WASSCE Past Questions and Answers – Business Management 1993

WASSCE Past Questions and Answers

WASSCE Past Questions and Answers  for Business Management 1993  is a content designed to help pupils/students preparing to write exams in the above stated examining body.

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Table of Content


General Overview

WASSCE Past Questions and Answers  for Business Management 1993  is a content designed to help pupils/students preparing to write exams in the above stated examining body.

You may ask – how can I pass my weac examination in business management? Educareguide has all the answers for. Just relax and stay on our website. For more about our site, read this.

Have you had challenges trying to learn, write or pass your WAEC BM paper? If the answer is yes, then I can promise you that educareguide is here to help you with enough content and assistance.

I’m here to encourage you that this paper is one of the easiest to pass. educareguide has made it easy as other subjects like, integrated Science, Core Maths, Core English, Economics, Geography, Government, Accounting, etc.

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, this site has designed various topics, sub-topics and content relating to the subject area. Therefore, our site has been very helpful to Senior High School Students across the West African sub-region.

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

Moreover, these students have relied on our site as a guide to write the WASSCE Business Management Examination. In detail, check the questions and the answers just below.


The Nature of the Paper

The examination is made of two Papers– Paper 1 and Paper 2. Paper 1 is made up of Two Sections – Section A and Section B. Section A is an Objective Test and Section B is Theory Test.

Furthermore, the objective Test is made up of 50 questions, and the Theory Test is made up 7 question (mostly with sub-questions under them).

Consequently, Papers 2 is made up of 9 questions. In detail, question 1 is a Case Study and other questions.

To explain more, The Case Study has some question under it to test the student’s understanding of the Case that has been given.

Finally, the other 8 theory questions after the case study, will also tests the student’s general understanding of the subject are.


The Summary of the Paper

The WASSCE Business management Paper for 1993 can summarized below:

  • 1993 WASSCE Business Management Paper One – Section A;
  • 1993 WASSCE Business Management Paper One – Section B;
  • 1993 WASSCE Business Management Paper Two


WASSCE Past Questions and Answers – Business Management 1993 – Paper 1


WASSCE Past Questions and Answers Bus. Management 1993 – 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.  An association of two or more persons who come together to form a business with a view to making profit is known as      [expand title=””]C is the answer -WASSCE Past Questions and Answers[/expand]

  1. Joint stock company
  2. Sole Proprietorship
  3. Partnership
  4. Co-operatives


2.  Which of the following statements is not true of an organizational chart?      [expand title=””]C   is the answer -WASSCE Past Questions and Answers[/expand]

  1. It shows the various management positions in a company
  2. It identifies the vertical and horizontal relationships of the workers
  3. It shows the profits made in one accounting year by a company
  4. It shows the span of control


3.  The basic steps in the decision-making process in an organization include;      [expand title=””]A   is the answer -WASSCE Past Questions and Answers[/expand]

    1. Establishing objectives
    2. Gathering information
    3. Developing possible alternative courses of action
    4. Employing many decision makers
    5.  Appointing a board of directors
  1. I, II and III only
  2. I, III and IV only
  3. I, II and V only
  4. I, II and IV only


4.  Which of the following is an essential part of a valid contract?     [expand title=””]is the answer -WASSCE Past Questions and Answers[/expand]

  1. Acceptance only
  2. Intention to create legal relations
  3. Counter offer
  4. A third party


5.  One advantage of a Sole Proprietorship is     [expand title=””]C   is the answer -WASSCE Past Questions and Answers[/expand]

  1. a high overhead cost
  2. ability to raise large capital
  3. ability to take quick decision
  4. impersonal service to customers


6.  The annual revenue and expenditure of Government are projected in the      [expand title=””]B    is   the answer -WASSCE Past Questions and Answers[/expand]

  1. a balance sheet
  2. balance of payment
  3. gross domestic income
  4. budget statement


7.  Money serves as:      [expand title=””]B   is  the answer -WASSCE Past Questions and Answers[/expand]

    1. medium of exchange
    2. a unit of wealth measures of wealth
    3. store of value
    4. balance of payment


  1. I, II and V only
  2. I, II, III and IV only
  3. II, III and V only
  4. III, W and V only


8.  Which of the following is a principle underlining all insurance policies?     [expand title=””]C    is the answer -WASSCE Past Questions and Answers[/expand]

  1. personal accident
  2. child education
  3. utmost good faith
  4. life assurance


9.  Trade between two different countries or between companies in different countries is referred to as     [expand title=””]C    is the answer -WASSCE Past Questions and Answers[/expand]

  1. Inter-company trade
  2. Inter-country trade
  3. International trade
  4. Multinational trade


10.  One problem associated with a developing economy is     [expand title=””]B     is the answer -WASSCE Past Questions and Answers[/expand]

