,OTE2601 Assignment 2 (COMPLETE
ANSWERS) 2025 - DUE 15 June 2025
MULTIPLE CHOICE,ASSURED EXCELLENCE
QUESTION 1
A famous South African entrepreneur like Patrice Motsepe can
mentor young entrepreneurs in running a business. Discuss
the reasons why most businesses fail. [20]
Most businesses fail due to a combination of internal
weaknesses and external challenges. Key reasons include:
1. Lack of Planning
Entrepreneurs often rush into business without proper
planning. Without a business plan outlining goals,
strategies, market research, and risk management,
businesses are vulnerable to failure.
2. Inadequate Capital
Many businesses start with insufficient funds and
underestimate the amount of money needed to sustain
operations until the business becomes profitable.
3. Poor Cash Flow Management
Even profitable businesses can fail if they do not manage
cash effectively. Late payments from customers, excessive
spending, or poor budgeting can lead to insolvency.
,4. Weak Marketing Strategies
If a business does not promote its product effectively or
fails to reach its target audience, it will struggle to
generate revenue.
5. Lack of Market Need
Sometimes businesses create products or services for
which there is little or no demand, leading to wasted
investments.
6. Poor Management Skills
Business owners may lack the managerial experience
needed to lead, organize teams, make informed
decisions, and resolve conflicts.
7. Failure to Adapt to Change
The market is dynamic. Businesses that fail to respond to
new technologies, consumer trends, or competitor
strategies may become irrelevant.
8. Choosing the Wrong Location
A poor location can reduce customer traffic, especially for
retail or service businesses.
9. Overexpansion
Growing too quickly without the necessary systems and
finances in place can overwhelm a business.
, 10. Legal and Regulatory Issues
Failure to comply with laws (e.g., tax, labor, health and
safety) can result in fines or closure.
QUESTION 2
2.1 Discuss the role of Trade Unions in the economy of a
country. [10]
Trade unions play a significant role in the economic
development of a country through the following ways:
1. Protecting Workers' Rights – Unions ensure that workers
are treated fairly, receive fair wages, and work in safe
conditions.
2. Promoting Economic Justice – By advocating for the
working class, unions help reduce income inequality and
poverty.
3. Negotiating Fair Wages – Through collective bargaining,
unions help increase the standard of living for workers,
boosting consumer spending and economic growth.
4. Supporting Skills Development – Unions often provide or
support training programs to upskill workers, increasing
productivity.
ANSWERS) 2025 - DUE 15 June 2025
MULTIPLE CHOICE,ASSURED EXCELLENCE
QUESTION 1
A famous South African entrepreneur like Patrice Motsepe can
mentor young entrepreneurs in running a business. Discuss
the reasons why most businesses fail. [20]
Most businesses fail due to a combination of internal
weaknesses and external challenges. Key reasons include:
1. Lack of Planning
Entrepreneurs often rush into business without proper
planning. Without a business plan outlining goals,
strategies, market research, and risk management,
businesses are vulnerable to failure.
2. Inadequate Capital
Many businesses start with insufficient funds and
underestimate the amount of money needed to sustain
operations until the business becomes profitable.
3. Poor Cash Flow Management
Even profitable businesses can fail if they do not manage
cash effectively. Late payments from customers, excessive
spending, or poor budgeting can lead to insolvency.
,4. Weak Marketing Strategies
If a business does not promote its product effectively or
fails to reach its target audience, it will struggle to
generate revenue.
5. Lack of Market Need
Sometimes businesses create products or services for
which there is little or no demand, leading to wasted
investments.
6. Poor Management Skills
Business owners may lack the managerial experience
needed to lead, organize teams, make informed
decisions, and resolve conflicts.
7. Failure to Adapt to Change
The market is dynamic. Businesses that fail to respond to
new technologies, consumer trends, or competitor
strategies may become irrelevant.
8. Choosing the Wrong Location
A poor location can reduce customer traffic, especially for
retail or service businesses.
9. Overexpansion
Growing too quickly without the necessary systems and
finances in place can overwhelm a business.
, 10. Legal and Regulatory Issues
Failure to comply with laws (e.g., tax, labor, health and
safety) can result in fines or closure.
QUESTION 2
2.1 Discuss the role of Trade Unions in the economy of a
country. [10]
Trade unions play a significant role in the economic
development of a country through the following ways:
1. Protecting Workers' Rights – Unions ensure that workers
are treated fairly, receive fair wages, and work in safe
conditions.
2. Promoting Economic Justice – By advocating for the
working class, unions help reduce income inequality and
poverty.
3. Negotiating Fair Wages – Through collective bargaining,
unions help increase the standard of living for workers,
boosting consumer spending and economic growth.
4. Supporting Skills Development – Unions often provide or
support training programs to upskill workers, increasing
productivity.
