Business Management 1999PC WASSCE-Past Questions and Answers-WAEC

WASSCE Past Questions and Answers for Business Management 1999PC (Private Candidates i.e. PC) is a learning aid.


Business Management 1999PC WASSCE


This learning aid has been carefully designed to assist students to understand how they are suppose to answer WASSCE questions in Business Management.

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General Overview

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The WASSCE business management exams is an easier one to pass.

Firstly, we have a lot of links to assist you to get enough details on our website.  Truly, this will help you to gain enough knowledge and understanding to pass your examination.

Secondly, we have materials on various topics, sub-topics relating to this subject area. Therefore, our site is very helpful to Senior High School Student across the West African sub-region.

Notably, these countries are Nigeria, Ghana, Sierra Leone, The Gambia and Liberia. 

Moreover, these students rely on our guide and pass the WASSCE Business Management Examination. In detail, check the questions and the answers just below.


The Nature of the Examination

There are two Papers in the examination, (and these are Paper 1 and Paper 2). In detail, there are two sections in the Paper 1 (i.e. Section A and Section B).

Section A is an Objective Test and Section B is Theory Test. There are 50 questions in the Objective test, and there are 7 question in the theory Section.

Consequently, there are 10 questions in the Paper 2. To explain more, the question 1 is a Case Study.

To explain, there are some question under the case to test the student’s understanding.

Finally, the other 9 theory questions are also theory questions.  They are asked to tests the student’s general understanding of the subject are.


The Summary of the Paper

The WASSCE Business management Paper for 1999-Private Candidatescan summarized below:

  • 1999 WASSCE Business Management Paper One – Section A;
  • 1999 WASSCE Business Management Paper One – Section B;
  • 1999 WASSCE Business Management Paper Two


Business Management 1999PC-Private Candidates- WASSCE-Past Questions and Answers Paper 1


Business Management 1999 WASSCE Past Questions and Answers- Paper 1 – Section A


  1. What is the term used for all assets of a firm, which change their forms when they go through the process of production?   
      B   is the answer -Business Management 1999PC WASSCE    
    1. Raw materials
    2. Circulating capital
    3. Fixed capital
    4. Consumables


  1. All forms of business activity that makes goods and services produced available to consumers is broadly classified as   
      D   is the answer -Business Management 1999PC WASSCE    
    1. secondary production
    2. mass production
    3. transportation
    4. commerce


  1. When can one say there is division of labour?   
      A   is the answer -Business Management 1999PC WASSCE   
    1. When production processes are broken down into smaller units
    2. When the company enjoys economics of scale
    3. When the employees are experts on their jobs
    4. When the manufacturing process is automated.


  1. A business venture is described as a sole enterprise when   
      C   is the answer -Business Management 1999PC WASSCE   
    1. engaged in retail trading
    2. not manned by sales girls
    3. ownership cannot be separated from the firm
    4. shares are limited to existing shareholders


  1. In addition to their contributions partners can contribute additional funds to the business in the form of   
      A   is the answer -Business Management 1999PC WASSCE   
    1. loans
    2. bank overdraft
    3. trade credit
    4. bonus share


  1. Lack of horizontal communication in an organization could lead to   
      D   is the answer -Business Management 1999PC WASSCE   
    1. Power struggle among managers
    2. Poor relations between managers and subordinates
    3. Lack of rivalry among departments
    4. Lack of co-ordination of efforts


  1. Which of the following decisions will not be made by employee of a lower rank in an organization?   
      A   is the answer -Business Management 1999PC WASSCE   
    1. Strategic
    2. Personal
    3. Programmed
    4. Routine


  1. Public enterprises are set up to provide goods and services to members of the public   
      B   is the answer -Business Management 1999PC WASSCE   
    1. freely
    2. at reasonable prices
    3. at high prices
    4. in abundance


  1. When an officer selects an alternative course of action, he has made   
      C   is the answer -Business Management 1999PC WASSCE   
    1. an affirmation
    2. a contribution
    3. a decision
    4. a resolution


  1. Which of the following is not a form of oral communication?   
      D   is the answer -Business Management 1999PC WASSCE   
    1. Interview
    2. Meeting
    3. Seminar
    4. Memorandum


  1. The survival of co-operative societies is hampered by the   
      A   is the answer -Business Management 1999 PCWASSCE 
    1. lack of skilled personnel to man them
    2. proliferation of retail outlets
    3. failure to grant loans to members
    4. limited scope of their activities


  1. The policy of privatization enables   
      C   is the answer -Business Management 1999PC WASSCE   
    1. private companies to dominate the market
    2. sole proprietors to operate business
    3. transfer of publicly owned enterprises to private sector
    4. the purchase of more private firms by the government


  1. Which of the following types of cheque is least secure?   
      A   is the answer -Business Management 1999PC WASSCE   
    1. A bearer cheque
    2. An order cheque
    3. A certified cheque
    4. A post-dated cheque


