Business Management 1996 WASSCE-Past Questions and Answers-WAEC

Business Management 1996 WASSCE

WASSCE Past Questions and Answers for Business Management 1996 is a learning resource.

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Table of Content


General Overview

WASSCE Past Questions and Answers for Business Management 1996 is a learning resource. This learning resource has been designed to help students to pass their exams in the above stated examining body.

I believe you are imagining what our website can offer you? If so, then just wait and see. Also, have you had challenges trying to learn, write or pass your WAEC BM paper?

If the answer is yes, then I can assure you that educareguide is here to help and guide you.


We are here to encourage you that you can easily pass this subject. Firstly, we have a lot of links to assist you to get enough details. 

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 1996 can summarized below:

  • 1996 WASSCE Business Management Paper One – Section A;
  • 1996 WASSCE Business Management Paper One – Section B;
  • 1996 WASSCE Business Management Paper Two


Business Management 1996 WASSCE-Past Questions and Answers Paper 1


Business Management 1996 WASSCE-Past Questions and Answers- Paper 1 – Section A


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)


  1. The management activity which ensures that actual work corresponds to what is planned is[expand title=””]  D is the answer -Business Management 1996 WASSCE   [/expand]
    1. forecasting
    2. co-ordination
    3. motivation
    4. controlling


  1. An agent does not need to have contractual capacity because[expand title=””]   C is the answer -Business Management 1996 WASSCE   [/expand]
    1. the principal will always be held liable for all acts of the agent
    2. the principal needs to avoid those contracts the agent enters into which will not benefit him
    3. he does not make contracts on his behalf but on behalf of the principal
    4. he could decide to deprive the principal of aspects of the contract he enters into


       3.  A display of goods for sale with price tag is an example of      [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]

    1. an offer which may be accepted
    2. invitation to treat
    3. a contract yet to be executed
    4. an offer to the world at large


  1. The principle of insurable interest can be explained as [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. insurance companies demanding interest payment on all insurance policies
    2. one insuring oneself against an accident but unable to insure one’s neighbour against accident
    3. the insured being obliged to receive interest payment on the loans taken from insurance companies
    4. insurance companies paying interest on all loans taken from individuals


  1. A contract may not be concluded even though agreement has been reached because [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. the contract may be illegal
    2. there may be no offer
    3. agreement may be lacking
    4. there may be cross offers


  1. One advantage of insurance to business is [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. that it enables firms to produce any commodity or service and to charge any price for it
    2. that businesses avoid the usual safety measures at work places as the insurance companies pay for any losses
    3. the certainty that the environment will continue to favour business
    4. the reduction or lessening of the impact of a loss when one occurs.


  1. The process to recruit new employees usually begin with [expand title=””] Ais the answer -Business Management 1996 WASSCE[/expand]
    1. announcing vacant positions in the organization
    2. invitations to applicants to attend an interview
    3. placing employees within the structure of the organization
    4. planning training and development courses for new employees.


  1. Job evaluation refers to [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. selection of one job from two or three jobs
    2. developing the potential of an employee to perform more than one job
    3. assessing the job content and placement of monetary value on it
    4. ranking jobs in order of relative importance


  1. The two basic pay schemes are [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. time rate and piece rate
    2. day rate and time rate
    3. bonus and salaries
    4. guaranteed day and piece rates


  1. The elements of the marketing mix are [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. pricing, production, personnel and purchasing
    2. promotion, advertising, sales and distribution
    3. product, price, promotion and place
    4. production, procurement, sales and pricing


  1. Promotions may be carried out within an organization in an organization in order to [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. give employees less responsibilities
    2. give employees greater responsibility
    3. test the efficiency of management
    4. assess the morale of the work-force


  1. Which of the following is a producer of services [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. Carpenters
    2. Teachers
    3. Miners
    4. Farmers


  1. The main objective of production is [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. to sell goods and services
    2. to satisfy human wants
    3. to extract natural resources
    4. to buy and sell resources


  1. Computer software refers to [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. that part of the computer that is not made steel or plastic
    2. the paper, ribbon, tape and diskette that is used by a computer
    3. data that is stored in the central processing unit of the computer
    4. the instructions that tell the computer what to do and how to do it


  1. The Central Processing Unit of the computer consists of control, arithmetic logical and [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. Memory unit
    2. Software packages
    3. keyboard and diskette
    4. output units


  1. One advantage of the manual method of processing data is [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. the capital cost involved is very minimal
    2. breakdown of machines may result in delays
    3. only a small volume of data can be processed at a time
    4. the rate of data processing may create delays in decision making


  1. An ideal population policy for Ghana should aim at [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. high rate of population growth and low rate of economic growth
    2. low rate of population growth and low rate of economic growth
    3. high rate of economic growth and low rate of population growth
    4. high rate of economic growth and high rate of population growth


  1. The profit of a partnership firm at the end of the year may be [expand title=””] C is the answer -Business Management 1996 WASSCE[/expand]
    1. used to pay dividends to shareholders
    2. used to pay off the firm’s debenture holders
    3. shared equally among the partners
    4. used to pay company tax


  1. Dependence on a single export crop, cocoa, is no longer a feature of Ghana’s economy because [expand title=””]C  is the answer -Business Management 1996 WASSCE[/expand]
    1. cocoa plantation set up required between two and five years to mature and increase cocoa export
    2. a greater percentage of the cocoa that is produced is now consumed locally
    3. gold and non-traditional export now contribute a large percentage of export earnings
    4. the price of gold keeps falling on the world market.


