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KCSE CLUSTER TESTS 27

Business Studies Paper 1

1.

Outline four challenges associated with the satisfaction of human wants.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

3.

Highlight four ways in which manufacturers can enhance consumer protection.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

5.

The balances below relates to Eureka Traders for the year ended 31st December 2010.
Shs.
Capital ?
2 year Bank loan 230,020
Creditors 95,200
Fixed assets 480,000
Current assets 145,220


Determine the following
i.) Working capital (2mks)
ii.)Capital employed (2mks)






4 marks

6.

Classify the following accounts as either real or nominal.

4 marks

7.

Highlight four measures that the government would undertake to provide investors with an enabling business
environment.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

8.

Outline four circumstances under which downwards communication would be appropriate in an
organization.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________

4 marks

9.

State four limitations of using national income statistics to compare the standards of living in different
countries.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

10.

State four merits of using indirect taxes to raise government revenue.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

11.

State four components of a business plan.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________

4 marks

12.

Outline four demerits of using pipeline to transport petroleum products.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

13.

Highlight four circumstances which may make personal selling appropriate as a way of product
Promotion.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

14.

Maneno traders had the following balances as at 6thJanuary 2012.
Land & building 150,000
Cash in hand 25,500
Creditors 15,000
Bank overdraft 30,000
Purchases 18,000
Sales 30,000
Returns inwards 5,000

Required; A trial balance as at 6thJanuary 2012

4 marks

15.

Outline four monetary methods that the government can use to control inflation.
a)_______________________________________________________________________________
________________________________________________________________________________
b) ______________________________________________________________________________
________________________________________________________________________________
c) ______________________________________________________________________________
________________________________________________________________________________
d) ______________________________________________________________________________
________________________________________________________________________________

4 marks

16.

Name the office machines used to perform the following functions. (4mks)

4 marks

17.

Outline four distinctions between monopolistic competition and oligopoly. (4mks)

4 marks

18.

Highlight four disadvantages of producer co-operative societies. (4mks)
a) ........................................................................................................................................................................................................................................................................

b) ........................................................................................................................................................................................................................................................................

c) ........................................................................................................................................................................................................................................................................

d) ........................................................................................................................................................................................................................................................................

4 marks

19.

State four objectives of export processing zones in Kenya. (4mks)
a) ...................................................................................................................................................................................................

b) .................................................................................................................................................................................................

c).......................................................................................................................................................................................................

d)..........................................................................................................................................................................................................

4 marks

20.

Outline four advantages of overpopulation in Kenya. (4mks)
a) ..........................................................................................................

b) ............................................................................................................

c) ............................................................................................................

d) ............................................................................................................

4 marks

21.

Highlight four benefits of a bonded warehouse to the government. (4mks)
a) ...................................................................................................................................................................................................................................................................

b) ...................................................................................................................................................................................................................................................................

c) ...................................................................................................................................................................................................................................................................

d) ...................................................................................................................................................................................................................................................................

4 marks

22.

State four features of a departmental store. (4mks)
a) .........................................................................................................................................................................................................................................................................

b) .........................................................................................................................................................................................................................................................................

c) .........................................................................................................................................................................................................................................................................

d) .........................................................................................................................................................................................................................................................................

4 marks

23.

Outline four conditions which are necessary for a successful development plan. (4mks)
a) ........................................................................................................................................................................................................................................................................

b)........................................................................................................................................................................................................................................................................

c)........................................................................................................................................................................................................................................................................

d)........................................................................................................................................................................................................................................................................

4 marks

24.

State four purposes of a three column cash book. (4mks)
a) ..............................................................................................................................................................

b) ................................................................................................................................................................

c) ................................................................................................................................................................

d) ...............................................................................................................................................................

4 marks

25.

Highlight four features of general insurance. (4mks)
a) .........................................................................................................................................................................................................................................................

b)...........................................................................................................................................................................................................................................................

c)............................................................................................................................................................................................................................................................

d)...........................................................................................................................................................................................................................................................

4 marks

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