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    Principles of Business For CSEC®: 2nd Edition

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    yuvita prasad
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    Principles of Business For CSEC®: 2nd Edition

    Uploaded by

    yuvita prasad
    82 views3 pages
    gdfg

    Original Title

    Chapter_8_online_test_answers

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    gdfg

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    82 views3 pages

    Principles of Business For CSEC®: 2nd Edition

    Uploaded by

    yuvita prasad
    gdfg

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    Principles of Business for CSEC®

    2nd edition

    Answers to Chapter 8: Business finance


    1. The correct answer is (B). Commercial banks make a living from holding customer accounts,
    making payments on behalf of customers and lending money to customers, as well as
    carrying out other roles.
    2. The correct answer is (A). A building society or commercial bank will often hold the deeds of
    the property or land for which it grants a mortgage. It will hand over these deeds once the
    mortgage has been fully paid off.
    3. The correct answer is (C). The income statement illustrates the revenues, costs and profits of
    a business.
    4. The correct answer is (D). In double-entry bookkeeping, entries are made twice, once as a
    credit and once as a debit.
    5. (a) (i) Answers could include any two of the following:
    • Credit unions
    • Insurance companies
    • Building societies
    • Micro-lending agencies
    • Government agencies

    Mark Scheme
    Answers should include any two of the above.

    (ii) Answers could include any three of the following:


    • Online banking
    • Credit and debit cards
    • Deposit boxes
    • ATM/ABM services
    • Advisory services
    • Remittance services
    • E-trade

    Mark Scheme
    Answers should include any three of the above.

    1 Principles of Business for CSEC®, 2nd edition © Oxford University Press 2019
    Chapter 8: Business finance
    (iii) Answers could include the following points:
    • Adjusting the bank rate means adjusting the interest rate at which commercial
    banks borrow from the central bank
    • It is adjusted depending on whether the central bank wants to discourage or
    encourage loans

    Mark Scheme
    Answers should gain 1 mark for stating what the bank rate is/what it means to adjust
    the bank rate, and 1 mark for explaining how this is a regulatory tool.

    (b) Income Statement for Bridgefield Supplies for the period ending 31 January 2019

    Sales 756 000
    Less:
    Opening inventory 25 000
    Purchases 400 000
    Cost of goods available (1) 425 000
    Ending inventory (2) 49 020
    Cost of goods sold (375 980)
    Gross profit (3) 380 020
    Less expenses
    Motor vehicle insurance 8 000
    Wages and salaries 140 000
    Interest on loan 8 000
    (4) Net profit (5) 224 020

    Mark Scheme
    Marks should be awarded as follows:
    • Calculating the cost of goods available correctly: 1 mark
    • Calculating the ending inventory correctly: 2 marks
    • Calculating the gross profit correctly: 1 mark
    • Indicating that net profit is missing: 1 mark
    • Calculating the net profit correctly: 1 mark

    2 Principles of Business for CSEC®, 2nd edition © Oxford University Press 2019
    Chapter 8: Business finance

    (c) (i) Answers could include the following points:


    • Crowd funding refers to the contribution of many small sums of capital by a large
    number of people to fund a new venture
    • It uses the Internet and social media to inform potential investors about projects
    that need support
    • Contributions are then made online to get projects started

    Mark Scheme
    Answers giving a limited description gain 1 mark; answers giving a good description
    gain 2 marks.

    (ii) Answers could include the following points:


    • Any disposable income that is not spent is called personal savings
    • These savings can be accumulated in formal accounts at commercial banks or credit
    unions, or in informal institutions such as sou-sou

    Mark Scheme
    Answers giving a limited description gain 1 mark; answers giving a good description
    gain 2 marks.

    (d) Answers could include the following points:


    • Mutual funds are not seen as savings because there is a risk involved when money is
    deposited into the account
    • The money will be pooled and invested into a range of instruments including shares,
    bonds and property
    • Mutual funds will be less liquid and less accessible than savings

    Mark Scheme
    Answers should gain 1 mark for indicating the involvement of risk, 1 mark for
    indicating how pooled resources are used, and 1 mark for indicating a lack of
    accessibility/lack of liquidity.

    3 Principles of Business for CSEC®, 2nd edition © Oxford University Press 2019

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