  1. An offer is terminated   
      A   is the answer -Business Management 1999PC WASSCE   
    1. if the offeror revokes the offer before acceptance
    2. by lapse of time
    3. when offeree and offeror die before acceptance
    4. if offeror falls sick


  1. A partnership may be dissolved when   
      A   is the answer -Business Management 1999PC WASSCE  
    1. partners agree to end the business
    2. the partnership fails to make profit at the end of the year
    3. a partner decides not to take part in the management of the business
    4. one partner takes a bigger share of profit


  1. Communication can best be defined as   
      C   is the answer -Business Management 1999PC WASSCE   
    1. sending information from superior to subordinate
    2. transfer of information form a subordinate to a superior
    3. transfer of understandable information from a sender to receiver
    4. gossiping between two people


  1. A type of business enterprise in which the members undertake to contribute a specified amount of money on liquidation is   
      A   is the answer -Business Management 1999PC WASSCE   
    1. a guarantee company
    2. an unlimited company
    3. a company limited by shares
    4. an unlimited partnership


  1. Under the Law of Agency, the authority which is incidental to the express authority of the agency is   
      D   is the answer -Business Management 1999PC WASSCE   
    1. implied authority
    2. considerate authority
    3. specific authority
    4. apparent authority


  1. Rokoto Company donates second-hand clothing to the Osu Children’s Home every year. Rokoto by this gesture is demonstrating its   
      B   is the answer -Business Management 1999PC WASSCE    
    1. generosity
    2. social responsibility
    3. good citizenship
    4. wealth to the public


  1. The three major types of tax bases are   
      C   is the answer -Business Management 1999PC WASSCE   
    1. income, ability to pay, consumption
    2. income, lifestyle, wealth
    3. income, consumption, wealth
    4. income, prestige, lifestyle


  1. Under the law on sale of goods, the right to retain possession of goods until payment of the price is effected is known as   
      A   is the answer -Business Management 1999PC WASSCE   
    1. lion
    2. right
    3. caveat emptor
    4. dispossession


  1. Unit of exchange is a problem related to   
      C   is the answer -Business Management 1999PC WASSCE   
    1. home trade
    2. foreign trade
    3. barter trade
    4. bilateral trade


  1. Non-tax sources of revenue for the Ghana Government include   
      C   is the answer -Business Management 1999 WASSC PCE   
    1. VAT
    2. Excise duties
    3. fees for various licenses
    4. tariffs


  1. Which of the following are functions of money?   
      C   is the answer -Business Management 1999 WASSCE PC   
          1. Medium of exchange
          2. Creation of wealth
          3. Store of value
          4. Means of deferred payment
    1. I, II and III only
    2. II, III and IV only
    3. I, III and IV only
    4. I, II and IV only


  1. The effort to establish and maintain goodwill and mutual understanding between an organization and its social environment is referred to as   
      C   is the answer -Business Management 1999 WASSCE PC   
    1. management
    2. human behaviour
    3. public relations practice
    4. marketing approach


  1. A financial institution which has as its business the custody, control and issue of currency is known as   
      A   is the answer -Business Management 1999 WASSCE PC   
    1. central bank
    2. merchant bank
    3. development bank
    4. commercial bank


  1. Bamidele collects a loan and promises to pay back in fifteen years. What type of loan is this?   
      C   is the answer -Business Management 1999 WASSCE PC   
    1. Medium-term
    2. Short-term
    3. Long-term
    4. Mortgage


  1. IMF stands for   
      C   is the answer -Business Management 1999 WASSCE PC   
    1. International Movement Fund
    2. International Monetary Foundation
    3. International Monetary Fund
    4. Interest Mobilization Foundation


  1. The rate of exchange of goods between two countries is referred to as   
      D   is the answer -Business Management 1999 WASSCE PC   
    1. balance of trade
    2. balance of current account
    3. balance of payments
    4. terms of trade


  1. Which of the following is not an insurable risk?   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. Aviation accident
    2. Loss of profit
    3. Marine accident
    4. Personal accident


  1. The process which seeks to create a suitable environment for the organization of effort to accomplish identified goals is   
      D   is the answer -Business Management 1999 WASSCE PC   
    1. directing
    2. organizing
    3. controlling
    4. management


  1. What is the first step in planning?   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. Information gathering
    2. Goal setting
    3. Data analysis
    4. Problem analysis


  1. Which of the following is a barrier to effective delegation?   
      D   is the answer -Business Management 1999 WASSCE PC   
    1. Lack of accountability
    2. Unity of command
    3. Lack of command
    4. The fear of criticism for mistakes


  1. A leader who persuades and considers the feelings of his subordinates adopts   
      A   is the answer -Business Management 1999 WASSCE PC   
    1. a democratic style
    2. a free reign style
    3. an autocratic style
    4. an authoritarian style


  1. Which of the following is not a tool for measuring performance?   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. A budget
    2. A Gantt chart
    3. A performance report
    4. A balance sheet


