Edexcel GCSE: Business Studies Quiz- III

20 Questions | Total Attempts: 340

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Edexcel GCSE: Business Studies Quiz- III

20 questions = 40 marks


Questions and Answers
  • 1. 
    Businesses supply goods and services to consumers. Which of the following is an example of a service? Select one answer:
    • A. 

      A magazine

    • B. 

      An MP3 player

    • C. 

      A train journey

    • D. 

      A bottle of water

  • 2. 
    Which two of the following are examples of commodities which might be used by a bakery? Select two answers:
    • A. 

      Wheat used in producing bread

    • B. 

      Rent of premises

    • C. 

      Electricity used by ovens

    • D. 

      Sugar used to produce biscuits

    • E. 

      Wages paid to workers

  • 3. 
    Which three of the following are possible advantages to an individual of starting a business as a franchise rather than as a sole trader? Select three answers:
    • A. 

      The franchisor pays the franchisee to set up the business

    • B. 

      Franchises pay lower rates of Value Added Tax than sole traders

    • C. 

      A franchise is likely to be an established business

    • D. 

      The franchisee has complete freedom to make their own decisions

    • E. 

      The franchisor provides continued help and support

    • F. 

      The franchisee can benefit from national advertising of the franchise

  • 4. 
    Using the chart, calculate the net cash flow for April to October. Select one answer:
    • A. 

      –£3 000

    • B. 

      £10 000

    • C. 

      £19 000

    • D. 

      £23 000

  • 5. 
    Monthly sales at PrintZone remained unchanged from April to October. Given this fact, which two of the following are possible reasons for the worsening in cash flow position of the business during this time? Select two answers:
    • A. 

      Increased spending on stocks of ink cartridges and printers by PrintZone

    • B. 

      Change in the interest rate on PrintZone’s bank loan from 5% to 4%

    • C. 

      Monthly rent on PrintZone’s premises changing from £700 to £650

    • D. 

      More favourable trade credit terms provided by suppliers to PrintZone

    • E. 

      PrintZone’s monthly advertising costs changing from £800 to £1400

  • 6. 
    Which two of the following are the most likely ways that PrintZone Ltd could improve its cash flow position? Select two answers:
    • A. 

      Use a mind map to improve financial planning

    • B. 

      Carry out quantitative market research

    • C. 

      Increase revenue by improving sales

    • D. 

      Negotiate lower prices with suppliers

    • E. 

      Employ two more full-time members of staff

  • 7. 
    Lisa Gallagher believes there is a growing market for gardening services as people do not have enough time to maintain their gardens. She has conducted some market research to find out if her business idea will work and has prepared the following summary of her findings. Would you consider hiring Lisa? Number of responses Yes 134 No 66 Lisa used the questionnaire (see Table 1) to estimate the number of potential customers for her business. This approach is an example of which type of market research? Select one answer:
    • A. 

      Market mapping

    • B. 

      Secondary

    • C. 

      Qualitative

    • D. 

      Primary

  • 8. 
    Table 2 What is the most important factor in the decision to choose a gardening service? Number of responses as a percentage Price of the service 12% Quality of the work 41% Advertisement in the local paper 16% Customer service 20% Whether the business is local 11% According to Table 2, which element of the marketing mix should Lisa focus on in her business? Select one answer:
    • A. 

      Place

    • B. 

      Price

    • C. 

      Product

    • D. 

      Promotion

  • 9. 
    Table 3 shows details of the 200 households which indicated they were interested in using Lisa’s business. Type of household Percentage Single - no children 7% Single - with children 11% Single - pensioner 28% Couple - no children 9% Couple - with children 31% Figure 1 Lisa aims to provide three levels of service for local people: Service 1 – cutting lawns and generally tidying garden areas = 49% chose Service 2 – planting and maintaining new planted areas = 29% chose Service 3 – garden redesign, including planning, preparation and all planting = 10% chose 12% chose a combination of the three types Study Table 3 and Figure 1. According to this information, what three conclusions can Lisa draw from the data? Select three answers:   Couple - pensioner 14
    • A. 

      100% more single pensioners than pensioner couples are interested in Lisa’s business

    • B. 

      Lisa should not offer Services 2 or 3 as there is no demand

    • C. 

      Her main two market segments are couples with children and single pensioners

    • D. 

      More than half of people prefer something other than Service 1

    • E. 

      Couples with children are more likely to use Service 1

    • F. 

      30% more couples with children than single pensioners are interested in Lisa’s business

  • 10. 
    Which two of the following are strategies which Lisa might use to help her business achieve high levels of added value? Select two answers:
    • A. 

