Year 10 Paper 1: Core Skills
Enterprise and entrepreneurship, spotting a business opportunity, business aims and objectives, cash flow, the marketing mix and external influences on business.
Year 10 here means a typical teaching order, not a syllabus rule. No exam board defines what belongs to Year 10, and schools sequence the course differently. Check it against your own scheme of work before using it to decide what a class has covered.
Questions
Question 1 [3 marks]
Enterprise and Entrepreneurship
Explain one reason why being decisive is a useful characteristic for an entrepreneur running a new business.
Question 2 [3 marks]
Business Aims and Objectives
Explain one reason why a new charity shop might set a survival objective, even though it does not aim to make a profit for owners.
Question 3 [3 marks]
Cash Flow
A new mobile hairdresser is preparing to launch and has been advised to prepare a cash flow forecast before starting.
Explain one reason why preparing a cash flow forecast is useful for the new business.
Question 4 [3 marks]
The Marketing Mix
Explain one reason why branding, such as a distinctive logo and name, is an important part of a business's product.
Question 5 [5 marks]
Business Aims and Objectives
A family-owned garden centre has always balanced modest profit with an objective of supporting the local community, such as running free gardening workshops for schools.
Explain two reasons the family might continue to prioritise this social objective, even though a purely profit-focused garden centre could probably earn more.
Question 6 [5 marks]
Spotting a Business Opportunity
In a small town, three plumbing firms share a market worth 500000 pounds a year.
Firm A has annual revenue of 175000 pounds and Firm B has annual revenue of 235000 pounds.
Calculate Firm A's market share and Firm B's market share as percentages, and state which firm has the larger share.
Question 7 [5 marks]
External Influences on Business
A small local hardware shop has operated alongside a similar-sized rival hardware shop in the same town for years.
The rival shop has just announced it is closing down permanently.
Explain two effects this could have on the surviving hardware shop.
Question 8 [4 marks]
Spotting a Business Opportunity
A regional bus company wants to segment its passengers to help plan its routes and fares.
Explain two ways the bus company could segment its passengers.
Question 9 [5 marks]
Cash Flow
A landscaping business forecasts the following for June: cash inflows of 8400 pounds, cash outflows of 9600 pounds, and an opening balance of 900 pounds at the start of the month.
Calculate the net cash flow for June and the closing balance at the end of June. The business has an agreed overdraft limit of 1000 pounds; calculate how much of this overdraft limit remains unused at the end of June.
Question 10 [6 marks]
The Marketing Mix
A children's clothing brand has always sold exclusively through independent boutique shops.
It is considering also selling through a large national supermarket chain, which would mean significantly lower prices per item to meet the supermarket's bulk-buying terms.
Evaluate whether the brand should start selling through the supermarket chain.
Question 11 [6 marks]
Enterprise and Entrepreneurship
A trainee accountant earning 30000 pounds a year is considering leaving his job to open an artisan bakery, using his entire 25000 pounds of personal savings as start-up capital.
Evaluate whether the trainee accountant should give up his job and savings to open the bakery.
Question 12 [6 marks]
The Marketing Mix
An established brand of savoury snacks, popular with older customers for over twenty years, is considering a bold rebrand of its packaging and advertising to attract younger customers.
Evaluate whether the brand should go ahead with this rebrand.
Question 13 [6 marks]
External Influences on Business
The government introduces a new tax on drinks with a high sugar content. A soft drinks manufacturer currently makes several high-sugar drinks that would be affected.
Evaluate the likely impact of this tax on the soft drinks manufacturer.
Model solutions
| Question 1[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying that a new business often needs quick decisions | B1 |
| developing this, such as there being no established procedures or senior colleagues for the entrepreneur to consult before deciding | B1 |
| concluding that being decisive lets the business respond to problems or opportunities before they are lost | B1 |
| Final answer: Decisiveness lets an entrepreneur respond quickly to problems or opportunities, without established procedures or senior colleagues to consult, before they are lost | |
| Question 2[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying that even a not-for-profit needs enough income to cover its running costs, such as rent and staff | B1 |
| developing this, such as being unable to continue any charitable work at all if it has to close | B1 |
| concluding that staying open is the top priority before it can help more people or expand | B1 |
| Final answer: Even a not-for-profit needs to cover its running costs to avoid closing, so staying open is the priority before it can help more people or expand | |
| Question 3[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a reason, such as predicting the months when the business might run short of cash | B1 |
| developing it, such as allowing the business to arrange finance, such as an overdraft, in advance of any shortfall | B1 |
| concluding that this reduces the risk of the business being unable to pay its bills or suppliers on time | B1 |
| Final answer: A cash flow forecast predicts months when cash might run short, letting the business arrange finance such as an overdraft in advance and reducing the risk of being unable to pay bills on time | |
| Question 4[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying that branding helps customers recognise and remember the product among many competitors | B1 |
| developing this, such as building trust and loyalty over time, so customers choose it again without comparing every option each time | B1 |
| concluding that this can allow the business to charge a higher price than an unbranded alternative | B1 |
| Final answer: Branding helps customers recognise and remember a product, building trust and loyalty so they choose it again, and can support charging a higher price than an unbranded alternative | |
| Question 5[5 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a reason, such as building reputation and goodwill with the local community | B1 |
| developing it, such as this encouraging loyal repeat custom and positive word of mouth that supports sales in the long run | B1 |
| identifying a second reason, such as the personal values and satisfaction of the owning family | B1 |
| developing it, such as private owners being free to prioritise objectives beyond pure profit, unlike a business answering to outside shareholders | B1 |
| a concluding link, such as this showing that objectives are not purely financial and can reflect the priorities of the people who own the business | B1 |
