Year 10 Paper 6: Mixed Practice
Enterprise and entrepreneurship, spotting a business opportunity, business aims and objectives, cash flow and the marketing mix.
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 [2 marks]
Business Aims and Objectives
State two objectives, other than making a profit, that a new business might set in its first year of trading.
Question 2 [2 marks]
The Marketing Mix
State two elements of the marketing mix, other than price.
Question 3 [3 marks]
Enterprise and Entrepreneurship
A qualified electrician earns 32000 pounds a year working for a large firm and is considering leaving to set up his own electrical contracting business.
Explain one opportunity cost the electrician gives up by leaving his job to start the business.
Question 4 [3 marks]
Cash Flow
Explain one reason why a business might arrange an overdraft facility with its bank, even if it does not expect to use it.
Question 5 [3 marks]
Enterprise and Entrepreneurship
Explain one reason why an entrepreneur might choose to start a business instead of remaining in paid employment.
Question 6 [3 marks]
The Marketing Mix
Explain one reason why a new energy drink brand might use a penetration pricing strategy when it first launches.
Question 7 [3 marks]
Spotting a Business Opportunity
Explain one disadvantage to a new restaurant of using only secondary research, without ever asking potential customers directly.
Question 8 [4 marks]
Enterprise and Entrepreneurship
A mobile pizza van owner is turning away customers at busy times and is deciding whether to use her savings to buy a second, larger van.
Explain two risks to the owner of using her savings to buy the second van.
Question 9 [4 marks]
Business Aims and Objectives
A business sets the objective: to become a well-known company.
Rewrite this as a SMART objective, and explain how your version meets the Specific, Measurable and Time-related parts of SMART.
Question 10 [4 marks]
The Marketing Mix
An online craft seller has monthly sales revenue of 3000 pounds selling through her own website, keeping all of it.
A marketplace platform offers to list her products, taking 10 percent commission on each sale, but she expects sales would rise to 4200 pounds a month because of the platform's existing customer traffic.
Calculate the money she would keep from selling through the marketplace after commission, and state whether switching would be worthwhile in terms of money kept.
Question 11 [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 12 [4 marks]
Business Aims and Objectives
A family-run bakery has grown steadily for five years.
Explain two reasons why the owners might now set an objective of growth rather than survival.
Question 13 [5 marks]
Enterprise and Entrepreneurship
A leather worker buys 18 pounds of materials to make a wallet, which she sells for 52 pounds.
She also buys 30 pounds of materials to make a belt, which she sells for 70 pounds.
Calculate the value added to each product, and state which product creates more added value.
Question 14 [5 marks]
Cash Flow
A market stall's cash flow forecast is shown below.
July: inflows of 5200 pounds, outflows of 4700 pounds, opening balance of 300 pounds. August: inflows of 4100 pounds, outflows of 5900 pounds, with an opening balance equal to July's closing balance.
Calculate the closing balance for July, and the closing balance for August, and state one action the stallholder could take in July to prepare for the August shortfall.
Question 15 [5 marks]
Business Aims and Objectives
A youth football club has 120 members, each paying 15 pounds a month, which currently just covers its costs.
It sets an objective to keep breaking even while doubling membership to 240 within two years, at the same monthly fee.
Calculate the club's current annual income, the annual income at 240 members, and by how much annual income would need to grow to reach the new membership level.
Question 16 [5 marks]
Cash Flow
A wedding florist has irregular cash inflows through the year, with most bookings in spring and summer, but steady monthly outflows for a lease and van costs.
Explain two ways the florist could manage cash flow to cope with this seasonal pattern.
Question 17 [5 marks]
The Marketing Mix
A new pet grooming business has a total marketing budget of 800 pounds for its launch month. Local flyers cost 0.20 pounds each to print and deliver, and the business plans to distribute 2000 flyers.
Calculate the total cost of the flyer campaign, calculate how much of the 800-pound budget remains, and recommend one further low-cost promotional method the business could use with the remaining budget.
Question 18 [6 marks]
Cash Flow
A small printing business holds large amounts of paper and ink stock just in case, which ties up a significant amount of cash, and has recently struggled to pay its own suppliers on time.
Evaluate two ways the printing business could improve its cash flow position.
Question 19 [6 marks]
Business Aims and Objectives
A successful independent bookshop is considering opening two new branches at once to pursue rapid growth, using most of its cash reserves to fund the expansion.
