ACCA BT Business organisation and environment: practice questions with answers

Question 1

Using Mendelow's matrix, how should an organisation manage a stakeholder group with high power but low interest in a project?

1. A Keep satisfied
2. B Keep informed
3. C Minimal effort
4. D Treat as key players

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Answer: A. Mendelow's matrix plots power against interest. High power, low interest stakeholders should be kept satisfied so that they don't use their power against the organisation.

Question 2

Which of the following groups is most likely to benefit from unexpectedly high inflation?

1. A Savers with money in bank deposit accounts
2. B People living on fixed pensions
3. C Borrowers with fixed-rate loans
4. D Banks lending at fixed interest rates

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Answer: C. Inflation reduces the real value of money. Borrowers with fixed-rate loans repay debts whose real value has fallen, so they gain.

Question 3

What is the main objective of most commercial companies?

1. A To provide public services
2. B To maximise the wealth of shareholders
3. C To maximise the number of employees
4. D To minimise taxation

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Answer: B. Commercial companies primarily aim to maximise shareholder wealth, while meeting other stakeholders' needs.

Question 4

In a perfectly competitive market, an individual firm can charge a price above the market price without losing its customers.

1. A True
2. B False

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Answer: B. In perfect competition there are many firms selling identical products, and buyers know all prices. Each firm is a price taker: if it charged more than the market price, it would lose all its customers.

Question 5

Operating more sustainably, for example by cutting energy use and waste, can reduce a business's costs as well as its impact on the environment.

1. A True
2. B False

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Answer: A. Sustainability is not only a cost. Using less energy and fewer materials and producing less waste reduce operating costs, and can also improve reputation and reduce the risk of fines or future regulation. These are among the benefits of economic sustainability to stakeholders.

Question 6

Tolland Recruitment Co asks every job applicant to complete an online form giving their religion, marital status, the ages of any children and their full medical history. None of this information is used in deciding which applicants to put forward to employers. Which data protection principle is Tolland Recruitment Co most clearly failing to comply with?

1. A Personal data must be accurate and, where necessary, kept up to date
2. B Personal data must be adequate, relevant and limited to what is necessary for its purpose
3. C Personal data must not be kept for longer than is necessary for the purpose for which it was collected
4. D Personal data must be protected against unauthorised access, accidental loss or damage

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Answer: B. Data protection law requires that personal data is collected for specified purposes and is adequate, relevant and limited to what is necessary for those purposes (data minimisation). Tolland needs details of applicants' skills and experience, not their religion, family circumstances or medical history, which are also especially sensitive. The other principles (accuracy, storage limitation, security) are important but are not the ones the scenario shows being breached.