D. Innovation stage (2 marks)
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 CAMS LEVEL I

PRINCIPLES OF ENTREPRENEURSHIP AND MANAGEMENT

MONDAY: 1 August 2022. Morning paper. Time Allowed: 2 hours.

This paper is made up of fifty (50) Multiple Choice Questions. Answer ALL the questions by indicating the letter (A, B, C
or D) that represents the correct answer. Do NOT write anything on this paper.

1. What name is given to the type of entrepreneurship that involves identifying a promising business and taking the
initiative to acquire it?
A. Researcher
B. Hustler
C. Buyer
D. Innovative (2 mark)

2. ________________ is an indicator of a good business idea.

A. High competition
B. Good market scope
C. More resource requirement
D. High government revenue (2 mark)

3. What is the name given to the process of building a business with minimal or no extra capital?
A. Informal financing
B. Micro financing
C. Bootstrapping
D. Crowd funding (2 mark)

4. Which of the following is NOT a factor that an entrepreneur could consider while choosing a business location?
A. Entrepreneur’s skills
B. Security
C. Potential for growth
D. Accessibility (2 marks)

5. Intrapreneurship also refers to___________________________?

A. Corporate entrepreneurship
B. Internal entrepreneurship
C. Business entrepreneurship
D. Innovative entrepreneurship (2 marks)

6. Which one of the following is a challenge faced by entrepreneurs in your country.

A. Low interest rates
B. Unregulated competition
C. Supportive government policies
D. Lack of employment (2 marks)

7. _________________ is a method of generating new ideas using suggested problems of known products.
A. Brainstorming problems
B. Focus groups problem solving method
C. Creative problem solving
D. Problem inventory analysis (2 marks)

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8. Why would an entrepreneur opt to buy an existing business instead of starting a new one?
A. Lower cost of starting a business
B. Ability to introduce a new product
C. Established relationship with suppliers
D. Support is assured by previous owners (2 marks)

9. Which of the following is a limitation of equity finance?

A. Loss of control
B. Lack of credit worthiness
C. Money has to be repaid back
D. High interest rates (2 marks)

10. What term is used to refer to all permits and licences that one must obtain before being allowed to operate a
business in your country?
A. Government requirements
B. Statutory requirements
C. Government policy
D. Business requirements (2 marks)

11. Which of the following statements is NOT true about an entrepreneur?

A. Is a catalyst of economic change.
B. Identifies a business opportunity.
C. Takes calculated risks.
D. Success depends on luck. (2 marks)

12. Which of the following is NOT a factor to consider while choosing a business incubator?
A. Success rate.
B. Quality of services.
C. Availability of market.
D. Policies and procedures. (2 marks)

13. The following are the benefits that a franchisee gains from a franchisor EXCEPT?
A. Training.
B. Brand name.
C. Product or service.
D. Profit guarantee. (2 marks)

14. Venture capital is a source of ____________________ finance.

A. Debt
B. Equity
C. Personal
D. Micro (2 marks)

15. Which of the following is NOT a reason for ensuring customer satisfaction?
A. Customer attraction
B. Customer experience
C. Customer retention
D. Customers to do one time purchase (2 marks)

16. Which of the following statements is TRUE about an imitating entrepreneur?

A. They learn from mistakes of others to make their products and services better
B. They start small and grow their business with hard work rather than capital
C. They do as much research as possible before launching a product or service in the market
D. They constantly come up with new ideas and turn them into profitable ventures (2 marks)

17. Why is it important to carry out competitors’ analysis while writing a business plan?
A. To evaluate the size of their businesses
B. To know what kind of product they sell
C. To determine their tastes and preferences
D. To determine their strengths and weaknesses (2 marks)

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18. ________________ is a person who initiates, creates and manages a new business.
A. A leader
B. A professional
C. An entrepreneur
D. A manager (2 marks)

19. Which type of entrepreneur utilises a chance to introduce a new technique or a new product?
A. Fabian entrepreneurs
B. Innovative entrepreneurs
C. Researchers
D. Businessmen (2 marks)

20. Which of the following behaviour, is not associated with successful entrepreneur?
A. Continuous innovation and urgency
B. Production as per customers’ requirements
C. Research and development
D. Running the business without planning (2 marks)

