Cambridge IGCSE: 0450/12 Business Studies

™
Cambridge IGCSE
BUSINESS STUDIES 0450/12

*6148412007*
Paper 1 Short Answer and Data Response February/March 2020

1 hour 30 minutes
You must answer on the question paper.
No additional materials are needed.
INSTRUCTIONS
• Answer all questions.
• Use a black or dark blue pen. You may use an HB pencil for any diagrams or graphs.
• Write your name, centre number and candidate number in the boxes at the top of the page.
• Write your answer to each question in the space provided.
• Do not use an erasable pen or correction fluid.
• Do not write on any bar codes.
• You may use a calculator.
INFORMATION
• The total mark for this paper is 80.
• The number of marks for each question or part question is shown in brackets [ ].
This document has 12 pages. Blank pages are indicated.
03_0450_12_2020_1.24
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2
1 HSN uses batch production to make breakfast cereals. The products are sold using several
distribution channels. HSN employs 600 production workers. HSN has problems with many
employees leaving. Following the dismissal of the Operations Manager, the Human Resources
Director has to recruit a new manager. She said: ‘The person must have good communication skills
to help solve the communication barriers HSN has with employees.’ The Human Resources Director
has to decide whether to use internal recruitment or external recruitment for the new manager.
(a) Define ‘dismissal’.
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(b) State two distribution channels a business might use.
Distribution channel 1: ......................................................................................................
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Distribution channel 2: ......................................................................................................
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(c) Outline two possible problems to HSN of many employees leaving.
Problem 1: ........................................................................................................................
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Problem 2: ........................................................................................................................
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(d) Explain how each of the following could cause communication barriers within HSN.
Language: .........................................................................................................................
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Medium of communication: ...............................................................................................
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(e) Do you think external recruitment is better than internal recruitment when recruiting a new
manager for a large business? Justify your answer.
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2 Gomez is a sole trader. He provides painting and decorating services to business customers. His
business does not benefit from any economies of scale because it is small. Gomez has to pay his
suppliers within 1 month. However, he gives customers 3 months to pay. Gomez uses an old van
he has borrowed from his father to travel to his customers’ offices and shops. As the van often
breaks down, Gomez is thinking of buying a new van. A cash-flow forecast for the next 3 months
is shown in Table 2.1.
Table 2.1
Cash-flow forecast for Gomez’s business ($)
April May June
Cash in 3 000 2 800 2 600
Cash out 2 600 3 000 Y
Net cash flow X (200) 200
Opening balance 200 600 400
Closing balance 600 400 600
(a) Define ‘economies of scale’.
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(b) Calculate X and Y.
X: ......................................................................................................................................
Y: ...................................................................................................................................... [2]
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(c) Outline two factors Gomez should consider when choosing a source of finance for the new
van.
Factor 1: ...........................................................................................................................
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Factor 2: ...........................................................................................................................
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(d) Explain one advantage and one disadvantage to Gomez of being a sole trader.
Advantage: .......................................................................................................................
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Explanation: ......................................................................................................................
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Disadvantage: ...................................................................................................................
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Explanation: ......................................................................................................................
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(e) Do you think asking customers to pay more quickly is the best way for a small business to
improve its cash-flow? Justify your answer.
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3 Globalisation has changed the way many businesses operate. VKW makes cell (mobile) phones.
It uses just-in-time inventory control. VKW exports 40% of its products. It imports most of its raw
materials to help reduce total costs. All 800 of VKW’s employees understand the importance of
quality assurance. The Operations Director has asked all suppliers to ensure they do not use child
labour. She is also concerned that many governments are planning to increase import controls
such as quotas.
(a) Define ‘globalisation’.
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(b) State two advantages to a business of using quality assurance.
Advantage 1: ....................................................................................................................
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Advantage 2: ....................................................................................................................
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(c) Outline two ways VKW might be affected by increased import controls.
Way 1: ...............................................................................................................................
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Way 2: ...............................................................................................................................
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(d) Explain one advantage and one disadvantage to VKW of using just-in-time inventory control.
Advantage: .......................................................................................................................
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Explanation: ......................................................................................................................
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Disadvantage: ...................................................................................................................
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Explanation: ......................................................................................................................
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(e) Do you think that businesses should be concerned about ethical issues such as child labour?
Justify your answer.
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4 WFG is a private limited company in country X. It owns 120 supermarkets, of which 20 are operated
as franchises. One of WFG’s objectives is to expand by opening 30 more shops in the next 18
months. The Managing Director said: ‘Market research shows that fewer people are going to the
local markets every day to buy their food. It is important for us to set prices at the right level.’ The
Managing Director is thinking about whether to introduce new technology into the business.
(a) Define ‘market research’.
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(b) State two objectives (other than expansion) a business might have.
Objective 1:........................................................................................................................
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Objective 2:........................................................................................................................
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(c) State four factors a business should consider when deciding the price of a product.
Factor 1:............................................................................................................................
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Factor 2:............................................................................................................................
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Factor 3:............................................................................................................................
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(d) Explain two factors WFG should consider when deciding whether to introduce new technology
into its business.
Factor 1: ...........................................................................................................................
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Explanation:.......................................................................................................................
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Factor 2:............................................................................................................................
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Explanation:.......................................................................................................................
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(e) Do you think selling franchises is a better way for a retail business to expand than opening
more of its own shops? Justify your answer.
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Cambridge IGCSE

Paper 2 Case Study February/March 2020
INSERT 1 hour 30 minutes
INFORMATION
• This insert contains the case study.
*8605031596-I*
• You may annotate this insert and use the blank spaces for planning. Do not write your answers on the
insert.
03_0450_22_2020_1.11
2
Bright Windows (BW)
Bob recently set up BW, a window washing business after he had been unemployed for 7 months.
Many home owners are extremely busy and find it difficult to find the time to wash the windows in
their houses. Increasing incomes have also led to a high demand for window washing services.
The primary market research carried out by Bob before setting up his business confirmed this high
demand. Bob used sampling when carrying out a questionnaire.
Bob is a sole trader. He invested $2 000 to get his business started and to provide working capital.
He needed $250 to purchase ladders, buckets and cleaning products. He also needed transport
to travel between customers houses. Bob decided to lease a van at a cost of $150 per month. Bob
has to pay wages to his 2 part-time employees of $300 per month each.
Bob only has a few regular customers and he needs to promote the business to attract more
customers. He is considering printing leaflets, advertising in local newspapers or just relying on
social media. He has to decide which method of promotion to use. He hopes his regular customers
will tell their friends about BW’s excellent services. If the promotion is successful he will need to
ensure his employees can meet this higher demand.
Appendix 1
Text message from one BW employee to another BW employee
10:44
Employee 1 >
I like working with Bob,