  1. over-employment
  2. rapid population growth
  3. excess liquidity
  4. high level manpower


11.  Which of the following economic unions is made up of countries in West  Africa?     [expand title=””]C   is the answer -WASSCE Past Questions and Answers[/expand]

  1. EEC
  2. ACP


12.  Which of the following is not a function performed by a computer?     [expand title=””]D   is the answer -WASSCE Past Questions and Answers[/expand]

  1. Receiving data
  2. Storing data
  3. Processing data
  4. Generating data


13.  Which of the following is not a management function?     [expand title=””]is the answer -WASSCE Past Questions and Answers[/expand]

  1. Controlling
  2. Communication
  3. Planning
  4. Advertising


14.  Recruitment and training in large business organization are functions of     [expand title=””]A   is the answer -WASSCE Past Questions and Answers[/expand]

  1. the personnel manager
  2. the managing director
  3. the company secretary
  4. the public relations manager


15.  Performance appraisal is a means of     [expand title=””]B   is the answer -WASSCE Past Questions and Answers[/expand]

  1. scheduling annual leaves
  2. evaluating the work of employees
  3. improving working conditions
  4. increasing welfare facilities


16.  All activities that direct the flow of goods and services from the producer to the consumer and assist to accomplish a change of ownership can be referred to as     [expand title=””]B    is the answer -WASSCE Past Questions and Answers[/expand]

  1. production
  2. marketing
  3. transporting
  4. advertising


17.  Which of the following is not a channel of distributing consumer goods?      [expand title=””]A   is the answer -WASSCE Past Questions and Answers[/expand]

  1. Consumer
  2. Wholesaler
  3. Retailer
  4. Manufacturer


18.  The life cycle of a typical product may be divided into      [expand title=””]C     is the answer -WASSCE Past Questions and Answers[/expand]

  1. two stages
  2. three stages
  3. four stages
  4. five stages


19.  Bank overdraft may be classified as a      [expand title=””]C     is the answer -WASSCE Past Questions and Answers[/expand]

  1. long-term loan
  2. medium-term loan
  3. short-term loan
  4. lease agreement


20.  Which of the following is not a factor of production?      [expand title=””]D    is  the answer -WASSCE Past Questions and Answers[/expand]

  1. Land
  2. Labour
  3. Capital
  4. Co-ordination


21.  A shareholder of a joint-stock company may at the end of the year receive a/an     [expand title=””]C    is the answer -WASSCE Past Questions and Answers[/expand]

  1. profit
  2. interest
  3. dividend
  4. commission


22.  Which of the following is a form of communication?      [expand title=””] is    the answer -WASSCE Past Questions and Answers[/expand]

  1. Vertical communication
  2. Formal communication
  3. Informal communication
  4. External communication


23.  A person who adopts the action of another as having been done on his behalf is said to have      [expand title=””]A    is  the answer -WASSCE Past Questions and Answers[/expand]

  1. ratified the action
  2. abrogated the action
  3. adopted the action
  4. mandated the action


The diagram below illustrates a typical channel of distribution. Use it to answer Questions 24 and 25.

24.  What is represented by X?      [expand title=””]C[/expand]

  1. Wholesaler
  2. Manufacturer
  3. Agent
  4. Consumer


25.  Y stands for a/ an      [expand title=””]B[/expand]

  1. employee
  2. consumer
  3. manufacturer
  4. promoter


Use the diagram below to answer Question 26 and 27.




26.  The column marked M indicates the      [expand title=””]A[/expand]

  1. introductory stage
  2. maturity stage
  3. decline stage
  4. saturation stage


27.  The column marked P indicates the      [expand title=””]B[/expand]

  1. growth stage
  2. maturity stage
  3. sales decline stage
  4. introductory stage


28.  The management activity which ensures that actual work corresponds to what      [expand title=””]D[/expand]

is planned is referred to as

  1. forecasting
  2. motivating
  3. co-ordinating
  4. controlling


29.  Johnson may not be able to insure a house belonging to Kofi against fire because Johnson has no      [expand title=””]D[/expand]

  1. utmost good faith
  2. indemnity
  3. proximate cause
  4. insurable interest


30.  Which of the following will assist clarity of communication in an organization?     [expand title=””]C[/expand]

  1. Technical language
  2. Speaking through an interpreter
  3. Clear and simple language
  4. Speaking forcefully and loudly


31.  The most popular business organization found in the rural areas of Ghana is     [expand title=””]A[/expand]

  1. one man-business
  2. corporation
  3. partnership
  4. co-operative society


32.  What is the form of tax paid by employees in an organization?      [expand title=””]D[/expand]

  1. Custom duty
  2. Excise duty
  3. Profit tax
  4. Income tax


33.  Before giving a long-term loan, a bank will normally require the customer to provide      [expand title=””]C[/expand]