  1. An organization like the Volta River Authority is usually set up by [expand title=””] D is the answer -Business Management 1996 WASSCE[/expand]
    1. its shareholders
    2. its creditors
    3. the ministry of finance
    4. an act of parliament


  1. One advantage of branding a product is [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. it reduces the number of outlets needed to market it
    2. less time is spent in designing and manufacture
    3. it ensures that there will always be buyers for the product
    4. to identify it with a particular company


  1. In health care application, the computer can be used to [expand title=””]B  is the answer -Business Management 1996 WASSCE[/expand]
    1. monitor the movement of aircraft by the use of radar
    2. conduct faster and more accurate tests for blood, stool and urine
    3. read bar codes on products and report on quantities unsold
    4. send messages by telex, telephone and facsimile


  1. Customs duties are levied on [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. goods manufactures in the country
    2. goods imported into the country
    3. incomes of customs officers
    4. incomes of public corporations


  1. The problem of double coincidence of wants in trade by barter is solved by money performing the function of [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. a unit of account         
    2. a medium of exchange
    3. a store of value
    4. a standard of deferred payments


  1. An offer can be accepted [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. by anybody, anywhere
    2. when one knows of its existence
    3. whether one knows of its existence or not
    4. by making another offer


  1. If there is a breach of a condition in contract, the injured party may [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. rescind the contract and sue for damages
    2. ask the other party to make a new offer
    3. modify the original contract
    4. sue for damages while performing the contract


  1. Which of the following depends on subventions and retained profits as its main source of capital? [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. Public corporation
    2. Private company
    3. Public company
    4. Sole proprietorship


  1. Certain goods and services are best provided by the government because [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. government derives revenue from those good and services
    2. the private sector is not interested in those goods and services
    3. waste and duplication need to be avoided
    4. the cost of producing those goods and services is very low


  1. Family Planning in Ghana may be one way of [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. increasing the country’s population
    2. increasing the labour force
    3. improving living condition
    4. worsening the standard of living


  1. Which of the following is not true of a sole proprietorship? [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. Its accounts are open to public scrutiny
    2. The liability of the owners is unlimited
    3. The business is a very personal one
    4. Control is in the hands of an elected management


  1. Employer’s liability insurance provides compensation to cover [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. inability of employees to increase productivity at work
    2. injuries or diseases contracted by employees while at work
    3. holidays, leave periods and Sundays when employees do not come to work
    4. employer’s ability to pay salaries and wags at any period in time


  1. Moneys paid by the insured to the insurer to cover risks are called [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. coverage
    2. premium
    3. indemnity
    4. interest


  1. Selection of a suitable person to fill a vacancy in a business may be done [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. only by announcement on radio
    2. by a questionnaire sent to prospective employees
    3. through very good pay schemes
    4. through an interview of applicants


  1. One rationale behind the transfer of employees from one job to another is to [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. reduce the number of employees
    2. demotivate other employees
    3. increase the rate of labour turnover
    4. enhance organizational efficiency


  1. Skimming pricing refers to [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. charging no price for a product
    2. charging different prices for different products
    3. charging the same price for different products
    4. charging an initial high price for a product


  1. The part of computer which initiates action and then directs and supervises [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. the other parts to work systematically is the
    2. memory unit
    3. control unit
    4. arithmetic logical unit


  1. Diskettes, keyboards, paper, tape-reader are examples of compute [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. central processing unit
    2. input devices
    3. software
    4. output devices


  1. Excise duties refer to taxes on [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. incomes of government employees
    2. value of goods and services
    3. locally manufactured goods
    4. profits of companies


  1. As a lender of last resort, the Bank of Ghana [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. makes funds available when the banking system is short of liquidity
    2. lends the last cedi in Ghana to the commercial banks
    3. receives funds from the banking system when there is surplus money
    4. makes arrangements for bank to lend money to the government.