he is a good boss. I am
happy he asks us what
we think. I do not want
to work for anyone else
but I would like to work
more hours.
Employee 2:
My last employer
always told me what to
do. I do not like having
to make decisions.
Working fewer hours
and being flexible with
the times I work makes
it easier to look after
my family.
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Appendix 2
Summary of costs, price and demand for BW
Fixed cost per month $1250
Variable cost per house cleaned $1
Price per house $11
Average number of customers per month 225
Appendix 3
Article in the national newspaper
Main News 10 February 2020
Should window washing become more environmentally friendly?
The most effective products used to wash windows contain chemicals which damage the
environment. However, these products reduce the time taken to wash windows by 50%.
Many window washing businesses use plastic bottles as containers for all their cleaning products.
Most of these bottles cannot be refilled or recycled.
Washing windows can use a lot of water which reduces the amount of water available for other
uses. Recently a new machine has been developed for washing windows which is very efficient
and recycles the water it uses. Each machine costs $1000.
The Government is being encouraged by environmental pressure groups to introduce legal controls
over the window washing industry.
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BLANK PAGE
Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible. Every reasonable
effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the publisher will
be pleased to make amends at the earliest possible opportunity.
To avoid the issue of disclosure of answer-related information to candidates, all copyright acknowledgements are reproduced online in the Cambridge Assessment
International Education Copyright Acknowledgements Booklet. This is produced for each series of examinations and is freely available to download at
www.cambridgeinternational.org after the live examination series.
Cambridge Assessment International Education is part of the Cambridge Assessment Group. Cambridge Assessment is the brand name of the University of
Cambridge Local Examinations Syndicate (UCLES), which itself is a department of the University of Cambridge.
© UCLES 2020 03_0450_22_2020_1.11

™
Cambridge IGCSE

*8605031596*
Paper 2 Case Study February/March 2020

1 hour 30 minutes
You must answer on the question paper.
You will need: Insert (enclosed)
INSTRUCTIONS
• Answer all questions.
• Use a black or dark blue pen. You may use an HB pencil for any diagrams or graphs.
• Write your name, centre number and candidate number in the boxes at the top of the page.
• Write your answer to each question in the space provided.
• Do not use an erasable pen or correction fluid.
• Do not write on any bar codes.
• You may use a calculator.
INFORMATION
• The total mark for this paper is 80.
• The number of marks for each question or part question is shown in brackets [ ].
• The insert contains the case study.
03_0450_22_2020_1.11
2
1 (a) Explain four reasons why a person may set up their own business.
Reason 1: .........................................................................................................................
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Reason 2: .........................................................................................................................
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Reason 3: .........................................................................................................................
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Reason 4: .........................................................................................................................
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(b) Explain the benefits to BW of employing part-time employees and full-time employees. Do you
think Bob should continue to employ only part-time employees? Justify your answer.
Part-time employees: ........................................................................................................
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Full-time employees: ........................................................................................................
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2 (a) Explain two reasons why Bob used sampling when carrying out a questionnaire.
Reason 1: .........................................................................................................................
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Explanation: ......................................................................................................................
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Reason 2: .........................................................................................................................
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Explanation: ......................................................................................................................
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(b) Explain the following three methods of promotion BW could use. Which method should Bob
use? Justify your answer.
• Leaflets
• Advertise in local newspaper
• Social media
Leaflets: ............................................................................................................................
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Advertise in local newspaper: ...........................................................................................
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Social media:.....................................................................................................................
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Recommendation: ............................................................................................................
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3 (a) Explain two reasons why working capital is important to BW.
Reason 1: .........................................................................................................................
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Explanation: ......................................................................................................................
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Reason 2: .........................................................................................................................
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Explanation: ......................................................................................................................
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(b) Consider the three main styles of leadership Bob could use in his business. Which leadership
style do you think he should use? Justify your answer.
Leadership style 1: ...........................................................................................................
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Recommendation: ............................................................................................................
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4 (a) (i) Calculate the break-even level of output for BW using the information in Appendix 2.
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(ii) Calculate the margin of safety for BW using the information in Appendix 2.
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(iii) Identify four ways break-even analysis can be useful to a business.
Way 1: ...................................................................................................................
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Way 2:....................................................................................................................
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Way 3:....................................................................................................................
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Way 4:....................................................................................................................
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(b) Consider the following three options for BW. Which option should Bob choose to improve
BW’s reputation? Justify your answer.
Option 1: Use cleaning products that contain chemicals

Option 2: Use bottles that can be refilled with cleaning products
Option 3: Purchase a new window washing machine
Option 1: ...........................................................................................................................
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Option 2: ...........................................................................................................................
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Option 3: ...........................................................................................................................
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Recommendation: ............................................................................................................
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12
BLANK PAGE
Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible. Every reasonable
effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the publisher will
be pleased to make amends at the earliest possible opportunity.
To avoid the issue of disclosure of answer-related information to candidates, all copyright acknowledgements are reproduced online in the Cambridge Assessment
International Education Copyright Acknowledgements Booklet. This is produced for each series of examinations and is freely available to download at
www.cambridgeinternational.org after the live examination series.
Cambridge Assessment International Education is part of the Cambridge Assessment Group. Cambridge Assessment is the brand name of the University of
Cambridge Local Examinations Syndicate (UCLES), which itself is a department of the University of Cambridge.
© UCLES 2020 03_0450_22_2020_1.11

Cambridge IGCSE™

Paper 1 Short Answer/Structured Response March 2020
MARK SCHEME
Maximum Mark: 80
Published
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.
Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.
Cambridge International will not enter into discussions about these mark schemes.
Cambridge International is publishing the mark schemes for the March 2020 series for most Cambridge
IGCSE™, Cambridge International A and AS Level components and some Cambridge O Level components.
This document consists of 23 printed pages.