21. Which of the following is NOT a source of ideas for an entrepreneur?

A. Imported products
B. Emerging technologies
C. Cost of the project
D. Product profile (2 marks)

22. A business plan is important for all of the following reasons EXCEPT?
A. It enables the business owners to systematically think through each aspect of the new venture.
B. It gives an assurance to lenders and investors that they will earn a decent return.
C. It is a selling document that enables a company to present itself to potential suppliers and business partners.
D. It provides an investor with something to react to (2 marks)

23. Which of the following is NOT a characteristic of entrepreneur?

A. Managerial training
B. Creativity
C. Innovation
D. Risk taking (2 marks)

24. Which of the following statements BEST describes the term leadership?
A. Managing human resources
B. Monitoring performance
C. Getting things done through people
D. Influencing the behavior of others (2 marks)

25. What stages of the business life cycle are sales the lowest?
A. Innovation
B. Stabilisation
C. Idea generation
D. Start-up (2 marks)

26. What name is given to the role of a manager that involves dealing with people outside the organisation?
A. Monitor role
B. Entrepreneurial role
C. Liaison role
D. Figurehead role (2 marks)

27. Identify the MAIN reason why planning is important in an organisation.

A. Helps in specialisation
B. Defines the organisation structure
C. Gives a sense of direction
D. Helps in training new employees (2 marks)

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28. Which level of management makes up the smallest group of managers in an organisation?
A. Top level
B. Middle level
C. Intermediate level
D. Lower level (2 marks)

29. Which management skills would a manager require MOST while resolving conflict among employees?
A. Conceptual skills
B. Interpersonal skills
C. Strategic thinking skills
D. Delegation skills (2 marks)

30. Identify the MAIN challenge that an organisation could face in the process of recruiting suitable employees?
A. Inability to attract the right candidates
B. Inappropriate media to advertise vacancies
C. Lack of an interview panel
D. Failure to induct employees (2 marks)

31. Which of the following is a purpose of the organising function of management?

A. Facilitate coordination
B. Set goals
C. Performance appraisal
D. Motivate staff (2 marks)

32. Who among the following is NOT an operational level manager?

A. Foreman
B. Supervisor
C. Chief Executive Officer
D. Superintendent (2 marks)

33. Identify the skills a manager would require to choose amongst alternative courses of action.
A. Leadership skills
B. Communication skills
C. Operating skills
D. Decision-making skills (2 marks)

34. Which of the following is not a challenge for an entrepreneur?

A. Choosing the product or service to sell in the market
B. Managing the cash flow of their business
C. Recruiting new employees
D. Formulating rules and regulations relating to conducting entrepreneurship in their country (2 marks)

35. Who should prepare a firm’s business plan?

A. Entrepreneur
B. Accountant
C. Engineer
D. Marketer (2 marks)

36. What is the name given to the process of creating something new?
A. Management
B. Business
C. Creative flexibility
D. Innovation (2 marks)

37. What is the purpose of a feasibility study while preparing to start a new venture?
A. Estimate sales
B. Exploring for potential customers
C. To understand if there are any barriers to success
D. To market the products (2 marks)

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38. What are the three interpersonal roles of managers?
A. Figurehead, organiser and spokesman
B. Communicator, organiser and spokesman
C. Director, coordinator and disseminator
D. Spokesman, leader and coordinator (2 marks)

39. Which of the following is NOT a recognised skill of management?

A. Technical skills
B. Writing skills
C. Conceptual skills
D. Human skills (2 marks)

40. What is the name given to the management function that involves determining whether the quality of work is up
to standard?
A. Leading
B. Controlling
C. Organising
D. Planning (2 marks)

41. When would cross referencing be important while filing office documents?
A. When there are so many records to be filed.
B. In case documents require frequent retrieval
C. To keep documents away from unauthorised users
D. In case a document can be filed under more than one heading (2 marks)

42. The following are components of a job description and a job specification:
(i) Job title
(ii) Working environment
(iii) Education and training
(iv) Tasks to be performed
(v) Skills
(vi) Personality

Which of the following sets relate to a job specification?

