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1. a) Highlight FOUR planning skills required by effective managers. (4 marks)

b) Explain four considerations taken into account by top managers when formulating policies. (6 marks)

c) i) Differentiate between decision making under risk and decision making under certainity. (6 marks)

ii) State two rules that govern brainstorming as a decision making technique.(6 marks)

d) There has been cases where management by objectives (MBO) has totally failed in organizations. Outline FOUR reasons for such failure. (4 marks)

2. a) Explain the meaning of the following terms as used in organizing:
i. centralization;
ii. accountability;
iii. coordinating. (6 marks)

b) State FOUR functions of the directors of a company. (4 marks)

c) One of the recent approaches to management of industrial organisations is the application of ‘operations research (OR)’ techniques in resolving managerial challenges. (i) Outline the steps followed in this approach. (ii)Highlight FOUR managerial challenges which can be addressed using OR techniques in an industrial organization. (10marks)

3. a) (i) Distinguish between a market economy and state-controlled economy. (ii) State TWO limitation of a market economy. (6marks)

(b) (i) Explain the meaning of ‘mobility of labour’ as a factor of production.
(ii) Outline THREE ways in which mobility of labuor is important to a country.(6marks)

(c) (i) With the aid of sketches, illustrate the different between elastic demand and
inelastic demand.
(ii) When the price of coffee is Ksh 100, the demand for tea is 120 units. When the price of coffee increases to sh. 140, the demand of tea increases to 160 units. Calculate the cross elasticity of demand. (8marks)

4. (a) The employment process involves FOUR basic stages; recruitment, selection, placement and induction. Explain each of these stages. (8marks)

(b) (i) Differentiate between formal and informal interviews.
(ii) Highlight FOUR limitations of interviews as a tool for employment selection. (6marks)

(c) Describe the following methods used in managerial development:

(i) Planned progression;

(ii) Job rotation;

(iii) Understudy.

5. (a) Explain the purposes of a dummy activity in a network diagram. (2 marks)

(b) Table 1 shows the activities of a project and their durations.

Table 1
Activity Preceding Activity Duration (Days)
A – 9
B – 3
C A 8
D A 2
E A 3
F C 2
G C 6
H C 1
J B,D 4
K F,J 1
L E,H,G,K 2
M E,H 3
N L,M 4

i. Draw the project network.
ii. Determine its critical path and completion time.
iii. Calculate the total float for the non-critical chains. (18 marks)




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