0450/12 Cambridge IGCSE – Mark Scheme March 2020
PUBLISHED
Generic Marking Principles
These general marking principles must be applied by all examiners when marking candidate answers. They should be applied alongside the
specific content of the mark scheme or generic level descriptors for a question. Each question paper and mark scheme will also comply with these
marking principles.
GENERIC MARKING PRINCIPLE 1:
Marks must be awarded in line with:
• the specific content of the mark scheme or the generic level descriptors for the question
• the specific skills defined in the mark scheme or in the generic level descriptors for the question
• the standard of response required by a candidate as exemplified by the standardisation scripts.
Marks awarded are always whole marks (not half marks, or other fractions).
Marks must be awarded positively:
• marks are awarded for correct/valid answers, as defined in the mark scheme. However, credit is given for valid answers which go beyond the
scope of the syllabus and mark scheme, referring to your Team Leader as appropriate
• marks are awarded when candidates clearly demonstrate what they know and can do
• marks are not deducted for errors
• marks are not deducted for omissions
• answers should only be judged on the quality of spelling, punctuation and grammar when these features are specifically assessed by the
question as indicated by the mark scheme. The meaning, however, should be unambiguous.
Rules must be applied consistently e.g. in situations where candidates have not followed instructions or in the application of generic level
descriptors.
© UCLES 2020 Page 2 of 23

PUBLISHED
Marks should be awarded using the full range of marks defined in the mark scheme for the question (however; the use of the full mark range may
be limited according to the quality of the candidate responses seen).
Marks awarded are based solely on the requirements as defined in the mark scheme. Marks should not be awarded with grade thresholds or
grade descriptors in mind.

PUBLISHED
Question Answer Marks Notes
1(a) Define ‘dismissal’.
Award two marks for a full definition. Award one mark for a 2 For both marks, candidates must show that it is the
partial definition. business that ends the employment and indicate why the
employee has been asked to leave the business.
Termination by the employer because the employee has
broken company rules or is not performing work to the
required standard [2]
OR When the employment is ended against the will of

the employee, usually for not working in accordance with
the employment contract [2]
OR When employee told or made to leave their job

because their work or behaviour is unsatisfactory [2]
Partial definition e.g. When employee told/made to leave

their job [1]
OR Termination of employment against the wishes of the

employee [1]
OR Employer ends employment [1]
1(b) State two distribution channels a business might use.
Award one mark per distribution channel. 2 Only award the first two responses given.
Two from:
• Wholesalers
• Retailers
• Direct to customers/Online/Internet/website
• Use of agents
Other appropriate responses should also be credited.

PUBLISHED
1(c) Outline two possible problems to HSN of many employees leaving.
Award one mark for each relevant problem. 4 Answers must focus on problems for the business.
Award one mark for each relevant reference to this Do not award answers which identify the impact on
business. employees/other stakeholders.
Points might include: Application marks may be awarded for appropriate use of
• Cost of recruiting new/replacing workers [k] as employ the following:
600 employees [app] • 600 (employees)
• Cost of training new employees [k] to use batch • Batch production
production [app] • Breakfast cereal
• Disruption to production/lower productivity/lower
output [k] of breakfast cereals [app]
• Can damage business reputation [k] so difficult to
recruit new manager/so harder to use external
recruitment [app]
• Takes managers time away from other aspects of the
business [k] such as reducing communication barriers
[app]
• Time taken to recruit new/replace workers [k]
• Time taken to train new employees [k]

PUBLISHED
1(d) Explain how each of the following could cause communication barriers within HSN.
Award one mark for identification of how each 6 Answers must focus on how the communication barrier is
communication barrier arises (max two). created/arises, not the impact it has on the business.
Award one mark for each relevant reference made to this Application marks may be awarded for appropriate use of
business (max two). the following:
• 600 (employees)
Award one mark for each relevant explanation (max two) • Batch production
• (Breakfast) cereal
Points might include: • (Several) distribution channels
Language:
• Use of new/different jargon/technical terms/difficult Do not award solutions.
words/vocabulary [k] when using batch production
[app] so employees may not understand the message
[an]
• Use foreign/different language [k] when making
cereals [app]
Medium of communication:
• The wrong channel may be used/workers may not be
able to use the method selected [k] so messages may
not be seen [an] by all 600 employees [app]
• Physical breakdown of medium [k] so that the
message is never received [an] which is important as
use several distribution channels [app]
• Message may be lost/distorted (if have a long chain of
command) [k] so may be misinterpreted [an]
• No feedback is received [k]

PUBLISHED
1(e) Do you think external recruitment is better than internal recruitment when recruiting a new manager for a large
business? Justify your answer.
Award up to two marks for identification of relevant issues. 6 Advantages of one method can be presented as
Award up to two marks for relevant development of points. disadvantages of the other method but do not award the
Award two marks for justified decision as to whether same point twice.
external recruitment is better than internal recruitment
when recruiting a new manager for a large business. For both evaluation marks justification must clearly relate
to a large business.
Points might include:
External recruitment: No not award ‘no need to train’ unless refers to induction
• Wider pool/choice of candidates [k] improving chances training.
of finding the most appropriate person [an]
• Bring in new ideas/experience/skills [k] could help
increase efficiency [an]
• Avoids risk of upsetting other employees when
someone who is internal is promoted [k]
Internal recruitment:
• Quicker/cheaper than external recruitment [k] which
reduces expenses [an]
• Acts as an incentive/motivation for employees [k] so
reducing labour turnover [an]
• People know the business [k] so can start work more
quickly [an]
• Company knows the people/employee [k]
• Suitable candidates may not be available [k]
• Would create another vacancy for the business to fill
[k]

PUBLISHED
1(e) • Justification might include:

External recruitment might be more expensive [k]
which will increase costs [an]. However, the business
might have no choice as there may not be suitable
internal applicants [k]. So, there may be no new ideas
which could increase efficiency [an]. Therefore, using
external recruitment would be better as it may result in
the appointment of a manager whose cost savings will
soon outweigh the cost of external recruitment [eval]
especially as this is more likely in a large business
[eval].
2(a) Define ‘economies of scale’.
Award two marks for a full definition. Award one mark for a 2 Do not award examples.
partial definition.
Do not award answers which refer to price.
Factors that lead to lower average costs as a business
increases in size [2]
OR
Reduction in average costs as a result of increasing the

scale of operations [2]
Partial definition e.g. benefit of increasing in

size/growth/expansion [1]

