Exam code: 1BS0
Which one of the following is a definition of an exchange rate?
Select one answer.
The flow of goods and services into a country
The value of one currency in terms of another currency
A tax on a particular good or service
When businesses operate on an international scale
Was this exam question helpful?
Which one of the following areas is covered by employment law?
Select one answer.
Consumer rights
Discrimination
E-commerce
Collusion
Quality of products
Was this exam question helpful?
Last Course Patisserie Ltd is a small private limited company based in Devon which produces hand-made desserts and puddings. The business was established in 1986. Its owners previously worked in the food industry but felt they could offer better value for money to customers. All of the desserts are made fresh to order which has provided Last Course Patisserie with a reputation for being flexible when meeting customer needs.
Getting the best ingredients for the desserts is a vital part of the business. Last Course Patisserie found excellent suppliers of free range eggs and dairy products close to its business location. This means all ingredients could be delivered quickly when needed.
Last Course Patisserie has recently employed a new head chef from Switzerland who has introduced a new range of products to the menu. This has proved to be very popular with customers and the business now struggles to keep up with demand. Last Course Patisserie is receiving increased orders for desserts but, due to the size of its business premises, struggles to meet this increase in demand. The owners have decided that it is the right time for Last Course Patisserie to expand and possibly relocate to new premises.
Outline one impact on a stakeholder group of Last Course Patisserie if it relocates to new premises.
Was this exam question helpful?
Aphrodite is a clothes shop that was formed in 1994 by two brothers, Andrew and Duncan McKenzie. They opened the shop because they had a lifelong enthusiasm for new fashion.
Andrew and Duncan visit Paris, Milan and London each year to buy their stock. They aim to buy well-known brands, such as Stone Island and Hugo Boss, and to also stock clothes from new designers. This range of stock helps provide them with an advantage over their competition.
Customer service has always been an important part of Aphrodite’s success. A polite and friendly attitude greets all customers on arrival at the shop. In 2007 the business launched its website, which sells its range of clothing using e-commerce. The owners looked to maintain existing high standards of service for customers using their website.
A new opportunity was created when the shop premises next to Aphrodite became available to buy. Andrew and Duncan are considering buying the shop in order to convert the two shops into one large premises. They have calculated that this will cost them £250 000 but are undecided on the best way to finance this.
Table 3 shows the value of the pound (£) in euros (€) from June to September.
Month | Number of euro (€) |
June | 1.13 |
July | 1.11 |
August | 1.09 |
September | 1.14 |
Table 3
Identify, from Table 3, which month was best for Aphrodite to import clothes from Paris.
Was this exam question helpful?
On Your Bike is a family owned business that first opened in London in 1983. Its customers include children buying their first bikes and scooters, through to experienced enthusiasts in road cycling and mountain biking.
The business offers a wide range of bikes, many imported from abroad. These include high quality brands such as Brompton, Cannondale and Ridgeback. It also stocks a wide range of clothing and helmets including brands such as Endura and Altura.
On Your Bike has large workshop facilities in its shop where qualified mechanics maintain and repair all makes of bike. All mechanics go on regular training courses to ensure they keep their skills and knowledge up to date with the latest cycling technology. This allows On Your Bike to offer exceptional customer service and advice.
The cycling market has grown over recent years. Market research has shown that an increasing number of tourists like to rent bikes when on holiday. In response to this, On Your Bike operates one of the largest bike rental services in London. Bikes can be hired by the day or week with a choice including road and electric bikes.
Outline one impact on On Your Bike of an increase in the value of the pound.
Was this exam question helpful?
Stand up paddleboarding is a sport which is similar to surfing but the riders use a paddle whilst standing on the board. Joe Thwaites opened Loco in 2012 as he spotted a gap in the market manufacturing stand up paddleboards (SUPs). Joe felt that he could compete using innovative designs and by changing the shape of the SUPs he made. He spent a few weeks in Fuerteventura, Spain, working with professional SUP riders where he developed designs for three Loco boards.