A. (ii), (v), (vi)
B. (iii), (v), (vi)
C. (i), (iii), (v)
D. (i), (ii), (iv) (2 marks)

43. Management skills applies to managers at which level?

A. All levels in an organisation
B. Top level in an organisation
C. Executive level in an organisation
D. Middle level in an organisation (2 marks)

44. Which management function entails grouping of jobs?

A. Controlling
B. Planning
C. Organising
D. Directing (2 marks)

45. Which type of decision making is carried out by lower level management and deals with specific daily tasks?
A. Mid-level decision making
B. Administrative decision making
C. Operational decision making
D. Programmed decision making (2 marks)

46. What is the goal of an entrepreneur during the start-up stage of a business lifecycle?
A. Enhance competitive edge
B. Growth
C. Survive
D. Enhance reputation (2 marks)
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47. Which of the following is a benefit of electronic filing systems?
A. Viruses can attack the computer
B. Staff training is needed
C. Staff need specialised training to use the system
D. It reduces the number of staff that must be hired to manage records (2 marks)

48. Which of the following is not an important aspect of employee involvement?

A. Employee empowerment
B. Teamwork
C. Keeping employee morale down
D. Employee motivation (2 marks)

49. Which of the following is a positive outcome of conflict?

A. Stimulates creativity
B. Strains relationships
C. Promotes resistance
D. Encourages poor performance (2 marks)

50. Which of the following is NOT an intervention that management could put in place to prevent health related
issues in an organisation?
A. Proper furniture
B. Adequate stationery
C. Ventilation
D. Noise control (2 marks)

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 CAMS LEVEL I

PILOT PAPER

PRINCIPLES OF ENTREPRENEURSHIP AND MANAGEMENT

SECTION ONE

[40 MARKS] [40 MINUTES]

November 2021. Time Allowed: Two Hours

This paper has three sections. Section One has forty (40) multiple choice questions. Section Two has twenty (20)
short response questions. Section Three has one (1) essay question. All questions are compulsory. The marks
allocated to each question are shown at the end of the question.

1. Entrepreneurship may be defined as; (1 mark)

A. Starting a business enterprise

B. The process of undertaking business
C. Process of creating incremental wealth
D. Process of gathering resources.

2. The entrepreneurial process of identifying and evaluating the business opportunity involves; (1 mark)

A. Writing a business proposal plan

B. Scanning the business environment
C. Seeking business finances
D. Registering the business name.

3. The harvesting stage of the entrepreneurial process involves: (1 mark)

A. Writing a business analysis report
B. Consulting an entrepreneur
C. Choosing an exit strategy
D. Getting a return on investment.

4. Corporate entrepreneurship may be defined as; (1 mark)

A. Changing an organisation set up

B. Re-structuring the organisation’s management structure
C. Engaging in external marketing in unique ways
D. Entrepreneurship within an existing organisation.

5. Well established organisations can promote Intrapreneurship by; (1 mark)

A. Establishing rigid management organisation structures

B. Applying a long and complex organisation structure
C. Providing a working environment
D. Penalising project and product failures.

6. Social entrepreneurship is a form of entrepreneurship that; (1 mark)

A. Focuses on social environments

B. Encourages individuals to make profits in an innovative way
C. Supplies goods and services to the society
D. Tackles social challenges in an innovative way.

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7. Entrepreneurship contributes to economic growth of the country through: (1 mark)
A. Discussions and reports about the economy.
B. Widening the economic gap in the country.
C. Creation of high growth enterprises.
D. Working on the country’s economic policies.

8. Select the major characteristic of an entrepreneurial firm; (1 mark)

A. Continuous production of goods and services
B. Bringing new products and services to the market
C. It is a lifestyle firm
D. Operated by individuals who are motivated by money.

9. The corporate entrepreneurship strategy process is composed of: (1 mark)

A. External environment conditions
B. Innovative strategic vision
C. Competitive capability
D. Strategic repositioning.

10. Select one principle applied by successful innovative companies. (1 mark)

A. A broad organisational vision
B. Use of a single management approach
C. Small, flat organizational structure with small project teams.
D. A complex market approach.
11. Select a common source of entrepreneurial stress. (1 mark)
A. Environmental stress
B. Business cycles
C. Political environment
D. Need to achieve.
12. Entrepreneurs enhance their business networks in order to; (1 mark)
A. Increase prices of the products and services.
B. Become popular
C. To grow their businesses
D. Earn higher returns in their investments.
13. An entrepreneur may be best defined as; (1 mark)
A. Young and energetic
B. Gamblers who take big risks
C. A catalyst for economic growth
D. Genetically predisposed to be successful.