PUBLISHED
2(b) Calculate X and Y
Award one mark for each correct calculation. 2 $ sign is not required.
X: 400
Y: 2400
2(c) Outline two factors Gomez should consider when choosing a source of finance for the new van
Award one mark for each relevant factor. 4 Answers must focus on factors to consider, not sources of
finance.
Award one mark for each relevant reference to this
business. Points might include: Application marks may be awarded for appropriate use of
the following:
• Amount needed/how much it will cost [k] as cash • Sole trader
available is only $600 [app] • Small business
• Cost of finance/interest rate [k] for this painting • Correct use of data from Table 2.1
business [app] • Borrowed from father
• Amount of security/whether he has any security to • Painting/decorating
offer [k] as has borrowed old van [app]
• Size/type of business [k] may be viewed as a higher
risk as he is a sole trader [app]
• Time needed to repay/time to obtain finance [k]
• Current level of debt/loans/gearing [k]
• Whether to buy or lease [k]
• Amount of finance/money available in
business/liquidity [k]

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2(d) Explain one advantage and one disadvantage to Gomez of being a sole trader.
Award one mark for identification of each relevant 6 Analysis must explain how it represents an
advantage/disadvantage (max two). advantage/disadvantage.
Award one mark for each relevant reference made to this Do not award quick/easy to set up as this is an established
business (max two). business.
Award one mark for each relevant explanation (max two) Application marks may be awarded for appropriate use of
the following:
Points might include: • (Old) van
Advantage: • Borrowed from father
• Painting / decorating
• Keeps all the profit [k] so if successful will make more • Customers are offices / shops
money/will encourage him to do better [an] from • Customers given 3 months credit
painting business [app] • Pay suppliers within 1 month
• Own boss/has complete control [k] so can make • Correct use of data from Table 2.1
decisions more quickly [an]
• Does not have to give information about his business
to anyone else/secrecy in business matters [k]
• Has freedom to choose own holidays/hours of
work/prices to charge [k] such as whether to offer
customers 3 months credit [app]
• Has close contact with customers [k] so able to
respond quickly to changes in demand [an]

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2(d) Disadvantage:
• Unlimited liability [k] so if business is not able to pay
the suppliers within 1 month [app] could lose his
personal possessions [an]
• Limited sources of finance/difficult to raise funds [k] to
buy new assets [an] such as the van [app]
• May have limited range of skills [k] as only a small
business [app]
• No continuity/if ill who will take control [k]
• Has to work long hours/difficult to take holidays [k]
otherwise may lose out on potential sales/revenue [an]
• No one to share the risks/losses with [k]
• Not able to benefit from economies of scale [k]
2(e) Do you think asking customers to pay more quickly is the best way for a small business to improve its cash flow? Justify
your answer.
Award up to two marks for identification of relevant 6 Analysis and Evaluation must focus on whether asking
points/alternative methods. customers to pay more quickly is the best way for a small
business to improve its cash flow.
Award up to two marks for relevant development of points.
Award two marks for justified decision as to whether

asking customers to pay more quickly is the best way for a
small business to improve its cash-flow.
Points might include: For both evaluation marks justification must clearly relate
• Asking customers to pay more quickly means: to a small business.
• Less/no need to borrow [k] so no interest paid so does
not increase cash outflows [an]
• Customers may be unable or unwilling to pay more
quickly [k] so may look for alternative suppliers so
reducing cash inflows [an]

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2(e) Other ways of improving cash-flow could be discussed:

• Delay payment to suppliers/change terms [k] which
delays cash outflows [an] but suppliers may stop
providing products may not have enough stock
leading to fewer sales so lowering cash inflows [an]
• Selling (unwanted) assets [k] which generates cash
inflow [an]
• Reduce amount of inventory ordered/held [k] which
reduces cash outflows [an]
• Debt factoring [k] which will provide immediate cash
[an] but does not receive full amount of money owed
by customers so overall cash inflow is less [an]
• Overdraft/short term loan [k] as will inject more cash
into the business [an] but interest must be paid/loan
repaid at some point which will reduce cash outflows
[an]
Accept practical solutions such as:

• Lower fixed costs [k]
• Buy cheaper materials/cut unnecessary expenditure
[k]
• Sell more products/increase cash sales [k]
Justification might include:

• As the business is small, it may be better to ask
suppliers for more time to pay as the business may
not have many customers so does not want to risk
losing them by asking them to pay more quickly [eval]
[eval].

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3(a) Define ‘globalisation’.
Award two marks for a full definition. Award one mark for a 2
partial definition.
The process by which countries are connected with each

other because of the trade of goods and services [2]
OR The process of countries becoming more

interconnected [2]
OR Increase in worldwide trade and movement of people

between countries [2]
OR Freer movement of people and capital between

countries [2]
Partial definition e.g. increase in trade around the world [1]

OR increased movement of capital around the world [1]

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3(b) State two advantages to a business of using quality assurance.
Award one mark per advantage. 2 Only award the first two responses given.
Points might include: Do not award points such as improve customer

• Lower cost/reduce cost of wastage/fewer satisfaction.
mistakes/less rework (of faulty products)
• Encourages teamwork Do not award answers such as better quality and increase
• Fewer customer complaints/improve/maintain sales as they are to vague.
reputation (as consistent quality)
• Better brand image/fewer customer returns
• Reduce inspection costs
• Allows business to know at what stage mistakes
happen

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3(c) Outline two ways VKW might be affected by increased import controls.
Award one mark for each relevant way. 4 Application marks may be awarded for appropriate use of
the following:
Award one mark for each relevant reference to this • trying to reduce total costs
business. • phones
• 40 per cent exported
Points might include: • (Most) raw materials are imported
• Increased import costs/more expensive to import [k] at • quotas
a time when trying to reduce total costs [app]
• Can export less products/fewer sales in other Do not award examples.
countries [k] which is a problem as export 40% of its
phones [app] Do not award lower prices or increased sales in other
• May not be able to obtain sufficient number/range of countries.
parts so delay/halt production [k] so difficult to use
just-in-time [app] For knowledge must identify the effect of import control.
• May have to spend time finding local suppliers [k] as
currently most raw materials are imported [app]
• Might have to charge higher prices [k]
• Domestic sales might rise [k]

