Business Studies Form 3 Questions and Answers End Term 1 Exam Free


Business Form 3 Past Paper Questions with Marking Schemes PDF

1.   Highlight four circumstances under which air transport can be preferred to transport goods from one place to another.    (4mks)

2.   List four costs incurred by intermediaries in the chain of distribution       (4mks)

3.   Outline four factors that comprise a negative internal environment in a business. (4mks)

4.   Given below are functions of office equipment. Identify the name of the equipment against

the rightful use.           (4mks)

Functions of the MachineOffice Equipment
Used in posting information to ledgers and preparing payrolls 
To transmit printed messages such as photographs, letters, and maps 
Usually fire proof where important documents in an organization are stored 
Used to carry out many functions such as storing information, typing and performing complex calculations 

5.   Give four disadvantages of division of labour and specialisation.      (4mks)

6.   Highlight four reasons why one should have a good business plan.                         (4mks)

7.   Outline four circumstances under which a profoma invoice may be used.               (4mks)

8.   Highlight four ways in which the government provides an enabling business environment.  (4mks)

9.   Eureka limited bought a building valued at Shs. 1,000,000 on 2nd Feburuary 2013. The

building was insured with two insurance companies lion and kangaroo for Shs. 600,000

and Sh. 400,000 respectively. In June 2013, fire damaged the building causing Eureka

limited to suffer a loss of 20% of the building value. Determine the contribution made

by lion and kangaroo.              (4mks)

10. Outline four important documents that are required in the registration of a public

company.                                                                                                                                (4mks)

11. The diagram below shows a shift in demand curve from D0D0  to   D1D1  

Identify four factors that have made the demand curve to shift from D0D0

to D1D1                                                                                                                                                                                (4mks) 

12. State four types of market structures                                                                               (4mks)

13. Give four reasons why firms choose to remain small in an economy dominated

by large firms.                                                                                                                       (4mks)

14. Commerce is the study of trade and aids to trade. List four aids to trade.                (4mks)

15. State any FOUR advantages of using cell phones                                                          (4mks)

16. Explain five challenges that may be experienced by a new entrepreneur who is

intending to start a business in Kenya.                                                                            (10mks)

17. Explain the distinctions between each of the following sets of goods and

services.                                                                                                                                 (10mks)

a.   Free goods and economic goods..


b.   Producer goods and consumer goods

c.   Perishable goods and durable goods..

d.   Public goods and private goods..

e.   Intermediate goods and finished goods

18. Explain FIVE circumstances under which a public limited company would

be dissolved.                                                                                                                         (10mks)

19. Explain five factors that may lead to decline in the demand for oranges in

Nakuru Town.                                                                                                                      (10mks)