Since then Loco has surrounded itself with creative talent. This includes world class SUP shapers, graphic designers and team riders, who compete in competitions using its boards. Within months of its new SUPs becoming available, one of the team went on to win the British National Championship and represent Team GB in the World Championships.
Loco now sells an extensive range of SUPs, surf and kite boards throughout the UK and Europe and is ready to further extend its brand. Joe feels that the use of digital marketing using social media is vital in this growth. This combination of creative marketing and Joe’s active role in the business, by offering advice to customers, has provided him with a firm belief that Loco can compete against larger manufacturers.
State one stakeholder of Loco.
Was this exam question helpful?
Sarah is the sole owner of a sandwich shop located in a busy town centre. The shop opened two years ago and employs two part-time staff members who help prepare food and serve customers. The shop sells freshly made sandwiches, soups and hot drinks, which are prepared on site each day.
The business attracts office workers, students and shoppers. Sarah prides herself on the freshness and quality of her products, which are made to order. Her prices are slightly higher than pre-packaged sandwiches sold in supermarkets.
Recently, a large supermarket chain opened nearby, selling cheaper sandwiches. Since then, Sarah has noticed her sales have started to fall. In March, Sarah’s revenue was £8,000, but in April this dropped by 15%. Her costs, however, have stayed the same at £6,200 per month.
Sarah is considering ways to respond. One option is to lower her prices to match the supermarket. Another option is to emphasise freshness, quality and customer service to encourage loyalty. She is also looking at launching online orders with local delivery to reach more customers and boost sales.
Outline one benefit to the local community if Sarah’s Sandwiches is successful.
Was this exam question helpful?
Stand up paddleboarding is a sport which is similar to surfing but the riders use a paddle whilst standing on the board. Joe Thwaites opened Loco in 2012 as he spotted a gap in the market manufacturing stand up paddleboards (SUPs). Joe felt that he could compete using innovative designs and by changing the shape of the SUPs he made. He spent a few weeks in Fuerteventura, Spain, working with professional SUP riders where he developed designs for three Loco boards.
Since then Loco has surrounded itself with creative talent. This includes world class SUP shapers, graphic designers and team riders, who compete in competitions using its boards. Within months of its new SUPs becoming available, one of the team went on to win the British National Championship and represent Team GB in the World Championships.
Loco now sells an extensive range of SUPs, surf and kite boards throughout the UK and Europe and is ready to further extend its brand. Joe feels that the use of digital marketing using social media is vital in this growth. This combination of creative marketing and Joe’s active role in the business, by offering advice to customers, has provided him with a firm belief that Loco can compete against larger manufacturers.
Table 3 shows the interest rate paid on savings between 2014 and 2017.
Year | Interest rate (%) |
2014 | 1.49 |
2015 | 1.40 |
2016 | 1.25 |
2017 | 1.00 |
Table 3
Using the information in Table 3, identify the best year for Loco to save any retained profit it may have.
Was this exam question helpful?
Which one of the following is a type of technology that could be used by a business?
Select one answer.
Consumer law
Crowdfunding
Venture capital
Marketing mix
Payment systems
Was this exam question helpful?
Sports Tours Ltd was established in 1989 and is one of the leading online specialist sports tour operators in the United Kingdom. It arranges tours for teams to destinations in the United Kingdom and Europe in sports such as football, rugby, hockey and netball. The business not only organises travel, accommodation and meals, but it also arranges games and entry to tournaments for the sports team whilst on tour.
Sports Tours Ltd has very high standards. It carries out full risk assessments for all tours including possible pre-tour inspection visits. Tours are licensed and authorised through official agencies. All tours have regular contact with a member of staff from Sports Tours Ltd.
In recent years the business has faced increasing competition. This is not only from other sports tour operators but also from teams organising their own tours. Changing levels of consumer income and exchange rates have also had an impact on demand for tours by sports teams.
Sports Tours Ltd are confident that the high level of service they offer will help them to remain competitive. However, it is always looking for more ways to add value to its business activities.
Outline one likely impact of changing levels of consumer income on Sports Tours Ltd.
Was this exam question helpful?