  1. When a car manufacturer designs vehicles to suit differences in climate, he is segmenting the market according to   
      A   is the answer -Business Management 1999 WASSCE PC   
    1. geography
    2. demography
    3. psychography
    4. ethnography


  1. Which of the following is not likely to determine whether an employee will become a stable member of the workforce of an organization?   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. Management style
    2. The size of the firm
    3. Conditions of employment
    4. Promotion and development prospects


  1. Firms undertake equity financing by   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. borrowing from foreign investors
    2. selling more of their shares
    3. borrowing from government
    4. selling debentures to the public


  1. A basic reason for packaging a product is   
      A   is the answer -Business Management 1999 WASSCE PC   
    1. protection
    2. branding
    3. transportation
    4. pricing


  1. One major decision to be made in setting up a selection procedure is   
      C   is the answer -Business Management 1999 WASSCE PC   
    1. where to place an advertisement
    2. the appropriate media to use
    3. how to compose a personnel specification
    4. which selection tools to use


  1. Which of the following are four main variables of the marketing mix?   
      A   is the answer -Business Management 1999 WASSCE PC   
    1. Price, place, product and promotion
    2. Price, place, packaging and branding
    3. -Price, place packaging and designing
    4. Price, place, product and transport


  1. Debentures are   
      C   is the answer -Business Management 1999 WASSCE PC   
    1. equities
    2. share capital
    3. loan capital
    4. bonus issue


  1. Which of the following is a sales promotion tool?   
      D  is the answer -Business Management 1999 WASSCE PC   
    1. Advertisement
    2. Personal selling
    3. Publicity
    4. Free gifts


  1. A budget deficit implies that   
      D   is the answer -Business Management 1999 WASSCE PC   
    1. imports are greater than exports
    2. net capital flows are positive
    3. the government has borrowed extensively
    4. government expenditure exceeds government revenue


  1. The choice of a method of recruitment by an organization may be determined by all the following except   
      D   is the answer -Business Management 1999 WASSCE PC   
    1. cost consideration
    2. company policy
    3. legal constraints
    4. stability of workforce


  1. A voyage policy covers   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. a period of one year
    2. the distance between ports of departure and arrival
    3. long distance voyages
    4. short distance voyages


  1. Which of the following taxes will not be used to discourage export of a particular good?   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. Excise tax
    2. Export tax
    3. Purchase tax
    4. Tariffs


  1. A document in international trade which aims at granting tax exemption or minimal tax to an exporting country is referred to as   
      D   is the answer -Business Management 1999 WASSCE PC   
    1. indent
    2. manifest
    3. consular invoice
    4. certificate of origin


  1. Which of the following management functions mainly deals with the identification and arrangement of positions and responsibilities?   
      C   is the answer -Business Management 1999 WASSCE PC   
    1. Controlling
    2. Planning
    3. Organization
    4. Directing


  1. The withdrawal of government form participating in the running of state enterprises is known as   
      B   is the answer -Business Management 1999 WASSCE PC   
    1. nationalization
    2. privatisation
    3. indigenization
    4. localization


Let me show you how to find the answers to the Business Management Questions – Paper 1, Section A.

To clarify that, when you read a question, just click on this symbol (˅) that follows the question. After doing so, the answer will drop down for you. In fact, it is a very simple task.

However, for the purposes of evaluating yourself, you may want to answer the before reviewing the suggested answer (or solution)

I’m sure you are going to evaluate your performance with regards to the objective questions above.

Let me emphasize again that the answers to the objective questions can be found by clicking on the symbol (˅) just after the question.

Now let’s proceed to the Paper 1 – Section B just below:


Business Management 1999 WASSCE-Past Questions and Answers- Paper 1 – Section B


This section of the examination is made up of essay-type questions. That normally require you to mostly state and explain your various points.

As I have always said, it is better to first answer the questions on your own before referring to the answer from the drop-down symbol.

Let me show you how to find the answers to the Business Management Questions – Paper 1, Section B. When you read a question, just click on this symbol (˅) beside it, and the answer will drop down for you. It is a very simple task.



1.   (a) Identify and explain five, reasons of unemployment in your country.

Suggested Answer:   

  • Rapid population growth. This happens when the rate of population growth of a country is higher than the available resources. This situation will lead to unemployment because few jobs are created.
  • RuralUrban migration: This situation occurs when there is mass movement of people from the rural areas of a country to the urban centres. These people move because they are looking better jobs and higher standard of living. When these people mass up like this in the urban centres, it creates high demand for jobs, which are not existing.
  • Increase in minimum wage: When the government increases wages and salaries, private sector employers who cannot pay these high wages and salaries may lay-off their workers in order to reduce cost of production.
  • Low productivity of labour: Low productivity occurs when a worker produces less the cost of keeping him/her in an employment. Eventually, the employer will lay the worker off to avoid waste of the organisation’s resources.
  • Uncontrolled trade liberalization policy of government. Some governments allow a lot of importation of products into their country.  That practice may kill local industries that may be unable to compete profitably, in terms of price.   


