KCSE Business Studies Topical Questions and Answers

Explain five importance of an efficient transport system in a country

8/11/2021

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Explain five importance of an efficient transport system in a country (10mks)

Five importance of an efficient transport system.

Transport promotes trade by enabling movement of goods from production sites to consumption areas.
It facilitates the growth of industries by transporting raw materials and labour.
It creates employment opportunities.
It opens up new markets since goods produced can be moved to the consumers.
It encourages mass production since they can be taken where they are needed.
It helps in minimizing wastage of goods and services.
It helps in facilitating specialization.
It assists in adding value to goods and services by taking them to where they are needed.
It facilitates movement of labour.
It encourages interaction of communities.

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Briefly explain the meaning of the following forms of advertising

8/11/2021

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Briefly explain the meaning of the following forms of advertising (8mks)

(i) Celebrity advertising

This is a form of advertising that uses of a prominent person on the product to encourage people to buy the product e.g a president, athlete, a footballer etc.

(ii) Product advertising

This is a form of advertising that put emphasis on the brand name of a product.
It is meant to promote that particular product.

(iii) Informative advertising

This is an advertising that gives general information of a product to a customer e.g price quality, uses, and side effects and where it is found.

(iv) Institutional advertising

This is a form of advertising which is meant to popularize or a business.
More emphasis is put on the name of the business.

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Discuss five advantages of a bonded warehouse

8/11/2021

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Discuss five advantages of a bonded warehouse (10mks)

Five advantages of a bonded warehouse.

Storage helps an importer to look for market.
Helps to protect goods safely against pilferage or spoilage by bad weather.
Gives a government a chance to scrutinize the goods.
It enables a government to collect taxes.
Records kept in a bonded warehouse is a source of statistics on a country’s imports.
Enable a trader to look for a market while goods are in bond.
Gives an import chance to prepare the goods before channeling them to the market.
If an importer sells goods while at bond, the burden of paying duty passes to buyer.

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Name four types of marine insurance policies

5/11/2021

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Name four types of marine insurance policies. (4mks)

Four types of marine insurance policies.

Voyage Policy - Taken by the ship owner to cover the ship while undertaking a particular voyage.
Time Policy -To cover the ship for a period of time.
Floating Policy - To cover the ship when it undertakes voyage and it is only in force when the ship sails.
Mixed Policy - It combines the features of a time and a voyage policy.
Port Policy - To cover the ship while at the port.

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State four limitations of billboards as a tool of product promotion.

5/11/2021

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State four limitations of billboards as a tool of product promotion. (4mks)

Four limitations of billboards as a tool of product promotion.

They can be destroyed by weather, since they are exposed to the elements of nature.
They can be vandalized, since no security is provided for them.
They are not useful to the blind persons since they can neither see nor read the message.
They can be ignored since they are silent.
The do not target a particular group of consumers.
They are expensive to erect and maintain.
They may cause obstructions to motorists if they are not well erected.

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Highlight four benefits that may be derived from an efficient road transport system in the country.

5/11/2021

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Highlight four benefits that may be derived from an efficient road transport system in the country. (4mks)

Four benefits that may be derived from an efficient road transport system in the country.

Workers are able to get to work and back to their homes in good time.
Ease in the delivery of raw materials to industries and finished goods to the market.
Reduced cost of transportation, which may lead to a decrease in the price of goods.
Low maintenance costs of motor vehicles since the vehicles do not break down oftenly.
Easy access to Auxiliary services, like banks and insurance.
Buyers and sellers are able to move easily from one market to another.
Goods can easily be moved from an area with excess supply to an area with a shortage.
Helps in the stabilization of prices since goods are availed in the market at all times.
Help to ensure that there is a steady supply of goods in the market at all times.
Helps to widen the market since many parts of the country are accessible.

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Name four ways of sending letters through the post office

5/11/2021

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Name four ways of sending letters through the post office. (4mks)

Four ways of sending letters through the post office

Ordinary post
Registered mail.
Express mail for faster delivery.
Poste restante
Business reply service
Telex
E-mail/E-letter
Speed post
Fax

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Highlight four features of abounded warehouse.

