WorksheetsBTF - QB 2025 - Chap 1
Total questions: 31
Worksheet time: 17mins
1. What are the primary objectives of profit-oriented and non-profit oriented organisations?
Option 1
Option 2
Option 3
Option 4
2. At the Annual General Meeting (AGM) of Vortex plc, a major shareholder claimed that the company was suffering from the symptoms of ‘satisficing’. In the context of corporate objectives, ‘satisficing’ means that:
A managers seek to make satisfactory profits rather than maximise wealth
B managers seek to keep all stakeholders satisfied
C owners seek to meet a satisfactory level of corporate responsibility obligations
D owners seek to make satisfactory profits
3. Joe, the Managing Director of Gargoyle Ltd, has set a primary objective of growth in profits for the company. He aims to concentrate on product development to support this objective. Identify whether the following will be suitable secondary objectives to achieve the growth in profits via product development.
(1) Bringing in new products
(2) Reducing labour turnover
(3) Investing in research and development
A. 1 and 2 only
B. 1 and 2 only
C. 1 and 3 only
D. 1, 2 and 3
4 Maximising the wealth of its shareholders is the stated goal of Avernanche plc. The company’s objectives have been expressed as a hierarchy of primary and secondary objectives. Identify which of the following is most likely to be Avernanche plc’s primary business objective.
A. To increase the annual profit after tax by 125% in the next 10 years
B. To introduce an average of two new products each year for the next six years
C. To double the share price within the next 10 years
D. To become the market leader in four market segments within the next 10 years
5 A major shareholder has stated that for three years the directors of Barrington plc have run the company in a manner designed solely to increase their prestige in the business community. According to William Baumol, this is most likely to be shown in the directors’ aim to:
A. maximise wealth
B. maximise sales revenue
C. minimise costs
D. minimise social impact
6 To establish whether a particular organisation should be classified as a business or not, it is necessary to enquire about the nature of its:
A. primary objective
B. mission
C. vision
D. secondary objective
7 The primary objective of ABC Car Rental Ltd is as follows: “We aim to be the fastest growing company with the highest profit margin in the global vehicle rental and leasing business.”
One of its secondary objectives is: “To increase our market share for global family car rentals to 20% within a reasonable time.”
Requirement
Which three components of the SMART acronym are present in the company’s secondary objective?
S
M
A
R
T
8 For a business, which two of the following would be classified as secondary objectives?
A The business’s market share target for next year
B The business’s productivity improvement target for next year
C The business’s mission statement
D The business’s financial objective of shareholder wealth maximisation
E The business’s vision
9 A major airline, FlotAir plc, has been drawing up a mission statement.
Requirement
Which three of the following items could be expected in it?
A. We will double profits in three years
B. We will encourage diversity in the workplace
C. We intend to be the best airline in the world
D. We aim to give excellent customer service
E. We intend to take over XYZ airlines
10 Two of Sunshine Tours plc’s stakeholder groups are putting the company under pressure to improve its return on investment.
Requirement
These are most likely to comprise which two of the following groups?
Shareholders
Customers
Bankers
Suppliers
Employees
11 Mandrake plc processes waste for local authorities. It has stated that it seeks to provide “our shareholders with increased value, our customers with value for money, our employees with secure and interesting jobs and the public with safe and sustainable waste disposal.”
Requirement: Identify which is Mandrake plc’s primary business objective.
A To provide our shareholders with increased value
B To provide our customers with value for money
C To provide our employees with secure and interesting jobs
D To provide the public with safe and environmentally sustainable waste disposal
12 Daycare is a charity that funds nursery places for children whose parents are both unemployed. On its website, the organisation states that it continually needs to raise funds that can be reinvested to produce an on-going income to fund its activities. It also seeks to provide daycare for all families who need its support and that it will never turn a family in need away.
business adviser has made two statements:
Statement (1): The primary objective of Daycare is to maximise profit.
Statement (2): The secondary objective of Daycare is the funding of nursery places.
Requirement: Identify whether each statement is accurate.
Statement (1) accurate; Statement (2) inaccurate
Statement (1) inaccurate; Statement (2) inaccurate
Statement (1) accurate; Statement (2) accurate
Statement (1) inaccurate; Statement (2) accurate
13 At its recent AGM, the shareholders of Boron plc voted by a small majority to accept a small dividend. At the meeting many shareholders said that they accepted the dividend because the company’s profits were low, but were very unhappy with the return because the company’s financial statements showed a large increase in revenue.
Requirement :Which of the following describes what is most likely to be happening at Boron plc?
A Revenue maximising
B Profit satisficing
C Profit maximising
D Revenue satisficing
14 Which of the following statements relating to Environmental, Social and Governance (ESG) objectives is true:
A If businesses are only interested in maximising the wealth of shareholders, they should ignore ESG objectives
B Businesses should only adopt ESG objectives if the costs are less than the fines of poor ESG behaviour
C Even where shareholders are only interested in maximising their wealth, the value of a business over the longer term is enhanced by good ESG practices
D ESG is likely to reduce the wealth of shareholders due to higher costs, but the owners have a moral obligation to embrace good ESG performance
15 To what does the term ‘triple bottom line’ refer?
A Operating profit, Profit before tax, Profit after tax
B Profits, Planet, People
C Profit after tax, Net cash flows for the year, Changes in equity
D Corporate profits, Business Unit profits, Departmental profits
16 Sportylook is a global retailer of fashionable sportswear clothes. The company reports on its environmental, social and economic sustainability in a sustainability report. The company outsources the manufacture of many of its products to suppliers in certain countries where labour costs are lower. There is concern that some of Sportylook’s suppliers in these countries use child labour and pay very low wages to all workers.
