CAIE IGCSE Business 0264 - Paper 2

5.1 Business finance

Topical Past-Paper Questions

Why it’s here: Why finance is needed and choosing suitable internal and external sources.

CAIE IGCSE Business 0264 Paper 2 Topic 5.1

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Key concepts to revise

The main ideas to know for 5.1 Business finance.

Reasons for finance

Businesses need money for start-up, working capital, expansion and emergencies.

Internal sources

Retained profit, owner savings and asset sales come from within the business.

External sources

Loans, overdrafts, trade credit, shares and leasing come from outside.

Choosing finance

Purpose, amount, duration, cost, risk and control determine suitability.

About this topic

Business finance includes selected 0450 questions that continue to align with the Cambridge IGCSE Business 0264 syllabus.

Keep every answer connected to the business in the case study.

Use the case-study evidence
Develop each explanation fully
Show working for calculations
Justify the final recommendation

Before you begin

1Read the command word
2Check the marks available
3Study every table or figure
4Apply the answer to the business

Exam material

Past-paper questions

Past-paper question 0450/21/M/J/25 [8] marks

4(a) Explain two advantages and two disadvantages to a business of using a bank loan as a source of finance. [8] [ Click here for the Case Study Insert ] Advantage 1 : Advantage 2 : Disadvantage 1 : Disadvantage 2:

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