Desmond wants to be a successful entrepreneur. He has decided to leave his office job to start up a gardening business cutting grass and planting flowers. It will be an unincorporated business. Desmond is aware that a new business is at greater risk of failure than an established business. He has identified his business objectives for the first year. Desmond has calculated he will need $750 for his start-up capital. Define ‘unincorporated business’. Identify two objectives a new business might have. Objective 1: Objective 2: Identify four characteristics of a successful entrepreneur. Characteristic 1: Characteristic 2: Characteristic 3: Characteristic 4: 1 12 Explain two reasons (other than lack of finance) why Desmond’s new business might be at greater risk of failure than an established business. Reason 1: Explanation: Reason 2: Explanation: Do you think owner’s savings are the most suitable source of finance for a start-up business? Justify your answer. [ 1 12

0450_w23_qp_11

THEORY

2023

Paper 1, Variant 1

View

Ramon is an entrepreneur. He plans to start up a home tutoring service to provide students with extra help to learn maths. Ramon is considering buying a franchise. He has prepared a business plan but is concerned about how an increase in the rate of inflation might affect his business. Ramon wants to know whether crowdfunding is the best source of finance for a start-up business to use. Define ‘inflation’. Identify two characteristics of a successful entrepreneur. Characteristic 1: Characteristic 2: Outline two ways a business plan might help Ramon. Way 1: Way 2: Explain one advantage and one disadvantage to Ramon of buying a franchise. Advantage: Explanation: Disadvantage: Explanation: Do you think crowdfunding is the best source of finance for a start-up business to use? Justify your answer.

0450_w24_qp_13

THEORY

2024

Paper 1, Variant 3

View

Kate is an entrepreneur. Two years ago she left her job as a fashion designer at a multinational company. She started up BBB, a women’s sportswear clothing business. BBB targets a market segment of high income consumers. BBB’s products are sold in 3 retail shops and also through its website. Kate said: ‘I saw a gap in the market and took the risk. Obtaining the finance I needed from the bank was not easy. I enjoy making decisions such as using leaflets to promote the clothes.’ BBB’s revenue target for next year is $500000. What is meant by ‘entrepreneur’? Identify two reasons why obtaining finance may not be easy for a new business. Reason 1: Reason 2: Identify and explain two possible reasons why Kate decided to start up her own business. Reason 1: Explanation: Reason 2: Explanation: 1 9 Identify and explain two reasons why segmenting the market might help BBB. Reason 1: Explanation: Reason 2: Explanation: Do you think that using leaflets is the best way for Kate to promote her products? Justify your answer. [ 1 9

0450_s19_qp_11

THEORY

2019

Paper 1, Variant 1

View

Kala always wanted to be an entrepreneur. She used to work for a business which downsized its workforce 5 years ago. She then decided to start up CHL. She produced a business plan which helped her obtain finance. Kala now designs customised sports clothes for women. Kala sells these products directly to customers using e-commerce. She has a loyal customer base of 25-40 year olds. However, Kala is worried about increased competition in this niche market. One idea she has is to target different market segments. Define ‘business plan’. Identify two reasons why a business might downsize its workforce. Reason 1: Reason 2: Outline two reasons why Kala’s business might need finance. Reason 1: Reason 2: 1 13 Explain one advantage and one disadvantage to Kala of using e-commerce to sell her products. Advantage: Explanation: Disadvantage: Explanation: Do you think selling to different market segments is the best way for a small business to respond to increased competition? Justify your answer. [ 1 13

0450_s20_qp_12

THEORY

2020

Paper 1, Variant 2

View

Nadia started her successful hairdressing business 4 years ago. Maintaining quality has always been important to Nadia. She said: ‘I started with no experience of business plans, recruitment, cash flow or profit. I did not understand how economic issues such as inflation could affect a business. Now I have 5 hairdressing shops and 20 employees. Last year I made a profit of $100000.’ Nadia is planning to expand her business. One way she could do this is by selling franchises. Define ‘business plan’. Identify two stages in the recruitment process. Stage 1: Stage 2: Outline one advantage and one disadvantage to Nadia’s business of selling franchises to expand. Advantage: Disadvantage: 1 12 Explain two possible effects of an increase in the rate of inflation on Nadia’s business. Effect 1: Effect 2: Do you think making a profit is more important for a growing business than managing cash flow? Justify your answer. [ 1 12