  1. Debt obligations have retarded the rate of growth of Ghana’s economy because [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. a greater percentage of export earnings are used to service the country’s debts
    2. donor countries have failed to provide sufficient funds for development
    3. a large number of Ghanaians have the habit of buying on credit
    4. prices paid for Ghana’s exports keep rising each year


  1. Irrespective of the number of shares held in a co-operative society, a member is entitled to [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. no vote during meetings
    2. votes equal to the number of shares held
    3. votes equal to half the number of shares held
    4. one vote during meeting


  1. 42 .Marketing begins with [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. selecting channels of distribution
    2. pricing a product
    3. employing marketing officers
    4. the conception of a product


  1. An agent that is employed verbally [expand title=””]A is the answer -Business Management 1996 WASSCE[/expand]
    1. cannot enter into contracts in writing
    2. can enter into verbal contracts only
    3. can enter into written contracts
    4. cannot be an agent of necessity


  1. One rule regarding consideration in law is that [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. it must be of very high value
    2. it should be adequate
    3. it should be capable of been valued
    4. it must move from the promisor


  1. If all those who are capable and willing to work can find employment’s, there is [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. under-employment
    2. full employment
    3. self employment
    4. voluntary employment


  1. When the Bank of Ghana wishes to increase the amount of money in circulation, it usually [expand title=””] Ais the answer -Business Management 1996 WASSCE[/expand]
    1. buys securities on the open market
    2. increases the bank reserve requirement
    3. increases the bank rate
    4. sells securities on the open market


  1. To help implement the official monetary policy, the Bank of Ghana [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. varies the cost and availability of credit in the economy
    2. acts as a banker to the commercial and development banks in the country
    3. draws up the national budget which is presented to the Ministry of Finance
    4. assists commercial banks to settle their mutual indebtedness


  1. Computers may be used in the field of aviation to [expand title=””]C is the answer -Business Management 1996 WASSCE[/expand]
    1. schedule trains, buses, ships and private cars
    2. train pilots by the use of computer simulations
    3. provides minute by minute information on events in the world
    4. sort out letters according to postal codes


  1. An excess supply over demand in a market result in [expand title=””]B is the answer -Business Management 1996 WASSCE[/expand]
    1. an increase in prices
    2. a fall in demand
    3. very low prices
    4. stable prices


  1. One essential elements of a valid contract is that [expand title=””]D is the answer -Business Management 1996 WASSCE[/expand]
    1. there must be at least three parties to make the contract enforceable
    2. only one party to the contract must have contractual capacity
    3. it must always be in writing in order to be enforceable
    4. the parties must have the intention to create legal relations


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 1996 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) What do you understand by Communication gap?

Suggested Answer:[expand title=””]

Communication gap is the breakdown in the smooth flow of information, thus, one party cannot reach the other. The breakdown may be deliberate or not.  An example of communication gap is when management deliberately withhold information from subordinates.[/expand]

1   (b) State three ways by which a manager might improve communication in his organization?

Suggested Answer:[expand title=””]

  • The information should always be disseminated at the right time to the recipient to be effective.
  • The purpose or objective of the communication must be established. Before information is sent, it is important to determine whether the message is to seek information, convey information or instruct some one to take action.
  • The manager should select the right and appropriate channels of communication. He should use formal channels rather than the grapevine. He should also hold regular meetings with his subordinates to teach them about how to communicate effectively and efficiently.[/expand]

1   (c) Discuss four problems that Communication gap can create in an organization.

Suggested Answer:[expand title=””]

  • Communication gap can creates industrial unrest in an organization. The workers or subordinates in an organisation may grow suspicious and engage in all sort of industrial actions to press home their demands.
  • A gap in communication makes it impossible for management to give instructions to subordinates to work. It therefore disrupts normal flow of work in an organization.
  • Communication gap creates “lack of trust” between management and their subordinates.
  • Where there is a communication gap, workers rely on rumours (grapevines) or gossip, which is very dangerous, because it could lead to misinformation.[/expand]


2   Explain the following: 

  • Foreign Exchange
  • Balance of Trade
  • Balance of payments

Suggested Answer:[expand title=””]

  • Foreign Exchange refers to the amount of foreign currencies and claims in such forms as cheques, notes, bills of exchange and promissory notes payable in a defined currency for goods and services exported e.g. the dollar, pound sterling, Deutsche marks, etc.

  • Balance of Trade refers to the relationship between the total value of a country’s exports and total value of imports within a given period of time mostly one year. Balance of Trade deals with only visible imports and exports and hence is also known as visible balance. Balance of Trade may be favourable or unfavourable. It is said to be favourable if the total value of visible exports of a country is more than the total visible imports within a year. Unfavourable balance of trade occurs where the total visible imports are more than the total visible exports within a year.

  • Balance of Payments is an Account of a country’s economic transactions with the rest of the world. It shows the value of overall imports of goods and services and value of overall exports of goods and services. Balance of payments actually shows the relationship between one country’s total payments to other countries and its total receipts from them within a given period of time usually one year.Balance of payment may be favourable or unfavourable. It is said to be favourable when receipts from ‘goods and services exported exceed payments for goods and services imported. If the reverse is the case, the balance of payments is said to be unfavourable.[/expand]


3   (a) Describe three main sources of finance for each of the following business organization.

  • Sole Proprietorship
  • Partnerships
  • Co-operatives
  • Corporations
  • Joint Stock Companies

Suggested Answer:[expand title=””]

      The main sources of finance available to the sole proprietor include:
  • Trade credit
  • Personal savings
  • Hire purchase
  • Loans from financial institutions, e.g. banks.


