EBM N4 June 2023 | Paper 1

Entrepreneurship and Business Management N4

EBM N4 June 2023 | Paper 1

Question 1.1

Various options are given as possible answers to the following questions. Choose the answer that does not fit .

1.1.1 Characteristics of an entrepreneur:

A. Achievement
B. Energy
C. Occupation

C. Occupation
Achievement and energy are characteristics of an entrepreneur. Occupation is not a personal characteristic, so it does not fit.

1.1.2 Examples of convenience goods:

A. Staple products
B. Impulse products
C. Shopping products

C. Shopping products
Staple products and impulse products are convenience goods because they are usually bought easily and often. Shopping products are compared more carefully before purchase, so they do not fit.

1.1.3 Examples of legal documents:

A. Location of business
B. Legal formalities
C. Taxation

A. Location of business
Legal formalities and taxation relate to legal and formal business requirements. Location of business is a business-planning issue, not a legal document.

1.1.4 Costs incurred when producing products:

A. Fixed costs
B. Startup costs
C. Variable costs

B. Startup costs
Fixed costs and variable costs are production-related costs. Startup costs happen before the business begins operating, so they do not fit as costs incurred during production.

1.1.5 Methods used to promote a new product in the market:

A. Validation
B. Customer service
C. Demonstration

B. Customer service
Validation and demonstration are used to support promotion of a new product. Customer service is important in business, but it is not mainly a promotional method for launching a new product.

1.1.6 Promotional strategies:

A. Layout
B. Delivery
C. Pricing structure

A. Layout
Delivery and pricing structure link to business strategy and market offering. Layout relates more to arrangement or design, so it does not fit as a promotional strategy in this question.

Question 1.2

Briefly discuss the economic importance of an entrepreneur with reference to the South African context. (5)

Entrepreneurs create jobs.
Entrepreneurs start businesses and employ people. In South Africa, this is important because job creation helps reduce unemployment.

Entrepreneurs develop the country.
Business activity supports economic growth and helps improve the country’s development through production and trade.

Entrepreneurs give the country hope for a better future.
Entrepreneurs introduce ideas, create opportunities, and help communities see possibilities for growth and improvement.

Entrepreneurs start the process of production and use labour.
They combine resources, labour, and ideas to produce goods or services. This keeps economic activity moving.

Entrepreneurs generate wealth and a higher standard of living.
Successful businesses create income, grow wealth, and improve living conditions for owners, workers, and the wider community.

Question 1.3

Name THREE personal resources of a successful entrepreneur. (3)

Knowledge and skill
Knowledge and skill help the entrepreneur make decisions, solve problems, and run the business effectively.

Contact
Contacts are useful relationships that can help with support, customers, suppliers, information, and business opportunities.

Funds
Funds provide the money needed to start, operate, and grow the business.

Question 1.4

Name and explain FIVE types of packaging. (5 × 2) (10)

Family packaging
Packaging of all products looks similar. This helps customers recognise products from the same business or range.

Individual packaging
Goods are packaged in such a way that they stand out from other products. This helps the product attract attention on its own.

Reusable packaging
After the product has been used, the container can be reused. This adds value and can reduce waste.

Multiple packaging
Several products from the same company are packaged together in a single container. This improves convenience and can encourage bulk buying.

Kaleidoscope packaging
Pictures of famous people are printed on packaging to create a demand for the product. This makes the packaging more eye-catching and appealing.

Question 2

Complete or answer the statements below with the correct word or term from the list here.

Word or term list
A. sources include the internet and statistics
B. flow of information from a customer to the business
C. enough capital
D. questionnaire
E. lack of computer skills
F. foreign investment
G. machinery
H. computer and laptop
I. sports car
J. bread and milk
K. consists of an analysis of the age, income and gender of customers
L. according to area
M. increase in petrol

2.1 Market feasibility

B. flow of information from a customer to the business
Market feasibility checks whether there is a market and how the business connects with customer needs.

2.2 Primary data

D. questionnaire
A questionnaire is a common tool for collecting primary data directly from people.

2.3 Strength

C. enough capital
Enough capital is a strength because it gives the business financial ability to operate and grow.

2.4 Secondary data

A. sources include the internet and statistics
Secondary data comes from information that already exists, such as internet sources and statistics.

2.5 Industrial product

G. machinery
Machinery is an industrial product because it is used in production and business operations.

2.6 Opportunity

F. foreign investment
Foreign investment can help a business or economy grow, so it is treated as an opportunity.

2.7 Speciality product

I. sports car
A sports car is usually bought as a speciality product because customers seek that specific product and brand with strong preference.

2.8 Convenience

J. bread and milk
Bread and milk are convenience products because they are bought regularly, quickly, and with little comparison.

2.9 Demographic segmentation

K. consists of an analysis of the age, income and gender of customers
Demographic segmentation groups customers by features such as age, income, and gender.

2.10 Weakness

E. lack of computer skills
Lack of computer skills is a weakness because it limits the business’s ability to perform effectively.

Question 3

Choose ONE term from the list below for each of the following descriptions.

Word or term list

fixed costs; competitive advantage; variable costs; gross profit; selling price; break-even analysis; organising; planning; geographic segmentation; debtors’ ledger; general ledger; sales promotion; marketing mix; close

3.1 Costs that vary every month

Variable costs
Variable costs change depending on production, sales, or activity level.

3.2 Turnover of the business

Gross profit
This is the accepted term for this paper and should be learned exactly for revision.

3.3 Costs that stay the same

Fixed costs
Fixed costs stay constant over a period and do not change with production in the short term.

3.4 Something that a business should have to make it unique

Competitive advantage
Competitive advantage is the special strength or uniqueness that helps a business stand out from competitors.

3.5 Price at which an item is sold

Selling price
Selling price is the amount charged to the customer for the product.

3.6 Point where total costs are equal to total expenses

Break even
Break-even is the point where the business makes neither a profit nor a loss.

3.7 Accounts of all customers who buy on credit

Debtors’ ledger
The debtors’ ledger records the accounts of customers who owe the business money.

3.8 Sponsoring fund-raising activities

Sales promotion
Sponsorship of activities is a form of sales promotion used to create awareness and encourage interest.

3.9 Asking the customer for a decision so that an order can be placed

Close
Closing is the stage of selling where the salesperson asks for the final buying decision.

3.10 Number of possible customers in the area you want to serve

Geographic segmentation
Geographic segmentation groups customers according to area or location, so it links to the number of possible customers in the chosen area.