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Grade 7 Introduction to Business Handout-chapter 1; Lesson 2 and 3-Test Answers

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Noreen Al-Mansur
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19 views

Grade 7 Introduction to Business Handout-chapter 1; Lesson 2 and 3-Test Answers

Uploaded by

Noreen Al-Mansur
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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GRADE 7 INTRODUCTION TO BUSINESS

CHAPTER 1: BUSINESS ACTIVITY; LESSONS 2 AND 3-TEST

MARKS: 25
TIME: 40 MINUTES

NAME: __________________________________________ DATE: _______________ SCORE: _______

1. What is specialisation and division of labour? (4)

ANSWER: Specialisation refers to people and businesses that concentrate on producing one product or
service that they are good at. Division of labour refers to how production is divided into separate tasks
and each worker does just one of those tasks.

2. Identify and explain two advantages to a business of specialisation. (4)

ANSWER: Two advantages of specialisation to a business include (ANY 2):


 Workers are trained in one task and specialize in this-this increases efficiency and output.
 Less time is wasted moving from one workbench to another-this saves time and cost.
 Quicker and cheaper to train workers as fewer skills need to be taught.
 The organization of production becomes easier and more effective.

3. Identify and explain two disadvantages of specialisation to workers. (4)

ANSWER: Two disadvantages of specialisation to workers (ANY 2):


 Workers can become bored doing just one job-efficiency might fall.
 If one worker is absent and no one else can do the job, production might be stopped.
 Workers could be replaced by machines.
 Little opportunity to progress to a better job since significant learning is rarely possible.

4. Explain how a restaurant might achieve specialisation of labour. (4)

ANSWER: A restaurant achieves specialization of labor by assigning specific tasks to different employees
based on their skills and roles. For example, servers focus on taking orders and serving customers, while
cooks handle food preparation, kitchen help assist with the cleaning of the kitchen, dishes and ingredients
and manager handles the accounts and paychecks as well as the overall running of the restaurant. This
division of labor allows employees to become more skilled and efficient in their tasks, resulting in
increased productivity and higher profits for the restaurant.

5. What are capital goods? Identify two examples of capital goods. (3)

ANSWER: Capital goods are products that are sold to other businesses to help them in their production
process. These are physical goods such as machines, computers and delivery vehicles.
6. What is meant by ‘added value’? (2)

ANSWER: Added value is when businesses take raw materials and turn them into a good or service
which it sells to customers at a price greater than the cost of the raw materials.

7. Identify and explain two ways a business could increase value added. Give examples as well. (4)

ANSWER: Two ways a business could increase value added are as follows (ANY 2):

 Branding: Well-known companies spend huge sums of money on advertising and other promotional
activities. They do this to build and then maintain their brand. The products produced by each of
these companies all have close substitutes – that means you can buy other brands of drink and
electronic goods. However, these companies are able to charge a higher price than their competitors,
even though the costs of production are likely to be quite similar. Branding increases added value
because people want or feel they should buy the item from this particular company. Example: The
mobile phone brand Apple is famous for its sleek design, latest technology and quality products.

 Excellent service quality: In some industries providing a high-quality, personalised service, can be the
difference between being able to charge a high price or one which is much lower. Examples of service
quality include: offering 24/7 customer service, responding to customer inquiries quickly and having
a knowledgable and friendly staff.

 Product features: Products that have more features and functions than similar products on the
market will allow the producer to charge a higher price. Although these additional features will
increase costs, consumers are prepared to pay a much higher price than they would pay for a product
with fewer features or functions. Example: The best smartphones allow you to perform multiple tasks
such as take pictures, surf the web, communicate, send email, work on documents, etc..

 Convenience: Many consumers lead busy lives and they are often prepared to pay a higher price for
goods and services which they can have immediately or which save them time. For example providing
delivery services, having in-store pick up or online ordering adds convenience.

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