Requirement :What social responsibility does Sportylook have for the behaviour of its suppliers?
A. Sportylook has no responsibility for the behaviour of its suppliers
B. Sportylook has a responsibility for the behaviour of its suppliers, and should require suppliers to comply with its own social standards
C. Sportylook should attempt to persuade its supplier of the need to treat employees fairly, but then leave it up to the supplier to decide if it wishes to comply with this request
D. Sportylook should recognise that different countries have different cultures, and while the use of child labour might be frowned on at home, it is acceptable in some countries
17 T he following statements have been made about the relevance of climate change to organisations:
(1) Climate change leads to extreme weather conditions, such as floods and droughts, and these can damage businesses assets and threaten the safety of its employees
(2) Laws and regulations that aim to limit climate change can cause additional costs to organisations
(3) Organisations that emit large quantities of greenhouse gasses, and therefore contribute to climate change, are increasingly suffering from reputational damage
Requirement
Which of the above statements are true?
A 1 and 2 only
B 2 and 3 only
C 1 and 3 only
D 1, 2 and 3
18 Quench, a manufacturer of soft drinks has decided to stop using plastic bottles and instead use glass bottles for all of its products. Each used bottle returned by customers to a retailer gives customers 10p off their next bottle of Quench. The bottles are returned by the retailer to Quench, who washes and sterilises them before using them again.
Requirement: Which of the following elements of as mitigation hierachy is this example of?
A. Eliminate
B. Reduce
C. Substitude
D. Substitude
19 The following are potential aims fo sustainability:
I. End poverty
II. Fight inequality
III. Stop climate change
Requirement: Which of the aims above aims of the UN global goals sustainable development?
A. 1 and 2 only
B. 2 and 3 only
C. 1 and 3 only
D. 1,2,3 only
20. The ability to meet the needs of the present without compromising the ablity of future generations to meet their owns needs is best decribed as
A. Corporate responsibility
B. Sustainability
C. Business ethics
D. Natural capital
21 Sustainability is about the long- term use of both tangible and intangible resources. Green plc manufactures customised furniture for customers from recycle materials.
Requirement: Which two of the following represent intangible resource of Green plc?
A. The design expertise of its employees
B. Stationery supplis to factory office
C. Recycled timber received from suppliers
D. Its reputation in the community
C. Its head office premises
22 Sustainability issues that are external to an organisation can be considered under SEE framework?
Requirement: What are the three elements of the SEE framework?
A. Scarity, environment and ecosystem
B. Social, environment and economic
C. Safety, enterprise and ecosystem
D. Social, enterprise and environment
23 Which of the following statements describes the ESG framework for sustainability?
A. ESG considers factors which are internal to an organisation and how they affect enterprise value
B. ESG considers factors which are external to an organisation and how they affect enterprise value
C. ESG considers factors which are internal to an organisation and how they affect social value
D. ESG considers factors which are enternal to an organisation and how they affect social value
24 All of the following are components of natural capital except one. Which is the exception?
A. Minerals
B. Water
C. Fossil fuels
D. Pollination
25 Which of the following combinations includes one of the main greenhouse gases and the Uks date for achieve net zero?
A. Methane, 2040
B. Ozone, 2040
C. Nitrous oxide, 2050
D. Helium, 2050
26 Two fundamental aspects of sustainability are impacts and dependencies
Requirement: Which of the following is an example of an impact?
A. Water usage
B. Climatic conditions
C. Resource availability
D. Worker health
27. Which of the following decribes the difference between ESG and sustainability?
A. ESG and sustainability can be used interchargebly but the term sustainability is more often used in non-corporate settings.
B. Sustainability focusses on environmental issues while ESG considers a broader set of factors.
C. Sustainability considers environmental, economic and social issues, while ESG approaches sustainability issues from the perspective of a business
D. Sustainability looks at what the planet can afford, while ESG considers a safe operating space in which to build enterprise value
28. Which of the following statements best describes the difference between physical risks and transition risks?
A. Physical risks are related to the financial implications of climate change, while transition risks are concerned with the societal impacts of transitioning to a low-carbon economy.
B. Transition risks are the immediate dangers posed by natural disasters, while physical risks are long-term changes in climate patterns
C. Physical risks arise from the direct impact of environmental degradation, whereas transition risks are associated with the social and economic shift towards an environmentally sustainable economy.
D. Physical risks are those that can be managed through insurance, while transition risks are mitigated by government policy and regulation.
29. What are the overall aims of the UN Sustainable Development Goals (SDGs)?
A. To provide a framework for international action to mitigate climate change and its impacts.
B. To end poverty, fight inequality and stop climate change
C. To limit the global temperature rise to 1.5 degrees Celsius.
D. A depiction of the sequential steps required to achive the SDG goals
30. Which of the following statements describes the relationship between ESG factors and enterpise value?
A. ESG factors can enhance enterprise value by improving operation performance, risk management, and brand value
B. ESG factors can improve enterprise value only due to public relations and marketing
C. ESG factors only impact enterprise value by increasing operational costs and regulatory burden
D. ESG factors primarily impact enterprise value through tax incentives and subsidies provided by governments for sustainable practices
31. Which of the following is an example of environmental harm primarily due to resource depletion?
A. Waste from chicken farms entering rivers, causing harm to aquatic life and ecosystems
B. Single-use electrical products contributing to landfill overflow and soil contamination
C. Deforestation for the cultivation of palm oil causing loss of biodiversity and habitat destruction
D. Excessive groundwater extraction by a drinks manufacturer