      Ensure a profit is made on every job completed

    • B. 

      Introduce a loyalty scheme to give regular customers price discounts

    • C. 

      Visit every customer 48 hours after work completed to take feedback

    • D. 

      Develop a strong brand awareness in the local area

    • E. 

      Compare the prices of Lisa’s competitors every month

  • 11. 
    Identify three conclusions that can be drawn from the chart. Select three answers:
    • A. 

      Actual total costs increased by 40% between April and May

    • B. 

      Actual profit was higher than forecast profit in May

    • C. 

      Actual revenue fell by more than 10% between June and July

    • D. 

      The fall in profit between June and July was most likely caused by a fall in sales

    • E. 

      The forecast profit for the period April to July was £24 000

    • F. 

      Revenue forecast for May was inaccurate

  • 12. 
    Which of the following would best explain the lower revenue in July compared to the forecast figure? Select one answer:
    • A. 

      Improvement in the business cycle

    • B. 

      An increase in interest rates

    • C. 

      Less competition in the market

    • D. 

      Increased promotion by Timbles

  • 13. 
    Timbles decided to increase its prices by 10% but sales stayed the same. Which two of the following are possible effects of the decision by Timbles to increase the price it charges for its product? Select two answers:
    • A. 

      Increased customer satisfaction

    • B. 

      Increased total revenue

    • C. 

      Higher fixed costs

    • D. 

      Increased interest payments

    • E. 

      Higher profit for every product sold

  • 14. 
    A business has the following cost and revenue information during one month: Costs: • £10 000 - raw materials imported from the USA • £ 7 000 - raw materials from the UK • £11 000 - fixed costs Revenue: • £39 000 In this month the exchange rate between the pound and the dollar was £1 = $1.50 What profit/loss does the business make in this month? Select one answer:
    • A. 

      £11 000

    • B. 

      £28 000

    • C. 

      £29 000

    • D. 

      £67 000

  • 15. 
    A business has the following cost and revenue information during one month: Costs: • £10 000 - raw materials imported from the USA • £ 7 000 - raw materials from the UK • £11 000 - fixed costs Revenue: • £39 000 In this month the exchange rate between the pound and the dollar was £1 = $1.50 In the next month the business imports the same amount of raw materials from the USA. The exchange rate has changed to £1 = $1.60. Assuming all other data remains the same, what effect does this change have on the profit level? Select one answer: The profit level will
    • A. 

      Decrease by £1 350

    • B. 

      Remain the same

    • C. 

      Increase by £625

    • D. 

      Increase by £1 600

  • 16. 
    Martin Hudson runs Buckingham Ltd, a business which sells high quality office furniture to other businesses. Martin needs to think creatively about how he can improve his business. He has used lateral thinking techniques to help him do this. Successful entrepreneurs need to think creatively and make connections between ideas. What is the diagram which can be used to record words and ideas connected to a central word or idea? Select one answer:
    • A. 

      Spreadsheet

    • B. 

      Market map

    • C. 

      Scatter diagram

    • D. 

      Mindmap

  • 17. 
    Changes in the business cycle can have important impacts on small businesses. Identify three likely effects on a business like Buckingham of a downturn in the business cycle Select three answers:
    • A. 

      Higher sales due to rising consumer incomes

    • B. 

      Lower fixed costs due to lower interest rates

    • C. 

      Less risk of the business becoming insolvent

    • D. 

      More difficult to recruit employees

    • E. 

      Lower demand due to business closures

    • F. 

      Lower prices on goods bought from suppliers

  • 18. 
    Martin Hudson runs Buckingham Ltd, a business which sells high quality office furniture to other businesses. Martin needs to think creatively about how he can improve his business. He has used lateral thinking techniques to help him do this.   Which three of the following are taxes which businesses like Buckingham may have to pay? Select three answers:
    • A. 

      National Insurance Contributions

    • B. 

      Value Added Tax

    • C. 

      Business Tax

    • D. 

      Minimum Wage

    • E. 

      Corporation Tax

    • F. 

      Distribution Tax

  • 19. 
    Which two of the following are likely to be the most effective methods that Buckingham might use to deliver high levels of customer satisfaction? Select two answers
    • A. 

      Securing repeat purchases by customers

    • B. 

      Fulfilling customer orders accurately

    • C. 

      Setting non-financial objectives

    • D. 

      Introduce a 24-hour customer help-line

    • E. 

      Advertise on local radio stations

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