1.   (b) Give five reasons for government participation in business.

Suggested Answer:   

  • To raise revenue for the government.
  • To target some special sectors that only the government has the needed resources to operate.
  • To raise the living standards of the people by providing employment for many of them with essential products.
  • Government participate in business as a means of controlling key industries in the economy.
  • As a means of controlling monopoly.   

2.   (a) List eight media of communication in an organization.

Suggested Answer:   

Circular letters

Memorandum and reports

  • Telephone and Telex
  • Email and Facsimile
  • Notice boards
  • Public Address System
  • Symbols and signs
  • Face-to-face conversation and meetings.   

2.   (b) What is the meaning of the term ‘grapevine’?

Suggested Answer:   


It is an informal means of communication in an organisation. It is a network used to transmit rumour or information unofficially. It circulates in the form of rumour, which could be true or false. It moves fast and takes the form of gossip. It is therefore an informal device that spreads truths, half-truths and untruths quickly throughout the organization and even beyond its boundaries. It arises when management refuses to communicate vital information to staff or employees.   

2.   (c) Explain two advantages and two disadvantages of the grapevine.

Suggested Answer:   

  • Grapevine informs management of the perception of the employees within the organisation. This will help to shape future policies.
  • It serves as a safety valve for employee emotions. It helps employees to ease pent up feelings which may escalate if there is no avenue to release them.
  • It helps spread useful information and therefore makes up for the shortcomings of the formal channel of communication.
  • Grapevine also plummets formal communication.
  • It leads to conflicts and confusion because it is difficult to identify the source.
  • The control of grapevine information is very difficult since it takes the form of gossip or rumour.
  • It makes workers or colleagues in the organization mistrust each other or act
  • It is also characterized by distortion, omission and filtration.   


3.   (a) Describe four circumstances under which a contract may be discharged

Suggested Answer:   

  • Performance: If both parties to a contract have performed what they agreed to do under the contract, the contract is said to be discharged. Performance must be strictly in accordance with the terms of the contract to be a discharge. This means that, each party is happy with and has accepted the other’s performance. However, if one of the parties does something less than or different from that which he agreed to do, he is not discharged from the contract and moreover, cannot sue on the contract. For instance, time is of essence to the contract when the parties have expressly said so in the contract. The general rule is that the contract must be performed within that time, otherwise it is broken.

  • Agreement: A contract may be discharged by mutual agreement between the contracting parties. The parties to the contract may agree to release each other from the contractual obligations. This means that, all rights and obligations under the contract is deemed to have come to an end due to the agreement. The party to whom obligation is owed may accept something different in place of the former obligation. The agreement may also be based on a waiver under which each party agrees to waive his rights, under the old contract or surrender of some rights, privileges or opportunities to take advantage of certain thin.

  • Termination By Notice: – It may contain a term giving either party power to terminate it by notice. The period of notice should be acceptable to both parties so that undue loss is not suffered. Example is a lease that can be terminated by notice to quit.

  • Frustration: A contract is said to be discharged through frustration when certain unforeseen events such as strike and outbreak of hostilities, fire outbreak, statutory interference and the destruction of a specific object necessary for the performance of the contract or a change in circumstances so fundamental to the contract makes performance illegal or impossible. The court will not enforce discharge, if the performance of a certain duty under the contract is impossible or illegal.

  • Acceptance Of Breach: Breach of contract occurs where a party fails to perform his contractual obligations or where he fails to perform his part of the obligation, expressly or impliedly without justification. A party not in breach can sue for damages against the party in breach. When the damages (compensation) are paid, the contract is said to be discharged by breach.   

3.   (b) State and explain three duties of an agent towards his principal.

Suggested Answer:   

The duties of an agent to the principal are:

  • Due Diligence: – To exercise due diligence (should be careful) in the performance of his duties and to apply any special skill which he professes to have. He should not be negligent in the performance of his duties. For example, a Salesman must sell his principal’s property at the best possible price.

  • Duty to Account: – It is the duty of the agent to render accounts to the principal as required. The agent must pay to the principal all monies received. The agent is obliged to keep the principal’s property separate from his own and from other people’s property, to keep proper accounts and be ready to produce them on demand.

  • Conflict of Interest: – An agent has a duty not to let his own interest conflict with his obligations to the principal. That is, he should not enter into any contract or transaction on behalf of the principal for which he has a personal interest without making full disclosure and obtaining approval from his principal.   


4.   (a) Discuss the central role of decision-making to planning and controlling as management functions.

Suggested Answer:   

Decision-making is the act of selecting one course of action from two or more alternative courses of action. Decision-making is central to planning because planning involves the collection, evaluation and selection of data from among alternatives in order to achieve given objective. Decision-making is important in planning because management has to select among the competing alternatives available to him.