  1. a promissory note
  2. guarantors
  3. a collateral security
  4. a lien


34.  Which of the following is an advantage of specialization?      [expand title=””]B[/expand]

  1. Monotony of work
  2. Increased output
  3. Flexibility of work
  4. Restricted output.


35.  Which of the following is most likely to be found in the conditions of service of an organization      [expand title=””]C[/expand]

  1. Financial records
  2. Organization structure
  3. Leave matters
  4. Duty schedules


36.  Which of the following is not a marketing activity?      [expand title=””]D[/expand]

  1. Packaging
  2. Product development
  3. Product planning
  4. Transportation


37.  One role that Commercial Banks perform is      [expand title=””]A[/expand]

  1. lending money to investors
  2. taking to active farming
  3. regulating the exchange rate
  4. advising the Bank of Ghana on inflation


38.  Which of the following statements is false     [expand title=””]D[/expand]

  1. Excise duty is paid on locally produced goods
  2. The Bank of Ghana serves as a banker for all Commercial Banks
  3. The Trade Union Congress gives guidance on labour matters
  4. Training is unnecessary for newly employed workers


39.  Which of the following group is a producer of services?      [expand title=””]C[/expand]

  1. Carpenters
  2. Miners
  3. Teachers
  4. Farmers


40.  Formal communication in an organisation would normally be between      [expand title=””]A[/expand]

  1. superiors and subordinates
  2. colleagues
  3. a man and a woman
  4. father and child


41.  The document in which the internal regulations of a limited liability company are stated is called     [expand title=””]A[/expand]

  1. Regulations
  2. Memorandum of Association
  3. Prospectus
  4. Indentures


42.  The responsibility of business to consumers include     [expand title=””]C[/expand]

  1. supplying inferior goods to the public
  2. causing pollution in the environment
  3. providing reliable and safe goods
  4. paying tax at the end of every year


43.   The main objective of any business enterprise is to     [expand title=””]D[/expand]

  1. sell goods to consumers
  2. provide services at a low cost
  3. employ people
  4. make profit


44.  Which of the following is the major source of government revenue?     [expand title=””]A[/expand]

  1. Taxes
  2. Loans
  3. Grants
  4. Fines


45.  Which of the following is not a quality of money?     [expand title=””]C[/expand]

  1. Acceptability
  2. Divisibility
  3. Invisibility
  4. Portability


46.  The practice of exchanging goods for goods is known as     [expand title=””]B[/expand]

  1. credit sales
  2. barter trade
  3. internal exchange
  4. international trade


47.  Commercial banks perform all the following functions except     [expand title=””]D[/expand]

  1. granting of loans
  2. keeping valuable items
  3. giving expert advice
  4. giving scholarship


48.  What is the main objective of production?     [expand title=””]A[/expand]

  1. To satisfy human wants
  2. To sell goods and services
  3. To extract natural resources
  4. To buy and sell resources


49.  Which of the following is not a form of business ownership?     [expand title=””]D[/expand]

  1. Sole proprietorship
  2. Partnership
  3. Joint-stock
  4. Merchandising Trading


50.  Business organizations have the responsibility to pay tax on their profit to     [expand title=””]B[/expand]

  1. Shareholders
  2. Government
  3. Consumers
  4. Merchandising Trading



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 lets proceed to the Paper 1 – Section B just below:


WASSCE Past Questions and Answers Bus. Mgt. 1993 – 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 Specialisation?

Suggested Answer:[expand title=””]

Specialisation is a system by which individuals, firms or countries channel their productive efforts to particular areas fields, and sectors. Consequently, this helps to  become more efficient or knowledgeable in the production of that item.[/expand]

1   (b) Identify and explain four advantages of specialization.

Suggested Answer:[expand title=””]

  • Increased output: – When a business or an individual concentrates on a particular sector, he becomes more faster and accurate in the making of that product. Thus, the person can produce more quantities within a limited time.
  • Efficient use of machines, tools etc.: – When a person uses a machine for a long time, he/she becomes very skillful in the operation of that machine. This reduces frequent breakdown of the machines and tools.
  • Reduces fatigue: – Specialisation reduces fatigue, because the worker does not move about to search for different tools or change different tools.
  • Saves time: – When a worker is made to concentrate on a specific job, he is able to do it faster.
  • Develops talent and skill of individuals: – This means that, it helps to develop the natural talent and skill of individual workers. Certainly,  Once he is given a particular job to do, by doing it over and over again, he develops the skill better.[/expand]


2   (a) Identity and explain briefly the important elements that must be present, for a contract to  be valid.

Suggested Answer:   [expand title=””]

A contract is a legally enforceable agreement. As a result, It must be made either by deed or for a valuable consideration. Furthermore, For a contract to be valid, the following important elements must be present.

