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CARIBBEA AMINATIONS OUNCIL

ADVANCED PROFICIENCY EXAMINATION
MANAGEMENTOFBUSINESS L.

Unit2-Paper0l
90 minutes

26 MAY 2009 (a.m.)

READ THE FOLLOWING INSTRUCTIONS CAREFULLY.

1. This testconsists of45 items. Youwillhave 90 rninutes to answerthem.

2. In addition to this test booklet, you should have an answer sheet.

3. Do notbeconcernedthatthe answersheetprovides spacesformore answersthanthere are items

in this test.

4. Each item in this test has four suggested answers lettered (A), (B), (C), (D). Read each item you
are aboutto answer and decide which choice is best.

5. Onyouranswersheet, findthenumberwhichcorrespondstoyouritemandshadethespacehaving
the same letter as the answer you have chosen. Look at the sample item below. +
Sampleltem
X
v)
Which ofthe following actions CANNOT be taken by a trade union?
l.
SampleAnswer
(A) Strike
(B)
(C)
Picket
GoSlow
@@o e {D

(D) Lockout

The best answer to this item is "Lock out", so answer space (D) has been shaded.

6. Ifyouwantto changeyouranswer,be sureto erase itcompletelybeforeyou fill inyournewchoice.

1 When you are told to begin, turn the page and work as quickly and as carefully as you can. Ifyou
cannot answer an item, omit it and go on to the next one. Your score will be the total number of
colrect answers.
8. You may do any rough work in this booklet.
9. You may use silent non-prograrnmable calculatols to answer questions.
I

E
ry
DO NOT .TURN THIS PAGE UNTIL YOU AR.E TOLD TO DO SO.
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t. The type of forecast that projects a company's 6. Which of the following is NOT a dimension
sales over a period of time is referred to as of quality?

(A) demand forecast

(A) Reliability

(B) technical forecast

(B) Durability

(C) (C) Affordability

economic forecast (D) Conformance
(D) production forecast

7. Which of the following are advantages of a

7 Which of the following is considered a Just-in-Time Production Svstem?
quantitative method of forecasting?
I. Better work flow
(A) Market survey II. Reduced inventory and set-up time
(B) Panel consensus III. Small freight and efficient deliveries
(C) The delphi method IV, Quick responses to changes in
(D) Time series analysis demand

(A) I and II only

3. Which of the following techniques would (B) I,II and III only
irnprove quality without directly involving the (C) I,II and IV only
business' employees? (D) II, III and IV only
(A) Kai s en
(B) Outsourcing 8. Business MUST operate under certain
(C) Quality circles regulations in order to
(D) Research and Development
I. be fair to employees
II. protect the environment
A
T. The strategy of selecting the best practice III. be good corporate citizens
against which the organization's performance IV. take advantage of prospective
is compared is known as customers

(A) outsourcing
(A) I and III only
(B) benchmarlcing
(B) I,II and III only
(C) continuous improvement
(C) I,II and IV only
(D) totalqualitymanagement
(D) II, IIi and IV only

3. Which of the following is NOT a control

strategy in production?
9. Which of the following will MOST likely
improve productivity?
(A) Design conhol
(B) Quality control (A) The organization chart
(C) Materials control (B) Increased working hours
(D) Employee contol (c) Good working environment
(D) Authoritarian leadership style

GO ON TO THE NEXT PAGE

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10. Which ofthe following production designs has 11. The perceived quality of a product is
an employee mastered when he can measured by
efficiently remove and replace ink cartridges
from the canon printer? (A) theproducer'sstandards
(B) the features of tlie product
(A) Designing (C) conformity to customers,
(B) Integration expectations
(C) Miniaturization (D) conformity to general production
(D) Modularization standards

Items 12 - 13 refer to the nefwork diagram below.

