KCSE Past Papers 2011 Business Studies Paper 2 (565/2)

5.5.2 Business Studies Paper 2 (565/2)

1 (a) Explain the following types of inflation:

(i) demand-pull inflation

(ii) cost-push inflation

(ii) imported inflation

(iv) structural. inflation. (8 marks)

(b) Explain six factors that may hinder the development of a country. (12 marks)

2 (a) Explain circumstances under which containerization may be used to transport goods. (10 marks)

(b) (i) Explain the procedure for making an insurance claim. (5 marks)

(ii) A farmer’s house valued at Ksh. l,200,000 was insured against fire for Ksh. 900,000 under the “with average clause”. Fire occurred and damaged the house causing a loss of Ksh. 500,000. Determine the value of compensation due to the farmer. ‘ (5 marks)

3 (a) Discuss product.

factors that may be considered when choosing a method for promoting a (10 marks)

(b) Describe features of economic resources. (10 marks)

4 (a) Explain benefits that may accrue to an organization that adopts an open office plan. (10 marks)

(b) Discuss circumstances under which a partnership may be dissolved. (10 marks)

5 (a) Amboseli Roses is a horticultural company producing flowers. Explain six factors that may influence the choice of a channel for distributing its products. (12 marks)

(b) Give reasons for maintaining books of original entry. (8 marks)

6 (a)Discuss causes of unfavourable balance of payment for most developing countries. (10 marks)

(b) The following balances were extracted from the books of Rehema Traders on 1st January 2007

The following transactions took place during the year ended 31 st December, 2007 (i) Sold furniture worth Ksh. 60,000 for which Ksh. 40,000 cash was received and the balance was due at the end of the year.

(ii) Purchased goods Worth Ksh.100,000 for which cash of Ksh. 70,000 was paid and the balance was still outstanding at the end of the year.

(iii) Cash Ksh. 10,000 was taken from the business by the proprietor to settle the spouse’s hospital bill.

Required: Dmw Rehema Trader‘s balance sheet as at 31st December, 2007 showing the items in their relevant classes. (10 marks)

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