      The main sources of finance for a partnership include:
  • Contributions from partners
  • Hire purchase
  • Trade Credit
  • Loans from banks and other financial institutions.


      Sources of finance for a Co-operative include:-
  • Contribution from members
  • Trade Credit
  • Hire Purchase
  • Loans from banks and other financial institutions


     The main sources of finance for public Corporations include:
  • Trade Credit
  • Government grants
  • Loans
  • Lease
     Sources of finance for joint stock Companies
  • Trade Credit
  • Hire purchase
  • Sale of shares
  • Loans
  • Debentures
  • Lease[/expand]

3   (b) State four differences between a public joint stock company and a public corporation.

Suggested Answer:[expand title=””]

  • Formation: – A public joint stock company is normally formed under the companies code with a certificate from the Registrar of Companies while a public corporation is formed by a Decree or Act of Parliament.
  • Ownership: – Public corporation is owned by the state or government while a public joint stock company is owned by individual or corporate shareholders.
  • Finance: – While a public joint stock company is financed through debentures, floating of shares etc., public corporation is financed through government subvention, grants and loans.
  • Management and Control: – Public joint stock companies are managed and controlled by Board of Directors who are appointed by shareholders of the company during the Annual General Meetings. On the other hand,  public corporations are managed and controlled by Board of Directors appointed by the government or Act of Parliament.[/expand]


4   (a) Describe how government obtained revenue from the following:

  • Indirect Taxes
  • Direct Taxes            

Suggested Answer:[expand title=””]

Indirect taxes:

Indirect Taxes are taxes levied on goods and services and are paid indirectly by consumers. The burden of the tax is mostly passed on to the final consumer in the form of higher prices. The main types of indirect taxes include the following:

  • Import Duties: – taxes imposed on imported goods and services.
  • Export Duties: Taxes imposed on goods and services which are exported to other countries.
  • Excise Duties: – taxes imposed on locally manufactured goods.
Direct Tax:

These are taxes mostly levied on incomes of individuals and companies. The effect of the tax is directly felt by the payer. Direct taxes include:

  • Income Tax: Revenue obtained by imposing taxes on individuals income at a standard rate
  • Company Tax: Taxes, which are imposed on profits of companies. It is only paid when profits are made
  • Capital Gains Tax: Taxes which are paid on the profit received as a result of selling assets, e.g. land or building[/expand]

4   (b) Discuss two reasons why apart from revenue generation, the government imposes taxes.

Suggested Answer:[expand title=””]

  • Taxes may be imposed to prevent dumping.
  • Government may also impose taxes in order to protect infant industries.
  • Taxes may also be imposed to redistribute income.
  • Government may impose taxes as a retaliatory measure.[/expand]


5   State and explain the essential elements of a valid contract.

Suggested Answer:[expand title=””]

A contract is a legally enforceable agreement. For a contract to be valid, the following important elements must be present.

  • Agreement: – There must be agreement between the contracting parties. One party must make an offer and the other party must accept the offer. Thus, there must be an offer and acceptance. There should be the meeting of the minds (i.e. consensus ad-idem).
  • Intention to create legal relations: – The agreement must be intended to be subject to an action in a court of law. That is the parties to the contract must intend that, where one party fails to perform his promise under the contract, the other can sue him for damages or be compelled in the law court to perform it.
  • Consideration: – Each party to the contract must give valuable consideration. Henceforth, each party must give up something or make a promise in return for a benefit received.
  • Legality: – All contracts must be made legally. Thus, the contract must not be for an illegal purpose or contain terms, which are considered to be contrary to public policy.
  • Formality: – It refers to the form in which the law requires the contract to take. For this reason, all specialty contracts must be made formally. In effect, they must be written, signed, sealed and delivered.
  • Capacity: – Both parties must have contractual capacity. Truly, each party to a contract must be of age that is 18 years and above, soundness of mind and other requirements for entering into the contract. Therefore, the law prohibits children, the insane, drunken persons from entering into a valid contract.[/expand]


6   (a) Distinguish between Computer Software and Computer Hardware

Suggested Answer:[expand title=””]

Computer Software refers to programs that are designed to perform specific tasks or functions. It is the intangible part of the computer and contains commands, procedures, instructions and programmes that direct the computer hardware to perform specific task or function.

Computer Hardware refers to the tangible or physical elements of the computer. That is, it refers to the mechanical, electrical and electronic parts of the computer that can be seen, touched and held.[/expand]

6   (b) Explain four (4) advantages and four (4) disadvantages that may arise from the use of computer in business.