Decision-making is also central to controlling as a management function. Controlling involves setting standards, measuring performance against standards set and taking corrective action where there are deviations. This process involves the continuous collection, evaluation and selection of data from among alternatives. At each stage of the control process, management decides on the best alternative action to take in order to achieve company’s objectives. Thus, decision-making is inevitable in both planning and controlling as management function.   

4.   (b) Explain the following: –

  • Routine decisions
  • Strategic decisions
  • Tactical decisions

Suggested Answer:   

  • Routine decisions: – These decisions are repetitive in nature and need little thought. They are decisions made by lower level management personnel and relate to the day-to-day running of the company. They are also referred to as programmed or laid-down patterns of discharging responsibility in an organization.

  • Strategic decisions: – These are decisions made by top management of the organization and require a high degree of initiative. These decisions are made by analysing a situation and modifying it with regards to the use of existing scarce resources.

  • Tactical decisions: – These are made by middle level management personnel and are routine in nature. They contain few alternatives and relate to the use of scarce economic resources.   


5.   (a) Explain five functions performed by a commercial bank.

Suggested Answer:   

  1. Refer to 1993 Paper Two Question 9 for the suggested answer.   

5.   (b) List five advantages of the cheque system.

Suggested Answer:   

  • A cheque can be written at any time. It is thus easy and convenient to use a
  • It saves a businessman from carrying huge sums of money around to make
  • Cheques may be made payable to one person only at one bank. They are
    therefore safe methods of transmitting cash.
  • Cheques for a record of payments and receipts and particular counterfoil may
    help in tracing a lost cheque.
  • If a cheque is crossed, it can only be paid into a bank account thus ensuring
    its safety.   


6.   (a) What is a budget?

Suggested Answer:   

A budget is a detailed financial program of an enterprise for a specific period of time. It shows the expected revenue and expenditure of the coming year and also reports on the economic activities or the income and expenditure of the previous year.   

6.   (b) Identify and explain five means by which government spending is financed.

Suggested Answer:   

NB: Refer to 1998 Paper One Question 4 for the suggested answer.   


7.   Why are the following factors often considered as problems in international trade?


  • Language
  • Currency
  • Distance
  • Culture

Suggested Answer:   

  • Language: – Different languages are spoken by different countries all over the world. It is very difficult for businessmen who speak different languages to communicate effectively and thus cannot do business with each other. It is also difficult for them to get an agent who can trade in both languages.
  • Currency: – Differences in currencies is another obstacle to international trade. It is not every currency which is accepted in international trade. Thus, if for instance Ghana wants to do business with U. K. (Britain) or America, she must first convert the cedis into pound sterling or dollars.
  • Distance: – International trade which involves the movement of goods across international boundaries may involve perishable goods. Special packing which also leads to increased cost is required. It therefore makes trade in perishable products very difficult.
  • Culture: – The existence of different cultural practices creates a problem in international trade. Culture which is the way of life of people in a particular locality can affect the demand for a product. Their beliefs, likes and tastes determine the demand for a foreign product. It also makes advertising and distribution of foreign products difficult.   


Business Management 1999PC WASSCE-Past Questions and Answers- Paper 2




Read the following case carefully and answer the questions which follow:   



Ideal Garments Enterprise was formed ten years ago as a family business owned by Mr. and Mrs. Birago. The company specialized in the manufacture of men’s wear suitable for sale through select retail stores.

Two years ago, Mr. and Mrs. Birago decided to expand their product line to include household linen of all kinds. In line with the expansion drive, they engaged the services of a consultant. The consultant recommended the recruitment of a seasoned personnel manager, a marketer with proven track record, a production engineer and a number of professionals.

Mr. and Mrs. Birago placed a series of advertisements in the media for the various positions as advised. They placed priority on retired public serve personnel. Mr. Birago was quoted to have said that “for some one to work in the public service several years till retirement at 60, means that the person was efficient, capable, honest, diligent, knowledgeable and God-Fearing”.

The first persni- o be engaged was Mr. Blankett, 61 with 36 years working experience in the garment industry.

Mrs. Briago was very instrumental in recruitment decisions. Nearly everyone recruited was known to her as either a church member, a former class teacher, a relation or a member of the local golf club.

With the wealth of experience behind then, it was not considered necessary for the new recruits to undergo the most fundamental training required for new employees. The company’s mission, objectives etc. were not explained. There were no organizational chart and job descriptions.

Mr. Mampam, the financial controller since the first day of his recruitment, had not been on good terms with the marketing manager. His worry was the manner in which the company granted credit to its distributors, leading to several millions of money locked up with debtors. The marketing manager thought that it was a subtle attempt to spoil the enviable record of sales he made each year. Very often, Mr. Mampam would pick on the salesperson whose reaction was always violent. The salespersons, in all the recorded instances, went unpunished because Mr. Mampam could not query their insolent behaviour, neither could he take up the matter with the marketing manager nor Mr. Blankett, the personnel manager.

