INTRODUCTION. The marking schemes which follow were those used by WJEC
for the Summer 2011 examination in GCSE BUSINESS STUDIES. They were ...
GCSE MARKING SCHEME
BUSINESS STUDIES SUMMER 2011
INTRODUCTION The marking schemes which follow were those used by WJEC for the Summer 2011 examination in GCSE BUSINESS STUDIES. They were finalised after detailed discussion at examiners' conferences by all the examiners involved in the assessment. The conferences were held shortly after the papers were taken so that reference could be made to the full range of candidates' responses, with photocopied scripts forming the basis of discussion. The aim of the conferences was to ensure that the marking schemes were interpreted and applied in the same way by all examiners. It is hoped that this information will be of assistance to centres but it is recognised at the same time that, without the benefit of participation in the examiners' conferences, teachers may have different views on certain matters of detail or interpretation. WJEC regrets that it cannot enter into any discussion or correspondence about these marking schemes.
GCSE BUSINESS STUDIES MARK SCHEME – SUMMER 2011 Q.1
Which two of the following apply to partnerships?
[2]
Owners may sign a Deed of Partnership (1) There must be at least 2 owners (1)
Q.2
Fred is paid £8 per hour and works a 40 hour week. His deductions are income tax and National Insurance Contributions which amount to £60 per week. (a)
What is Fred's net pay?
[1]
£260 (1) (b)
Q.3
National Insurance is an example of which type of deduction from pay? [1] Statutory deduction (1)
Which two of the following are most likely to be multinational businesses?
[2]
Mobile phone manufacturer (1) Oil refining company (1)
Q.4
Below are a number of terms and phrases used in business. Which word best describes each of the following: (a)
a business which allows others to use its name in return for royalty payments; FRANCHISOR (1)
(b)
profit left after expenses have been deducted; NET PROFIT (1)
(c)
costs which do not change with the number of goods made or sold; FIXED COSTS (1)
(d)
a business which is owned by its customers? CO-OPERATIVE (1)
1
[4]
Q.5
Use the chart to answer the following questions. (a)
[4]
Which person on this chart is responsible for the whole business? Managing Director (1)
(b)
Who do the Sales Staff first report to when there is a problem? Sales Manager (1)
(c)
Which director is responsible for marketing the products? Sales Director (1)
(d)
What is the span of control of the Production Director of Autotronics Ltd.? 2 OR The number of workers the Production Manager is directly responsible for.
Q.6
Businesses are affected by factors over which they have no control. Explain how each of the following might affect businesses in the United Kingdom (UK): (a)
an increase in income tax; Valid suggestion (1) explanation (1) [2] Less income for people/they have less to spend (1) so businesses sell less (1)/make less profit (1) some selling cheaper goods may sell more (1) and earn greater profits (1) some businesses may be affected more than others (1) e.g. (1) Sole trader/partnerships pay income tax (1) Therefore, increase prices/lower investment (1) etc. (b)
a very heavy fall of snow across all of the UK; Valid suggestion (1) explanation (1) [2]
Businesses unable to get supplies (1) unable to supply customers (1) so businesses sell less/make less profit (1) workers may find it difficult to get to work (1) effect on production (1) customers cannot get to shops (1) may be panic buying (1) some shops may sell more/earn greater profits (1) in most cases short term effect (1) Increased sales (1) for businesses selling winter goods (1) etc. (c)
a fall in the value of the pound against the euro. Valid suggestion (1) explanation (1) [2]
Affects prices of exports and imports (1) Exports will be cheaper (1) so more sales to Eurozone (1) Imports more expensive (1) so raw materials more expensive (1) will make finished goods more expensive (1) Businesses which do not import/export will be less affected (1) Businesses which don't trade in euros less affected (1) etc. (Not effect on balance of trade). 2
Q.7
(a)
Suggest and explain two advantages to Sam and Mary of being in a business partnership. Suggestion Explanation
[4]
[2 x 1] [2 x 1]
Suggestions comparing with sole trader might include: extra money to invest (1) more people in business (1) more skills/specialisation (1) partners can do tasks for which best suited (1) share workload (1) share ideas (1) two heads better than one (1) can cover (1) for holidays/illnesses/etc. (1) share risks/losses (1) each can input own resources (1) etc. Suggestions comparing with limited companies might include: business affairs kept private (1) no need to publish accounts (1) less chance of takeover (1) no one can buy in without owner's permission (1) etc. (b)
Suggest and describe two types of market research Sam and Mary could use to find out if they should expand their business. Suggestions Descriptions/expansions
[4]
[2 x 1] [2 x 1]
Suggestions might include: Primary/Field research (1) using Questionnaires (1) Surveys (1) Polls (1) focus groups (1) Description of questionnaire (1), etc. Description of each (1) Secondary/Desk research (1) using internet (1) government statistics (1) newspapers (1) etc. Description of each (1) (c)
Suggest two ways in which Sam and Mary could obtain the money needed if they decide to expand. Any two valid suggestions
[1 each]
e.g. bank loans - (loan on its own (1)) overdrafts Hire Purchase/leasing equipment loans from family/friends taking on additional partners setting up a company/selling shares personal savings/own capital/mortgaging house retained profits grants selling assets etc. NOT trade credit, mortgage, raffles, jumble sales, etc.