Suggested Answer:[expand title=””]

Advantages of the use of computer include:
  • Computers maintain a high standard of accuracy and efficiency in processing and analysing data.
  • Computers function as storage units for information. They have the ability to store enormous files of information and retrieve information as and when necessary.
  • A computer can carry out complex and complicated exercises at a very high speed than can be done manually.
  • Computers relieve qualified and entrepreneurial manpower from routine work.
  • With the use of a computer, data security can be maintained through, the use of passwords.
Disadvantages of the use of computer include:
  • Large capital is required to be invested in the purchase and installation of a computer. It also involves high maintenance and repair cost.
  • There is scarcity of qualified computer experts with the requisite training to operate the computer effectively and efficiently.
  • Computers render some clerical staff redundant. Displacement of clerical staff leads to fear and resentment among staff and therefore possible low morale. .
  • In the event of computer breakdown, work slows down and back log of work is created which could take time to get done.
  • Virus infection may lead to loss of information or data.[/expand]

6   (c) Give five reasons why some organisations continue to process data manually.

Suggested Answer:[expand title=””]

Organizations continue to process data manually because of the following reasons:-

  • Lack of money for the acquisition and maintenance of the computer. Most organizations in Ghana lack the necessary funds to go into electronic data processing.
  • Processing data manually may be relatively cheaper or economical. Low consumption of electricity because the machines do not use too much current.
  • Lack of computer experts to man the system. Lack of personnel with the requisite qualification and experience to operate and maintain the machines.
  • Some organizations do not handle large data and information and thus do not need computers.
  • Lack of innovation on the part of some managers. Some managers feel reluctant or afraid to adopt new technology.[/expand]


7   (a) Mention and describe four forms of production.

Suggested Answer:[expand title=””]

  • Extractive or primary production: This is a form of production concerned with extracting raw materials from nature such as the land, seas and rivers and transform them to satisfy human needs and wants. It takes the form of farming, mining, logging, fishing, drilling, etc.

  • Manufacturing or Secondary production: – It is concerned with transforming or converting raw materials produced by those in the extractive industry into finished products or more useful forms through various processing stages. Examples of manufacturing production in Ghana include Takoradi Flour Mills Limited, Nestle Ghana Limited, etc.

  • Construction: – The construction industry is concerned with changing the form or shape of things. They put together what has been produced by the manufacturing sector. It involves the building f roads, bridges, houses, etc. using products such as cement, bricks and steel produced by the manufacturing sector.

  • Commercial Services: – Commercial services is a form of production which facilitate the efficient operation of the other forms of production. They facilitate exchange, distribution and consumption of goods and services. Activities such as warehousing, transportation, advertising, banking, insurance, retailing, wholesaling, etc. come under this form of production.
  • Direct Or Personal Services: These are activities, which contribute to production. They refer to all those services from which consumers enjoy direct benefit. Workers who are neither involved in the production nor distribution of goods come under direct services. Even though they do not handle goods. their services are recognized as productive since they satisfy the wants of consumers and the society as a whole. People who provide medical services such as doctors and nurses, raise our living standards by making us healthier, and also help raise the level of production because a healthy labour force will produce more than unhealthy one. Lawyers, teachers, cooks, drivers and gardeners all come under the direct service occupation. [/expand]

7   (b) Put the following into respective forms of production

  • Farmer
  • Banker
  • Factory Workers
  • Carpenter
  • Teacher
  • Baker
  • Miner
  • Insurance agent
  • Fisherman
  • Shoemaker

Suggested Answer:[expand title=””]

  • Extractive: –
    1. Farmer,
    2. miner and
    3. fisherman


  • Manufacturing
    1. Shoemaker
    2. Factory worker
    3. baker
  • Construction
    1. Carpenter


  • Personal Services
    1. Teacher
    2. Insurance agent


  • Commercial Services
    1. Banker[/expand]


Business Management 1996 WASSCE-Past Questions and Answers- Paper 2



Read the following case carefully and answer the questions which follow:[expand title=””]


Barely four years ago, Mr. Apalas and Mr. Sasa purchased some boarded equipment and office machinery from a well-known manufacturing company located in Accra. They decided to set up Apalassasa Limited, a printing and stationery supplies business to be located in their village, Papakrom, a distance of one hundred kilometres from Accra. The principal factor that pulled the siting of the factory was the desire to find jobs for the many graduates of the senior secondary schools in the area that moved about helplessly in search of jobs. Mr. Apalas conceded the locational constraints but was resolute in his desire to help the people of Papakrom.


Mr. Apalas had never operated a business of his own, but he was pretty sure that he would be able to do well. He had worked in many factories holding different positions. Mr. Sasa had also had similar experience in factory work. Together, both friends handled all sales and price-related issues. They utilised their shallow experience in plant maintenance to service minor breakdowns which often caused mountain holdups. In most cases, the two executives found themselves doing 12 hours a day. Major repair work was contracted from Accra. Repair bills were very high.


The product prices were far above competitive levels. The idea was to cream the market to pay for start-up cost. The existence of the factory and its products were little known in the stationery market. Patronage of the company’s products was low. Stockpiles of finished goods were valued at (8 million on the average. The declining state of the company’s operation for three successive years was a concern, which called for investigation.


A team of market research consultants was employed to analyse the situation. Several customers and a few other potential customers were interviewed and the result was summarised as follows: “The stuff we are now using is better. We have never heard about or seen this type of brand. We are not going to pay that much for such a product”.[/expand]


1   (a)  Identify and explain the pricing policy adopted by Apalassasa Ltd.