0450_s21_qp_13

THEORY

2021

Paper 1, Variant 3

View

Tom wants to leave his job to become an entrepreneur. He and his sister plan to start a window cleaning business. Tom has been told that new businesses are at a greater risk of failure than established businesses. Tom has to decide whether a partnership is a suitable form of business organisation for the new business. He has calculated the business will need $700 as start-up capital. Tom knows that every decision he makes will have an opportunity cost. Define ‘entrepreneur’. Define ‘opportunity cost’. Identify four reasons why a new business might be at greater risk of failure than an established business. Reason 1: Reason 2: Reason 3: Reason 4: 1 17 Explain two suitable sources of start-up capital Tom’s business might use. Source 1: Explanation: Source 2: Explanation: Do you think a partnership is the best form of business organisation for a new business? Justify your answer. 1 17

0450_s22_qp_12

THEORY

2022

Paper 1, Variant 2

View

Gloria is a sole trader. Her business provides house-cleaning services. Gloria uses telephone calls to communicate with her 4 employees. She wants to expand the business by offering a repair service. Gloria plans to carry out some market research. She has been told producing a business plan can help to reduce risk. Gloria would also like to reduce her workload and is considering taking on a business partner. Identify two ways a business plan can help a business to reduce risk. Way 1: Way 2: Identify two possible reasons why a business might want to expand. Reason 1: Reason 2: Outline one advantage and one disadvantage to Gloria of using telephone calls as a method of communication with her employees. Advantage: Disadvantage: [ 1 15 Explain two factors Gloria should consider when deciding whether to take on a business partner. Factor 1: Explanation: Factor 2: Explanation: Explain two methods of primary market research a business could use to find out the demand for a new product or service. Which would be the best method to use? Justify your answer. 1 15

0450_s23_qp_12

THEORY

2023

Paper 1, Variant 2

View

Mitchell is an entrepreneur. He wants to start up a business selling books. As part of his business plan Mitchell has carried out some market research. An extract is shown in . Mitchell will use microfinance as a source of finance. He wants to know whether the opportunities of using ecommerce for a new business are greater than the threats. Chart 1: Type of people reading books Extract from Mitchell’s market research data for 2023 Chart 2: Book sales by type Adults 20% Older people 27% Students 18% Children 35% Electronic books Audio books Paperbacks Hardbacks Define ‘entrepreneur’. Define ‘business plan’. Outline one advantage and one disadvantage to Mitchell of using microfinance as a source of finance. Advantage: Disadvantage: Explain how the market research data in Chart 1 and Chart 2 in could help Mitchell when making decisions. Chart 1: Explanation: Chart 2: Explanation: Do you think the opportunities of ecommerce for a new business are greater than the threats? Justify your answer.

0450_w24_qp_11

THEORY

2024

Paper 1, Variant 1

View

Gareth is planning to start a car washing business using government support. He is analysing market research data to help him make important decisions about his business. Extracts from this data are shown in Figure 3.1 and Figure 3.2. Gareth said: ‘I will need to set business objectives.’ He plans to keep his business small. Gareth is worried about the possible effects of higher taxes. Identify two reasons why businesses need objectives. Reason 1: Reason 2: Identify two possible reasons why an owner might want their business to remain small. Reason 1: Reason 2: 1 15 Outline two ways higher taxes might affect Gareth’s business. Way 1: Way 2: Explain how the data shown in Figure 3.1 and Figure 3.2 could be useful to Gareth. Figure 3.1: Figure 3.2: [ 1 15 Do you think offering financial help, such as grants, is the best way for a government to support business start-ups? Justify your answer. 1 15

0450_s22_qp_13

THEORY

2022

Paper 1, Variant 3

View

TXE is a large food retailer. The Finance Director is worried as last year profit fell by 10%. ‘I blame competition and increased taxes. We have spent more on sales promotions, but these have not been successful. We have to find ways to increase profits.’ TXE has 200 shops and plans to close 50 to lower costs. TXE may decide to sell a wider range of products, such as clothes, to help increase its profits. Identify two ways to measure the size of a business. Way 1: Way 2: Identify two reasons why a Government might increase taxes. Reason 1: Reason 2: Identify and explain two possible reasons why sales promotions might not have been successful for TXE. Reason 1: Explanation: Reason 2: Explanation: Identify and explain two factors TXE should consider when deciding which shops to close. Factor 1: Explanation: Factor 2: Explanation: Do you think TXE should sell a wider range of products? Justify your answer.

0450_m17_qp_12

THEORY

2017

Paper 1, Variant 2

View

---