18/9/2021

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Give any four features of abounded warehouse

Features of abounded warehouse include:

mostly located at points of entry into a country like the ports
guarantees payment of customs duty to customs authority
very spacious to accommodate even bulky goods like motor vehicles
must issue release warrants to owners of goods for customs clearance
works hand in hand with customs officials for inspection of goods
Goods can be re-exported while in the bonded warehouse
Storage charges are made on all goods stored in the warehouse
Goods can be sold while still under bond
Goods can be inspected or prepared for sale that is they can be repacked, branded and blended while in the warehouse.
Goods are released only on the production of a release warrant.

Highlight four features of abounded warehouse

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Explain four ways through which a public limited company may be dissolved.

21/12/2020

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Explain four ways through which a public limited company may be dissolved.

Ways through which a public limited company may be dissolved include:

A resolution by the shareholders to dissolve the company. When there is a unanimous decision by the shareholders to wind up the company during the annual general meeting.
Change in the country’s law that renders the activities of the company illegal/unlawful. When the laws of a country bars certain activities that the company may have been involved in.
Inability to repay financial debts on infringement of stakeholders’ rights.
Amalgamations/mergers - a company may be dissolved if it combines with another and a new one replaces the one combining/creates a new entity.
Take overs/acquisition/absorption - a company may be dissolved if it is taken over by another/or by the government through acquisition of majority shares hence redirection of its activities/loss of identity.
Realization of sustained / continuous losses. A company may be dissolved when it makes losses continuously to the extent of not being able to meet its recurrent expenditure/insolvency.
Court order for infringing on the law/granted to a complaint raised by stakeholders/acting ultravires.
Completion/fulfilment of task/activity/objective (for which the company was formed) hence making its continued existence unnecessary.
Failure to commence business within one year after incorporation thus contravening the company’s act.

Explain four ways through which a public limited company may be dissolved.

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Outline six circumstances under which a trader may use air transport.

21/12/2020

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Outline six circumstances under which a trader may use air transport.

Circumstances under which a trader may use air transport:

Perishable nature of goods since they go bad/get damaged.
Goods are of high per unit value since they are prone to theft.
Urgency - where goods require to arrive al the destination promptly.
Security - where security of goods is of valuable consideration.
Where other means of transport are unavailable.
Where distance to be covered is too large.
Where it ¡s the policy of the business which needs to be followed.
Where destination is remote making it inaccessible by other means.

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Explain five advantages of advertising to the consumer.

21/12/2020

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Explain five advantages of advertising to the consumer.

Advantages of advertising to the consumer include:

Consumers become aware of existence of a product and where it can be found.
Consumers enjoy high quality goods resulting from competitive advertising/Producers seek to maintain very high standards of quality.
Makes it easy for consumers to choose products from a variety offered in the market based on their advertised quality and contents.
Protects consumers from exploitation since they are aware of prices and quality of items and can therefore enforce their rights.
Communicates changes about the producer like new product lines, change of name and physical address. This enhances convenience for the customers.
Educates the consumers on the proper use of products where advertising messages involve demonstrations of product u sage.
Entertainment by use of drama/music/plays.
Aiding budget planning as they are made to know about price and existence of goods.
May enjoy lower prices due to competition.
Correct misconceptions hence assist in making decisions.

Explain five advantages of advertising to the consumer.

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State four reasons for privatizing public corporations.

21/12/2020

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State four reasons for privatizing public corporations.

Reasons for privatizing public corporations.

To improve efficiency in their operations.
To generate revenue to the government through sale of shares and taxes.
To enhance competition.
To increase public participation in economic activities of the country.
To reduce government expenditure.
To comply with conditions set by development partners and international donor agencies.
To enable the government to concentrate on other state responsibilities.
To minimize political interference.

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Highlight four factors that a trader may consider when choosing a means of transport.

21/12/2020

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Highlight four factors that a trader may consider when choosing a means of transport.

Factors that a trader may consider when choosing a means of transport include:

Nature of goods - whether they are bulky, perishable or fragile.
Speed/urgency - where goods are to be delivered quickly.
Cost of transport - should be economical.
Distance to be covered.
Availability of the means.
Packaging requirements for the goods.
The risks involved.
Availability of terminals.
Reliability of the means.
Flexibility.
Comfortability.
Need for special services.

Highlight four factors that a trader may consider when choosing a means of transport.

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Outline four circumstances in which the government may be involved in business.

21/12/2020

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Outline four circumstances in which the government may be involved in business.

