Observation

The question was fairly answered by candidates except (ii) where candidates were expected to apply their knowledge of the benefits of answering the question. The expected responses to the question include:

3(a)i. Commerce is the exchange of goods and services which involves all activities that facilitate trade, Or It is the buying, selling and distribution of goods and services.

ii. Benefits that Mr. Ali could derive from using e-commerce in the conduct of his business.

• It will enable Mr. Ali’s customers to do their shopping from their homes./Saves customers’ time.

• It will enable him reach a wider market, thus increasing his sales.

• He will be able to provide 24 hours service.

• His customers will be able to settle debts through the use of electronic means of payment..

• Customers can adequately access his products online before making an order..

• He will be able to advertise his products at all times (24 hours/7 days).

• Cost of operations is reduced.

3(b) Environmental factors affecting businesses

i. Political factors (Bureaucracy)

Changes in government as well as government policies will affect their business operations.

ii. Technological factors

Advancement in technology will affect the operations of the business.

iii. Economic factors

Economic factors such as changes in incomes, inflation, lending rates and unemployment may affect the performance of businesses.

iv. Legal factors

A change in law or introduction of new regulations will affect the conduct of businesses.

v. Social/ cultural factors

The beliefs, culture and religion of the environment will affect the business activities.

vi. Demographic factors

The composition/ distribution of the population such as gender, age and educational background will affect the business.

vii. Competition

The number of competitors in the same or similar line of business will affect the level of operation.

viii Infrastructural factors

The availability of social amenities such as electricity, good roads and communication network will affect the operation of business.