Business 9609/13 May/June 2025: question paper and mark scheme

Mark scheme

1(a) Define the term motivation. 2 Indicative content AO1 Knowledge and understanding Clear understanding A clear definition that merits 2 marks should include reference to two out of the following three 1-mark responses (an acceptable definition will NOT use the word ‘motivate’ ) • The factors-such as stimulate, encourage, interest, leading to the desire of employees (1) providing a willingness to work, to work harder, to perform well, to achieve something, a goal/task or objective, become more efficient, more satisfied (1) with incentives such as money, promotion, job enrichment/rotation (1) Partial understanding • Why employees work hard (1) Accept all valid responses. 1(b) Explain one benefit for a business of motivated employees. 3 There are 3 marks for this question: 1 mark for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one BENEFIT for a business of motivated employees • Lower absenteeism • Better workplace culture • Employees work harder • Lower labour turnover • Employees more productive • Business objectives more likely to be achieved • Better customer service • Greater creativity/innovation ( motivated employees more likely to challenge, explore more creative options and collaborate with colleagues ) • Improved work relationships- more likely to accept change and less likely to take industrial action • Positive business reputation- motivated employees more likely to speak highly of the business • Higher sales- more profit 1(b) AO2 Application 2 marks for developed of the benefit given 1 mark for limited of the benefit given • Disruption caused by absent employees is reduced • Positive work environment • Recruitment and training costs for the business are reduced • Better quality products or services due to more care being taken – a good standard of work – happier customers • Employees will match their personal objectives with those of the business. • Improved customer satisfaction leading to increase in repeat customers – less complaints – better reviews Accept all valid responses.

Mark scheme

2(a) Define the term incremental budgets. 2 Indicative content AO1 Knowledge and understanding Clear understanding • Incremental budgeting is a budgeting process that involves developing a budget by making adjustments/changes to an existing or previous budget (2) Partial understanding • Setting this year`s budget based on last year`s budget (1) Accept all valid responses. 2(b) Explain one advantage to a business of using variance analysis 3 There are 3 marks for this question: 1 mark for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one advantage of using variance analysis • Gives a business more control • Clarifies accountability in a business • Improves accuracy of budgets • Improves financial decision making • Identifies areas for improvement. • Allows business to compare their estimated costs with their actual costs • Allows planning • Shows how to allocate resources • More effective strategy 2(b) AO2 Application 2 marks for developed of the advantage given 1 mark for limited of the advantage given • Highlights areas of business needing attention • Helps in assessing management performance • Identifies potential problems early • Helps to monitor financial performance • Helps a business to budget more accurately in the future • Helps managers to respond to adverse or favourable variances • Identifies areas of over/under spending and spending not authorised • May lead to improved business efficiency • Helps to monitor success and failure • Helps to identify areas of underperformance • Helps strategic decisions/better planning • Provides fast financial information Accept all valid responses.

Mark scheme

3(a) Define the term Just in Time (JIT). 2 Indicative content Responses may include: AO1 Knowledge and understanding Clear understanding NOTE: A clear definition that merits two marks should include reference to two out of the following three 1 mark responses: • The management of inventory (1) that ensures that new inventory arrives just when needed (1) removes the need for inventory to be held in storage until it is needed (1) Partial understanding • Where inventory is kept low (1) Accept all valid responses. 3(b) Explain one disadvantage to a business of using Just in Time (JIT). 3 There are 3 marks for this question: 1 mark for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one disadvantage of using JIT • Production process can be delayed when supplies do not arrive or are late • Frequent small deliveries needed • More planning ahead with suppliers required • Small orders need to be processed • Suppliers need to be reliable • Could be expensive • No discounts for bulk orders- no economies of scale • Unable to respond to unexpected customer demand • Can lead to stockouts 3(b) AO2 Application 2 marks for developed of the disadvantage given 1 mark for limited of the disadvantage given • Any failure to receive supplies or components on time – could lead to production delays. • Frequent small deliveries – could lead to an increase in delivery costs. • Small orders need to be processed – administration costs may rise. • Each order is likely to be small – lose out on bulk discounts. • Suppliers need to be reliable – if not could affect reputation • Could be expensive to implement for small firms – increase costs • May require investment in new technology • Could lose sales/ revenue/profit Accept all valid responses.

Mark scheme

4 Analyse one advantage to a business of using mass marketing. 5 There are 5 marks for this question: 1 mark for 2 marks for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one advantage to a business of using mass marketing • Business may secure economies of scale • Mass marketing may ensure cost effectiveness in business operations • Opportunity to secure significant sales • Opportunity to build and develop a brand • Opportunity to build and develop the business 4 AO2 Application 2 marks for developed of the chosen advantage. 1 mark for limited of the chosen advantage. • Economies of scale – unlike niche marketing • Cost effective – when used to advertise products • Mass marketing campaigns can reach a large audience – via several channels. • Appeals to the total population – lead to more sales. • Can increase brand awareness – via several channels • Can save time with marketing campaigns – as don’t have to create new campaign for each different segment AO3 Analysis 2 marks for developed of the chosen advantage 1 mark for limited of the chosen advantage • Economies of scale can enable substantially lower average costs of production – increase profit margin. • The ability to target the whole market could lead to huge sales – and profits. • Brand awareness could become global – could lead to becoming market leader. • Time saved on marketing campaigns could be used in other ways to increase business efficiency. • Less prone to changing tastes – so a change in consumer buying habits may not impact sales. Accept all valid responses.