Each time Mr. and Mrs. Birago called a meeting to express their concern about the mess, Mr. Blankett shouts, “Leave the job to me, we are all experienced people. These old folks know what they are about. Minimize interference,” he would say with a smile.

The petty squabbles and rivalry affected productivity and the company profit experienced a nosedive for the rest of the years till the company was declared bankrupt.   



1.   (a) Give two possible reasons why Mr. and Mrs. Birago preferred retired personnel.

Suggested Answer:   

  • They preferred retired personnel as a way of minimizing cot of training. That is, to avoid investment in training of personnel.
  • They assumed that retired personnel will put the required rich experience at the disposal of the company. Thus, Mr. and Mrs. Birago expect to tap the rich experience of the retired personnel.
  • Retired personnel is preferred by Mr. and Mrs. Birago because they expect to pay less in the form of salaries all things being equal.   

1.   (b) Identify two factors that made the recruitment process of Ideal Garments Enterprise wrong.

Suggested Answer:   

(I)     The recruitment process placed too much emphasis on long service as a major
criteria for employment. That is, undue emphasis was placed on length of service.

  • The recruitment process was based on “whom you know” relationship. For example, church members, golf club members and former class teachers.
  • The recruitment process placed too much emphasis on retired personnel as the cream of management personnel at the expense of recruiting young personnell for the job. It must be stressed here that retired personnel may be unlikely to cope with stress at work.   

1.   (c) What type of training is very fundamental to new employees of a company?

Suggested Answer:   

The type of training that is basic to new employees of a company include:

  • Orientation of new employees;
  • Induction of new employees;
  • Socialization of new employees.   

1.   (d) Apart from company mission and objectives, list five other areas in which new employees need to be given orientation upon recruitment.

Suggested Answer:   

The following are some of the areas in which new employees need to be given orientation upon recruitment:

  • Company history
  • The Structure of the Company
  • Company product range and features
  • Competitors’ product and product features
  • Plant locations
  • Major customers of the Company
  • Company rules and regulations.   

1.   (e) What two permanent solutions can you offer to the problem between Mr. Mampam and the marketing manager?

Suggested Answer:   

  • A comprehensive job description for each position must be developed.
  • There must be a well-developed organization structure spelling out the duties and responsibilities of each position. The structure must be represented on a chart to highlight the relationship, chain of command and levels of authority
  • There must be in place a developed grievance/complaints handling procedure for the Company. Staff must be educated on this document.   


2.   (a) Explain four factors a personnel’ manager will take into consideration in deciding to fill vacancies from within the company.

Suggested Answer:   

  • Cost of recruitment: – The cost of recruitment is low when vacancies are filled from within the company, e.g., advertising, consultancy and interview costs are avoided.
  • The performance of the employee: – The employee in question is known to management because of his records and character. The risk of employing a person with doubtful character is eliminated.
  • Training duration:- Personnel employed within the company need less training since he knows much about the company.
  • Organization’s policy: – If it is the policy of the organization to recruit internally, then the personnel manager has no choice but to conform.
  • The Urgency of the need:- When there is an urgent need to fill a vacant position in a company, internal recruitment is usually more convenient and quick.   

2.   (b) Explain the following:

  • Internal recruitment
  • External recruitment
  • Employee selection

Suggested Answer:   

  • Internal recruitment: – This is the exercise whereby the required manpower to fill vacant positions in a company is obtained within the company itself. This may be done by promoting personnel* to fill vacant higher position.

  • External recruitment: – This involves making contacts with various bodies or sources outside the company from which perspective employees may be obtained to fill vacant positions. The external sources include: – educational institutions, e.g., Universities, Colleges etc., private employment agencies, Labour Department, Trade unions etc.

  • Employee selection: – It is the process by which an organization evaluates and chooses from a list of applicants, the applicant best qualified to fill a vacant position. The process involves the use of application forms, letters, resumes, interviews, tests, reference checks, physical and medical examination for evaluating and choosing qualified applicants.   


3.   (a) Explain the following as sources of short-term financing:

  • Bank Overdraft
  • Trade Credit
  • Bank Loan

Suggested Answer:   

Note: Check the answer from to 1998 Paper Two Question 4, 1997 Paper Two Question 4(b) and 1994 Paper Two Question 4.   

3.   (b) Explain three advantages that a business gets when it raises capital from the issue of shares instead of borrowing from short-term sources.

Suggested Answer:   

  • Share capital provides permanent capital for the business.
  • It lessens pressure on business in times of poor financial performance because dividends are only paid when the business makes profit.
  • Raising capital from the issue of shares makes it possible for the business to have access to large source of capital.   


4.   (a) What is market segmentation?

Suggested Answer:   

Market segmentation may be defined as “the sub-division of a market into distinct and increasingly homogenous subgroups of customers, where any subgroup can conceivably be selected as a target to be met with a distinct marketing mix.

