Open University of Mauritius

CEMBA [OUpm003]
CEMPA [OUpm004]
MBA GENERAL [OUpm005]
MBA SPECIALISATION [OUpm006]
MBA EDUCATIONAL LEADERSHIP [OUpm007]

EXAMINATIONS FOR: November 2014 – Semester 1

MODULE: C5 - Economic Environment of Business

[OUpm0031103/OUpm0041103/OUpm0051103/
OUpm0061103/OUpm0071103]

DURATION: 3 HOURS

READING TIME: 15 Minutes

INSTRUCTIONS TO CANDIDATES

1. This paper consists of Sections A (25 Marks) and Section B (each

question carries 25 Marks).

2. This question paper contains 1 question in Section A and 4 questions

in Section B.

3. Section A is COMPULSORY

4. Answer any three questions from Section B.

This question paper contains 5 questions and 3 pages.

Page 1 of 3
 SECTION A

COMPULSORY

QUESTION 1: (25 MARKS)

(a) Using the knowledge of PEST analysis, explain, using examples, as to

how it can be used to devise a strategic approach to your business
activities.
[15 marks]

(b) Illustrate the concept of inflation, using appropriate examples, highlighting

its impacts on an economy.
[10 marks]

SECTION B

ANSWER ANY THREE (3) QUESTIONS

QUESTION 2

Using the concept of kinked demand curve model and relevant examples,
discuss the characteristics and behaviour of firms in an oligopolistic market.

[25 marks]

QUESTION 3

“Unemployment is a normal feature of most economies of the world”. Discuss this

statement highlighting the various types of unemployment as well as how public
policy is used to deal with them effectively.

[25 marks]

QUESTION 4

“The removal of imperfections in the market leads to an increase in efficiency in

the allocation of resources”. How far do you agree with this statement?

[25 marks]

Page 2 of 3
QUESTION 5

(a) “Income elasticity of demand can be a powerful tool available to

business”. Discuss this statement highlighting the relevance of this
concept to business.
[15 marks]

(b) “International trade has continued to assume greater importance for any
country in the world”. Discuss this statement stressing on the protective
policies that are generally used by countries.
[10 marks]

Page 3 of 3