Business 9609/11 October/November 2024: question paper and mark scheme

Mark scheme

1(a) Define the term zero budgeting. 2 Indicative content Responses may include: AO1 Knowledge and understanding Clear understanding of the term zero budgeting is worth 2 marks. • budgets are automatically set to zero and budget holders must argue their case to receive any finance/funds (2) Partial understanding of the term zero budgeting is worth 1 mark. • budgets are set to zero (1) • budgets set without consideration of historical data (1) • potential costs evaluated from 0 each year (1) Accept all valid responses. 1(b) Explain one cause of a favourable variance. 3 Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one cause of a favourable variance • income higher than expected • increase in demand/sales • loss of competition • effective promotion • costs less than expected/decreased spending • profit higher than expected AO2 Application 2 marks for developed application/explanation of the cause given 1 mark for limited application/explanation of the cause given • actual sales revenue higher than budgeted sales revenue - economic boom leads to more sales than expected • advertisements increase sales and sales revenue is higher than budgeted • actual wages less than budgeted wages - wage rises lower than expected/less staff employed/less hours worked • lower material costs – motivated workers making less mistakes/less wastage • produced less, therefore spent less money on raw materials and labour Accept all valid responses.

Mark scheme

2(a) Define the term sampling. 2 Indicative content Note: do not accept test marketing as a correct answer to this question. Responses may include: AO1 Knowledge and understanding Clear understanding of the term sampling is worth 2 marks. • selecting a group of people/customers to represent the population/customer base/target market as a whole (2) Partial understanding of the term sampling is worth 1 mark. • choosing a group of people (1) • form of market research (1) Accept all valid responses. 2(b) Explain one method of interpreting quantitative market research data. 3 Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one method of interpreting quantitative market research data. • tables • charts – bar, pie • graphs – line • trend analysis/moving averages • arithmetic mean, mode and median • index numbers AO2 Application 2 marks for developed application/explanation of one method. 1 mark for limited application/explanation of one method. • direct comparison of numerical information in table with columns and rows – could use a spreadsheet • use charts and/or graphs to represent the information presented in a table – easy to read/analyse • compare size of segments in pie charts or heights of bars comparing actual figures collected • plot data on a graph and analyse change in trend over time/moving averages • percentage or actual changes shown over time, possibly with a forecast based on the data • calculate average/most frequent/middle of a set of results - allows focus on a more realistic figure than considering extremes • set a base year as the start of analysis and compare changes over time using index numbers Accept all valid responses.

Mark scheme

3(a) Define the term résumé. 2 Indicative content Responses may include: AO1 Knowledge and understanding Clear understanding of the term résumé is worth 2 marks. • document/form/statement/template …... which summarises applicant’s relevant job experience/achievements, education/qualifications and training (2) Partial understanding of the term résumé is worth 1 mark. • Similar/separate to a CV (1) Accept all valid responses. 3(b) Explain one reason why a business may produce a workforce plan. 3 Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for identifying one reason why a business may produce a workforce plan. • planning for future labour requirements • help with budgeting • preparing for changes in external environment • predicts changes in current labour and skills needed AO2 Application 2 marks for developed application/explanation of one reason 1 mark for limited application/explanation of one reason • business can plan for redundancies, retirements, maternity/paternity leave, expansion of business, labour turnover • allows changes to workforce to be budgeted for – recruitment, training, wages • ensuring that they have the right employees in terms of numbers, work locations and skills • helps businesses to deal with changes (such as the impact of new technology or in consumers’ tastes) • help businesses to prepare for changes in the workforce, such as the introduction of new production-line machinery • enabling businesses to meet their organisational objectives Accept all valid responses.

Mark scheme

4 Analyse one benefit to a business of improving capacity utilisation. 5 Note: no marks can be awarded if a relevant benefit is not given Indicative content NOTE: some candidates have interpreted improving capacity utilisation as preventing capacity shortages or reducing long- term excess capacity. This leads to answers that focus on saving costs. This is a valid response and should be marked and rewarded appropriately. Responses may include: AO1 Knowledge and understanding 1 mark for identifying one benefit to a business of improving capacity utilisation • better use of factors of production/more efficient • more products made in same time/match production to demand • achieve output maximisation • take advantage of economies of scale • reduce inventory storage cost AO2 Application 2 marks for developed application/explanation of the chosen benefit 1 mark for limited application/explanation of the chosen benefit 4 • no idle assets e.g. employees, premises, machinery, office space • spread fixed costs of business over more units e.g. running machinery, rent of premises/unit fixed costs will reduce • cope with increases in demand, no risk of stock out • buy more raw materials/components to gain discounts • opportunity cost of inventory stored but unable to be used • no wastage AO3 Analysis 2 marks for developed analysis of the chosen one benefit 1 mark for limited analysis of the chosen one benefit • business can be more competitive/increase market share • cost of producing each item will fall so can lower selling price or increase profit margins • increased flexibility to meet customer demand results in customer satisfaction • business can become more profitable as costs fall but sales increase • reduced inventory costs increases profits and allows money to be used elsewhere Accept all valid responses.