Suggested Answer:[expand title=””]

Apalassasa Limited adopted the Skimming pricing policy. This is a pricing policy where the producer or marketer charges high price at the introductory stage of the product with a view to taking a cream of the market (maximise profits) before competitors enter the market. It however depends on the uniqueness of the product.

Apalassasa adopted this policy to get people to buy at a high price before making provisions for those segments of the market, which are more price sensitive.[/expand]

1   (b) State and explain four problems that the Company encountered in its four years of operation.

Suggested Answer:[expand title=””]

  • Maintenance problems. This was caused by lack of qualified and experience personnel to service, maintain and repair the machines and equipment used in production. Frequent machine breakdowns were the order of the day and Engineers had to be brought from Accra frequently to make ad hoc repairs, which was expensive. The two executives did not have the knowledge and skill either.
  • Promotion, which is an important tool or technique, used by a company to communicate information, ideas, attitudes and feelings about the firm’s product was inadequate.
  • The pricing policy adopted did not match with the quality of the product. This is because skimming pricing policy works well under the following condition; where the product is new and unique, where the company has monopoly power and where consumers do not react to price. This pricing strategy failed because consumers got these products from other competitors.
  • Location is also one of the problems. The two executives did not consider factors like nearness to raw materials and market. The company’s operation therefore declined as a result of poor location and high cost of production.[/expand]

1   (c) Offer four recommendations, which in your view will help, resolve the problems of Apalasasa Ltd.

Suggested Answer:[expand title=””]

Some of the solutions to the company’s problems include

  • Qualified personnel must control the Quality Control Department of the.
  • It should adopt either penetration pricing policy or competitive pricing policy to attract customers. This must however be backed by effective promotional strategies aimed at informing, educating, persuading and reminding Customers about the company and its products.
  • The company must also employ the right caliber of staff; i.e. staff with the  right knowledge, skills, expertise and experience to man the production department of the company.
  • All employees of the company must be educated on cost reduction and how to ensure high quality of the company’s products if the company is to survive and grow.
  • The maintenance section of the company must also be staffed with qualified personnel who possess the required knowledge and skills. If the cost of maintaining an engineer will be too high for the company, consultancy services may be obtained from external sources.[/expand]


 2   (a) Discuss two major objectives of personnel planning

Suggested Answer:[expand title=””]

  • To predict, identify and determine the likely future human resource requirements or needs of the organization.
  • To formulate policies and strategies that will help deal with future human resource problems.[/expand]

2   (b) State five reasons why business organizations must undertake planning.

Suggested Answer:[expand title=””]

Planning is important in business for the following reasons:

  • Planning reduces the dependency on intuition in decision-making. It provides information for the course of action that an organisation wants to pursue.
  • It also helps to reduce uncertainty by anticipating change. . Since planning is future oriented, it enables a company to forecast and predict events, which may have effect on the company’s operations.
  • furthermore, it provides standard for controlling. When a plan is in place, it . Control provides management with information to assess the extent to which such objectives are being achieved.
  • Planning also ensures effective and efficient use of resources. It ensures  efficiency and economy of operations by minimising waste, inducing consistency and ensuring ever flow of work into the company’s operations.
  • Planning establishes co-ordinated effort. It provides directions and a common sense of purpose for the company. This enables a company to gear its resources towards its objectives or goals.
  • Planning also provides a point of reference for evaluating and measuring.
  • Planning provides information for the course of action that an organization
    wants to take.

NB:       The same question was asked in 1999. Refer to 1999 Paper 2Question 1(a)[/expand]


3   (a) Explain what the following terms mean in Business Management:


  1. Job Evaluation

Suggested Answer:[expand title=””]

The same question was asked in 1995. Refer to 1995 Paper Two Question 8(a). Click here to find-out the answer.[/expand]

  1. Job Description

Suggested Answer:[expand title=””]

This is the second stage in the recruitment process. It is a written statement of what a job holder does, how the job is done and why it is done. It states the title and location of the job, working conditions, duties to be performed, tools, machinery to be used, etc. It typically portrays job content, environment and conditions of employment. Job description may also cover job specification which is a statement of the minimum acceptable qualifications, experience, training, etc. that an incumbent (a recruit) may possess to perform a job successfully.[/expand]


3   (b) In every organization, facilities are provided to ensure the safety and health of employees. Mention eight of such facilities.

Suggested Answer:[expand title=””]

  • There must be good ventilation in the work place, e.g. cooling and heating systems to suit different atmospheric conditions.
  • Protective clothing must also be provided to ensure the safety of employees during accidents.
  • There should be facilities for comfortable sitting for all workers.
  • Welfare services like transportation, good drinking water, places of convenience must also be provided.
  • Provision must be made for first aid box(es), free medical care, sick leave with pay, etc.
  • A system of free medical care should also be provided for the families of the employees to ease their minds at work side to avoid accidents.
  • There should also be an insurance scheme for all workers.
  • A periodic medical check-up should also be instituted for all the workers to ensure that every likely sickness is detected at an early stage.[/expand]


4   (a) The marketing mix comprise four variables. Name these variables.

