Introduction to Entrepreneurship

22 Grade 7 Pre-Technical Studies questions on Introduction to Entrepreneurship, with worked marking schemes. 22 questions are available on this topic in full.

1. Question 1

   4 marks

   Explain two reasons why keeping proper business records is important for a young entrepreneur.

   (4 marks)

   Marking scheme

   Any two explained (2 marks each): to know whether the business is making a profit or loss; to track money coming in and going out; to help in planning and decision making; to avoid misuse/theft of money; to help when seeking a loan; for calculating taxes. Award 1 for point + 1 for explanation. Total 4 marks.

2. Question 2

   4 marks

   Otieno starts a small poultry business at home with Ksh 5,000 he saved. After three months he sells eggs and chicken worth Ksh 8,000, having spent a total of Ksh 5,000.

   (a) Identify the Ksh 5,000 he started with in business terms.

   (b) Calculate his profit and show your working.

   (4 marks)

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3. Question 3

   6 marks

   Explain three benefits of entrepreneurship to an individual and the country.

   (6 marks)

   Marking scheme

   Any three explained (2 marks each): Income/self-employment - the entrepreneur earns money and becomes self-reliant; Job creation - the business employs others reducing unemployment; Provision of goods/services - satisfies community needs; Economic growth - businesses pay taxes and boost the economy; Development of talents/skills - encourages creativity and innovation. Award 1 for point + 1 for explanation. Total 6 marks.

4. Question 4

   1 mark

   A learner sells home-made juice during break time and uses the profit to buy more fruit and earn more. This learner is BEST described as a/an:

   A. Entrepreneur, because they start a business to make a profit

   B. Employee, because they work for a fixed salary

   C. Customer, because they buy goods from others

   D. Inspector, because they check the quality of goods

   (1 mark)

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5. Question 5

   1 mark

   If a trader buys mangoes for Ksh 20 each and sells them for Ksh 30 each, the Ksh 10 gained on each mango is called:

   A. Capital

   B. Loss

   C. Debt

   D. Profit

   (1 mark)

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6. Question 6

   6 marks

   A Grade 7 learner notices that pupils in the school often arrive hungry because there is no place selling healthy snacks nearby, so she plans to start a small snack stall.

   (a) Explain what is meant by the term 'entrepreneur'. (2 marks)

   (b) State two qualities of a successful entrepreneur that the learner should have. (2 marks)

   (c) Identify the business opportunity the learner has spotted. (2 marks)

   (6 marks)

   Marking scheme

   (a) An entrepreneur is a person who identifies a business opportunity and starts a business by organising resources and taking the risk in order to make a profit. (2 marks) (b) Qualities (any two): creativity/innovativeness; risk taking; hard work/persistence; self-confidence; good planning; honesty; ability to spot opportunities. (2 marks) (c) The opportunity is the unmet need for healthy snacks among hungry pupils, since there is no place selling them nearby; she can satisfy this need and earn money. (2 marks)

7. Question 7

   4 marks

   State four qualities of a successful entrepreneur.

   (4 marks)

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8. Question 8

   1 mark

   A learner who buys ripe mangoes, makes fresh juice and sells it at a profit, taking the risk that it may not sell, is best described as a what?

   A. A consumer

   B. An entrepreneur

   C. An employee

   D. A spectator

   (1 mark)

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9. Question 9

   6 marks

   Njeri has a talent for making beaded jewellery. Suggest three ways she can turn this talent into a successful business.

   (6 marks)

   Marking scheme

   Any three explained (2 marks each): identify customers/market for the jewellery (e.g. schools, markets, online); improve quality and create attractive designs (innovation); price the products to make a profit; advertise/market the jewellery (social media, word of mouth); keep records of sales and costs; reinvest profits to grow the business. Award 1 for point + 1 for explanation. Total 6 marks.

10. Question 10

    4 marks

    A group of Grade 7 learners wants to start a small business selling exercise books in school. Outline four steps they should follow before starting the business.