  • There must be agreement between the contracting parties: – One party must make an offer and the other party must accept the offer. This leads to an agreement which is known as “consensus ad idem”, which means “the meeting of the minds”.

  • Intention to create legal relations: – The parties to a contract must have the intention to create a legal relation. This means that, 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. Therefor social agreements are not considered as contract.
  • 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. In other words, it means that each party to the contract must sacrifice something in order to benefit under the contract.
  • Legality: – All contracts must be made legally. This means that, the purpose of the contract must not illegal.  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, and sound mind. For certain special contract, the person must qualify under law to engage in such contract, e.g. when a minister of state signs a contract on behalf of the president. Therefore, the law prohibits children, the insane, drunken persons from entering into a valid contract.[/expand]

2    (b) Mention four ways by which an agency may be created.

Suggested Answer:   [expand title=””]

The four ways by which an agency may be created are:

  • Agency of Necessity:It occurs when a person is entrusted with another’s’ property and it becomes necessary to do something to preserve the property. The person who is entrusted with the property has no express authority to do the act necessary to protect it from damage.  However, because of the necessity, such an authority is implied.
  • Agency by ratification:This occurs when an agent goes beyond the authority given to him by his principal,  and the principal adopts or continues the unauthorised act, making it binding on him as if he has previously authorised it.
  • Agency by agreement:This is the usual method by which an agency is formed. Thus, an agent may be expressly appointed either verbally or by writing to act on behalf of the principal.
  • Agency by Estoppel:If one person by words or conduct holds out another as having authority to make contract on his behalf, then he will be bound by such contracts as if he had expressly authorized them.
  • Co-habitation: this happens when couples live together in a domestic apartment. Both spouses have each other’s authority to enter into a transaction on behalf of the other.

  • Ostensible/Implied Authority: Here, there is no express agreement between the agent and the principal. But there is an implied authority by which the agent acts during the normal course of business.


3   (a) What is Money?

Suggested Answer:   [expand title=””]

Money may be defined as anything that is generally accepted as payment for goods and services and in the settlement of debts. Thus, is any commodity which is generally accepted as a medium of exchange and in the settlement of debt.[/expand]

3   (b) Mention and explain five qualities of money?

Suggested Answer:  [expand title=””]

Five main qualities of money include the following:

  • Acceptability: Money must be acceptable. Indeed, people must have confidence in it to enable them readily accept it. In that way, the material would be considered as a good medium of exchange,.
  • Portability: It must be portable. To clarify that, anything that is used as money must be easy to carry about without facing any  difficulties. Hence the use of more paper money than coins.
  • Divisibility: In order to ensure that goods can be bought in small and large quantities, there is the need for money to be capable of being divided into smaller units.
  • Durability: For money to perform its function effectively, it should not wear out quickly or be destroyed within a short period. As a result, money must be able to last without any deterioration.
  • Homogeneity:   Money must be homogenous. To clarify that, it means that a unit in each denomination should be the same as any other unit in the same denomination. Example, a hundred cedis note in Accra should be the same as a hundred cedis note in Bolgatanga.
  • Scarcity:   It must not be too much in an economy in order to maintain its value. This is because if it is abundant in the economy it may lose its value.[/expand]


4   (a) Mention and Explain three types of insurance

Suggested Answer:   [expand title=””]

  • Fire Insurance: – This is an insurance policy taken to protect the insured against losses arising from destruction by fire to property. Examples of those properties are homes, factories, office buildings, warehouses, fixtures and fittings, etc. Thus, the compensation paid enables the insured to re-equip or rebuild the damaged items. Examples of fire insurance policies include: – Consequential loss insurance, household policies and fire insurance on domestic and business premises.
  • Accident Insurance: Accident Insurance provides insurance for injury, damage or loss resulting from an accident. Examples of accident insurance include: third party policy, (comprehensive policy, burglary insurance and aviation insurance).
  • Life Assurance: Under life assurance, an amount of, money is paid as compensation on the death of the life assured. Furthermore,  in the case of life endowment policy, on the death of the assured or at the lapse of an agreed period. The compensation is usually paid to the dependents of the assured. Examples of life Assurance policies include: whole life policy, Group Assurance policy, life endowment policy and health insurance policy.
  • Marine Insurance: It deals with all the risks connected with the sea, covering both ships and goods. It therefore covers perils on the sea. It is the oldest type of insurance where the insurer undertakes to compensate (indemnity) the insured against losses sustained by perils on the sea. Examples of marine insurance policies include: – voyage policy, time policy, floating policy, mixed policy, fleet policy etc.[/expand]

4   (b) Discuss briefly four reasons why insurance is important to business.