3
[2]
(d)
Suggest and evaluate how Sam and Mary can use the marketing mix (the 4 Ps) to encourage customers to use their business. [10] Level 1
[1-3]
Mentioning Ps or examples of Ps to encourage customers. Information is poorly organised. There is limited use of specialist terminology/vocabulary and frequent errors in spelling, punctuation and grammar.
Level 2
[4-6]
Strategies explained or ways in which strategy can encourage customers to use their business. May have unsophisticated evaluation. Information is well organised and ideas are expressed in a logical manner. There is good use of specialist terms/vocabulary with some errors in spelling, punctuation and grammar, but these are not intrusive.
Level 3
[7-10]
Answers also consider disadvantages of selected strategies. Answers may recommend with reasons certain strategies rather than others. Information is very well organised and the form and style of communication is highly appropriate. There is very good use of specialist terms/vocabulary with few, if any, errors in spelling, punctuation and grammar.
Answers might include: Product, Sam and Mary might introduce new goods, example or service, e.g., in shop. BUT might be difficult to sell, find supplier, might be difficult to sell, expense. etc. Place, Sam and Mary might move, to bigger shop, in busier location, sell on internet, with e.g. advantages of doing so, BUT might cost more to rent/buy, problems of informing customers, problems of selling on internet, example. etc. Price, strategy mentioned, described, BUT may put off customers and reduce sales. etc. Promotion, example mentioned, showing how customers influenced to buy, but problems with e.g. cost/coverage. etc. Packaging - packaging can also be included Note: Candidates may achieve level 3 with two Ps if done particularly well. If only one P, maximum 4. Covering all four Ps does not necessarily mean level 3. Level 3 requires evaluation.
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Q.8
(a)
Which method of production - job, batch or flow - is likely to be used by Jo Downs Handmade Glass Ltd to meet the needs of individual customers? Explain your answer. [2] Job
[1]
Explanations might include: Products are handmade (1) /individually produced (1)/made to order (1) bespoke (1) not mass produced (1) one off/unique (1) etc. Not individual customers (b)
Suggest one advantage and one disadvantage to customers of buying individually designed and produced jewellery and mirrors.
[2]
Advantages might include: 1 mark per advantage Exclusive/few other people will have similar products/unique High quality products/made by skilled workers Individual/requirements of customer can be built into product etc. Disadvantage might include: 1 mark per disadvantage Price will be high Wait for delivery of product/will take longer to produce etc. (c)
Suggest and explain one benefit and one problem the business has from owning its own shops rather than selling through shops owned by other businesses. [4] Suggestion Explanation
[2 x 1] [2 x 1]
Benefits might include: Control over how products are sold display (1)/marketing (1)/image (1) Control over selling price (1) customers not being charged too much (1) /too little (1) Maximise profit (1) made from sales (1) as well as production (1) Immediate feedback from customers (1) on what is required (1) on what is sold (1) Staff trained (1) on specific products (1) and will promote own products (1) etc. Problems might include: Fewer customers (1)/fewer selling opportunities (1) Extra costs of setting up (1) renting/buying shop (1) fixtures/fittings (1) Problems in finding premises (1) suitable location (1) planning permission (1) Staff training (1) expertise (1) cost (1) recruitment (1) Owners skills (1) in production rather than retailing (1) may not be so efficient (1) Left over stock (1) problem for producer (1) Selling costs borne by manufacturer (1) e.g. rent/electricity/business rates, promotion costs, etc. 5
(d)
Suggest and explain two factors the business would have considered when trying to find a suitable site for this shop. [4] Suggestion Explanation/description
[2 x 1] [2 x 1]
Answers might include: Closeness of shop to market (1) plenty of customers (1) Availability of shop (1) town centre (1) out of town (1) Suitability of shop (1) size (1) facilities (1) Cost of shop (1) to buy (1) or rent (1) Ease of access (1) for customers (1) for deliveries (1) Business area/passing trade (1) Nearness of similar shops (1) as competition (1) as attraction (1) Planning permission (1) developed (1) etc. Not near source of power, raw materials, motorways, grants, availability of workers. (e)
Should Jo Downs Handmade Glass Ltd try to sell more of its goods abroad? Justify your answer. Level 1
[1-2]
Advantage and/or disadvantage suggested.