Last Course Patisserie Ltd is a small private limited company based in Devon which produces hand-made desserts and puddings. The business was established in 1986. Its owners previously worked in the food industry but felt they could offer better value for money to customers. All of the desserts are made fresh to order which has provided Last Course Patisserie with a reputation for being flexible when meeting customer needs.
Getting the best ingredients for the desserts is a vital part of the business. Last Course Patisserie found excellent suppliers of free range eggs and dairy products close to its business location. This means all ingredients could be delivered quickly when needed.
Last Course Patisserie has recently employed a new head chef from Switzerland who has introduced a new range of products to the menu. This has proved to be very popular with customers and the business now struggles to keep up with demand. Last Course Patisserie is receiving increased orders for desserts but, due to the size of its business premises, struggles to meet this increase in demand. The owners have decided that it is the right time for Last Course Patisserie to expand and possibly relocate to new premises.
Identify one external stakeholder of Last Course Patisserie Ltd.
Was this exam question helpful?
Outline one principle of consumer law.
Was this exam question helpful?
During Max's first year of trading, interest rates increased from 2.0% to 5.5%. Which of the following was a possible effect of this on Max's business?
A reduction in fixed costs due to lower repayments on his overdraft
An increase in sales due to higher levels of consumer spending
A greater chance of rivals entering the market
A fall in sales due to higher levels of consumer saving
Was this exam question helpful?
Which one of the following is an impact of an increase in interest rates?
Customers borrow more money
Loan repayments rise
The economy grows faster
Costs of borrowing fall
Was this exam question helpful?
Sarah is the sole owner of a sandwich shop located in a busy town centre. The shop opened two years ago and employs two part-time staff members who help prepare food and serve customers. The shop sells freshly made sandwiches, soups and hot drinks, which are prepared on site each day.
The business attracts office workers, students and shoppers. Sarah prides herself on the freshness and quality of her products, which are made to order. Her prices are slightly higher than pre-packaged sandwiches sold in supermarkets.
Recently, a large supermarket chain opened nearby, selling cheaper sandwiches. Since then, Sarah has noticed her sales have started to fall. In March, Sarah’s revenue was £8,000, but in April this dropped by 15%. Her costs, however, have stayed the same at £6,200 per month.
Sarah is considering ways to respond. One option is to lower her prices to match the supermarket. Another option is to emphasise freshness, quality and customer service to encourage loyalty. She is also looking at launching online orders with local delivery to reach more customers and boost sales.
State one stakeholder group of Sarah’s Sandwiches.
Was this exam question helpful?
Which one of the following is an impact of a decrease in interest rates?
Businesses will borrow less money
Customers will borrow less money
Customers will borrow more money
Repayments on loans should go up
Was this exam question helpful?
Amelia Cooper trained as a plumber six years ago. Since then she has worked for a building company that carries out repairs to houses and business premises in the Birmingham area.
Amelia is now in a position where she wants to start her own plumbing business called Lili Heating Ltd. Even though there are many plumbers in the Birmingham area, Amelia feels she has a unique selling point – she is a woman. Many female customers feel that they can relate more closely with a woman doing repairs in their homes.
As part of her business plan, Amelia has identified some clear aims and objectives and conducted a large amount of market research using the internet. Her target market requires clear advice on what work needs to be done and how much she will charge. Amelia also thinks she can cut down on advertising costs by getting her customers to recommend Lili Heating Ltd to their friends and families. For this to happen she knows that her work must be of the highest standard.
Amelia’s business plan also included a wide range of financial information to help her forecast the potential success of the business and see if she would need an overdraft.
Outline one reason why the government would want Lili Heating Ltd to be successful.
Was this exam question helpful?
Ripple is an energy company aimed at providing green and renewable energy to homes and businesses across the UK. It is the country’s first consumer-owned wind farm, generating green energy that does not have a damaging effect on the environment.
Instead of customers paying Ripple to supply them with energy, they become members of the business and buy a part of a wind farm located in a remote area of South Wales. Customers are then supplied with energy to their homes based on the amount of money they invested. The amount of money that customers can invest varies on their energy needs, but Ripple claims that it can supply energy cheaper than its competitors.
