MNE2601 EXAM PACK.

CHAPTER TITLE PAGE LONG QUESTIONS/ MCQs 1 Entrepreneurship in emerging economies 1-6 2 Small businesses in emerging economies 7-13 3 Feasibility analysis for small businesses within EE 14-17 4 Small businesses within emerging economies 18-24 5 Challenges of starting a business in an emerging economy 25-27 7 & 15 Strategic planning in small businesses 27-33 Entrepreneurial Growth 33-35 9 Creativity and innovation in entrepreneurship 36-40 10 Ethics, governance and sustainability 41-45 14 Entrepreneurial finance for an emerging economy 46-47 16 Enterprise development 48-55 17 Tourism 56-59 18 Alternative paths to entrepreneurship (Franchising) 60-67 19 The family business 68-72 21 Social Entrepreneurship 73-78 S1-2020 Long questions 79 MNE2601 EXAM PACK. 1 LONG QUESTIONS (long questions, you can study chapters 2,3,4,5,10,15 and 16) STUDY GUIDE QUESTIONS MCQs LEARNING UNIT 1-CHAPTER 1- Entrepreneurship in emerging economies-(pg. 1 Adobe 25) 1.1. Explain the concept of emerging economies (pg. 2 Adobe 25) They are acknowledged as engines of economic growth, competitiveness and job creation. The International Monetary Fund (IMF) and the World Bank indicate that the traditional BRIC countries (Brazil, Russia, India and China) are now counted among the largest economies in the world. The BRICS countries are important drivers of economic growth and that is why they are considered as efficiency driven economies. They are referred to as “Global South” and mostly located in Asia & Pacific- also previously colonized by some Western powers. DEFINITION OF EEs These are the transitional economies that are increasing their free-market systems. They experience challenges in regard to culture, values and infrastructure limitations. CHARACTERISTICS OF EEs (Pg. 3/A25) • Trade: There is a need to re-define trade among developing countries as they prefer to trade among themselves. • Finance: The hegemonic (dominant) role of money lending is the IMF, and WBboth are dominated by Western leadership. • Institutions: The policies of the IMF/WB/WTO have placed huge debt burdens and prescriptive policies for countries in the South. • Hegemony: The Global South has distanced itself from the West and is pursuing South- friendly policies in response to the West. • Growing inequality: there is clear growth of inequality in developing countries as compared to developed ones, as seen in shrinking agricultural produce, the often-negative role multinational companies and rising slums. 2 1.2. Evaluate the opportunities and challenges facing BRICS (Brazil, Russia, India, China, South Africa) countries-(pg. 9/A30) COUNTRY OPPORTUNITIES CHALLENGES BRAZIL •Social infrastructure lacking. •High tax burden on individuals and corporates •Low levels of investment in education and skills development. •High level of inflation and public debt. INDIA • Growing young population gives a competitive edge and drives economic growth • Private companies in key sectors (IT, outsourcing, pharmaceuticals and textiles) are a key asset • Public sector finance is poor • High levels of debt • Low spending on development • Poor infrastructure, low levels of internet penetration and burdensome bureaucracy • Risk-averse environment RUSSIA • Rich in natural resources • A leading economy • Has the largest consumer class • Relatively politically stable • Has a skilled labour force • Hit hard by 2008's financial crisis • High levels of inflation in comparison to other emerging economies • Low levels of investment in social infrastructure • Low levels of investment in business resulting in businesses not always being competitive • Lacks institutional strength and political willingness to implement serious reforms that help to sustain growth CHINA • Industrially competitive and diverse • High levels of economic growth (although slowing) • Strong foreign investment • Strong levels of development with regard to infrastructure and technology • Environmental issues pose a threat to sustainable growth • High levels of inequality lead to social tensions • Factory employment is close to maximum capacity • The supply of cheap labour is shrinking, as urban wages rise, and more people leave rural areas for urban areas SOUTH AFRICA • Gateway to Africa • Good natural resources • Relatively stable politically, mature economy and sound corporate governance structures • Good infrastructure • Business finance available • An advanced banking system • Expanding consumer market • Youthful demography • Skills shortages due to a poor education system. inherited from the previous dispensation • High levels of unemployment, poverty and inequality • Corruption and crime • Economically small in comparison to the other BRIC countries • High levels of bureaucracy and regulatory compliance • Natural challenges, such as drought and the spread of HIV/AIDS 3 • Benefit & Barriers to regional cooperation in the SADC BENEFITS BARRIERS Regulation of air services Poor connectivity & high fares Customized regulations & legislations Fear of losing own sovereignty Gender equality & empowerment Negative traditional views of subordinating women Improved postal services Labour disputes Improved telecommunications Theft of copper cables Trade liberation Dumping of cheap, poor quality goods Labour mobility Trafficking Loosening border control Threats to sovereignty Improved tourism market Environmental degradation Population provides market Unemployment & poverty make trade difficult Cultural diversity Trade marginalizes local cultures Technological transfers Patent/intellectual property rights 1.3. Discuss the challenges facing small and medium enterprises in South Africa Entrepreneurship is the dynamic process of creating incremental wealth. It involves vision, change and creation. It requires an application of energy and passion towards the creation and implementation of new ideas and creative solutions. Small businesses created more than 50 percent of all employment opportunities in South Africa, while contributing more than 45 percent of the country's gross domestic product (GDP). Challenges facing small and medium enterprises in South Africa: (p4/a26) • Lack of access to capital • Lack of skills training • Crime • Capital -intensive structure of the formal economy that makes it difficult for the small business to find its own niche. • Regulatory environment, which makes it difficult for the small business to be sustainable • High unemployment levels that may have a bearing on the demand for goods • Reliance on exporting primary raw materials • Lack of understanding of market needs • Lack of support for research and development