14. Identify one characteristic associated with entrepreneurial ego that may have destructive implications on the
business. (1 mark)
A. Sense of trust
B. Desire for success
C. Overbearing need for control
D. Unrealistic pessimism.

15. Identify one characteristic not exhibited by successful entrepreneurs in general. (1 mark)
A. Independence
B. Reactive
C. Ambitious
D. Flexible.
16. Which of the following manifest needs was not proposed by McClelland. (1 mark)
A. Need for affiliation
B. Need for affection
C. Need for power
D. Need for achievement.
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17. Identify the entrepreneurial motivator that is not classified under compelling factors. (1 mark)
A. Unemployment
B. Self-actualisation
C. Dissatisfaction with job
D. Utilisation of knowledge and skills.

18. Choose one characteristic exhibited by an entrepreneur that may have positive implications to the businesses.
(1 mark)
A. Sense of trust
B. Overriding desire for success
C. Overbearing need for control
D. Unrealistic optimism.

19. Select the theory that is not classified as an entrepreneurship theory. (1 mark)

A. Economic theories
B. Psychological theories
C. Stakeholders’ theories
D. Sociological theories.

20. Based on Schumpeterian theory of entrepreneurship; innovation is defined as; (1 mark)

A. Coming up with new ideas

B. New products and services
C. Technical work of invention
D. Application of new things into practical and efficient use.

21. Entrepreneurship sociological theories are based on; (1 mark)

A. Political values
B. Socio-cultural values
C. Environmental considerations
D. Technological development.

22. Select one factor not considered under the Integrative approach to entrepreneurship. (1 mark)

A. The organisation
B. The environmental opportunities
C. The individual entrepreneur
D. The financial and nonfinancial resources.

23. Identify the quality that does not define a viable business opportunity. (1 mark)

A. Durability
B. Timeliness
C. An idea/thought
D. Attractiveness.

24. Select the factor that does not contribute to the recognition of a business opportunity. (1 mark)

A. Observing trends
B. Solving a problem
C. Finding gaps in the market place
D. Social discrimination and exclusion.

25. Identify the personal characteristic that may hinder business opportunity recognition. (1 mark)
A. Prior business experience
B. Business social networks
C. Entrepreneurial awareness
D. Inability to solve problems.
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26. Select a rule that is not observed when conducting a formal brainstorming session. (1 mark)

A. No criticism is allowed
B. Freewheeling
C. Detailed analytical reasoning
D. Leapfrogging.

27. Choose the behaviour that encourages creativity. (1 mark)

A. Rigid organisational structure

B. Investing in human resource
C. Retaining employees in same job
D. Penalising failed ideas.

28. Identify the behaviour that discourages creativity. (1 mark)

A. Listening actively
B. Being pessimistic, judgmental and critical
C. Protecting honest mistakes when learning
D. Treating employees as equals.

29. Select an environmental trend that does not suggest business or product gaps. (1 mark)

A. Technological advances
B. Economic forces
C. Political instability
D. Social forces.

30. Entrepreneurs choose business opportunities which have the qualities shown below. Select the quality that
entrepreneurs may not consider. (1 mark)

A. Opportunity that adds value to customers

B. An open window of opportunity
C. Timeliness of the opportunity
D. Diversified market.

31. A business plan may be defined as; (1 mark)

A. An entrepreneur’s expression of interest

B. A list of business ideas
C. Entrepreneurs’ diary of business activities
D. A document on proposed venture.
32. Identify a private form of business organisation from the list below. (1 mark)
A. Partnerships
B. Cooperatives
C. Public social benefits organisations
D. Savings and loans cooperative societies.
33. Select the main disadvantage of a public limited company. (1 mark)
A. Unlimited liability
B. Loss of direct control by the shareholders
C. Responsibilities and risks are shared on agreed proportions
D. Possibility of raising large sums of money.
34. Identify the major difference between sole proprietorship and partnerships. (1 mark)

A. Perpetual continuity of business

B. Unlimited liability
C. Full control of the business by the owners
D. Shared responsibilities.

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35. Identify the document that is presented to the registrar of companies during registration of a company.
(1 mark)
A. Audited financial statements
B. Memorandum of Association
C. A deed
D. An environmental audit reports.
36. Identify a major similarity between a general partnership and a private limited company. (1 mark)