Suggested Answer:  [expand title=””]

  • To the businessman, insurance provides a certain amount of money as compensation for any loss or damage that one suffers for a property that he has insured. Thus, insurance indemnifies the insured.
  • Insurance removes certain uncertainties in business and hence encourages businessmen to go into risky projects, which they would otherwise have hesitated.
  • To the businessman insurance policies may serve as collateral security for taking loans from banks and other financial institutions.
  • Insurance also provides the businessman with capital for investment. This they get out of premium payments.[/expand]


5.   All developing countries face common problems which affect the growth of their Economies. Identify and explain four of the problems.

Suggested Answer:  [expand title=””]

Developing countries refers to those countries which are experiencing a gradual but sustained improvement in the economic welfare of their people and have potential of increasing their growth.

Some of the common problems that affect the growth of the economies include:

  • Shortage of high-level manpower: – Developing economies lack high-level manpower. The issue of brain drain which refers to the exodus of skilled manpower to other countries. The main problem is that skilled manpower like engineers, doctors, accountants, lawyers, etc. are short in supply because those who are trained in the developing countries travel and sell their services to the developed countries. There is therefore shortage of people with the necessary experience and knowledge to man various fields of production.
  • Single export dependency: – Another problem facing developing economies is their dependency on single or a few primary products for their foreign exchange needs. The fluctuation of prices on the world market may lead to decreasing export earnings from such items.  This retards the economic growth of the countries involved.
  • Unemployment: – Unemployment is a situation where skilled, qualified, willing and active personnel are looking for jobs but cannot get them. It is also an economic situation where the demand for factors of production (i.e. land, labour, capital and entrepreneurship) fall short of supply. Unemployment is a problem that confronts many developing countries.  This is because without jobs people cannot earn income and this will lead to low savings, low capital formation, low investment and low development. It also leads to low output, a tall in standard of living, prostitution, stealing, etc.
  • High rate of population growth: – Increased population growth rate is one of the problems facing developing countries. Most of these countries experience population explosion and the consequences of this include unemployment, lack of capital, inadequate infrastructural facilities, etc. Also, government expenditure in the provision of schools and health services is bound to increase. Capital needed to accelerate the growth of the economy will be diverted to provide basic needs of the people and thus economic growth.
  • Import Dependency: – This means greater dependence or reliance on goods and services from other countries. Most developing countries depend on foreign economies for their basic needs.  These basic needs include food, clothing, drugs, etc. this increases the import bill of most of these countries leading to balance of payment deficits.  Balance of payment deficit arises because the value of imports usually exceeds the value of exports. Imports also discourage and kill infant industries.[/expand]


6   (a) State and explain five important provisions that may be found in a partnership Deed.

Suggested Answer:   [expand title=””]

A partnership deed may have the following provisions:

  • The official recognized name of the partnership. This will make it easy to identify and differentiate one partnership business from other partnership businesses.
  • Names and addresses of partners. This will help people to know those who have established the business.
  • Address and place of business. This makes it possible for people to locate and make contacts when necessary.
  • The method of sharing profits accruing to the business. This is to prevent or avoid conflict and ensure equity in profit sharing
  • Duration of the partnership. This refers to the time period for which the business is going to be run.
  • Method of settling disputes and disagreements. This will help ensure peaceful settlement of misunderstandings in the partnership.
  • Agreed remuneration (Salaries) to be paid to partners.[/expand]

6   (b) Explain briefly five barriers to communication in an organization.

Suggested Answer:   [expand title=””]

  • The use of technical words or “jargons” can be a barrier especially where the recipient is not familiar with the jargons used in a particular specialized field.
  • Lack of attention may affect effective communication.
  • Wrong choice of medium of communication can also affect effective communication.
  • Long chain of command or unclear levels of authority may hinder effective communication.
  • Where there is conflict between individuals or department, communication will be withdrawn or information withheld.
  • Overload, that is, a person being given too much information to digest within a short period.
  • Physical barriers like noise, poor or illegible handwriting can also affect effective communication.[/expand]


7   Write short notes on the following.

7   (a)  Organisational Structure:

Suggested Answer:  [expand title=””]

It may be defined as the arrangement and interrelationships of the various positions and component parts (departments) of an organization. Organisational Structure is the framework in which the organization defines how tasks are divided, resources deployed and departments are co-ordinated. It therefore refers to the type of tasks or jobs individuals are assigned to, whom to report to, who they work with as well as interact with in order to get their jobs effectively and efficiently done. It establishes responsibility and authority relationships in the organization.[/expand]

7   (b)  Informal Communication:

Suggested Answer:  [expand title=””]

It is the means by which information flows outside official channels. Informal Communication is information given without the authority or permission of any superior. It has no official source and takes the form of gossip or rumour. Informal Communication arises when communication needs of members of an organization are not adequately catered for. The grapevine is an example of informal communication. It spreads very fast.[/expand]

