3.1 Define the term insurance and give TWO examples of insurable risks - NSC Business Studies - Question 3 - 2016 - Paper 1

1. Risk Assessment: Evaluating the level of risk associated with different investments.
2. Return on Investment: Considering the potential returns relative to the risk.
3. Market Trends: Analyzing current market conditions and trends that may affect investments.
4. Time Horizon: Understanding the duration for which the investment will be held.

1. Voting Rights: Shareholders can vote on important company matters, influencing management decisions.
2. Dividend Potential: Ordinary shares may pay dividends which can provide income to shareholders.
3. Capital Appreciation: The value of shares may increase over time, offering potential profits when sold.

To calculate the interest for Andries who invests R30,000 at a 10% interest rate compounded semi-annually, we can use the simple interest formula:

$ext{Interest} = P imes r imes t$

Where:

• P = Principal amount (R30,000)
• r = Rate (10% or 0.1)
• t = Time in years (2)

Thus,

$ext{Interest} = R30,000 imes 0.1 imes 2 = R6,000$

Andries will receive R6,000 in interest after 2 years.

Tshidi's investment in a flexi-deposit account at a 10% interest rate compounded annually can be calculated using the compound interest formula:

$A = P(1 + r)^t$

Where:

• A = Amount after interest
• P = Principal amount (R30,000)
• r = Rate (10% or 0.1)
• t = Time in years (2)

Calculating,

$A = R30,000(1 + 0.1)^2 = R30,000(1.21) = R36,300$

Thus, the interest amount is:

$ext{Interest} = A - P = R36,300 - R30,000 = R6,300$

Tshidi will receive R6,300 in interest after 2 years.

Comparing both investment options:

• Andries will receive R6,000 in interest.
• Tshidi will receive R6,300 in interest.

Thus, Tshidi's flexi-deposit account offers a higher return. Therefore, the better investment option is Tshidi's, as it yields a higher interest amount.

1. Electronic slides - used to display information visually in a presentation.
2. Printed copies - provide a tangible reference for attendees.

Electronic slides: These are effective as they can combine text, images, and data to enhance understanding. They can be visually engaging and help maintain the audience's attention throughout the presentation.

1. Clarity of Information: Ensure that the information is presented in a concise and clear manner.
2. Audience Engagement: Use questions and interactive elements to keep the audience engaged.
3. Visual Appeal: Ensure that slides are visually appealing and not overcrowded with information.

Personal attitude is crucial for successful leadership as it influences team morale and productivity. Leaders with a positive attitude inspire others, foster a conducive working environment, and build trust among team members. Negative attitudes, however, can lead to conflict and low motivation among employees.

Management plays a pivotal role in a partnership's success by ensuring efficient decision-making and conflict resolution. Effective management helps in aligning partner objectives and mitigating disagreements that may arise from differing opinions or leadership styles.

Taxation can impact a partnership significantly. For instance, if partners are not aware of tax liabilities, it could lead to financial difficulties. Effective tax planning can help in maximizing profits and ensuring compliance, while poor tax decisions may result in penalties and financial strain.