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MAC2602 EXAM PACK .
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- University Of South Africa
MAC2602 EXAM PACK .100% CORRECT questions, answers, workings and explanations.
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MAC2602EXAM PACK .
,Table of Contents
Welcome ...............................................................................................................................................
2
MAC2602 Jan/Feb 2021 Exam Paper............................................................................................ 4
MAC2602 Jan/Feb 2021 Exam Memo.........................................................................................13
MAC2602 Oct/Nov 2020 Exam Paper .........................................................................................
18
MAC2602 Oct/Nov 2020 Exam Memo ........................................................................................25
MAC2602 June/July 2020 Exam Paper........................................................................................
30
MAC2602 June/July 2020 Exam Memo.......................................................................................37
3
,MAC2602 Exam Pack Principles of
Strategy, Risk, and Financial
Management Techniques
MAC2602 Jan/Feb 2021 Exam Paper
Question 1: Multiple Choice Questions
This question consists of ten multiple-choice questions. Each question must be considered
independently, except where specific reference is made to information in another question. Each
question has only one correct answer, and the marks per question (1.1 – 1.10) are indicated in
brackets after each question.
List the question numbers below one another, from 1.1 – 1.10, with your corresponding answer
next to it, for example:
1.1 (a)
1.2 (b)
The questions are as follows:
1.1 The major limitations of financial information are given below:
(1) The financial statements are to an extent, subjective or reflective of the judgement of the
accountants who prepared it. Although the IFRS helps to align the accounting policies of an
organisation, there are still certain industry specific transactions that may have an effect on the
way the financial information is accounted for, or technical errors may occur.
(2) The financial information is the responsibility of the directors. Independent auditors then state
their opinion regarding the fairness of the financial performance, position and cash flows in the
financial statements. The audit guarantees the total accuracy and an exact level of assurance that
the figures presented are in accordance with IFRS.
(3) There is limited guidance on forward-looking information of an organisation. Organisations can
be sued if they do not achieve specific targets.
(4) Financial statements represent past results which will not necessarily predict what the future
results will be. The annual report also has a tendency not to reflect all the failures and mistakes
and can exaggerate achievements of management.
(5) In some instances, financial statements still reflect information on a historical cost basis, and
thus do not include the effect of inflation or changes in, for example, an asset’s value.
4
, Which statement/(s) listed above is FALSE?
(a) Statements (1) and (3)
(b) Statement (2)
(c) Statements (3), (4) and (5)
(d) Statement (5)
1.2 The development of an organisation’s strategy is influenced by different internal and external
environmental factors. Which ONE of the following combinations are factors that influence the
internal environment?
(a) Corporate culture, technological environment, controls at organisation level and political
environment.
(b) Social environment, economic environment, organisational leadership, HR policies and
corporate culture.
(c) HR policies, controls at organisation level, industrial relations and corporate culture.
(d) Organisational leadership, political environment, competitive environment and social
environment.
1.3 Which of the following statements are TRUE with regards to the purpose of doing a competitor
analysis?
1) Plan for diversification and expansion
2) Study the market, trends and patterns
3) Formulate a strategy
4) Study forthcoming trends in the industry
5) Increase the market share.
a) Statements (1), (3) and (5)
b) Statements (2), (3), (4) and (5)
c) Statements (1), (3), (4) and (5)
d) All of the above statements
1.4 Two types of market transactions can be distinguished, namely primary market transactions
and secondary market transactions. The following types of market transactions are given to you.
Which ONE of the following alternatives is not a secondary type of market transaction?
a) Equity and bond securities are initially sold to investors. The money that flowed from the
investors to the organisation is invested by the organisation to exploit investment opportunities.
b) This type of market makes the organisation’s securities more attractive to other investors. This
increases the price of the securities in the organisation.
c) Equity and debt securities can subsequently be sold by the holders of these securities to other
investors.
d) The level of the organisation’s share price is set by this type of market transactions. This will
determine how much money can be raised by the future issue of shares.
1.5 Which ONE of the following statements does not relate to strategic risk?
a) Actions of the competitors
5
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