Level 2
[3-5]
Advantages and/or disadvantages simply explained.
Level 3
[6-8]
Advantages and disadvantages fully explained.
[8]
Points might include: Advantages might include: Bigger market, more potential customers in worldwide market, leading to higher sales, and greater profits. Wider range of customers, from various market segments. so greater spreading of risks, following downturn in one segment. If products sold in European Union, no tariffs/restrictions on movement. Exchange rate fluctuations, may benefit - if exchange rate falls may sell more but even if it rises can benefit from higher profit margins. etc. Disadvantages might include: Higher transport costs, products sent over greater distance/longer time. Other transport problems, such as availability of mode/weather, strikes at ports. Language problems, in trading, translation costs. Currency conversion, costs, and exchange rate fluctuations. Costs of different laws/customs, types of designs. Problems of getting paid, more difficult to resolve over distance. Trade barriers, embargoes/quotas. Political factors, increased packaging costs/possibly more breakages e.g. etc. Not about setting up and producing abroad.
6
Q.9
(a)
Explain one advantage and one disadvantage to Greggs of becoming a public limited company. [4] Suggestion Explanation
[2 x 1] [2 x 1]
Advantages might include: Credit shareholders/owners limited liability because the text does not state that it was previously a private limited company (1) so shareholders/owners do not lose personal possessions (1) People more likely to invest (1) more capital (1) example of use of capital (1) as shares available on Stock Exchange (1) higher profile business (1) Easier to borrow money from others (1) etc. Disadvantages might include: May be taken over/loss of control (1) as shares can be bought by anyone/on the Stock Exchange (1) less likely to keep business affairs private (1) as information available to all (1) expense (1) of formalities (1) of becoming public company cost (1) of keeping shareholders informed (1) etc. (b)
Complete the shaded areas in the balance sheet. Total Assets 27 June 2009 Total Net Assets 14 June 2008
(c)
= =
260 140
[2] [1] [1]
What is meant by the term Fixed Assets?
[2]
Fixed Assets are those items owned (1) which do not change in the short term/they last a long time/used over and over again (1) They include buildings/machines or examples/vehicles or examples (1) etc. (d)
Why are the balance sheets shown useful to the shareholders of Greggs plc? [4] (4x1) Any of the following relevant points: Shareholders are owners (1) of the business so they want to know how well it is doing (1) Helps to determine shareholding (1) Gives a picture of the assets/what the business owns (1) and the liabilities/what the business owes (1) For Greggs, the current liabilities are a lot more than the current assets (1) in each year showing that the business could have a problem in paying its debts (1) although the picture is improving (1) as the difference was less in 2009 (1) Long term liabilities have increased (1) by 17 from 16 to 33 (1) but fixed assets are substantial (1) and growing Total net assets are large (1) and healthy/growing (1) although the picture has not changed greatly (1) Can be compared over time (1) etc. Not profit, cashflow, break even. 7
(e)
Discuss the advantages and disadvantages to businesses, such as Greggs plc, of adopting environmental and ethical policies.
[8]
Level 1
[1-2]
Advantages and/or disadvantages listed.
Level 2
[3-5]
Advantages and/or disadvantages simply explained.
Level 3
[6-8]
Balanced consideration of the advantages and disadvantages of adopting environmental and ethical policies.