A. Unlimited liability
B. Continuity of business
C. Low liquidity of investment
D. Management control.

37. Select the main function of the articles of association. (1 mark)

A. State the liability of members

B. Show the objectives of the company
C. Guide the internal management of company
D. Provide a list of directors.

38. Identify the main purpose of a memorandum of association. (1 mark)

A. Show the list of shares offered

B. Show the class and rights of shareholders
C. Show the company’s broad objectives
D. State the qualifications and duties of the directors.
39. Select the circumstance in which a sole proprietorship is regarded as a favorable form of ownership.,
(1 mark)
A. Where owner prefers autonomy
B. Where promptness is not required in decision making
C. Where personal attention is not an important aspect of business relationship
D. Where the market is broad and requires large capital investment.

40. Partnership deed may be defined as; (1 mark)

A. A document of capital appropriation

B. Articles of partnership stipulating the internal workings of the business
C. Document that allows transfer of shares
D. Document of transfer of assets.
(Total: 40 marks)
SECTION TWO

[40 MARKS] [1 HOUR]

You are advised not to exceed forty words in answering each question.

41. List two bootstrapping methods a start up restaurant business can utilise to ensure business success.
(2 marks)
42. Define the term “venture capital”. (2 marks)

43. Explain the term “window of opportunity”. (2 marks)

44. Suggest two primary reasons why people become entrepreneurs. (2 marks)

45. Distinguish between creativity and innovation in entrepreneurship. (2 marks)

46. Define the term “corridor principle”. (2 marks)

47. Explain two reasons why corridor principle supports the fact that majority of business ideas are conceived at
work. (2 marks)
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48. Giving two examples, explain how “solving a problem” can create a business opportunity”. (2 marks)

49. Identify two areas that a properly executed feasibility analysis explores. (2 marks)

50. Identify two challenges faced by an entrepreneur at the start up stage of the business. (2 marks)

51. Distinguish between a product franchise and a business format franchise. (2 marks)

52. Identify two benefits that accrue to an accounting firm that operates in form of a partnership. (2 marks)

53. Highlight two qualities to look for in a prospective Franchisee. (2 marks)

54. Explain how a manager can promote intrapreneurship. (2 marks)

55. Describe two qualities of an opportunistic entrepreneur. (2 marks)

56. Explain the challenges a prospective entrepreneur experiences at the idea generation stage. (2 marks)

57. Describe two factors that an entrepreneur whose business is at the stabilisation stage of business life cycle can
consider in order to grow. (2 marks)

58. Explain the characteristics of a business that is in the decline stage of business life cycle. (2 marks)

59. Explain two innovative strategies an entrepreneur may consider to apply at the business decline stage of
business life cycle. (2 marks)
60. Explain the meaning of “generation of a new entry opportunity”. (2 marks)
(Total: 40 marks)
SECTION THREE
[20 MARKS] [20 MINUTES]
61. Bizz game is the brainchild of four trainees in accounting who want to spark student’s interest in running a
business. Their aim is to create a social enterprise that will help promote youth entrepreneurship more widely.
In 2020, the team launched Bizzgame, an interactive business simulation game. Players increase their
company’s valuation through strategic decisions on buying goods, marketing, sales development and logistics
management.

Students were initially reluctant to take up the challenge but several months of further trial and enhancements
saw the game popularity increase among other trainees. Bizz game is gaining a following in the educational
establishments across the country. The take-up has been enhanced by a series of Bizz game Youth challenge
competitions. Although Bizz game has an appeal among consumers as the “new board game in town” the team
has stuck to its original plan of promoting youth entrepreneurship. An online portal for training institutions
and even a computer game version is being developed.

Required:
(a) Define the term “social enterprise”. (2 marks)

(b) Give two reasons that could have made the trainees come up with the idea of “Bizzgame”. (2 marks)

(c) List three benefits of running Bizzgame as a social enterprise. (3 marks)

(d) State three methods that the team can use to promote Bizzgame in other training institutions.

(3 marks)

(e) Give five challenges that the four undergraduates are likely to encounter as they promote the
Bizzgame.
(5 marks)
(f) Explain three objectives achieved through playing the Bizzgame. (3 marks)

(g) Explain the plan that the four trainees have for the growth of Bizzgame. (2 marks)
(Total: 20 marks)
……….………………………………………………………………….

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