Mark scheme

5(a) Analyse two limitations to a business of using a business plan. 8 There are 8 marks in total for Q5(a) – 4 marks for each of the two reasons given: 1 mark for 1 mark for 2 marks for Indicative content Responses may include: AO1 Knowledge and understanding 1 mark for giving one limitation to a business of using a business plan • plan is often set up before the business starts to run • plan may not be accurate/may be biased • plan may be unrealistic • business plan for a large business can be a very complex document • plans quickly become out of date/are short term • may cause inflexibility/over-reliance • reduce innovation • reveals future strategies to competitors • does not guarantee success AO2 Application 1 mark for application of one limitation • must be based on market research but no past experience of running this business • an entrepreneur may not have business knowledge, just an idea based on a hobby • unrealistic expectations puts pressure on employees 5(a) • a lot of time and effort is taken to produce a detailed business plan • external and internal circumstances may not be predictable and can change rapidly • owner may prefer to follow the plan rather than reacting to external influences and ideas • plan may be critiqued by other businesses AO3 Analysis 2 marks for developed analysis of one limitation L2 1 mark for limited analysis of one limitation L1 • for a start-up business the plan might be weak due to inexperience or over-optimism of entrepreneur so will not help the business to make decisions • to be useful the plan must have accurate forecasts, the right actions must be planned and effectively implemented in the given circumstances, otherwise it is a waste of time for the business to produce • without being based on reliable research and experience in this type of business the plan may be inaccurate and will not help the business to survive or develop • if goals are not achieved employees are discouraged and motivation is reduced • an employee, probably a manager, will have to be allocated the role of producing the plan, which takes them away from other aspects of their job role, so the business may be less efficient • the business plan needs to be constantly updated if it is to be an effective working document which takes further time/effort • lack of quick responses causes missed opportunities and lack of competitiveness • simply having a plan does not guarantee success/must be good and carried out well • confidential company information is revealed to external sources, losing competitive advantage Accept all valid responses. 5(b) ‘A chocolate manufacturer should use external methods of growth to successfully achieve its objectives.’ 12 Evaluate this view. 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 L2 1 mark for limited knowledge L1 • external (inorganic) buying or joining with another business, integration, merger, takeover, horizontal, forward vertical, backward vertical, conglomerate diversification, joint venture, strategic alliance • internal (organic) sales growth with existing products and customers or new products, new customers, new markets • different types of objectives – growth in size, market share, profit, cash flow, survival, diversification, providing a service, ethical, social 5(b) AO2 Application 2 marks for developed application L2 1 mark for limited application L1 • chocolate manufacturer – may give named examples, brands or foods, could refer to specific parts of the process. The manufacturer could undertake backward vertical integration with a supplier of cacao beans. Packaging is not application unless explained in relation to chocolate – it can apply to any manufacturer AO3 Analysis 2 marks for developed application L2 1 mark for limited application L1 • horizontal integration is good for increasing market share by combining sales of both businesses, whilst getting rid of a competitor • mergers can bring together complementary ideas and techniques to aid product development e.g. new chocolate recipe • external growth is good for entering new markets where the other business is already established and successful • external growth is a quick method of expansion as all factories, equipment and employees are already in place • takeover may be too expensive for a business aiming for quick profit maximisation or a small business • internal growth is less expensive and may appeal more to a smaller business • depending on what the objectives are it is possible to achieve them without growth e.g. motivating/training workers for profit maximisation • a new business may focus on survival and then slower internal growth building on their success 5(b) AO4 Evaluation 6 marks for evaluation Developed/Supported judgement in context 6 marks L3 Developed/Reasonable evaluative comments in context 5 marks L3 Developed/Supported judgement without context 4 marks L2 Developed/Reasonable evaluative comments without context 3 marks L2 Limited supported judgement 2 marks L1 An attempt to balance the arguments/Weak attempt at evaluative comments 1 mark L1 A judgement/decision on whether a chocolate manufacturer should use external methods of growth to successfully achieve its objectives is made. Such judgements/decisions may be made at any point in the essay, not just in a concluding section • depends on the objectives of the business • depends on current size of the business • depends on strength of brand, competition, state of economy, changing customer tastes e.g. for lower sugar chocolate • depends on the type of chocolate products being manufactured - niche or specific to particular countries e.g. chilli chocolate. Will it transfer to a wider market? • is there the potential for the manufacturer to grow? • depends on how much finance is available to grow • depends on the type of ownership of the business • merger, friendly and hostile takeovers can all be carried out Accept all valid responses.