7   (c)  Capital:

Suggested Answer:  [expand title=””]

This is one of the factors of production. It is defined as “all man-made productive assets used to produce goods and services”. Thus, capital includes all those things made by man to help him produce other things. It therefore refers to goods not wanted for their own sake, but for the contribution they make to the production of other goods. Examples of capital assets include machines, buildings, factories, railways etc. whilst money capital is the method of paying for capital goods. The reward of financial capital as a function of production is interest.[/expand]


7   (d)  Utmost Good Faith:

Suggested Answer:  [expand title=””]

This is a principle of insurance which requires the insured in an insurance contract to answer all questions put to him by the insurer in truthfulness without hiding any material fact. Utmost Good Faith will enable the insurance company to make accurate assessment of the risk and calculate the premium to be paid by the insured. Failure on the part of the insured to comply with this principle may render the contract null and void making the insurance company free from liability.[/expand]

7   (e)  Balance of Trade:

Suggested Answer:  [expand title=””]

This shows the relationship between the total value of a country’s exports and total value of its imports within a given period of time, mostly one year.[/expand]


WASSCE Past Questions and Answers – Business Management 1993 – Paper 2



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


The manager of Jaysec Enterprise Limited, Mr. Danquah, a young graduate in his thirties, was frank and did not hesitate to speak his mind when pointing out subordinates’ mistakes. Mr. Danquah was very attentive to the views of others and provided his workers with incentives and urged them to perform under the favourable conditions he had created.

Mr. Danquah held regular discussions on all-important issues with his top officers. He took very active part in the discussions and invited others to do so. He criticised, invited new ideas and promoted new projects or changed unsuitable procedures. He liked to have the benefit of other people’s opinion and judgement. In most of his ways, Mr. Danquah initiated action on and modified unpleasant situations rather than adapted to them. The workers were made to feel their worth.

Work under Mr. Danquah was very smooth. Profit grew steadily. However, 10 years after intensive and successful work Mr. Danquah resigned to continue his education in a university. His place was taken over by Mr. Mensah. Mr. Mensah was rather quiet and stern. He created the feeling that his role is to rule and give instructions. Collective decisions stopped. Instructions must be obeyed if one was to keep his job. Fear silently crept into the work. Mistakes reflected in poor results. Many unit heads were fired. Mr. Mensah personally supervised all jobs but the supervision was casual. His energy soon ran out and he became easily irritated. Co-operation among workers virtually ceased.[/expand]

1   (a) What were the main factors that contributed to the success of Mr. Danquah’s administration?

Suggested Answer:   [expand title=””]

The secret behind the success of Mr. Danquah’s administration include the following:

  • He was frank and straightforward in pointing to his subordinates their shortcomings. This good human relation therefore contributed a great deal to the success of his administration.
  • He also created a motivational environment apart from providing incentives necessary for the employees to work hard.
  • Mr. Danquah was a man of dynamism, equipped with interpersonal skills, initiative and drive, which are necessary for the success of every administration.
  • He worked hand in hand with his employees. Mr. Danquah was therefore able to eliminate unnecessary procedures. Thus, his personal involvement contributed greatly to his success.
  • He did not hesitate to include his subordinates in decision. making and administration. This delegation therefore made the employees feel to be part of the administration and put up their best.
  • Mr. Danquah was free to discuss with top officers about the problems they were facing. These regular discussions contributed immensely in solving their problems.[/expand]

1   (b) What were the causes of the problems that faced the company during the era of Mr. Mensah?

Suggested Answer:   [expand title=””]

The main causes of the problems of Mr. Mensah’s era include the following:

Mr. Mensah was too temperamental

  • He was bossy and did not have good personal relations
  • Mr. Mensah fired unit heads unnecessarily, this made the workers feared of dismissal and caused a lot of blunders in the cause of their duties
  • Conditions under which the employees worked were very hostile to them. These unfriendly working conditions created a big problem.
  • Mensah took up supervision alone and did not allow any delegation. His supervision did not therefore go through his approach to management ignored group discussions and he made decisions alone. This lack of collective decision making therefore affected his administration
  • He was very strict and this led to lack of open-door policy. This autocratic nature of him contributed to his failure.[/expand]

1   (c) What recommendations will you make to ensure the smooth operation of Jaysec Enterprise Limited?

Suggested Answer:   [expand title=””]

Suggestions to remedy the problems may include:

  • There is an urgent need for him to delegate authority in order to reduce his
  • He must be made to undergo management training and workshops.
  • Open door policy should be adopted to allow for collective decision making.
  • The manager should follow the steps of Mr. Danquah by reviving his group discussion.
  • He should undergo a human relation course.[/expand]


2   (a) What are the three main functions of management apart from planning?