t2. The broken line on the network diagram 13. The duration of the Critical path is
represents a
(A) l0 days
(A) tail (B) 12 days
(B) head (c) 14 days
(C) node (D) I 6 days
(D) dummy
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14. The Riverside Resort and Spa is considering 18. Consumer buying behaviour refers to the
the purchase of a bus. The miles driven over
the past 6 years are as follows (A) target market buying
(B) marhet segment buying
Year I Mileage (C) business buying behaviour
(D) buying behaviour of final customers
I 2 000
2 3 000
t
J 3 800 19. ABC Co. Ltd decides to use advertising,
4 3 200 personal selling and sales promotion to inform
5 2 s00 customers of the company's product. These
6 I 800 techniques can be BEST described as

The forecasted mileage for year 7 using a (A) marketingmix

2-year moving average is (B) promotionalmix
(c) marketing channels
(A) l 800 (D) direct advertising mix
(B) 2 000
(c) 2 rs}
(D) 4 300 20. The primary components of the promotiona^
mix are
15. Which of tlie following types of layout is
(A) personal selling, potential customers,
MOST suitable for large, bulky projects such
advertising
as ships and buildings?
(B) personal selling, advertising,
information
(A) Office
(c) personal selling, advertising, word of
(B) Product
mouth
(C) Process
(D) personal selling, advertising, sales
(D) Fixedposition
promotion

16. Which of the following is NOT a

characteristic of a service? 21. At what stage of the "business buyer
process" does value analysis occur?
(A) Uniformity
(B) Intangibility (A) Needs description
(C) Perishability (B) Problem recognition
(D) inseparability (C) Product specification
(D) Performance review

17. Which of the following BEST describes the

stages in the life cycle of a product?

(A) Introduction, growth, saturation,

mailrity, decline
(B) Introduction, growth, maturity,
saturation, decline
(c) Introduction, maturity, growth,
sahration, decline
(D) Introduction, saturation, growth,
manrity, decline

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o))a'\nl0/r- A plr ?onc)
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22. Packaging is an important aspect of the 25. Which of the following are functions
marketing process for any product. The type performed by the act of labelling?
ofpackaging depends on the
I. Identifring the product or brand
I. size of the product II. Describing the product and its
il, nature ofthe product features
iil. contents ofthe product m. Identifuing the specific cost of the
IV, method of transport chosen item
IV. Promoting the product through
(A) I only attractive graphics
(B) I and IV only
(c) I,II and III only (A) I, and IV only
(D) II,III and IV only (B) I,II and III only
(C) I,II and IV only
(D) II,III and IV only
23. All businesses are affected by a number of
forces in the environment. Which of the
following are forces in the micro- 26. The salespersons of 'Perfume Palace'
environment? conduct door-to-door promotional
presentations to prospective buyers. The
I. Customers sales persons are engaged in
TT
lr. Government
uL Competitors (A) publicity
IV. Company's suppliers (B) advertising
(C) personal selling
(A) I and III only (D) sales promotion
(B) I, II and III only
(c) I,III and IV only
(D) II, III and IV only 27. Megastar Ltd. displays samples of muffins
near the deli counter for shoppers to taste.
This is an example of
24. A segment of the population selected to
represent the population as a whole is called (A) creative selling
(B) personal selling
(A) a census (C) sales promotion
(B) a sample (D) event promotion
(c) a survey
(D) an experiment

28. A small 'start-up' hair-dressing operation

wants to reach its target market in a small
town in the shortestpossible time. Which of
the following methods of advertising is MOST
appropriate?

(A) Fliers
(B) Newspapers
(C) Beauty magazines
(D) Business catalogues
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29. For a sniall busine^ss
with a small advertising
budger, which of the f"l;;;; 34. Niche Markeling may
media of be BEST defined
, adverrising would cost
ttre ipai"rr the process of as