It may also be defined as the sub-division of a market into identifiable buyer groups with the aim of reaching each group with the particular product it prefers.   

4.   (b) Mention three benefits that a company can derive from effective market segmentation.

Suggested Answer:   

  • It leads to a more precise definition of the market in terms of consumer needs. It thus helps improve management understanding of the consumer and why he buys a particular product.

  • Companies have limited resources and by concentrating on the particular

    market segments which match their resources, they can operate effectively and efficiently.

  • It leads to more precise setting of marketing objectives. This means that those

    market segments that are not profitable may be identified and eliminated and the resources reallocated to profitable segments.

  • It also helps a company to design the appropriate market mix for a particular product and therefore making sure that resources are not wasted.   

4.   (c) Explain five demographic factors that can be used as a basis for segmentation consumer markets.

Suggested Answer:   

  • Sex: – Here the total market can be categorized into male and female for the purpose of identifying the appropriate group, e.g. market for ladies wear and that for men’s wear.

  • Age: – Consumer needs and wants change with age. Using age as a base for market segmentation involves the grouping of ages of potential consumers of heterogeneous market into ranges such as 1-10, 11-19, 20-29 etc. A company can also segment its market on the basis of the baby market, teenage market and senior citizens’ market.

  • Education: – The marketer can segment the total heterogeneous market into segments such as pre-school, primary education, secondary education and tertiary education.

  • Occupation: – The marketer can. segment the market on the basis of white- collar jobs, and non-white-collar jobs.

  • Religion: – The market can also be segmented based on religious groups, e.g. Christians, Moslems, Traditionalists etc.   


5.    (a) What is meant by the term Decentralization in management?

Suggested Answer:   

NB: Refer to 1997 Paper Two Question 7(c) for the suggested answer.   

5.   (b) Explain four advantages and four disadvantages of decentralization?

Suggested Answer:   

  •  It saves time: – Decentralization saves time in the sense that it prevents Central government overload by • freeing it from many minor operational decisions and allowing it to concentrate on more strategic responsibilities.

  • Introduces Flexibility in Decision-making: – Decentralization allows decisions to be taken at the point of the activity and also gives managers the room to take decisions based on the situation or local conditions.

  • Speeds decision making process: – Instead of making reference all the time to the Central government, decentralization allows districts and regional offices to take their own decisions.

  • Motivates subordinates: – Decentralization also motivates employees. This is because subordinates are allowed to participate and to get involved in the decision-making process.

  • Trains and develops subordinates: – it earns training and development for subordinates. They are introduced to jobs training involving more responsibilities and challenges. They thus acquire more skills and knowledge, which prepares them for more challenging, jobs.
  • Lack of Uniformity in decisions: – It does not allow for uniformity of operations and implementation of company policies since every district or regional head will claim that his situation or conditions are different.

  • Difficult to Control: – Under decentralization, because the departments are spread/scattered all over the country, effective control is difficult.

  • Co-ordination is Difficult: – It is very difficult to co-ordinate the activities of the various departments or units to tow company line or the overall objectives and policies of the company.

  • Taking of Hasty Decisions: – Decentralization also encourages taking of hasty Since decisions are taken at the various units or profit centres without making reference to the headquarters, mistakes in decision making affect the operations of the company.   


6.   (a) What is Packaging?

Suggested Answer:   

Packing involves producing a container or wrapper for a product and also creating an attractive image to consumers. It must be stressed that the success of a product partially depends on good packaging which ginger the sale of the product.   

6.   (b) State and explain five factors which the manufacturer of a liquid soap will consider when packaging his product.

Suggested Answer:   

  • Production: – The pack must provide adequate protection so that there is nothing like contamination or deterioration of the product. That is, it should protect it against spoilage, chemical change and should prolong the life span of the liquid soap.
  • Re-use of empties: – The company should design a pack that provide opportunity for re-use or that has after use benefit.
  • Convenience: – The pack should be convenient to handle, transport and distribute. That is, it should be easy to open for use and convenient fortransporting it through the channels of distribution.
  • Easy identification and differentiation: – Here the packaging design should make it possible to identify and differentiate a manufacturer’s products form those of his competitors.
  • Conform to legal requirements: – The legal requirements with regard/respect to safety and health must also be considered when packaging liquid soap.   


7.   (a) State two objectives of a business enterprise.

Suggested Answer:   

  • Profit
  • Survival
  • Employee welfare/interest
  • Produce economic goods/services.   

7.   (b) Explain the following elements of the management process: ­

  • Planning
  • Organising
  • Directing
  • Controlling

Suggested Answer:   

NB: Refer to 1995 Paper One Question 2(b) for the suggested solution.   



8.   (a) Identify three reasons why a manager delegates authority.

Suggested Answer:   

  • The first importance of delegation is that it saves executives time and allows them to concentrate on more difficult and strategic issues affecting the organisation.