Mark scheme

5(a) Analyse two benefits to a business of using break-even analysis. 8 There are 8 marks in total for Q5(a) 4 marks for each of the two benefits given. These 4 marks consist of 1 mark for 1 mark for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one benefit of using break-even analysis. • Provides crucial insights for business decisions • Provides information for a range of important business decisions • Shows whether a product is worth selling or too risky- such as new products, pricing, costs and production levels • Shows the amount of revenue a business will make at different levels of output • Assists in evaluating investment plans/decisions • Helps to analyse costs • Calculations are quick/easy • Helps set pricing strategy • Supports setting targets 5(a) AO2 Application 1 mark for of a one benefit. • The use of break-even analysis in a business -indicates production volume required to cover costs/make profits • Allows informed decisions to be made on: Pricing • Cost management • Production levels • Overall business strategy • Relatively easy to calculate and understand – great for quick estimates. • Used to assist managers in decision making – location, equipment, projects. • The break-even analysis can be used in business plans to support loan applications • Really useful when launching new products or entering new markets AO3 Analysis 2 marks for developed of one benefit 1 mark for limited of one benefit • Break-even analysis can give a business an idea of whether the product is likely to be successful by analysing the costs involved and likely revenues. • The level of output for a desired level of profit can be determined • A break-even chart indicates the margin of safety. If the margin of safety is too low the business might reconsider its product(s) • Break even analysis can be used to assist managers when making important decisions such as location decisions, whether to buy new equipment, or invest in a project – so reduces the risk to the business. • A business might see that if a certain level of profit is to be achieved, costs might have to be reduced to make it possible • A change in price might also be indicated. If the desired profit is not achieved, then the price of the product might have to be increased. Accept all valid responses. The AN marks are recorded in the 5(a) AO3 box 5(b) Evaluate whether cash flow forecasting is the most important activity for the success of a fashion clothing 12 manufacturer There are 12 marks for Q5(b) 2 marks for 2 marks for 2 marks for 6 marks for Indicative content Responses may include: AO1 Knowledge and understanding 2 marks for developed knowledge and understanding 1 mark for limited knowledge and understanding • Cash flow forecasting-the process of obtaining an estimate/forecast of a business’s future cash position – anticipated payments and receivables in a given period of time • Clothing manufacturers convert raw materials into finished garments • Success may be measured in terms of quality of clothing, customer satisfaction, level of clothes purchased, reputation established, health of financial position, level of profit, amount of time in business. 5(b) AO2 Application/Context 2 marks for developed application/context 1 mark for limited application/context • Success of a fashion clothing manufacturer very much concerned with following/creating the latest trends, fashions/fads in clothing, keeping pace with the latest fashion house changes in a range of different clothing items. • Fashion clothing manufacturers produce a variety of clothes such as trousers, skirts, dresses, jumpers, T-shirts. casual wear, evening wear, summer ware etc • Use different materials-cotton, wool, leather • Creativity/innovation in clothing design work AO3 Analysis 2 marks for developed analysis 1 mark for limited analysis • A CFF can provide an early warning system for a business – future shortfalls in cash balances – allows a business to take informed business decisions, such as overdraft provision or short-term loan • If a business runs out of cash, it may face insolvency. A CFF can indicate the correct time to take action. • CFF enables a business to track expected cash movements over a period of time in the future – provides a degree of certainty in possible turbulent times – allows well planned decisions to be made • CFF is a strategic tool for a new business – gives information for development of plans for survival and growth • A cash flow forecast may be useful for external stakeholders – such as banks, may want to look at CFF at regular intervals in order to support a business plan. 5(b) AO4 Evaluation AO4 Evaluation: Up to 6 marks for evaluation: Developed/Supported judgement in context 6 marks Developed/Reasonable evaluative comments in context 5 marks Developed/Supported judgement without context 4 marks Developed/Reasonable evaluative comments without context 3 marks Limited supported judgement 2 marks An attempt to balance the arguments/Weak attempt at evaluative comments 1 mark A judgement/conclusion is made as to the importance of cash flow forecasting for the success of a new restaurant. Such judgements/conclusions may be made at any point in the essay, not only in a concluding section. • A judgement is made as to whether activities other than CFF could/should be considered as important or more important in affecting a new clothing manufacturer’s ability to succeed. • A judgement is made as to what is meant by success and when to take the measure • Alternative measures of success are judged to be – perception of the quality of the clothes – brand image – desirability of clothes – strength/weakness of the economy – ability to react to changes in trends – retailer/supplier relationships • A judgement is made regarding the significance of cash control and CFF for a new clothing manufacturer in relation to other factors. • Is CFF as important as market research or monitoring trends and fashions in clothing? Accept all valid responses. NOTE: The marks for 5(b) are recorded in the mark input column on the right-hand side of the screen. K marks are entered in the 5b AO1 box APP marks are entered in the 5b AO2 box AN marks are entered in the 5b AO3 box EVAL marks are entered in the 5b AO4 box