Suggested Answer:   [expand title=””]

The three other functions are:

  • Organizing
  • Directing
  • Co-ordinating[/expand]

2   (b) Discuss briefly how planning assists the manager to achieve his objectives? 

Suggested Answer:   [expand title=””]

Planning is the first managerial function performed by every business organisation. It involves setting objectives and showing how these objectives can be achieved.

Planning assists the manager to achieve his objectives in the following ways:

  • The first importance of planning is that it reduces the dependency on intuition in decision-making. It provides information for the course, of action that an organisation wants to pursue.
  • Planning also helps to reduce uncertainty by anticipating change. It therefore reduces the level of organisational failure. Since planning is future oriented, it enables a company to forecast and predict events, which may hamper goal attainment.
  • Moreover, planning establishes objectives or standards that facilitate control. It provides the foundations for controlling processes. Every good plan has targets which members strive to achieve. 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 direction 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
  • It provides information for the course of action that an organization
    wants to take.[/expand]


3   Explain briefly how the following variables of the marketing mix which helps the marketing manager to sell his products.


  1. Product
  2. Promotion               
  3.  Place          
  4. Price

Suggested Answer:   [expand title=””]

  1. Product: A product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. It includes physical objects, services, persons, places, organizations and ideas. The product therefore refers to the range of products or services the company offers for sale. It also deals with the physical design of the products e.g. the colour, quality, size, packaging, brand name, product line, price, product life cycle, product positioning etc. the product must meet the needs, wants and aspirations of customers or consumers. Once this is done it becomes easier for the marketing manager to sell his products.
  2. Promotion: It deals with the methods and techniques used to inform customers or consumers about the availability of a product or service. Promotion therefore involves methods of communicating the product message to the target market by personal selling, mass selling, sales promotion, exhibitions, trade fairs etc. It may aim at informing, persuading, educating or reminding the target market about the product. Effective and efficient promotional methods and techniques will help the marketing manager sell his products without any difficulty.
  3. Place: This has to do with where and how the company would sell its products. It involves decisions about channels of distribution to be used to reach the customer. Place thus entails choice about channel men, storage facilities, transportation and transfer of title. Effective and efficient channels would help the marketing manager move the products from where they are manufactured to the final consumer.
  4. Price: Price bears the monetary or exchange value of the products or services. The success of a product partly depends on the price. In setting the price, the marketer must consider competition, existing pricing policies, mark-ups, terms of sale and cost of the product. Pricing policies must be related to cost and profit. A good pricing policy would enable the marketing manager sell his products.[/expand]


4   Identify and explain any four sources of short-term finance available to a young business entrepreneur who wants to undertake poultry fanning.

Suggested Answer:   [expand title=””]

  1. Trade Credit: This is one of the main sources of finance for business organizations. Trade Credit involves the purchase of goods or services that is backed by a promise to pay at a future date. It gives the debtor the opportunity to sell the goods or services, make some profit before paying for them. It however, depends on the credit worthiness of the debtor and the price paid is usually higher than when cash is paid immediately.
  2. Bank Loans: This is another source of finance for several business organizations. Loan may either be short-term or long term and could be obtained either from financial institutions such as banks, insurance companies or from individuals. Interest is charged on the amount granted as loan whether it is withdrawn or not and where the amount is substantial, collateral security may be required.
  3. Overdrafts: Overdraft is probably the commonest means of obtaining short-term funds. Here, a customer is allowed to overdraw up to a certain limit and interest is charged only on the actual amount overdrawn. A collateral security may be required where the amount to be overdrawn is substantial.
  4. Hire Purchase: This is an important source of finance for businessmen who cannot make full payment for items purchased. Under the hire purchase agreement, the businessman undertakes to pay for items purchased in instalments after an initial deposit has been paid. The agreement spells out the rights of both the seller and the buyer. These buyers however takes complete possession of the goods after the last instalment has been paid.
  5. Personal Savings: Under personal savings, an individual or a company may start business either by using his past savings with the banks or the local “Susu”. Personal savings forms the major source of finance to the sole proprietor and small-scale businesses.
  6. Help from family members and friends: Sole proprietors may finance their business with funds from relatives and friends.
  7. Leasing: Here organizations lease out their fixed assets which are lying idle and would not be used immediately at a fee and the fee (rent) could be another source of finance for business organizations.[/expand]


5    As a young business executive, state and explain briefly

  1. three health measures.
  2. three safety measures you will recommend in your company.