    (4 marks)

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11. Question 11

    1 mark

    Wanjiku notices that learners in her school lack affordable healthy snacks. She starts selling fresh fruit at break time. Wanjiku has MAINLY demonstrated the entrepreneurial skill of:

    A. Identifying a business opportunity

    B. Copying without thinking

    C. Wasting resources

    D. Avoiding risk completely

    (1 mark)

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12. Question 12

    1 mark

    A young entrepreneur notices that learners are thirsty after games and starts selling clean drinking water near the field. Which entrepreneurial quality is the learner showing?

    A. Ability to identify and act on a business opportunity

    B. Fear of taking any kind of risk

    C. Refusal to listen to customers' needs

    D. Wasting resources without a plan

    (1 mark)

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13. Question 13

    1 mark

    Which of the following BEST describes a 'business opportunity'?

    A. A guaranteed loss

    B. Money borrowed from a bank

    C. A chance to meet a customer need and make a profit

    D. A situation with no customers at all

    (1 mark)

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14. Question 14

    1 mark

    Which one of the following is a benefit of entrepreneurship to the Kenyan community?

    A. It reduces the goods and services available

    B. It creates jobs and improves people's living standards

    C. It increases unemployment

    D. It discourages innovation

    (1 mark)

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15. Question 15

    1 mark

    A learner selling home-made juice realises customers prefer cold juice, so she adds ice and improves packaging. This shows the entrepreneurial quality of:

    A. Innovation and responding to customer needs

    B. Ignoring customers

    C. Fearing change

    D. Reducing quality

    (1 mark)

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16. Question 16

    5 marks

    Mary, a Grade 7 learner, sells home-made fruit juice to fellow learners during break time and uses the profit to buy more fruit.

    (a) Define the term 'entrepreneur'. (2 marks)

    (b) Describe three qualities of a successful entrepreneur that Mary should have. (3 marks)

    (5 marks)

    Marking scheme

    (a) An entrepreneur is a person who identifies a business opportunity, organises resources, takes risks, and starts and runs a business with the aim of making a profit. (2 marks) (b) Any three qualities (1 mark each): - Creativity/innovativeness - able to come up with new ideas and improve products. - Risk-taking - willing to take calculated risks in the business. - Hard work and persistence - committed and does not give up easily. - Good time management - serves customers promptly. - Honesty and good customer care - builds trust with customers. - Confidence and self-discipline.

17. Question 17

    1 mark

    A young entrepreneur keeps a record of all the money coming in and going out of the business. This record keeping MAINLY helps her to:

    A. Impress friends only

    B. Increase her risks

    C. Hide money from customers

    D. Know whether the business is making a profit or a loss

    (1 mark)

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18. Question 18

    4 marks

    Distinguish between 'profit' and 'loss' in a business, giving one example to illustrate each.

    (4 marks)

    Marking scheme

    Profit (2 marks): the gain a business makes when income/sales is greater than costs, e.g. buying at Ksh 20 and selling at Ksh 30 gives Ksh 10 profit. Loss (2 marks): occurs when costs are greater than income/sales, e.g. buying at Ksh 30 and selling at Ksh 20 gives Ksh 10 loss. Total 4 marks.

19. Question 19

    1 mark

    An entrepreneur is BEST described as a person who:

    A. Identifies a business opportunity, takes a risk and starts a business

    B. Only works for someone else for a salary

    C. Refuses to take any risks in life

    D. Spends all money without saving

    (1 mark)

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20. Question 20

    1 mark

    Which one of the following is the MOST likely risk faced by a learner who starts selling snacks in school?

    A. Becoming completely free of all costs

    B. The snacks may not be bought and could go to waste

    C. Making too much profit instantly with no effort

    D. Never needing any capital at all

    (1 mark)

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21. Question 21

    1 mark

    Which one of the following is a key characteristic of a successful entrepreneur?

    A. Poor time management

    B. Giving up at the first difficulty

    C. Fear of trying anything new

    D. Creativity and willingness to take calculated risks

    (1 mark)

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22. Question 22

    1 mark

    The money or resources needed to start and run a business is known as:

    A. Loss

    B. Capital

    C. Profit

    D. Discount

    (1 mark)

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