CIE IGCSE Topical Past Paper 1
1.3 Enterprise, business growth and size
045/13/O/N/2024Ramon is an entrepreneur. He plans to start up a home tutoring service to provide students with extra help to learn maths. Ramon is considering buying a franchise. He has prepared a business plan but is concerned about how an increase in the rate of inflation might affect his business. Ramon wants to know whether crowdfunding is the best source of finance for a start-up business to use.
(b) Identify two characteristics of a successful entrepreneur.[2]
Characteristic 1:
Characteristic 2:
(b) Identify two characteristics of a successful entrepreneur.[2]
Characteristic 1:
Characteristic 2:
(c) Outline two ways a business plan might help Ramon. [4]
Way 1:
Way 2:
0450/12/O/N/2024
Avtar owns a car repair business which operates in the private sector. It is a small business with 2 full-time employees. Avtar wants to find out the best way for a business to increase added value. Avtar’s business needs finance for many reasons. Avtar wants to know how an economic recession might affect his business.
(a) Identify two features of a private sector business. [2]
Feature 1:
Feature 2:
0450/11/O/N/2024
Mitchell is an entrepreneur. He wants to start up a business selling books. As part of his business plan Mitchell has carried out some market research. An extract is shown in Fig. 2.1. Mitchell will use microfinance as a source of finance. He wants to know whether the opportunities of using ecommerce for a new business are greater than the threats.
(a) Define ‘entrepreneur’. [2]
(b) Define ‘business plan’. [2]
045/12/M/J/2024
ADN is a food retailer. It has 5 shops and 300 full-time employees. All ADN’s employees receive off-the-job training. ADN has a tall hierarchical structure. Managers have a narrow span of control and all use an autocratic leadership style. ADN’s directors are planning to expand the business and cannot decide whether it is better for a business to use internal growth or external growth.
(e) Do you think it is better for a business to use internal growth or external growth when planning to expand? Justify your answer. [6]
045/12/M/J/2024
Nicky wants to be a successful entrepreneur. She plans to start up a travel business specialising in walking holidays. Nicky will be operating in a niche market. She is preparing a business plan to help with her decision-making. Nicky has been told government support is available for business start-ups. She knows building customer relationships will be important.
(a) Identify two reasons why a government might support business start-ups. [2]
Reason 1:
Reason 2:
(e) Explain two characteristics of a successful entrepreneur. Which characteristic is likely to be the most important? Justify your answer.[6]
045/12/M/J/2024
AH is an insurance business. It operates in a competitive market. AH has 1000 employees including 50 supervisors. The supervisors use an autocratic leadership style. AH currently has a 5% market share and is planning to take over a competitor. The Managing Director is considering how to communicate with AH’s employees about the takeover. There are many sources of finance available to fund business growth.
(c) Outline two benefits to AH of taking over a competitor. [4]
Benefit 1:
Benefit 2:
045/12/F/M/2024
WFH produces hats and sells them to a mass market. It holds a high level of inventory. The Managing Director is concerned about the liquidity of the business and has been analysing WFH’s financial statements. An extract is shown in Table 2.1. The Managing Director thinks that the business might fail. Other stakeholder groups might also be interested in WFH’s financial statements.
Extract from WFH’s financial statements ($000) | ||
2021 | 2022 | |
Current assets | 60 | 50 |
Inventory | 20 | 30 |
Trade receivables | 25 | 10 |
Cash | 15 | 10 |
Current liabilities | 20 | 40 |
Profit / loss | 15 | (10) |
(a) Identify two possible causes of business failure. [2]
Cause 1:
Cause 2:
045/11/O/N/2023
Desmond wants to be a successful entrepreneur. He has decided to leave his office job to start up a gardening business cutting grass and planting flowers. It will be an unincorporated business. Desmond is aware that a new business is at greater risk of failure than an established business.
He has identified his business objectives for the first year. Desmond has calculated he will need $750 for his start-up capital.
(a) Define ‘unincorporated business’.[2]
(d) Explain two reasons (other than lack of finance) why Desmond’s new business might be at greater risk of failure than an established business. [6]
Reason 1:
Explanation:
Reason 2:
Explanation:
045/13/M/J/2023
Meena wants to leave her job as a teacher to become a successful entrepreneur. Her business will produce handmade jewellery. Meena knows that there is government support for business start-ups. She plans to use market research to help identify a market segment for her jewellery. Meena’s brother has offered to become her business partner but she cannot decide whether it would be better to operate as a sole trader
(a) Identify two ways a government might support business start-ups. [2]
Way 1:
Way 2:
(c) Outline two characteristics Meena will need to become a successful entrepreneur. [4]
Characteristic 1:
Characteristic 2:
045/11/M/J/2022
Pamela is a successful entrepreneur. She is the owner of a gift shop selling celebration cards, toys and candy (sweets). When Pamela started her business 30 years ago she had no help to manage the shop. She now has 5 employees. Pamela knows maintaining customer loyalty is important. She uses competitive pricing. Most of her marketing budget is spent on sales promotion. Pamela does not use e-commerce.
(e) Do you think being a risk-taker is a more important characteristic of a successful entrepreneur than being creative? Justify your answer. [6]