Suggested Answer:[expand title=””]

The four marketing mix variables are

  • Product
  • Price
  • Promotion
  • Place

4   (b) Explain briefly how the variables in the marketing mix can be blended to satisfy the consumer.

Suggested Answer:[expand title=””]

The variables which include the product, place, promotion and price are interdependent and when a variable is selected, all the decisions about the rest should be made at the same time.

The blending of the marketing mix begins with the product. The crux of the matter in the product is to develop and manage a product line that will satisfy the consumer. Attention will therefore be paid to product designing, packaging, branding, trademarks, product positioning and developing products generally acceptable to the customer or consumer.

When the product is developed, the next thing to develop becomes the price. Price bears the monetary or exchange value of the product or service. In setting the price, the marketer must consider the quality of the product, the cost of the product, existing pricing policies, mark ups and the nature of competition in his market.

Promotion is the third variable after designing the product and pricing it. Promotion deals with how to inform people about the availability of a product or service. It involves methods of communicating the product message to the target market by either personal selling, mass selling, sales promotion, advertising etc. Promotion may aim at informing, persuading, educating or reminding the target market about the product.

The last variable of the marketing mix is the place. The place decision will solve problems about how, where, by whom and when products will get to consumers. Place involves choice of channel men or middlemen like wholesalers, retailers, distributors etc, storage facilities, transportation, transfer of title and warehousing of the product.

All the four elements of the marketing mix are inter-related and to disregard one of them in marketing will imply the failure of the other three. The marketing manager should therefore ensure that these four elements are well blended to achieve the objectives of the organization.[/expand]


5   As a young business executive, state nine ways in which you can motivate workers serving under you.

Suggested Answer:[expand title=””]

Workers can be motivated in the following ways: –

  • First is the reward scheme. The manager must provide adequate reward system to all his subordinates. The reward system must be fairly and equitably distributed. It must also comply favourably with what their colleagues obtain elsewhere as well as their output levels.
  • Secondly, opportunity must be created for their training and development. Training and development geared towards equipping subordinates with the right skills, attitudes and knowledge will also motivate them.
  • To motivate employees, a manager must establish or institute open communication channels so that subordinates can freely approach their superiors when necessary. This eliminates suspicion and mistrust and creates a bond of trust and confidence among employees.
  • A manager may also motivate his subordinates by delegating authority to subordinates to perform specific assignments on his behalf.
  • Promotion, which involves raising a person to a higher status in the organisation is another step by which a manager may motivate his subordinates because promotion gives recognition for good performance and the readiness to assume greater responsibility.
  • The administration of transfers and promotions must be transparent and based on merit.
  • Management by objective policy must be adopted. That is workers must be made to feel their worth and be made to take part in the decision-making[/expand]


6   Explain the meaning of market segmentation under the following

  1. Meaning
  2. Bases
  3. Aims

Suggested Answer:[expand title=””]

  1. Meaning of Market Segmentation: Market segmentation is a process of isolating smaller, more homogeneous market segments within a market for the purpose of selecting one or more markets and developing a unique marketing mix to satisfy the needs of each. Simply defined, it is the sub-division of a market into identifiable buyer groups with the aim of reaching each group with the particular product it prefers.

  2. Markets may be segmented based on the following:

  • Geographic factors: This is where the market is segmented or divided into different geographic units such as regions, cities, districts, climate, density, population size etc.
  • Demographic factors: This consists of dividing the market into groups
    based on demographic variables such as age, sex, income, education, occupation, religion, race and nationality.                                                                                   
  • Psychographic factors: Here buyers are divided into different groups based on social class, lifestyle, personality characteristics, consumption and purchasing behaviours of individuals.
  • Behaviouristic factors: In behaviouristic segmentation buyers are divided into groups based on the Lenefit sought, user status, purchase occasion, usage rate, etc.
       c. The aims of segmenting a market include
  • To provide product assortment that can be more precisely defined to reflect differences in customer needs.
  • To make judicious use of organizations resources.
  • To identify new marketing opportunities as a result of better understanding of consumer needs in each of the segments.
  • To provide maximum satisfaction to consumers
  • To cut cost, make greater sales and maximise profit.
  • To increase benefits to consumers by providing products, product features or attributes more closely matching their identified needs.[/expand]


7   Explain the following as sources of long-term capital to a business organization.

  2. Mortgage loans
  3. Sale and Lease back

Suggested Answer:[expand title=””]

  • Shares: This is a major source of finance for large business organizations like companies. Shares are units of a company’s capital and investors who buy them are referred to as shareholders. Firms who wish to raise funds to finance their activities may float shares in the stock exchange market. Individuals become shareholders by buying these shares and therefore becoming members of the company and share in their yearly dividends (profits). Shares may carry fixed rates or not. Preference shareholders are those who have a fixed rate of dividends irrespective of the amount of profit realised whilst ordinary shareholders are those who receive dividends depending on the amount of profits. They are likely to be paid high dividends when the firm’s operations are profitable.

