commerce first term 2008 grade 10 paper 2.doc

MADHRASATHUL MADHRASATHUL AHMADHIYYA, AHMADHIYYA, MALE’ FIRST TERM TEST 2008 COMMERCE Grade 10 PAPER - 2 D URATION : 2 HOURS Information and instructions: • •

Write your name, index number, class and register number on the answer sheets.  Answer any  Answer any four questions four  questions.

(1)

Mr and and Mrs Mrs Phiri Phiri own a ware wareho house use.. (a) State two reasons why they should insure their warehouse. [2 Marks] (b) In relation to insuring insuring the warehouse, warehouse, explain explain the functions functions of the following: following: (i) the propos proposal al form form [3 Marks Marks]] (ii) (ii) a poli policy cy [3 Mark Marks] s] (iii) underwri underwriters ters [4 Marks] Marks] (c) The warehouse warehouse is valued valued at $1m $1m but Mr and and Mrs Phiri Phiri wish to insure insure it for  $750 000. (i) Why might might they they wish wish to do this? this? [2 Marks Marks]] (ii) Why is it not advisabl advisable e for them them to do this? this? [2 Marks] Marks] (iii) Explain how how consequential consequential loss insurance insurance might might assist them if the warehouse were burnt down. [4 Marks]

(2)

Samsing Samsing Electric Electricals als is a compan company y making making and sellin selling g electroni electronic c componen components. ts. It has received a letter of enquiry from a customer. (a) Why are commercial documents documents used in trade? [5 Marks] (b) (i) What is a letter of enquiry? [2 Marks] (ii) How might Samsing Electricals respond to the letter of enquiry? [2 Marks] (c) The customer has decided to place an order. Name and briefly describe three documents which migh be used between the order and payment for the goods. goods. [6 Marks] (d) The electronic components components are packaged after manufacture. manufacture. Explain why Samsing Electricals needs to package its components components before selling them. [5 Marks]

(3)

(a) (i) Explain Explain what is meant meant by competit competitive ive advertisi advertising. ng. [2 Marks] Marks] (ii) State and explain one advantage and one disadvantage of competitive advertising for the consumer. [4 Marks] (b) Why does a company company which has has a large volume volume of sales sales continue to advertise? [2 Marks] (c) State two different advertising advertising media for each of of the following. Give a reason reason for each of your choices. (i) a chain chain of clothi clothing ng stores stores.. [4 Marks] Marks] (ii) a vacancy vacancy for the manager manager of a supermar supermarket. ket. [4 Marks] Marks] (iii) the new catalogue of a mail order company. [4 Marks] (NB You should not select the same advertising medium more than once)

(4)

Many Many busines business s organis organisation ations s operat operate e as limited limited compan companies. ies. (a) What is a limited company? (b) (i) Who owns a limited company? (ii) Who decides the long – term policies of a limited company? (c) A limited company has paid – up capital of 5 million ordinary shares of $1 each. Its net profit for the year is $400 000. It has decided that 75% of the Madhrasathul Ahmadhiyya, 2 

First Term Test – 2008,

Commerce -10,

Paper 2

[4 Marks] [1 Marks] [1 Marks]

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net profit shall be distributed as dividends. (i) How much paid – up capital does the company have? (ii) How much will the owner of 2000 ordinary shares receive in dividend? (iii) What is the company likely to do with the remaining profits? (d) Many limited companies have developed into multinational corporations. (i) Give an example of a multinational corporation. (ii) State two features of a multinational corporation. (iii) State and explain one advantage and one disadvantage to a country of  having a multinational corporation operating in that country.

[1 Marks] [4 Marks] [2 Marks] [1 Marks] [2 Marks] [4 Marks]

(5)

State four factors you would take into consideration when choosing a method of transport for goods. [4 Marks] (b) Explain why effective and efficient transport is important to a manufacturer. [10 Marks] (c) Why is it important to provide good passenger transport systems within a country? [6 Marks]

(6)

(a) (b)

(7)

(8)

(a)

State four services a wholesaler might offer to a retailer. Why do the following producers often prefer to sell direct to retailers: (i) manufacturers of technical goods; (ii) producers of perishable products? (c) What is a specialized wholesaler? (d) How might a voluntary chain assist a small retailer to survive?

You wish to set up a small business and have approached a bank for a loan and for other assistance. (a) State three items of information which the bank manager will require before considering a loan. (b) If you borrow $20 000 over two years at a flat rate of interest of 10% per  annum, how much will you have to repay monthly in order to settle the debt and the interest? (You are advised to show all your workings). (c) Describe two other services which the bank can provide in helping you to set up in business. (d) Describe two different services which the bank can provide to help your  business once it is running.

[4 Marks] [2 Marks] [2 Marks] [4 Marks] [8 Marks]

[3 Marks] [5 Marks] [6 Marks] [6 Marks]

You have chosen to buy a car on hire purchase terms rather than on credit sale terms. (a) In what ways do hire purchase terms differ from credit sale terms? [6 Marks] (b) Give possible reasons for deciding to buy on hire purchase terms rather  than paying immediately in full. [4 Marks] (c) What legal protection do you receive when buying on hire purchase terms? [4 Marks] (d) If you paid $4000 deposit on an $8000 car, how much would you have to repay monthly (capital and interest) over two years if the rate of interest was a flat 10% per year? (You are advised to show your workings). [6 Marks]

Madhrasathul Ahmadhiyya, 2 

First Term Test – 2008,

Commerce -10,

Paper 2

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