Circumstances in which the government may be involved in business include:

When a business venture requires investment of large sums of money which individual entrepreneurs may not provide.
When the goods or services to be provided are essential to the welfare of the citizens.
When there is need to protect citizens from exploitation by private entrepreneurs.
When the government desires to create employment for the citizens.
When the government needs to generate income through revenue collection.
When there is need to safeguard national security.
When the venture is strategic but provides low profits hence unattractive to private investors.
Where there are monopolies in the economy, the government gets involved in business to increase competition.
Where there is need to balance regional development.
To reduce foreign dominance in the economy.
Where there is need to attract foreign investment.

Outline four circumstances in which the government may be involved in business.

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Outline four features of a parastatal.

21/12/2020

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Outline four features of a parastatal.

Features of a parastatal include:

Provide essential services.
Not profit motivated.
Is formed by an Act of Parliament.
Is mainly funded by the government.
Is managed by government appointees.
Any surplus earned is surrendered to the government.
Has limited liabilities.
Attachment to a government ministry.
Can be dissolved only through an act of parliament.

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Outline four qualities of a successful salesperson.

21/12/2020

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Outline four qualities of a successful salesperson.

Qualities of a successful sales person include:

Has adequate product knowledge.
Is a good communicator.
Is sensitive to customer needs.
Has a high sense of integrity1honesty
Is presentable (neat and well groomed).
Is persuasive.
Has a high level of commitment.
Good listener.
Have good command of language,
Polite and courteous.
Persistent and patient

Outline four qualities of a successful salesperson.

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State four benefits of a bonded warehouse to the government.

21/12/2020

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State four benefits of a bonded warehouse to the government.

Benefits of a bonded warehouse to the government include:

A source of data for planning purposes.
Enable the government to control entry of harmful goods.
Enable the government to inspect goods while still under bond.
Enables the government to regulate the quantity of imports.
The government uses it to check illegal goods entering the country.
A source of revenue from customs duty.
Enable verification of documents on transit.
Enable checking of the quality of goods.

State four benefits of a bonded warehouse to the government.

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Name four documents that may be required by the registrar of companies in order to register a public limited company.

21/12/2020

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Name four documents that may be required by the registrar of companies in order to register a public limited company.

Documents that may be required by the registrar of companies in order to register a public limited company include:

Articles of Association.
Memorandum of Association.
Prospectus.
List of directors.
Declaration.
Statement signed by directors.

Name four documents that may be required by the registrar of companies in order to register a public limited company.

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Explain five elements of effective communication.

20/12/2020

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Explain five elements of effective communication.

Elements of effective communication include:

Sender - This is the source of the message.
Message - This is the information to be communicated.
Channel - This is the medium to be used in conveying the information/message.
Encoding - This is the process of forming / generating the message.
Decoding - This is the process of interpreting the message so received.
Receiver - This is the party (person) to whom the message is sent.
Feedback - This is the receivers reaction or response to the message.

Explain five elements of effective communication.

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Explain five characteristics of property insurance. (10 marks)

20/12/2020

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Explain five characteristics of property insurance.

Characteristics of property insurance include:

The value of premium charged is dependent on the degree of risk. Higher premium will be paid for risks of high degree and vice versa.
It is a contract of indemnity - the owner of the insured property is compensated for the loss of the property upon occurrence of the risk.
It is a short term contract - the insurance contract ends after a specific period of time usually one year and must be renewed for the policy to continue being in force. .
The owner of the property insured is the only one to be compensated - it cannot be assigned to a next of kin or to another individual.
It has no surrender value - should the insured stop payment of premium before expiry of the contract, he/she is not entitled to any refund from the insurer.
There must be an insurable interest in the property to be insured. The insured must be in a position to suffer financial loss in the event of the risk covered happening in order to claim compensation.
There is a maximum limit to the amount of compensation - This can be upto the value of the insured property in case of over insurance and the sum insured in case of under insurance.
The risk insured is uncertain - it may or may not occur.

Explain five characteristics of property insurance. (10 marks)

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Outline four conditions under which a warehouse may be considered to be operating efficiently.

20/12/2020

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Outline four conditions under which a warehouse may be considered to be operating efficiently.

Conditions under which a warehouse may be considered to be operating efficiently include:

The warehouse should be conveniently located.
The warehouse should be managed by qualified personnel.
Operational procedures and guidelines should be in place.
Security systems should be in place.
Should have specialized buildings and equipment.
Should have good communication network.
Should ensure proper record keeping.