Mark scheme

6(a) Analyse two reasons why an employee’s human needs may not be satisfied at work. 8 There are 8 marks in total for Q5(a) – 4 marks for each of the two reasons given: 1 mark for 1 mark for 2 marks for Indicative content Note: A candidate may interpret the question as why the business is unable to satisfy its employees’ human needs e.g. it cannot afford to pay higher wages or provide a rest room. This is an acceptable interpretation and the full range of marks is available for such an answer. Responses may include: Note: Some candidates make the application points as knowledge points and vice versa. This is acceptable and should be rewarded. AO1 Knowledge and understanding 1 mark for giving one reason • underpaid • lack of job security • unsafe working conditions • lack of teamwork • no promotion prospects • lack of work life balance • type of job • style of leadership • objectives of the business 6(a) AO2 Application 1 mark for application of one reason • basic/hygiene needs not met – money, survival, low wages/salary • security and safety needs – contract, business struggling • belonging or social needs - isolated • higher level needs/motivators not being met – recognition, self-esteem, self-actualisation, achievement • hours are long and restrictive • work is boring, monotonous, lack of opportunity • autocratic, strict, regimented working style • if objectives are not profit maximisation employees might suffer AO3 Analysis – 2 marks for developed analysis of one reason L2 1 mark for limited analysis of one reason L1 • not enough money to pay for basic standard of living for self and family. May be unskilled and low paid job – no opportunity to improve this without employer willing to increase wage and may need to pay for training to do this • no job security – no contract, zero hours, no trade union representation, unethical employer, high demand for jobs, recession causing business uncertainty – employee unable to make plans for the future • no opportunity to work with others – labour intensive flow production. Exclusion by other employees. Discrimination. Employee may be demotivated and not want to go to work • no acknowledgement or opportunity for promotion – employee feels they don’t matter and may have to change jobs • no consideration by employer or management that employees have needs – may feel exploited and demotivated • employees have different needs depending on past experience and current position – need to feel that this is recognised • focus on business survival rather than profit maximisation means employee wages might be lower Accept all valid responses. 6(b) ‘Non-financial motivators are the most effective methods of motivating a hotel’s employees.’ 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 L2 1 mark for limited knowledge L1 • non-financial motivators – job satisfaction, training, leadership, job rotation, job enlargement, teamworking • financial motivation – salary, commissions, bonuses, overtime AO2 Application 2 marks for developed application L2 1 mark for limited application L1 • hotel – vacation, holiday makers, business conferences, rooms, services provided • types of employees/job roles in a hotel – cleaners, reception, hotel manager, chef, waiters 6(b) AO3 Analysis 2 marks for developed application L2 1 mark for limited application L1 • teamworking may lead to greater efficiency in taking care of guests and lead to getting good reviews, but some employees might work better individually and dislike working with others • job rotation could make working more interesting e.g. cleaners rotate into different areas of the hotel rather than only cleaning bedrooms, but could take time to train in different areas • training to improve performance boosts self-esteem and also encourages employee to take pride in work but has cost implications • job enrichment and being given more responsibilities e.g. junior chefs being encouraged to develop a dish for the restaurant • provision of good working conditions will motivate many employees to stay with the hotel due to having good equipment and safe surroundings where there is no risk of accident • low paid, temporary, often young employees in hotels e.g. waiting staff and cleaners are possibly motivated by money therefore opportunities to earn more with overtime or piece rate may motivate them to work harder/longer AO4 Evaluation 6 marks for evaluation Developed/Supported judgement in context 6 marks L3 Developed/Reasonable evaluative comments in context 5 marks L3 Developed/Supported judgement without context 4 marks L2 Developed/Reasonable evaluative comments without context 3 marks L2 Limited supported judgement 2 marks L1 An attempt to balance the arguments/Weak attempt at evaluative comments 1 mark L1 6(b) A judgement/decision regarding the most effective methods of motivating a hotel’s employees is made. Such judgements/decisions can be made at any point in the essay and not just in a concluding section • method may depend on type of employee and current job role • may depend on the amount of finance available to the hotel • may depend on the size/type of the hotel – small/niche/local/large chain • may depend on loyalty of employees to the hotel • may depend on number and type of competitors • may depend on whether the hotel requires motivated workers • budget vs luxury hotel e.g. Travelodge vs Hilton • expectations of clientele Accept all valid responses.