The process of becoming a member is very simple. Firstly, Ripple will ask customers a few questions to identify their energy needs. It will then create a green energy plan to establish how much each customer should invest into the wind farm. Ripple manages the wind farm and provides energy to each customer’s home or business.
Ripple’s business plan fits in with the UK government’s cleaner energy strategy. This strategy includes plans for the country to have net zero carbon emissions by 2050 and to create 220,000 new jobs in the green energy sector of the economy.
The table shows the percentage of different energy types used to produce electricity in the UK in 2018 and 2019.
Type of energy | 2018 % of use | 2019 % of use |
|---|---|---|
Gas | 39.4 | 40.6 |
Renewables | 33.3 | 37.1 |
Nuclear | 19.5 | 17.3 |
Coal | 5.0 | 2.2 |
Oil | 2.8 | 2.8 |
Using the information in Table 4, identify which type of energy use declined the most between 2018 and 2019.
Was this exam question helpful?
Which one of the following are covered by employment law?
Consumer rights
Discrimination
Unfair competition
Product quality
Taxation
Was this exam question helpful?
QualQuick is a medium-sized supermarket chain with 120 stores across the UK. It focuses on fresh produce and convenience items, and has expanded steadily in recent years. The business aims to differentiate itself through high-quality local sourcing and eco-friendly packaging.
However, QualQuick faces growing competition from discount retailers such as Aldi and Lidl, which attract price-sensitive customers. Sales growth has slowed, and profit margins have fallen.
The directors are considering new strategies to increase competitiveness. They are debating whether to:
Option 1: Expand into online grocery deliveries.
Option 2: Focus on opening more small convenience stores in city centres.
State one stakeholder group of QualQuick.
Was this exam question helpful?
Explain one disadvantage to a small business of an increase in interest rates.
Was this exam question helpful?
Sports Tours Ltd has been organising football tours to Munich, Germany since 2010. The price of a hotel room in Munich in 2010 was €100.
Table 2 shows the value of the pound (£) in euros (€) in June 2010 and June 2019.
Number of euro (€) | |
June 2010 | 1.23 |
June 2019 | 1.13 |
Table 2
Using the information in Table 2, calculate, to 2 decimal places, the price in pounds (£) of a hotel room in 2010. You are advised to show your workings.
Was this exam question helpful?
Last Course Patisserie Ltd is a small private limited company based in Devon which produces hand-made desserts and puddings. The business was established in 1986. Its owners previously worked in the food industry but felt they could offer better value for money to customers. All of the desserts are made fresh to order which has provided Last Course Patisserie with a reputation for being flexible when meeting customer needs.
Getting the best ingredients for the desserts is a vital part of the business. Last Course Patisserie found excellent suppliers of free range eggs and dairy products close to its business location. This means all ingredients could be delivered quickly when needed.
Last Course Patisserie has recently employed a new head chef from Switzerland who has introduced a new range of products to the menu. This has proved to be very popular with customers and the business now struggles to keep up with demand. Last Course Patisserie is receiving increased orders for desserts but, due to the size of its business premises, struggles to meet this increase in demand. The owners have decided that it is the right time for Last Course Patisserie to expand and possibly relocate to new premises.
UK consumer incomes are expected to rise over the next 10 years.
Analyse the likely impact on Last Course Patisserie of this changing level of consumer income.
Was this exam question helpful?
On Your Bike is a family owned business that first opened in London in 1983. Its customers include children buying their first bikes and scooters, through to experienced enthusiasts in road cycling and mountain biking.
The business offers a wide range of bikes, many imported from abroad. These include high quality brands such as Brompton, Cannondale and Ridgeback. It also stocks a wide range of clothing and helmets including brands such as Endura and Altura.
On Your Bike has large workshop facilities in its shop where qualified mechanics maintain and repair all makes of bike. All mechanics go on regular training courses to ensure they keep their skills and knowledge up to date with the latest cycling technology. This allows On Your Bike to offer exceptional customer service and advice
The cycling market has grown over recent years. Market research has shown that an increasing number of tourists like to rent bikes when on holiday. In response to this, On Your Bike operates one of the largest bike rental services in London. Bikes can be hired by the day or week with a choice including road and electric bikes.