  • Secondly, delegation makes it possible for subordinates to be ‘groomed’ for promotion. It serves as training ground for subordinates.

  • Delegation also motivates subordinates because they are engaged in more difficult and challenging jobs which help to involve them in- decision making process of the organisation.

  • Delegation ensures effective utilisation of the expertise of subordinates.

  • It facilitates management succession. That is managers who delegate will have competent managers ready to replace them when necessary.

  • Finally, delegation is the key to organisational efficiency. It makes the organisation to function well since there are physical and mental limitations to the workload of any individual or group in authority, there is the need for delegation.   

8.   (b) List and explain five ways by which a manager can make delegation effective.

Suggested Answer:   

For delegation to succeed, the manager must put the following conditions or measures in place:

  • In the first place there must be training for the subordinates. Delegationrequires subordinates with the right skills, abilities, knowledge and attitude. The aim of the training is to adequately prepare them for challenges of the new job.

  • Secondly, management must provide reward systems to compensate for extra

    effort put in by subordinates. This will entice subordinates to accept the new responsibilities.

  • Proper mechanism should be put in place to control subordinates and to help determine feedback on performance.

  • There should be effective and open communication channels. This will create room for mutual interaction and open avenues for subordinates to approach superiors with their problems and grievances for amicable solution.

  • There should be absolute accountability. That is the manager who delegates should be held responsible for the results of his subordinates. This principle is meant to compel managers to effectively supervise the task and offer the needed assistance to the subordinates.

  • To ensure effective performance, the authority to be given to help execute the task (job) should be equated to the responsibility expected of the job.   


9.   (a) Describe three roles intermediaries or middlemen lay in the distribution process.

Suggested Answer:   

  • Collection of marketing information:- Middlemen play an important role by collecting market information from the customers to the manufacturer. The middlemen have a direct link with the customer than the manufacturer and thus are able to collect vital market information.

  • Breaking Bulk:- Middlemen save their customers money by buying in bulk from manufacturers and breaking them into convenient shapes and sizes. They also grade, standardize and repackage products to suit the needs and convenience of the customer.

  • Financial assistance:- Middlemen sometimes pre-finance trading and manufacturing activities by making advanced payment to the manufacturer or owning stocks or shares in the company.

  • Distribution and promotion:- Middlemen also ensure that a manufacturer’s products are widely distributed through its target markets. They also help the manufacturer to reach many small customers at as low cost.   

9.   (b) Mention the most common channels that the manufacturer of aluminium pans would use in the distribution of his products.

Suggested Answer:   

Producer          Agent  Consumer

Producer          Wholesaler      Retailer            Consumer


10.    (a) Describe five functions performed by a personnel manager.

Suggested Answer:   

  • Manpower Planning: – This is the first function of the personnel department. It has to do with the process by which a firm ensures that the required staff in terms of qualification and number are available at the right time. It involves determining personnel needs in relations to the objectives of the organization. It therefore deals with the qualification or education, skills and the appropriate number of personnel a firm should engage. It is therefore the process of assessing, predicting, or forecasting an organisation’s manpower needs in a relation to its plans.
  • Employment/Recruitment: – After the manpower needs of the organization have been determined, the next stage is to make an attempt to employ the right calibre of personnel into the organization. This involves identifying sources of labour supply, carrying out recruitment, selection and placement into the organization.
  • Education/Training and Development: – The personnel department is responsible for the training, education and the development of employees. It is responsible for assessing staff training needs through performance appraisal. Once the training needs have been determined, it is the responsibility of the department to design an appropriate programme by determining the method to be used, the course content, the duration and the institution or person to conduct the training. Training enables employees to adjust to new trends, improve their performance on the job and prepare them for promotion.

  • Wage and Salary Administration: – Wage and Salary Administration is one of

    the important functions of the personnel department. It is responsible for designing equitable and attractive Wage and Salary Schemes for employees in an organization. It also determines how overtime payments, bonuses and other fringe benefits are to be paid. It is also responsible for [surveying the labour market and making the necessary changes and adjustments to the wage and salary structures to reflect the wages and salaries policies of the government of the day.

  • Health, Safety and Welfare of Employees: – Another important function of the Personnel department is to ensure that there are measures to take care of the health, safety and welfare of its employees. It ensures these by providing first-aid facilities, good ventilation, lighting, drainage and proper working conditions. It also provides protective gadgets for employees to reduce the occurrence of accidents and injuries. Canteen, sports, transport, pension schemes, group insurance schemes and other recreational programmes are provided for the welfare of its employees.

  • Industrial Relations: – The personnel department plays an important role in maintaining a cordial and harmonium working relationship between workers and management. The term industrial relations is used to describe the relationship that exists between employers, employees (trade unions) and the government.   

10.   (b) List three factors involved in the determination of wages and salaries in a company.

Suggested Answer:   

  • Cost of Living
  • Ability to pay
  • Bargaining Power
  • Differential abilities if employees
  • Competition
  • Labour Laws   


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