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3(d) Explain one advantage and one disadvantage to VKW of using just-in-time inventory control.
Award one mark for identification of each relevant 6 Application marks may be awarded for appropriate use of
advantage / disadvantage (max two). the following:
• reduce total costs
Award one mark for each relevant reference made to this • phones
business (max two). • 40 per cent exported
• 800 (employees)
Award one mark for each relevant explanation (max two). • Quality assurance
• Imports most of its raw materials
Advantage:
• Less inventory held [k] to make phones [app] so less
chance of wastage [an]
• Lower storage costs [k] because there is less
space/smaller warehouse needed [an] which also
helps reduce total costs [app]
• Improve working capital/cash-flow [k] as less money
tied up as stock [an]
• Less risk of inventory becoming obsolete/damaged [k]
which helps quality assurance [app]
Disadvantage:
• Parts might not arrive in time/limited inventory held [k]
especially as many are imported [app] causing
production delays [an]
• No extra stock/materials available to meet unexpected
orders [k] could lead to lower revenue/sales [an]
• Little room for mistakes in production as little/no
inventory kept for rework [k]
• May not have good relationship/communication with
suppliers/requires a lot of planning to make sure
goods delivered on time [k]
• No economies of scale possible [k] leading to higher
average costs [an]

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3(e) Do you think that businesses should be concerned about ethical issues such as child labour? Justify your answer.
Award up to two marks for identification of relevant issues. 6 Candidates can discuss points in relation to ethical issues
other than child labour.
Advantages of being ethical can be disadvantages of
Award two marks for justified decision as to whether being unethical but do not award the same point twice.
businesses should be concerned about ethical issues such
as child labour. Do not credit answers which refer to legal or quality issues
as these do not answer the question.
• Being ethical may enhance image/reputation [k] so Do not award examples of how a business can be ethical.
more customers want to buy its products [an] which
may increase revenue [an]
• People want to support ethical businesses/help attract
customers/being ethical can help increase sales [k]
• Can help attract investors (who want to be associated
with such businesses) [k] leading to access to more
finance [an]
• Help attract/retain employees [k] leading to higher
productivity [an]
• Can charge/may have to set higher prices [k] so
customers may switch to cheaper competitors [an]
• Being ethical can conflict with profit objective/short
term profits may fall [k]
• Being ethical may mean paying higher wages which
can increase costs [k] which a business might not be
able to afford [an]
• Pressure groups might organise a boycott [k]

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3(e) Justification may include:
Being ethical may enhance image [k] so more customers

want to buy its products [an] which may increase revenue
[an]. However, being ethical may increase costs [k]. So,
the business would have no option, even though in the
short-term profits may fall [eval], in the long term this could
be outweighed by the additional revenue received. [eval]
4(a) Define ‘market research’.
Award two marks for a full definition. Award one mark for a 2 To award both marks response must refer to at least two
partial definition. stages of the research process, not for example primary or
secondary market research.
Process of gathering, analysing and interpreting
information about the market [2] Do not award examples.
OR Process of collecting, recording and analysing data

about customers, competitors and market for a product [2]
Partial definition e.g. find out what customers want [1] OR

find out about competition [1]

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4(b) State two objectives (other than expansion) a business might have.
Award one mark per objective 2 Only award the first two responses given.
Objectives might include: Do not award growth as this is the same as expansion.
• survival/stay in business beyond first two years/break-
even/improve cash flow
• make a profit
• increase market share/increase sales/increase
revenue/enter new markets (or examples such as start
selling online)/become market leader
• return to shareholders/increase return on capital
employed
• be socially/ethically/environmentally responsible (or
examples but allow only once)
• provide a service to the community
• cuts costs/improve profit margin/add value

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4(c) State four factors a business should consider when deciding the price of a product.
Award 1 mark per factor. 4 Only award the first four responses given.

• Cost of production/examples of costs e.g. cost of
materials/labour/transport (allow only once)/break-
even/profit mark up
• Level of demand or factors such as
recession/income/what people are willing or able to
afford/price elasticity of demand
• Actions of competitors/level of competition/price
charged by competitor/where or when the product is
sold/whether there are any substitutes/whether it is a
niche or mass market/size of market
• Business objectives/profit margin/add value
• Type of product/quality of product/what is being
sold/brand image
• Availability of economies of scale
• Government or legal controls/tax
• Stage in product life cycle/new product

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4(d) Explain two factors WFG should consider when deciding whether to introduce new technology into its business.
Award one mark for identification of each relevant factor 6 Answers must focus on a retail business and appropriate
(max two). types of new technology.
Award one mark for each relevant reference made to this Application marks may be awarded for appropriate use of
business (max two). the following:
• 120 or 30 or 150
Award one mark for each relevant explanation (max two). • Supermarkets or shops
• Local markets or food
Points might include: • 20 or franchises
• Cost of technology [k] as has 120 locations [app]
which they may not be able to afford [an]
• Cost of training time taken for training/are workers
able or willing to learn how to use it [k] as need to offer
training for the 20 franchises [app] increasing its
expenses [an]
• Potential efficiency gains [k] to lower average cost [an]
so able to lower the prices of its food [app]
• How many workers may lose jobs/number of
redundancies [k]
• Level of demand [k] as most people buy at local
markets [app] so may not be able to justify cost [an]
• Opportunity cost [k]
• Availability of power/electricity [k]
• Sufficient space available [k] as if not the rent might
increase [an]
• Customer ability to operate the technology [k] as if
cannot use could result in fewer sales/less revenue
[an]

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4(e) Do you think selling franchises is a better way for a retail business to expand than opening more of its own shops?
Justify your answer.
Award up to two marks for identification of relevant points. 6 Do not award answers which refer to advantages and/or
disadvantages to franchisees.
Do not award more sales as this would apply to both
Award two marks for justified decision as to whether options.
selling franchises is a better way for a retail business to
expand than opening more of its own shops. For both evaluation marks justification must clearly relate
to a retail business.
Selling franchises:
• Franchisee pays fee to franchisor to use the brand
name [k] so franchisor does not have to raise as much
capital [an]
• Can expand more quickly (than if franchisor had to
finance all new outlets) [k]
• Franchisees are responsible for day-to-day
management [k] so franchisor has time to focus on
more strategic objectives [an]
• Franchisee should have local knowledge [k] which
could help increase sales/revenue [an]
• Franchisor receives a percentage of revenue/profits
[k]
• Franchisor shares risks with franchisee [k]
• Brand/customer awareness increases [k]
• All products sold must be obtained from the franchisor
[k]
• Wrong decision or poor management by one
franchisee can damage reputation for whole business
[k] reducing sales/revenue [an]
• Franchisor may have to provide training and support
[k] which will increase franchisors costs [an]

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4(e) More of its own shops:

• Have total control over the operations [k]
• Keep all the profits [k]
• Need to raise all the capital [k]
Justification might include:

• Franchisees will pay towards the start-up costs [k]
which will help reduce the amount the business has to
raise [an]. However, the franchisor may lose control [k]
which may damage their reputation [an]. It might be
better to sell franchises, as it will reduce the costs
especially if it wants to open a large number of shops
quickly [eval]. This can improve its chances of being
able to expand as much as the retail business wants
[eval].