Analyse the impact on On Your Bike of customers using social media to review the business.
Was this exam question helpful?
Explain one reason why a small business may choose not invest in the latest technology.
Was this exam question helpful?
Explain one possible conflict between business owners and employees.
Was this exam question helpful?
Discuss the impact of lower unemployment rates on a small high-tech electronics manufacturer.
Was this exam question helpful?
Explain one way a small business may respond to a change in employment law.
Was this exam question helpful?
A UK-based small business has the following costs in September:
September cost | |
Raw materials imported from German suppliers | £20,000 |
Raw materials from UK suppliers | £14,000 |
Expenses | £22,000 |
Exchange rate | £1 = €1.25 |
In October, the exchange rate has changed to £1 = €1.10.
Assuming all other data remain the same, calculate the change in the businesses profit in October.
Was this exam question helpful?
Discuss the impact on a small fashion retail business of rising inflation.
Was this exam question helpful?
Explain how one economic factor may affect demand for a small businesses goods or services.
Was this exam question helpful?
Explain one way technology can improve communication in a small business.
Was this exam question helpful?
Explain one impact on a small business of an increase in unemployment.
Was this exam question helpful?
Explain one advantage to a small business of meeting all employment legislation.
Was this exam question helpful?
Discuss how possible conflicts between owners and employees could affect the profit of a small business.
Was this exam question helpful?
Explain one advantage to a small business of meeting its legal obligations.
Was this exam question helpful?
Explain one disadvantage to a small business of not paying its employees on time.
Was this exam question helpful?
Explain one disadvantage to a small business from an increase in unemployment.
Was this exam question helpful?
On Your Bike is a family owned business that first opened in London in 1983. Its customers include children buying their first bikes and scooters, through to experienced enthusiasts in road cycling and mountain biking.
The business offers a wide range of bikes, many imported from abroad. These include high quality brands such as Brompton, Cannondale and Ridgeback. It also stocks a wide range of clothing and helmets including brands such as Endura and Altura.
On Your Bike has large workshop facilities in its shop where qualified mechanics maintain and repair all makes of bike. All mechanics go on regular training courses to ensure they keep their skills and knowledge up to date with the latest cycling technology. This allows On Your Bike to offer exceptional customer service and advice.
The cycling market has grown over recent years. Market research has shown that an increasing number of tourists like to rent bikes when on holiday. In response to this, On Your Bike operates one of the largest bike rental services in London. Bikes can be hired by the day or week with a choice including road and electric bikes.
To expand its business in response to the growth in the cycling market, On Your Bike is considering two options:
Option 1: open a second shop
Option 2: start to use e-commerce on its website.
Justify which one of these two options On Your Bike should choose.
Was this exam question helpful?
Stand up paddleboarding is a sport which is similar to surfing but the riders use a paddle whilst standing on the board. Joe Thwaites opened Loco in 2012 as he spotted a gap in the market manufacturing stand up paddleboards (SUPs). Joe felt that he could compete using innovative designs and by changing the shape of the SUPs he made. He spent a few weeks in Fuerteventura, Spain, working with professional SUP riders where he developed designs for three Loco boards.
Since then Loco has surrounded itself with creative talent. This includes world class SUP shapers, graphic designers and team riders, who compete in competitions using its boards. Within months of its new SUPs becoming available, one of the team went on to win the British National Championship and represent Team GB in the World Championships.
Loco now sells an extensive range of SUPs, surf and kite boards throughout the UK and Europe and is ready to further extend its brand. Joe feels that the use of digital marketing using social media is vital in this growth. This combination of creative marketing and Joe’s active role in the business, by offering advice to customers, has provided him with a firm belief that Loco can compete against larger manufacturers.
In order to make improvements to the business, Loco is considering two options:
Option 1: introduce a digital payment system e.g. PayPal
Option 2: hold online meetings using digital communication.
Justify which one of these two options Loco should choose.
Was this exam question helpful?
