B. Acy Bachelor of Accountancy Bachelor of Science in Accountancy: BEC 5 — Questions and Answers
Question 1: Which concept in strategic planning describes the process of evaluating a firm's internal strengths and weaknesses alongside external opportunities and threats?
- Porter's Five Forces analysis
- SWOT analysis (Correct answer)
- Balanced Scorecard
- Value chain analysis
Correct answer: SWOT analysis
SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) is a strategic planning framework that assesses both internal capabilities and external market conditions.
Question 2: In project management, which scheduling tool displays tasks as horizontal bars along a timeline, showing start dates, durations, and dependencies?
- PERT chart
- Gantt chart (Correct answer)
- Fishbone diagram
- Critical path diagram
Correct answer: Gantt chart
A Gantt chart visually represents a project schedule with horizontal bars representing tasks plotted against a calendar timeline.
Question 3: Which financial instrument gives the holder the right, but not the obligation, to purchase a stock at a specified price within a set timeframe?
- Futures contract
- Forward contract
- Call option (Correct answer)
- Put option
Correct answer: Call option
A call option grants the buyer the right (not obligation) to buy the underlying asset at the strike price before or at expiration.
Question 4: Economies of scale in production are best described as:
- Increased costs resulting from expanding output
- Declining long-run average costs as output increases (Correct answer)
- Fixed costs spread over fewer units as output rises
- Variable cost reductions achieved through automation
Correct answer: Declining long-run average costs as output increases
Economies of scale occur when a firm's long-run average cost decreases as it increases its scale of production, often due to specialization and bulk purchasing efficiencies.
Question 5: Which data analytics technique uses historical data patterns to forecast future outcomes?
- Descriptive analytics
- Diagnostic analytics
- Predictive analytics (Correct answer)
- Prescriptive analytics
Correct answer: Predictive analytics
Predictive analytics applies statistical algorithms and machine learning to historical data to forecast future events or behaviors.
Question 6: A firm pursuing a cost leadership strategy under Porter's Generic Strategies aims to:
- Offer uniquely differentiated products at premium prices
- Serve a narrow market segment with specialized products
- Produce goods or services at the lowest cost in the industry (Correct answer)
- Maximize short-term profits by reducing quality
Correct answer: Produce goods or services at the lowest cost in the industry
Cost leadership strategy focuses on becoming the lowest-cost producer in an industry, enabling competitive pricing while maintaining acceptable profit margins.
Question 7: Which type of risk cannot be eliminated through portfolio diversification?
- Unsystematic (company-specific) risk
- Business risk
- Systematic (market) risk (Correct answer)
- Default risk
Correct answer: Systematic (market) risk
Systematic risk affects the entire market (e.g., recessions, interest rate changes) and cannot be diversified away, unlike unsystematic risk which is firm-specific.
B. Acy Bachelor of Accountancy Bachelor of Science in Accountancy: BEC 5
Which concept in strategic planning describes the process of evaluating a firm's internal strengths and weaknesses alongside external opportunities and threats?