Page 303 - Microsoft Word - 00 CIMA F1 Prelims STUDENT 2018.docx

Answers to supplementary objective test questions

4.8 C

Many of the advantages gained from participative budgeting may still be
relevant, and making an appointment from within may improve the accuracy of
the budget.

4.9 A

4.10 A

CHAPTER 11– RISK AND UNCERTAINTY

5.1 A

5.2 The answer is 1,280.

Sales Probability Expected
value
Rainy 2,000 0.4 800
Sunny 800 0.6 480
––––––
1,280
––––––

5.3 A

The maximin criteria chooses this best possible return in the worst possible
outcome. The worst possible outcome in this scenario is that demand is only for
20 cakes a day, in which case it would provide the highest returns if only
20 cakes were baked each day.

5.4 B

299