| Final answer: Two developed reasons, such as building loyal local goodwill that supports sales long-term, and the family's own values, which as private owners they are free to prioritise over pure profit | |
| Question 6[5 marks] | |
|---|---|
| Answer or working | Marks |
| Firm A's share = 175000 divided by 500000, multiplied by 100 | M1 |
| 35 percent | A1 |
| Firm B's share = 235000 divided by 500000, multiplied by 100 | M1 |
| 47 percent | A1 |
| correctly concluding that Firm B has the larger market share | B1 |
| Final answer: Firm A's market share = 35 percent; Firm B's market share = 47 percent; Firm B has the larger share | |
| Question 7[5 marks] | |
|---|---|
| Answer or working | Marks |
| identifying an effect, such as customers who used to shop at the rival switching to the surviving shop | B1 |
| developing it, such as increasing the surviving shop's sales revenue and market share, since there is now less choice in the town | B1 |
| identifying a second effect, such as feeling less pressure to keep prices low or invest as heavily in customer service with less local competition | B1 |
| developing it, such as this potentially allowing prices to rise somewhat, though risking attracting a new competitor drawn by the reduced competition | B1 |
| a concluding link, such as both effects generally strengthening the surviving shop's position in the short to medium term | B1 |
| Final answer: Two developed effects, such as former rival customers switching to the surviving shop, increasing sales and market share, and reduced pressure to keep prices low, though this risks attracting a new competitor later | |
| Question 8[4 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a segmentation method, such as age | B1 |
| developing it, such as offering discounted fares for students and pensioners while charging full fare to other passengers | B1 |
| identifying a second method, such as geographic location | B1 |
| developing it, such as running more frequent buses on popular routes near schools or town centres than on quieter rural routes | B1 |
| Final answer: Two developed methods, such as segmenting by age to vary fares for students and pensioners, and by geographic location to vary how frequently buses run on different routes | |
| Question 9[5 marks] | |
|---|---|
| Answer or working | Marks |
| net cash flow = 8400 minus 9600 | M1 |
| a net cash flow of negative 1200 pounds | A1 |
| closing balance = 900 plus the net cash flow | M1 |
| a closing balance of negative 300 pounds | A1 |
| calculating that 700 pounds of the 1000-pound overdraft limit remains unused | B1 |
| Final answer: Net cash flow = negative 1200 pounds; closing balance = negative 300 pounds; 700 pounds of the 1000-pound overdraft limit remains unused | |
| Question 10[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour, such as reaching a much larger number of potential customers than the boutiques alone | B1 |
| developing it, such as significantly increasing total sales volume and national brand awareness | B1 |
| a point against, such as the lower prices required by the supermarket reducing the profit margin on every item sold that way | B1 |
| developing it, such as this also risking making the brand seem less premium or exclusive, harming its image with existing boutique customers | B1 |
| a further factor, such as whether the extra volume would make up for the lower margin, or whether the boutique range could be kept separate and premium | B1 |
| a justified conclusion weighing wider reach and volume against lower margins and the risk to the brand's premium image | B1 |
| Final answer: A justified judgement weighing the much wider reach and volume from the supermarket against the lower margin per item and the risk to the brand's premium image with existing boutique customers | |
| Question 11[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour, such as gaining independence and the chance to turn his passion for baking into his main income | B1 |
| developing it, such as this potentially being more personally rewarding than continuing in a job that is not his own business | B1 |
| a point against, such as giving up his guaranteed 30000-pound salary and risking his entire 25000 pounds of savings | B1 |
| developing it, such as having no financial safety net left if the bakery struggles in its early months | B1 |
| a further factor, such as whether he has researched local demand or gained any relevant baking or business experience before committing everything | B1 |
| a justified conclusion weighing the appeal of independence against the total loss of income and savings if the bakery fails, related to how well-prepared his plan is | B1 |
| Final answer: A justified judgement weighing the appeal of independence and potential reward against the risk of losing his entire salary and savings if the bakery fails, depending on how well-researched his plan is | |
| Question 12[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour, such as the rebrand potentially attracting new, younger customers and keeping the brand relevant for the future | B1 |
| developing it, such as widening the total customer base beyond its currently ageing core market | B1 |
| a point against, such as risking alienating loyal, older customers who valued the familiar packaging and image | B1 |
| developing it, such as these existing customers making up a large, reliable share of current sales that could be lost | B1 |
| a further factor, such as researching younger customers' reactions first, or rebranding gradually rather than all at once | B1 |
| a justified conclusion weighing the potential to attract new customers against the risk of losing loyal existing ones | B1 |
| Final answer: A justified judgement weighing the potential to attract younger customers against the risk of alienating loyal existing customers, considering whether gradual change or prior research could reduce that risk | |
| Question 13[6 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a negative impact, such as the tax increasing the cost of making the high-sugar drinks | B1 |
| developing it, such as the manufacturer needing to raise prices or accept lower profit margins on these products | B1 |
| identifying a positive or adaptive impact, such as the manufacturer reformulating recipes to reduce sugar content and avoid the tax | B1 |
| developing it, such as this potentially also appealing to increasingly health-conscious customers, opening up new sales | B1 |
| a further point, such as the cost and time needed to reformulate recipes, or smaller manufacturers finding this harder to afford than larger rivals | B1 |
| a justified overall conclusion on whether the impact is likely to be more positive or negative for this manufacturer, with a reason | B1 |
| Final answer: A justified judgement weighing the short-term cost of the tax or reformulation against the longer-term opportunity to appeal to health-conscious customers by reducing sugar content, considering the cost of reformulating recipes | |