  • Mortgage Loans: In a mortgage loan agreement, one party (i.e., the lender) called the mortgagee. advances a loan (i.e., money) to another party (i.e. the borrower) called the mortgagor on the security of a real property (machinery, equipment and building etc.) that may be provided by the borrower. The lender has a claim on the said real property in case the money loaned out is not repaid when due. The borrower however, has a good ownership title to the property so long as he keeps to the terms of the agreement (he does not violate the agreement). His right to the property is subject to a mortgage charge for the term of the loan. The repayment arrangements and the period of repayment are normally contained in the loan agreement between the two parties. Mortgage loan as a source of long-term capital to a business organization is therefore a loan- made to a company by an investor, secured on the real property (e.g., building, machinery and equipment etc.) of that company in question.

  • Sale and Lease Back: A company in need of finance can sell its buildings or assets for a capital sum and at the same time, lease the asset back for its own use from the purchasing institution for a long-term at a specific rent.[/expand]


8   Briefly explain how the following influence business activities?

    1. Shareholder
    2. Employees
    3. Competitors
    4. Suppliers
    5. Customers
    6. The Community

Suggested Answer:[expand title=””]

  • Shareholders provide the vital funds needed to run the business. They are joint owners of the business. Management account to the shareholders, it is therefore the responsibility of management to work hard in order to earn enough profit for these shareholders, else, future capital will be difficult to come by.
  • Employees are the people offering their services to help the company achieve
    its goals. The success or failure of any business organisation depends to a large extent on the performance of its employees.
  • Competitors are people or organisations who operate similar business activities. Competitors are not enemies but partners and may join together to form an association to promote their mutual interest. The presence of competitors helps in shaping the activities of rival firms.
  • Suppliers are people who provide the business with raw materials and other
    components, which go into the production of the company’s output. The quality and quantity of the raw materials and input they supply can affect the company’s output. Managers must therefore deal with them honestly in order to obtain the supply of goods and services on schedule and at the right quantity, quality and price.
  • Customers are individuals and organisations who buy from a business organisation. Customers preference, taste, need etc should not be ignored if the company wants to be successful. Customers’ needs/wants thus dictates/determines the production policies of the company. Quality and not shoddy goods are what the customers expect from the company.
  • Since a business exists in the community upon which it depends for its survival and prosperity, it must initiate policies to improve their welfare. It must actively participate in community development. It should also avoid causing damage to property and people as a result of their industrial activities e.g. pollution. It must engage in Construction of roads, schools and colleges, places of Convenience and health post. It must also fulfil its tax obligations. It must engage in employment. These activities are very important as they go a long way to determine the success or failure of the business in that community.[/expand]


9     (a) What is wholesaling?

Suggested Answer:[expand title=””]

Meaning of Wholesaling:

Wholesaling includes all activities involved in selling goods and services to those buying for resale or business use. Wholesalers are therefore a group of middlemen who sell to consumers either directly or through retailers some of the bulky items they buy from producers.[/expand]

9   (b) Explain four functions that the wholesaler performs to benefit his customers.

Suggested Answer:[expand title=””]

The following are some of the functions wholesalers perform to benefit their customers:
  • Wholesalers save their customers money by buying in car load lots and
    breaking bulk.
  • Wholesalers provide quicker delivery to customers because they are
  • Wholesalers finance their customers by giving credit.
  • Wholesalers can select items and build assortments needed by
    customers, therefore saving the consumers much work.
  • Wholesalers hold inventories, thereby reducing the inventory costs and
    risks to customers.[/expand]

9   (c) State four functions performed by the retailer in a distribution channel.

Suggested Answer:[expand title=””]

The following are the functions of the retailers
  • A retailer provides information about market conditions to their
    producers through the wholesalers.
  • Retailers repack and standardise products in convenient sizes for sale
    to the final consumer.
  • Retailers buy goods needed by consumers and sell directly to them.
  • The retailer buys and stores goods from wholesalers.
  • They also provide credit facilities to their creditworthy customers.[/expand]


10   Give four major reasons to Support the Need for Industrial Training in Business Organizations.

Suggested Answer:[expand title=””]

Reasons advanced to support industrial training for personnel include the following:

  • Industrial training is undertaken to enable new employees acquire the requisite skills and the existing employees to improve upon their skills to meet the challenges of the business community.
  • Training is also made to prepare the trainee for a higher job or position in the organization or different department in the same organization.
  • Training also helps to attract desired personnel. Most potential employees will riot join and stay in an organization that has no opportunity for training and self-advancement.
  • Training schemes are instituted to help solve operational problems such as grievances, accidents, low morale and other factors that affect employment. Internal training institutions and programmes help satisfy labour requirements therefore eliminating the possibility of the organization resorting to the external labour market.[/expand]


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