Points might include: Advantages might include: Beliefs of owners, who have a concern for the environment, with problems of litter, waste, social inequality, effects on health, and climate. Meeting government targets, avoids bad publicity. Also concern for employees, with need for safe working environment, fair pay, and treatment, worker's morale. Concern for producers, in third world countries, fair trade. Influence of pressure groups, who work to convince others of their views. Consumer pressures, as they become more aware of environmental issues, and to do business with those who share their ideas. This is all important for the image of business, marketing/commercial reasons, aiming to promote sales and profit, can make more profit by being ethical. etc. Disadvantages might include: Business costs of being ethical, e.g. filtering machines, litter clearance, distribution unsold food, increased price of fair trade goods. Difficulties in being ethical, e.g. food miles. Packaging issues, cost, alternatives, hygiene. Staff issues, training, supervisions. Bad publicity, when errors made. etc. Not the effects on the environment.
8
Q.10
(a)
Suggest and explain how the new technology and new working practices might affect (i) the workers and (ii) the customers as stakeholders of the Royal Mail. Suggestion Explanation/description (i)
[4]
[2 x 1] [2 x 1]
the workers
May lose jobs (1) as changes require fewer workers (1) Promotion may be reduced (1) with smaller workforce (1) Lower morale/harder work (1) Fewer hours (1) Less efficiency (1) health problems (1) New skills may be gained (1) which may lead to higher pay (1) greater opportunities (1) Need to familiarise with technology (1) will need to work harder (1) etc. (ii)
the customers
delays in post (1) consequences of (1) better service (1) as more work done by machines (1) lower prices (1) as lower total wage bill (1) inferior service (1) because of lower morale of workers (1) higher prices (1) to pay cost of machines (1) no effect (1) as customers do not appreciate differences in service (1) etc. (b)
Describe how the strike might have damaged the Royal Mail's business. [4] Delays in post (1) might have led to customers finding alternatives (1) lower income/revenue (1) lower profits (1) Poorer relationship between workers and management (1) reduced trust (1) poorer quality service (1) Increased costs (1) in resolving dispute (1) Bad publicity (1) as dispute featured in media (1) etc. 4 x 1 or 2 x 2
(c)
Apart from going on strike outline one other form of industrial action trade unions can take. [2] Answers may include: negotiation (1) collective bargaining (1) discussing/talking (1) possibly with arbitration (1) overtime ban (1), refusing to work more than contracted hours (1) may be difficult to complete all work/backlogs (1) go slow (1) taking time/care to complete tasks (1) backlogs (1) work to rule (1) only working within rules (1) no short cuts (1) may be difficult to complete all work/backlogs (1) Sit-in (1) drawn attention to grievance (1) Can describe the 'action' but do not necessarily need the term. 9
(d)
Evaluate ways in which the Royal Mail could improve the performance of its workers. [10] Level 1
[1-3]
Suggests ways in which the business might improve performance of workers. Information is poorly organised. There is limited use of specialist terminology/vocabulary and frequent errors in spelling, punctuation and grammar.
Level 2
[4-6]
Explains ways in which the business might improve performance of workers with one-sided or unsophisticated evaluation. Information is well organised and ideas are expressed in a logical manner. There is good use of specialist terms/vocabulary with some errors in spelling, punctuation and grammar, but these are not intrusive.
Level 3
[7-10]
Answer with well balanced/sophisticated evaluation. Information is very well organised and the form and style of communication is highly appropriate. There is very good use of specialist terms/vocabulary with few, if any, errors in spelling, punctuation and grammar.
Suggestions might include: Higher pay, to encourage workers to work harder, but this will increase the business cost, may be short term benefits. Bonuses/commission, will relate pay to amount/quality of work, but may be expected by workers, targets to be set, demotivation if not achieved. Fringe benefits, see examples below Longer holidays, to provide rest/enthusiasm for work, will cost, will mean work not being done, dissatisfied customers. Promotion/job title, gives feeling of importance, reward for work, but only limited availability, envy in work place, internal promotions may not be good for dynamic business. Training/better qualifications, worker feels better about self, encouraged to work harder, but cost of training, better qualified workers may find jobs elsewhere, worker turnover. Health care/insurance, encourages workers to stay, but cost. Pension schemes, ensure long term security of worker, more likely to remain, but employee contributions add to costs, able to transfer pension to other employment. Ethical policies, will involve the way the worker is treated, e.g. good communications/conditions, may not be costly, but employer may be seen as not sufficiently autocratic. Rewards for best workers, e.g. employee of the week, may demotivate others. Working environment, increased efficiency, cost of provision. etc. N.B. Theories - answers will need to show how these motivate. GCSE Business Studies MS (Summer 2011)
10
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