Cambridge IGCSE™

Paper 2 Case Study March 2020
MARK SCHEME
Maximum Mark: 80
Published
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.
Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.
Cambridge International will not enter into discussions about these mark schemes.
Cambridge International is publishing the mark schemes for the March 2020 series for most Cambridge
IGCSE™, Cambridge International A and AS Level components and some Cambridge O Level components.
This document consists of 15 printed pages.

PUBLISHED
Generic Marking Principles
These general marking principles must be applied by all examiners when marking candidate answers.
They should be applied alongside the specific content of the mark scheme or generic level descriptors
for a question. Each question paper and mark scheme will also comply with these marking principles.
Marks must be awarded in line with:
• the specific content of the mark scheme or the generic level descriptors for the question
• the specific skills defined in the mark scheme or in the generic level descriptors for the question
• the standard of response required by a candidate as exemplified by the standardisation scripts.
Marks awarded are always whole marks (not half marks, or other fractions).
Marks must be awarded positively:
• marks are awarded for correct/valid answers, as defined in the mark scheme. However, credit
is given for valid answers which go beyond the scope of the syllabus and mark scheme,
referring to your Team Leader as appropriate
• marks are awarded when candidates clearly demonstrate what they know and can do
• marks are not deducted for errors
• marks are not deducted for omissions
• answers should only be judged on the quality of spelling, punctuation and grammar when these
features are specifically assessed by the question as indicated by the mark scheme. The
meaning, however, should be unambiguous.
Rules must be applied consistently e.g. in situations where candidates have not followed
instructions or in the application of generic level descriptors.
Marks should be awarded using the full range of marks defined in the mark scheme for the question
(however; the use of the full mark range may be limited according to the quality of the candidate
responses seen).
Marks awarded are based solely on the requirements as defined in the mark scheme. Marks should
not be awarded with grade thresholds or grade descriptors in mind.

PUBLISHED
Question Answer Marks
1(a) Explain four reasons why a person may set up their own business. 8
Award one mark for each relevant reason (maximum of four). Relevant
reasons might include:
• Made redundant – need to provide an income as lost job

• To be own boss – independence from instructions from others/employer
• Able to decide how to spend time – flexible working hours/choose when
to take time off
• To make a profit – as may receive a higher income than working for
another business
• Gap in the market identified/able to put own ideas into practice/can
make use of personal skills and interests/be creative/ethical principles
• To gain recognition and status – to become well known and respected
Award a maximum of one additional mark for each explanation. For

example:
Redundancy means loss of job (1) so setting up a business replaces the
income which was lost (1).
1(b) Explain the benefits to BW of employing part-time employees and full- 12

time employees. Do you think Bob should continue to employ only
part-time employees? Justify your answer.
Level Description Marks
3 Sound application of knowledge and understanding 9–12

of relevant business concepts using appropriate
terminology.
Detailed discussion of the two alternatives.
Well-justified conclusion.
Candidates discussing the two alternatives in detail,

in context and with well-justified conclusion including
why the alternative was rejected should be rewarded
with the top marks in the band.

terminology.
Detailed discussion of at least one alternative.
Judgement with some justification/some evaluation

of choice made.
Candidates discussing the two alternatives in detail

and applying it to the case should be rewarded with
the top marks in the band.

PUBLISHED
1(b)
1 Limited application of knowledge and understanding 1–4
of relevant business concepts.
Limited ability to discuss the alternatives with little/no

explanation.
Simple judgement with limited justification/limited

evaluation of choice made.
Candidates outlining the two alternatives in context

should be rewarded with the top marks in the band.
0 No Creditable Response 0
Relevant points might include:

Advantages
Part-time • More flexible hours of work – increases motivation of

employee the two part-time employees
• Easier to increase the employee hours during busy
times cleaning windows – allows for BW to meet
customer demand effectively
• Easier to recruit part-time employees – because hours
may be more flexible and fit in with family commitments
• May reduce labour costs compared to employing full-
time employees – as may only employ workers when
needed at busy times in the window washing
business/may be willing to accept a lower wage rate
than $300 per month
Full-time • More likely to be trained and seek training – increases

employee productivity of employees as clean windows faster
• Reduce labour turnover – more likely to see the
window cleaning job as long-term rather than
temporary/lower recruitment costs
• More committed to the cleaning business – leads to
more motivated workers which increases efficiency
• More likely to be suitable for promotion as gained more
skills and experience if BW expands in the future – may
allow promotion from the two internal applicants and
reduces recruitment costs
• Easier to communicate with than part-time employees –
as in work for more hours a day

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1(b)
Conclusion Justification might include:
• As the business is new and may not have a lot of
customers then part-time employees might be cheaper
in terms of wage costs than full-time employees and
willing to only work at busy times – therefore saving
BW costs.
• If BW is planning to expand in the future then full-time
employees may be better as they will gain more skills
and be suitable to take on more responsibility – helping
Bob to cope and delegate some of his tasks managing
the window cleaning business. Which would be more
difficult to do with part-time employees.
2(a) Explain two reasons why Bob used sampling when carrying out a 8
questionnaire.
Award one mark for each relevant reason (maximum of two reasons).
Relevant reasons might include:

• To reduce the time taken to carry out the questionnaire – takes a lot of
time to ask the whole population – sampling means reduced number of
questionnaires have to be collated and analysed
• To reduce the cost of carrying out the questionnaire – reduced number
of questionnaires printed – reduced postage/time taken by staff to carry
out questionnaire
• More accurate or relevant information – as potential customers can be
targetted – so answers only relate to potential customers and results
are not influenced by answers from people not interested in the service
Award a maximum of three additional marks for each explanation – one of

which must be applied to this context – of the reasons for using sampling
when carrying out a questionnaire.
For example: To reduce costs for the business (1) because if the whole
population is asked about cleaning windows this will be very expensive
(App) therefore choosing a small number of people will be less expensive
(1). This is important for a small business which will have other costs to pay
(1).
Application could include: window cleaning business; window washing

service; busy home owners; increasing incomes for potential customers;
only has a few regular customers at the moment; need to decide the best
ways to promote the business; confirm there is a high demand for these
services.