Outline four conditions under which a warehouse may be considered to be operating efficiently.

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Outline one circumstance under which each of the following telecommunication services may be used: Paging, Facsimile (fax) and Radio call

19/12/2020

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Outline one circumstance under which each of the following telecommunication services may be used:Paging,Facsimile (fax) and Radio call

Circumstances under which the following communication services may be used are:
(i) Paging - when there is need to call a person to attend to an emergency in a specific location.
(ii) Facsimile (fax) - where there is need to send a copy of a printed document urgently.
(iii) Radio call . - when there is need to give co-ordinated information through a central point.

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Highlight four ways in which consumers may protect themselves against exploitation by traders.

19/12/2020

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Highlight four ways in which consumers may protect themselves against exploitation by traders.

Ways in which consumers may protect themselves against exploitation include:

Inspecting goods before buying.
Enlightening themselves about their rights as consumers.
Familiarizing themselves with the obligations of traders.
Forming consumer associations.
Reporting cases of exploitation by traders to relevant authorities.
Avoiding traders identified as exploiters.
Demonstrate peacefully against the exploiter.
Complain through the media.

Highlight four ways in which consumers may protect themselves against exploitation by traders.

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Highlight three benefits of globalization to a business enterprise. (3 marks)

19/12/2020

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Highlight three benefits of globalization to a business enterprise.

Benefits of globalization to a business enterprise include:

Facilitates application of better technology for improved products.
Encourages collaboration among businesses from different countries.
Makes it possible to share new production techniques among the countries of the world.
The business accesses a wider market.
Facilitates the sharing of research findings by business globally.
Enables business enterprises to take advantage of resources found in other parts of the world without relocating there.

Highlight three benefits of globalization to a business enterprise. (3 marks)

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State four benefits that a farmer may derive from being a member of a Producer Co-operative Society. (4 marks)

19/12/2020

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State four benefits that a farmer may derive from being a member of a Producer Co-operative Society.

Benefits that a farmer may derive from being a member of a producer co-operative society include:

May receive inputs e.g. fertilizer at fair prices.
The society may get better prices for the member’s produce.
May get transport facilities for produce to the market.
May get better storage facilities for the produce.
The society may grade, package and process the produce for the member.
May receive input on credit from the society.
Can acquire skills on better methods of production.
May get dividends earned on shares held.

State four benefits that a farmer may derive from being a member of a Producer Co-operative Society. (4 marks)

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​Explain five importance of an efficient transport system in a country (10mks)

Briefly explain the meaning of the following forms of advertising (8mks)

​(i) Celebrity advertising

​(ii) Product advertising

(iii) Informative advertising

​(iv) Institutional advertising

​Discuss five advantages of a bonded warehouse (10mks)

Name four types of marine insurance policies. (4mks)

State four limitations of billboards as a tool of product promotion. (4mks)

Highlight four benefits that may be derived from an efficient road transport system in the country. (4mks)

​Name four ways of sending letters through the post office. (4mks)

Give any four features of abounded warehouse

Explain four ways through which a public limited company may be dissolved.

Outline six circumstances under which a trader may use air transport.

Explain five advantages of advertising to the consumer.

State four reasons for privatizing public corporations.

Highlight four factors that a trader may consider when choosing a means of transport.

Outline four circumstances in which the government may be involved in business.

Outline four features of a parastatal.

Outline four qualities of a successful salesperson.

State four benefits of a bonded warehouse to the government.

Name four documents that may be required by the registrar of companies in order to register a public limited company.

Explain five elements of effective communication.

Explain five characteristics of property insurance.

Outline four conditions under which a warehouse may be considered to be operating efficiently.

Outline one circumstance under which each of the following telecommunication services may be used:Paging,Facsimile (fax) and Radio call

Highlight four ways in which consumers may protect themselves against exploitation by traders.

Highlight three benefits of globalization to a business enterprise.

State four benefits that a farmer may derive from being a member of a Producer Co-operative Society.

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Explain five importance of an efficient transport system in a country (10mks)

(i) Celebrity advertising

(ii) Product advertising

(iv) Institutional advertising

Discuss five advantages of a bonded warehouse (10mks)

Name four ways of sending letters through the post office. (4mks)