(A) Local newspaper (A) tugetingthe entire

marker
poputar internlt (B) exproiting . ,;;;;;;f
I!) site
popularradiostation
a rarger
igj
(D) Localtelevi.ion.i.*"t (C)
market
tailoring products to individual
consumers
(D) selling different producs
30. to each
In addition to selling furniture, consumer
Delmar,s
Furniture Ltd. offers
Oji"C i"ri"ilurion uno
repair servic
35.
";lj, iiT,l"* ;liffi ff
and waiting Which ofthe following
characteristics would
described as BEST describe an entrepreneur
who remains
in business in spite
of n.r..
(A) a core product
I.
""rffi#,
Ambidon
(!) a hybridproduct II
(C) an actuaiproduct
III.
Self_confidence
perseverance
(D) an augmented product
ry. Resourcefulness
(A) I and II onlv
31. Entepreneurship can be
BEST defined (B) II and III onlv
as

(A) accessing capital

I9]
(D)
r, rr and llr onry
I, III and IV onlv
(B) makingprofits atall cost
(c) identifyingrh"fil;;;;production
(D) using scarce resources
to establish 36. One prirnary risl< associated
business entities with bonds is
(A) investment
(B) interest rate
32. Which of the following can be BEST (C) loanpayment
identified as a benefir
or"_""orr,_Jrl."io"rh" (D) insurancepremium
enEepreneur?

37.
e)
q] market
Access to a larger
Higherlevetrofp-ntuUiriry
A 'patent'can
to a business because
be considered a shategic
asset
rt
19]
(D)
Reduction inproducrion
Improvemenrrnproductd;;
costs
(A) protects innovative
new products
(B) advertises innovative
new products
(c) reduce_s the cost
33. Which of the following of innovative new
characteristic
is NOT a
(D)
products
of a successfuf ent rt1::-r o.ther businesses
"pr"n*u.t copy to
mnovative newproducts ' J
11] High energy lever
lil Fear ofthe unlcnown
I9]
(D)
Toteranceforambiguity
Intemal locus ofcontrol

02233010/c,\PE2o0g
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38. Fix-It Ltd is adding some new stores within
its cunent market areas to make it easier for
more customers to visit. which of the
following marketing sftategies is this company
adopting?
42. Paula has just started a pastry shop in her
community and wants to know the skills she
needs to possess in order to be successful.
The skills required in Small Business
Management include

(A) Diversification
I. Market research
(B) Marketpenehation
II. Record keeping
(C) Marketdevelopment
ilL lnteqpersonal
(D) Productdevelopment
IV. Entertaining

(A) I,II and III only

(B) I,II and [V only
39. At which stage of the product life cycle does (C) II,III and IV only
aproduct experience rapid market acceptance (D) I,III and IV only
and increasing profits?

(A) Growth 43. By conducting sales forecasting an

(B) Maturity entrepreneur is seeking to determine
(c) Introduction
(D) Product development (A) howmuchwillbesold
(B) if there is sufficient demand for a
product
40. Which of the following are likely reasons why (c) ifthe productwill be popular among
some small businesses fail? the users
(D) how successful the business will be
I. Limitedliability
u. Lack ofexperience
III. Insufficient capital
IV. Poor credit arrangements

(A) I and II only

(B) III and IV only
(c) I, III and IV only
(D) II, III and IV only

41. John is the supervisor of a bank in a

Caribbean territory. He decides to leave the
bank and start a sole trader business in a
neighbouring city. Which of the following
documents would he need to present to the
bank in order to receive a loan?

(A) Prospecfus
(B) Business Plan
(c) Organizational Chart
(D) Certifi cate of Incorporation
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Items 44 - 45 refer to the following chart'

(I) Lack of Lack of

sufficient technical and
finance managerial slcills

(II) Lack of
marketing
0V) E-commerce
knowledge

45. Which of the above challenges are MOST

44. Which of the above problems is MOST likely
to prevent a small business from expanding?
likely to be overcome by training and
development programs offered by a smal-
business association?
(A) I
(B) II (A) I and IV onlY
(c) III (B) I,II and III onlY
(D) IV (C) I,III and IV onlY
(D) II,III and IV onlY

IF YOU FINISH BEF'ORE TIME IS CALLED'

CIIECKYOITRWORK ON TIIIS TEST'