Suggested Answer:   [expand title=””]

(a)        Health Measures include:
  • Sanitation – The business premises must be clean. Proper sanitation must be maintained in all departments or offices of the business so as to provide for the comfort of employees.
  • Good Hygienic Conditions — There must be general education on personal and industrial hygiene, e.g. overcrowding in factories, shops and offices must be discouraged and avoided.
  • Good Building Plan or Design – A good building plan will provide for good system of ventilation, sanitation and drainage. It should also provide for good lighting system so that workers may not strain their eyes.
  • Protective clothes – protective clothes must be provided to employees who are engaged in jobs of hazardous nature.
(b)        Safety Measures include:
  • Education and Training – Training should be provided for management and employees on safety methods at work, accident prevention programme, job knowledge and skills
  • Proper maintenance and rehabilitation – There should be regular maintenance and rehabilitation of all equipment, machinery, tools, etc. through cleaning and lubrication to keep all the systems (machines) in good working condition.
  • Proper methods should be put in place for the movement of plant and materials
  • Showing of accident prevention films, display of posters and safety matters, etc. at the workplace.[/expand]


6    State and explain briefly four advantages of training programmes for workers in an organization.

Suggested Answer:   [expand title=””]

Training has many benefits among which include:

  1. Training  helps workers to improve upon their existing skills and acquire new ones. It therefore improves their efficiency and increase output
  2. Training improves employee morale because of the satisfaction employees derive from doing their jobs very well.
  3. A company with good training programme can attract desired and qualified personnel
  4. Training provides for succession. It helps to prepare employees for higher jobs or promotion
  5. Training ensures greater accuracy of work. It ensures more efficient handling of machines and equipment by well trained staff and thus reducing cost of maintenance and accidents.
  6. Training helps organizations to adapt to changes more effectively.[/expand]


7    Mention six reasons why marketing is important to commercial organizations.

Suggested Answer:   [expand title=””]

Marketing is important to commercial organizations because of the following reasons:

  1. Marketing offers employment to a lot of people who are engaged in it. For instance, wholesalers, retailers, distributors, marketing officers and managers, workers in the service sector e.g. banking, insurance. transportation. warehousing etc. are all employed by marketing.
  2. It makes it possible for commercial organizations to achieve their objective of profitability. Profit depends on the volume of sales which involves a lot of marketing activities e.g. promotion.
  3. Marketing bridges the gap between production and consumption by making it possible for goods produced to be moved from the point of production to where they are needed for consumption.
  4. It also makes it possible for commercial organizations to create awareness about the existence of a product or service. This is achieved through promotion.
  5. Marketing ensures that the organizations resources are used judiciously so as to achieve its objectives. This is achieved through effective and efficient use of these resources.
  6. It provides maximum satisfaction and convenience of consumer needs and wants by providing the right product, at the right place, at the right time and at the right price. [/expand]


8   Workers often complain of poor working conditions. Give six suggestions likely to help improve the working conditions of the Clerical Staff of an organization. 

Suggested Answer:   [expand title=””]

The main suggestions to improve the working conditions of the clerical staff in an organization include the following:

  1. A good competitive condition of service – There must be a good and competitive pay structure, welfare facilities and some benevolent activities to help solve workers’ personal problems.
  2. There should also be clear lines of communication. Clear communication channels must be laid down and followed. All grievances and industrial disputes must be solved fairly and amicably without fear or favour.
  1. There must be congenial work environment. This must be congenial with up- to-date equipment, which are well serviced and maintained. Equipment and working tools as well as the work place must be suitable for workers to feel comfortable to contribute their best.
  1. The organization should also provide such facilities as good ventilation, lighting, furniture for its workers. That will reduce fatigue. Places of convenience separate should be provided for both men and women. Protective clothing and good drinking water should be provided to create a conducive atmosphere for the workers.
  2. There should in addition to the above be recreational facilities to reduce fatigue and boredom. First aid facilities together with fringe benefits in the form of canteen services and transportation facilities should be provided.
  3. Good reward system should be instituted. The reward system must be adequate and commensurate to the output and achievement of the worker. Reward may take the form of cash incentives, promotion based on merit and laid down procedure, transfers to higher positions, etc. [/expand]


9   Give six functions performed by Commercial banks in the development of Ghana’s economy.

Suggested Answer:   [expand title=””]

-The following functions are performed by Commercial banks in the development of Ghana’s economy:

  1. Commercial Banks accept deposits from the general public including savings account, Deposit account and current account. They therefore provide a safe place for keeping customer’s money.
  2. Commercial Banks grant credit facilities to their customers in the forms of loans and overdrafts. They therefore provide businessmen with money to finance their activities.
  3. Commercial banks apart from keeping money also keep customers valuables such as wills, certificates, life policies, securities as well as title deeds.
  4. They  make payments on behalf of their customers upon the written consent of the customers. Commercial Banks also receive dividends and other monies on behalf of their customers.
  5. They serve as trustees and referees for their customers, recommending such customers when necessary to other banks.
  6. They  also reduce unemployment by employing people.
  7. Also, they provide export advice on investment and business opportunities to their customer.[/expand]


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