Question 1 Madina owns a restaurant in Nakawa town. She is well known for serving delicious meals. Most people in Nakawa and the surrounding areas flock her restaurant from morning to evening.The restaurant serves breakfast, lunch and super and is always busy and full of customers all the time. Madina has a sense of humour. She is curious, flexible, confident and energetic. She is heavily involved in the business and monitors every aspect of the business. Madina values creativity and she is always coming up with new ideas to meet the changing needs of her clients and this has enabled the business to grow. Externally, Madina is doing well but internally, all is not well with employees. Madina has a diverse labour force. Her staff include people from different religions, gender, cultural, age and educational background. Though she pays them relatively well compared to other restaurants in vicinity, the staff has low morale and job satisfaction. At the restaurant, there is no team work, no respect for employees and they do nottaste the food they have prepared. The non- resident staffcarry packed lunch. Madina takes all the decisions without involving the employees. Internally, employees work under tension and pressure. As a result, they are highly demotivated and some are threatening to abscond from work. Madina shared the situation with her friend Sarah who advised her to use non-monetary methods of motivation to lift up the morale of employees. She explained that non-monetary methods of motivation have a powerful impact on stimulating people to work and promotes job satisfaction.

Required: (a) (i) Define the term creativity. (ii) Explain the characteristics of creative persons like Madina. (b) Explain to Madina the: (i) non-monetary methods of motivating employees (ii) importance of motivation to a business.

Question 2 Solomon and Filista, founders of Organic Fertilizers Limited (OFL), a five-year old manufacturer of organic fertilizers are frustrated by their inability to secure Shs 2billion loan to fund the company's operations.OFL wants to sell a franchise to Joe Organics Limited (JOL), a company based in Arua.OFL is to finance the research and development, physical plant, insurance, advertising, training of personnel, and the necessary support services among others. Although OFL is profitable and sales are growing rapidly, it has failed to secure the required money from banks, despite their presentation of a highly polished business plan. "We were hopeful in the beginning," they said, "but we have been turned down three times for lack of capacity, even from the bank we have had a relationship with for nearly ten years". After failing to secure the loan due to lack of capacity to pay back, Solomon and Filista resorted to generating revenue through increasing retained profits which can only be achieved by raising the volume of sales. This calls for effective and efficient personnel to produce high quality products and improve marketing systems. The copreneurs have concluded that the only way to realize this is by promoting job satisfaction among employees and providing an opportunity to have continuous and unbroken services.This can be achieved by rewarding employees and encouraging them for higher performance through building up their morale, loyalty, commitment, and sense of belonging. The first step the copreneurs have embarked on is promotion of employees within the organization as recognition for their loyalty, sincerity and efficiency. This strategy is yielding tangible results, hence OFL is now able to finance its franchising operations.

Required: (a) (i) Define the term "capacity" with reference to payment of credit advanced. (1 mark)

(ii) Explain to OFL the factors that a lender should consider when assessing the capacity of a customer to pay credit advanced. (5 marks) (b) Explain to Solomon and Filista the advantages of promoting employees in a business organization. (7 marks) (c) (i) Define the term "franchising". (ii) Describe the advantages OFL is likely to enjoy by selling a franchise to JOL.

Question 3 Clear Pictures Limited (CPL) is a modern studio dealing in photography and video coverage. They cover functions like weddings, introductions, give-away, birthdays and many others. It is owned by David and Jonathan who are businessmen in Kikuubo tradingcentre.They appointed Musa and John who are graduates of journalism and mass communication as directors. CPL employs 5 other employees who have no qualification in photography. This has reduced their confidence when it comes to doing work on their own. CPL is well known for its good service. David and Jonathan, the only professionals get worked up because they have to cover each and every function especially when they have more than one at the same time.This calls for delegation of work to other employees if they are to reduce on the workload. However, the subordinates do not accept delegation of work partly because of fear of making mistakesand do not wish to bear any responsibility for their work.The employees lack ambition, dislike responsibility and prefer to be led. A studio is one business that requires good business ethics when dealing with customers. At first, the directors were applying principles of good business ethics but with time, they are no longer behaving ethically. They take long to return the pictures after covering a function and sometimes give a lesser number than what was agreed upon. The employees are mistreated and no clear feedback is given to the shareholders. There is also unfair competition and most customers are now complaining about the declining service at CPL. Management needs to be educated on the principles of good business ethics if they are to remain competitive in the market of photography and video coverage. Required:

(a) Describe the behavioural characteristics shown by employees of CPLunder McGregor theory X and Y. (b) (i) Define the term "delegation". (8 marks) (1 mark) (ii) Explain the reasons why subordinates at CPL do not accept delegation of authority. (4 marks) (c) Describe the principles of good business ethics to the directors of CPL. (7 marks)

Question 4

(a) Explain the factors that an entrepreneur should consider when selecting a legal form of business organisation. (c) Explain any six characteristics of public limited companies. (c) Discuss the economic factors that influence business activities. Question 5 (a) Explain the elements that an entrepreneur should include in the marketing plan of a business. (6 marks) (b) Describe unethical practices that are used by entrepreneurs when running their business ventures. (c) Explain the sources of innovation to a business venture.

Question 6

(a) Explain the reasons for: (i) registering a business. (ii) setting up objectives in a business plan. (b) Describe the process of risk management. (c) Explain the role of entrepreneurship in national development.

Question 1 Madina owns a restaurant in Nakawa town. She is well known for serving delicious meals. Most peOpIe in Nakawa and the surrounding areas flock her restaurant from morning to evening.The restaurant serves breakfast. lunch and super and is always busy and lull of customers all the time. Madina has a sense of humour. She is curious. flexible, confident and energetic. She is heavily involved in the business and monitors every aspect of the business. Madina values creativity and she is always coming up with new ideas to meet the changing needs of her clients and this has enabled the business to grow. Externally, Madina is doing well but internally, all is not well with employees. Madina has a diverse labour force. Her stall include people from different religions. gender. cultural. age and educational background. Though she pays them relatively well compared to other restaurants in vicinity. the staff has low morale and iob satisfaction. At the restaurant, there is no team work, no respect for employees and they do nottaste the food they have prepared. The non- resident staffcarry packed lunch. Madina takes all the decisions without involving the employees. Internally. employees work under tension and pressure. As a result, they are highly demotivated and some are threatening to abscond from work. Madina shared the situation with her friend Sarah who advised her to use non-monetary methods of motivation to lift up the morale of employees. She explained that non-monetary methods of motivation have a powerful impact on stimulating people to work and promotes job satisfaction. Required: (a) (i) Define the term creativity. (1 mark) (ii) Explain the characteristics of creative persons like Madina. (7 marks) (b) Explain to Madina the: (i) nonmonetary methods of motivating employees (6 marks) (ii) importance of motivation to a business. (6 marks) (Total 20 marks)