Mark scheme

6(a) Analyse two advantages to a business of making ethical decisions. 8 There are 8 marks in total for Q6(a) 4 marks for each advantage given. These 4 marks consist of 1 mark for 1 mark for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one advantage • Enhanced business reputation • Increased employee morale • Improved customer trust/loyalty • Mitigate legal risks/pressure group criticism • Positive social impact • May give competitive advantage • Ensures long term sustainability • Ensures business success • Attracts more investors • Government support • Higher sales • Attracts employees • Reduce costs • Reduce conflict between employees 6(a) AO2 Application 1 mark for of the chosen way. Repeat this for the chosen advantage • Paying fair/living wages – not employ child labour • Committing to sustainability – reduce carbon footprint, recycle, energy efficiency • Using Fairtrade suppliers – pay fair price for goods • Reducing workforce without layoffs – through consultation with unions • Reduce pollution – use more eco-friendly machines • Limit advertising to children/parents – ‘pester power’ • Not take bribes – written into code of conduct • Investors feel that their money is being used in a responsible way AO3 Analysis 2 marks for developed analysis of the chosen analysis 1 mark for limited analysis of the chosen analysis • Can lead to good publicity and brand image/usp – customers may become loyal • Attract ethical customers – a potentially increasing customer base in today’s market • Ethical businesses are more likely to be awarded government contracts – increase revenue • Well qualified staff may be attracted to work for businesses who are the most ethical – competitive advantage. • Fosters a culture of fairness and respect within the business – help reduce labour turnover and increase efficiency. • Improves the public image of the business – people want to work there, customers want to purchase goods, investment • Improves the bottom line of the business – loyal customers – increased profits • Appeals to shareholders as there is a growing number of ethical investors – greater investment Accept all valid responses. 6(b) ‘Employees are the most important stakeholder group in a primary sector oil and gas business.’ 12 Evaluate this view. There are 12 marks for Q6(b) 2 marks for 2 marks for 2 marks for 6 marks for Indicative content Responses may include: AO1 Knowledge and understanding 2 marks for developed knowledge and understanding 1 mark for limited knowledge and understanding • Stakeholders are persons who have an interest in/are affected by a business, such as owners, shareholders, customers, suppliers, employees, local communities, government, special interest groups • Primary sector oil and gas businesses exist in the energy sector and often span many countries with huge revenues and profits. • They engage in the exploration and extraction of oil and gas. 6(b) AO2 Application 2 marks for developed application/context 1 mark for limited application/context • Employees are important as they provide skilled labour and without them the business would not be able to operate and make profits. • Employees ensure new sites are found, oil and gas is extracted efficiently and safely. • Primary sector oil and gas industries can be dangerous and risky- health and safety policies needed to protect employees • Oil and gas sector produce energy services to power vehicles, heat homes and manufacture steel • Sold to petrol/gas stations AO3 Analysis 2 marks for developed analysis 1 mark for limited analysis • If the workforce is unhappy about a change in work practices though it might reduce costs in the short run, it may be detrimental if a demotivated workforce affects the quality of production. • If there is strong trade union membership then strike action may occur if demands are not met – this would affect image, stop production, delay deliveries. • Good relationships with employees would improve morale and motivate – lead to improved productivity and lower staff turnover • Skilled employees ensure that the business is able to locate and extract the raw materials (oil) thus ensuring sales revenue and profits. 6(b) AO4 Evaluation: Up to 6 marks for evaluation: Developed/Supported judgement in context 6 marks Developed/Reasonable evaluative comments in context 5 marks Developed/Supported judgement without context 4 marks Developed/Reasonable evaluative comments without context 3 marks Limited supported judgement 2 marks An attempt to balance the arguments/Weak attempt at evaluative comments 1 mark A judgement/conclusion is made as to the view that the main reason for new business failure is the pursuit of growth too quickly. Such judgements/conclusions may be made at any point in the essay, not just in a concluding section. • A judgement is made that there are a number of factors that impact on the importance of employees as stakeholders such as how strong trade unions are, how skilled they are and how easy it is to find new employees. • If employees are easy to recruit i.e. unemployment is high, then employee’s importance might not be too significant. • Business might place more importance on keeping shareholders happy with dividends. • A judgement is made that most businesses need to balance the needs of all stakeholders for a successful business especially a business as large and complex as those in the oil and gas primary sector. • A judgement is made that in the modern era local communities are more willing to protest if their local community will potentially be polluted and the resulting negative impact in the news. This however may depend on which country the business is operating in. • A judgement is made that pressure groups are becoming more visible and any business would be foolish not to take them seriously as the impact on brand image and the ability to operate can be significant especially in light of global warming. • A judgement is made to that very often compromises need to be made in business with negotiations occurring with all stakeholder groups. • How important are other stakeholders such as shareholders, local communities, suppliers, governments? Accept all valid responses.