Last Course Patisserie Ltd is a small private limited company based in Devon which produces hand-made desserts and puddings. The business was established in 1986. Its owners previously worked in the food industry but felt they could offer better value for money to customers. All of the desserts are made fresh to order which has provided Last Course Patisserie with a reputation for being flexible when meeting customer needs.
Getting the best ingredients for the desserts is a vital part of the business. Last Course Patisserie found excellent suppliers of free range eggs and dairy products close to its business location. This means all ingredients could be delivered quickly when needed.
Last Course Patisserie has recently employed a new head chef from Switzerland who has introduced a new range of products to the menu. This has proved to be very popular with customers and the business now struggles to keep up with demand. Last Course Patisserie is receiving increased orders for desserts but, due to the size of its business premises, struggles to meet this increase in demand. The owners have decided that it is the right time for Last Course Patisserie to expand and possibly relocate to new premises
Evaluate the importance to Last Course Patisserie of following all relevant employment laws. You should use the information provided as well as your knowledge of business.
Was this exam question helpful?
Ripple is an energy company aimed at providing green and renewable energy to homes and businesses across the UK. It is the country’s first consumer-owned wind farm, generating green energy that does not have a damaging effect on the environment.
Instead of customers paying Ripple to supply them with energy, they become members of the business and buy a part of a wind farm located in a remote area of South Wales. Customers are then supplied with energy to their homes based on the amount of money they invested. The amount of money that customers can invest varies on their energy needs, but Ripple claims that it can supply energy cheaper than its competitors.
The process of becoming a member is very simple. Firstly, Ripple will ask customers a few questions to identify their energy needs. It will then create a green energy plan to establish how much each customer should invest into the wind farm. Ripple manages the wind farm and provides energy to each customer’s home or business.
Ripple’s business plan fits in with the UK government’s cleaner energy strategy. This strategy includes plans for the country to have net zero carbon emissions by 2050 and to create 220,000 new jobs in the green energy sector of the economy.
In order to help small businesses, such as Ripple, become successful, the UK government is considering two options:
Option 1: reduce the tax paid by small businesses
Option 2: provide free training if businesses recruit new employees
Justify which one of these two options would have the most significant impact on the success of Ripple.
Was this exam question helpful?
Digital Allies is a private limited company. It supports clients to create marketing materials that can be used in a wide range of digital communications. This includes online advertising, web design, and digital data analysis to ensure clients are getting the most from their digital communications. It also offers training to businesses on how they could use social media and digital communication to improve their marketing.
The use of social media is something Digital Allies believes is becoming a major influence on how customers interact with businesses. It manages marketing campaigns across Facebook, Twitter, Instagram, Snapchat and LinkedIn. This allows its clients to target a wide range of consumers and to analyse these communications on social media to give businesses a competitive advantage over their rivals.
In February 2019, Digital Allies announced a three-year expansion plan which involved doubling its workforce to 40 employees and moving to new offices. The business believed that this move would allow it to employ people with the most up-to-date knowledge and to become one of the main digital marketing companies in the UK.
Evaluate the impact that changes in technology may have on Digital Allies. You should use the information provided as well as your knowledge of business.
Was this exam question helpful?
Performance Fitness Centre (PFC) is an independent gym and fitness studio. It has been open for seven years and has over 200 members. Members pay a fee of £39 per month for unlimited access to the gym and fitness classes that take place five days per week. Non-members can also pay to use the gym for each individual session they attend.
The gym at PFC is stocked with high-specification equipment and weight machines. As a result, it has become very popular with customers interested in maintaining a high level of personal fitness. It has an equal number of male and female customers, but the owner has noticed that there is a lower number of members from people aged over 50. He believes that this may be because they feel out of place amongst the younger membership.
Over the past year a new gym that is part of a large national chain has opened nearby. It is much larger and membership fees at the new gym are only £19 per month. PFC has seen a reduction in new members joining the gym and is now considering what it can do to compete with its larger and cheaper rival. Its current members are loyal and enjoy the high quality offered at PFC.
Evaluate the importance of the level of consumer income to the success of PFC. You should use the information provided as well as your knowledge of business.
Was this exam question helpful?