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2(b) Explain the following three methods of promotion BW could use. 12

Which method should Bob use? Justify your answer.
• Leaflets
• Advertise in local newspaper
• Social media

terminology.
Detailed discussion of at least two methods.
Well-justified recommendation.
Candidates discussing the three methods in detail, in

context and with well-justified recommendation
including why the alternative methods were rejected

terminology.
Detailed discussion of at least one method.

of choice made.
Candidates discussing two methods or more in detail


Limited ability to discuss the methods with little/no

explanation.

Candidates outlining the three methods in context


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2(b) Relevant points might include:

Leaflets • Cheap method of advertising – low printing costs
• Handed out in the streets to a wide range of
people and can be delivered to households and
offices where windows may require cleaning –
giving a wide distribution to potential customers
• Could contain promotion, e.g. discount off first
windows cleaned – increases the likelihood of
attracting customers
• Can be kept for later use – provides reminder of
contact details for customers – more likely to
use the window cleaning business in the
future
• However, home owners may not read the
leaflets and just throw them away – waste of
money and ineffective
Advertisements • Will reach the target market of home owners in

the local area – targeted advertising
• Relatively cheap to place advertisements
compared to national advertising – reduces
advertising costs as only targeting local home
owners/too expensive for a new business
• Information/discount coupons can be cut out
and kept for later use – reminds potential
customers of contact details for the cleaning
service
• A lot of information about cleaning services
can be included in the advertisement – may
encourage more customers if persuaded by the
additional information
• However, only black and white so may not be as
attractive – not eye-catching
• Many younger households do not read
newspapers and so may not see the advertising

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2(b)
Social Media • Can be free with no cost – unless paid for
advertising – seen by many younger consumers
although may not be home owners
• Reputation of the cleaning business helps
encourage new customers – spread quickly as
easier to share
• Allows video and audio to be added – makes the
advertisement more attractive – may be more
likely to persuade customers to have their
windows cleaned
• Advertising can be carried out across the local
area and not national area – so more targeted
on potential customers
• However, limited number of family and friends of
the small number of current regular
customers – restricting sales
• Customers may not trust posts on social media
– may think they are fake
Recommendation Justification might include:

• As the business is new then it will need to
keep marketing costs low and therefore leaflets
might be the best method to use as they are low
cost. They can be put through the doors of
prospective customers and may be more
effective in directly targeting these customers.
These customers may not read local
newspapers and social media may not reach
them.
• Advertising in local newspapers is likely to reach
the target market in the local area as the
business is a service and is only aimed at
the local population. Social media may be less
effective as it will reach a wide range of people
who may not all live locally to BW.
• Social media is the cheapest of the three
methods and can easily be seen by many home
owners. This will be especially effective if
regular customers put favourable posts about
BW cleaning services. This will not need BW to
do anything or spend money printing leaflets or
paying for advertising.

PUBLISHED
3(a) Explain two reasons why working capital is important to BW. 8
Award one mark for each relevant reason (maximum of two).
Relevant reasons might include:

• Needed to pay for day-to-day expenses – if lack of working capital then
may not be able to pay wages – not able to supply services as workers
will not work if not paid
• Not able to buy supplies of cleaning materials – not able to satisfy
customer needs – gain poor reputation with customers as being
unreliable
• So the business does not lack liquidity – to avoid cash flow problems –
so does not become insolvent/cease trading/not survive
• Holding too high a level of inventories – not good use of cash if working
capital too high – other opportunities to gain profit are missed
Award a maximum of three additional marks for each explanation – one of

which must be applied to this context – of the reasons why working
capital is important to BW.
For example:
Needed to pay day-to-day expenses (1) as BW will need to buy cleaning

materials to carry out the services (App). If there is insufficient working
capital then it will be difficult for BW to continue trading (1) because without
wages paid cleaning materials available BW cannot continue operating (1).
Application could include: window cleaning business; window washing

service; cleaning materials; busy home owners; only has a few regular
customers at the moment; wages $300 per month; lease van at cost of $150
per month; new business.

PUBLISHED
3(b) Consider the three main styles of leadership Bob could use in his 12
business. Which leadership style do you think he should use? Justify
your answer.

terminology.
Detailed discussion of two or more leadership styles.
Candidates discussing the three leadership styles in

detail, in context and with well-justified
recommendation including why the alternative styes
were rejected should be rewarded with the top marks
in the band.

terminology.
Detailed discussion of at least one leadership style.

of choice made.
Candidates discussing two or more leadership styles

in detail and applying it to the case should be
rewarded with the top marks in the band.

of relevant business concepts. Limited ability to
discuss the leadership styles with little/no
explanation.

Candidates outlining the three leadership styles in

context should be rewarded with the top marks in the
band.

PUBLISHED
3(b) Relevant points might include:

Autocratic • The manager expects to be in charge and have
all orders followed – such as which cleaning
materials should be used
• Manager keeps himself separate from the two
part-time employees
• Bob will make all the decisions and keep
information to himself – employee 2 likes to be
told what to do
• Communication is one-way with employees
having no opportunity to comment or take part in
any decisions about the cleaning services
which can be demotivating
• Decision making is quick
Democratic • Gets employees involved in decision-making –

and employee 1 is happy to be asked what he
thinks
• Information about future plans of the window
cleaning business shared with employees and
discussed before owner makes the final decision
• Communication is both downward and upward
allowing the experience of both part-time
employees to be considered by the owner,
leading to possibly better decisions being made
• Motivating for employees as they feel more
involved in the business – less likely to leave
• May be time consuming to ask employees –
reducing the work carried out by the two
employees
• Unpopular decisions may need to be made and
employee ideas ignored
Laissez-faire • Main objectives of the new business shared

with employees but then they are left to organise
their own work and take decisions without any
interference which can be motivating
• Communication can be difficult as the leader has
little involvement in the decisions being made
• Employees can be motivated as are valued and
trusted in to make the decisions
• Employees can be creative with fresh ideas
about how to wash windows more quickly
• Not suitable if a clear direction is needed and
consistent approach to customers

PUBLISHED
3(b)
Recommendation Justification might include:
• Autocratic might be best so that Bob gives clear
instructions to be followed by his two part-time
employees. They may not be there all the time
or working together and mistakes may be made
if decisions are left to these two people. They
will not have all the information about the
business and what the future plans are.
• Democratic might be suitable as there are only
two employees and Bob may have a close
working relationship with them. This may make
autocratic less likely to be used as it may require
Bob to keep his distance from his employees
and this would not make for a good working
relationship in the business.
• Laissez-faire is not suitable as consistent
customer service is required to maintain a good
reputation for cleaning windows and for the
business to gain more customers.
4(a)(i) Calculate the break-even level of output for BW using the information 2
in Appendix 2.
Two marks for correct calculation. One mark for correct method/formula but
wrong answer.
Break-even output = Fixed costs + Price – Variable cost per unit (1)
$1250 ÷ ($11–$1)(1) = 125 (1)
Note: If answer is only 125 with no working then award two marks.
4(a)(ii) Calculate the margin of safety for BW using the information in 2

Appendix 2.
Two marks for correct calculation. One mark for correct method but wrong
answer. OFR applies.
Margin of safety = Actual output – break-even output (1)

225 – 125 (1) = 100 (1)
Note: If answer is only 100 with no working then award two marks.

PUBLISHED
4(a)(iii) Identify four ways break-even analysis can be useful to a business. 4
Award one mark for each way (maximum of four)

• Predicts how many sales the business needs to make to break-even
• Predicts how much sales could fall by and still make a profit
• Shows potential profit/loss for the business at different levels of output
• Shows possible effect of change in price on the break-even level of
output/profit
• Shows possible effect of change in costs on the break-even level of
output/profit
• May be useful to show to the bank manager to indicate a profit is
predicted and therefore more likely to gain a bank loan
4(b) Consider the following three options for BW. Which option should Bob 12
choose to improve BW’s reputation? Justify your answer.
Option 1: Use cleaning products that contain chemicals.

Option 2: Use bottles that can be refilled with cleaning products.
Option 3: Purchase a new window washing machine.

terminology.
Detailed discussion of two or more options.
Candidates discussing all three options in detail, in

context and with well-justified recommendation
including why the alternative options were rejected

terminology.
Detailed discussion of at least one option.

of choice made.
Candidates discussing two or more options in detail


PUBLISHED
4(b)
Limited ability to discuss each option with little/no

explanation.

Candidates outlining all three options in context

Relevant points might include:

Option 1 • Faster to clean windows – more
efficient/improved customer satisfaction
Use cleaning • More efficient by 50 per cent if using these
products that chemicals so more windows washed per hour –
contain chemicals possibly increasing profit
• However, bad reputation from using chemicals
as not environmentally friendly and pressure
groups may campaign against them – although
legal at the moment, the law may change in the
future so may have to change later anyway
Option 2 • Slightly higher transport cost of taking the

containers to be refilled as would need more
Use bottles that than one – but may be the cleaning products are
can be refilled cheaper if use own bottle
with cleaning • Good reputation from being ethical as previously
products they may have used plastic bottles which were
not environmentally friendly
• Time taken by employees to get containers
refilled – reduces efficiency
• Cost to buy bottles may increase costs
initially/short run – but lower costs in the long
run as they do not need to keep being replaced
Option 3 • High cost of purchase – $1000 – difficult to raise

finance as a new business
Purchase a new • Ethical and may encourage more customers in
window washing the local area with increasing income to use
machine BW
• Reduces the amount of water required to clean
windows – may save money
• Improved reputation with the local community –
as they may benefit from less wastage of water
– as the machine recycles the water

PUBLISHED
4(b)
Recommendation Justification may include:
• Choose Option 1 as although costs may be
slightly higher the increased efficiency and
cleaning more windows per hour increases
reputation for a fast service. Customers may not
know about the new machine or bottles being
refilled and therefore this may not improve BW’s
reputation.
• Choose Option 2 as plastic bottles would not
need to go to waste and this can be a USP in
advertising if other window washing businesses
do not use these, hence improving BW’s
reputation. It is also a lot cheaper than paying
$1000 for a new machine.
• Choose Option 3 as it may be better in the long
term as water is important and BW will not be
wasting it. It also means that BW can wash
windows without having to gain water from the
house if the owners are out. This may increase
efficiency and improve the reputation for being
careful with the scarce resource of water. BW’s
reputation will not be enhanced as much if it
refills bottles, as this may not be noticed by
customers and they may not be aware of the
chemicals being used.

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BUSINESS STUDIES 0450/12

Paper 1 Short Answer and Data Response February/March 2020

You must answer on the question paper.

No additional materials are needed.

This document has 12 pages. Blank pages are indicated.

(a) Define ‘dismissal’.

(b) State two distribution channels a business might use.

Distribution channel 1: ......................................................................................................

Distribution channel 2: ......................................................................................................

(c) Outline two possible problems to HSN of many employees leaving.

© UCLES 2020 03_0450_12_2020_1.24

Medium of communication: ...............................................................................................

© UCLES 2020 03_0450_12_2020_1.24 [Turn over

April May June

Cash in 3 000 2 800 2 600

Cash out 2 600 3 000 Y

Net cash flow X (200) 200

Opening balance 200 600 400

Closing balance 600 400 600

(a) Define ‘economies of scale’.

(b) Calculate X and Y.

© UCLES 2020 03_0450_12_2020_1.24

© UCLES 2020 03_0450_12_2020_1.24 [Turn over

© UCLES 2020 03_0450_12_2020_1.24

(a) Define ‘globalisation’.

(b) State two advantages to a business of using quality assurance.

© UCLES 2020 03_0450_12_2020_1.24 [Turn over

© UCLES 2020 03_0450_12_2020_1.24

(a) Define ‘market research’.

© UCLES 2020 03_0450_12_2020_1.24 [Turn over

© UCLES 2020 03_0450_12_2020_1.24

BUSINESS STUDIES 0450/22

This document has 4 pages. Blank pages are indicated.

Bright Windows (BW)

Text message from one BW employee to another BW employee

I like working with Bob,

© UCLES 2020 03_0450_22_2020_1.11

Summary of costs, price and demand for BW

Fixed cost per month $1250

Variable cost per house cleaned $1

Price per house $11

Average number of customers per month 225

Article in the national newspaper

Main News 10 February 2020

Should window washing become more environmentally friendly?

© UCLES 2020 03_0450_22_2020_1.11

© UCLES 2020 03_0450_22_2020_1.11

BUSINESS STUDIES 0450/22

Paper 2 Case Study February/March 2020

You must answer on the question paper.

You will need: Insert (enclosed)

This document has 12 pages. Blank pages are indicated.

© UCLES 2020 03_0450_22_2020_1.11

Part-time employees: ........................................................................................................

Full-time employees: ........................................................................................................

© UCLES 2020 03_0450_22_2020_1.11 [Turn over

© UCLES 2020 03_0450_22_2020_1.11

Advertise in local newspaper: ...........................................................................................