Evaluate whether the bookshop should prioritise this rapid growth objective over protecting its cash reserves.
Question 20 [6 marks]
The Marketing Mix
An online-only furniture brand, which has never had a physical shop, is considering opening one flagship showroom in a major city so customers can see and touch products before buying online.
Evaluate whether the brand should open this flagship showroom.
Question 21 [6 marks]
Enterprise and Entrepreneurship
A new entrepreneur is planning to launch a business selling handmade greetings cards only through a physical market stall, with no online presence.
Evaluate whether the entrepreneur should also sell online through a website and social media, given how technology is changing the way small businesses reach customers.
Question 22 [6 marks]
Cash Flow
A building firm often waits 60 days to be paid by clients, and has been offered a factoring service that would pay it 90 percent of an invoice's value immediately, in exchange for a fee, with the factoring company then collecting the full amount from the client itself.
Evaluate whether the building firm should use this factoring service.
Question 23 [6 marks]
Business Aims and Objectives
A manufacturing business is considering cutting its workforce by 15 percent to reduce costs and increase profit for its shareholders.
Evaluate the likely conflict between the interests of shareholders and employees if this objective is carried out.
Model solutions
| Question 1[2 marks] | |
|---|---|
| Answer or working | Marks |
| a valid objective, such as survival | B1 |
| a second valid objective, such as building a customer base, gaining market share, or a social or ethical objective | B1 |
| Final answer: Any two of: survival, building a customer base, gaining market share, social or ethical objectives | |
| Question 2[2 marks] | |
|---|---|
| Answer or working | Marks |
| a valid element, such as product | B1 |
| a second valid element, such as promotion or place | B1 |
| Final answer: Any two of: product, promotion, place | |
| Question 3[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying an opportunity cost, such as the guaranteed 32000-pound salary | B1 |
| developing it, such as this being the next best alternative given up by choosing self-employment | B1 |
| linking this to the electrician needing the new business to eventually replace or exceed this income | B1 |
| Final answer: The opportunity cost is the guaranteed 32000-pound salary given up, the next best alternative, which the new business must eventually replace or exceed | |
| Question 4[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying that an overdraft acts as a safety net of short-term cash | B1 |
| developing this, such as being available immediately if an unexpected shortfall occurs, for example from a late-paying customer | B1 |
| concluding that this reduces the risk of being unable to pay bills on time even during an unplanned shortfall | B1 |
| Final answer: An overdraft acts as a safety net of short-term cash that is available immediately if an unexpected shortfall occurs, reducing the risk of being unable to pay bills on time | |
| Question 5[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a reason, such as wanting independence | B1 |
| developing the reason, such as having control over decisions and working hours | B1 |
| linking this to the entrepreneur's own motivation, such as personal satisfaction rather than following an employer's instructions | B1 |
| Final answer: Wanting independence and control over decisions and working hours, rather than following an employer's instructions | |
| Question 6[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying that a low initial price is set | B1 |
| developing this, such as attracting customers away from established rival brands quickly | B1 |
| concluding that this helps the new brand build market share and awareness before it later raises prices | B1 |
| Final answer: A low launch price attracts customers from established rivals, helping the brand build market share and awareness before prices rise later | |
| Question 7[3 marks] | |
|---|---|
| Answer or working | Marks |
| identifying that secondary data was collected for another purpose and not for this specific restaurant | B1 |
| developing this, such as it not answering specific questions about the restaurant's own planned menu or location | B1 |
| concluding that this could lead to decisions based on data that does not really fit the restaurant's own situation | B1 |
| Final answer: Secondary data was collected for another purpose and may not answer specific questions about the restaurant's own menu or location, risking decisions that do not fit its situation | |
| Question 8[4 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a risk, such as using up her entire savings safety net | B1 |
| developing it, such as having nothing to fall back on if the business then has a difficult period | B1 |
| identifying a second risk, such as the new van's running costs continuing even if it is not fully used | B1 |
| developing it, such as demand for the extra capacity being uncertain, so the second van could sit idle and lose money rather than earn it | B1 |
| Final answer: Two developed risks, such as losing her cash safety net, and the new van's costs continuing even if demand for it turns out lower than hoped | |
| Question 9[4 marks] | |
|---|---|
| Answer or working | Marks |
| a rewritten objective containing a specific, measurable target and a timeframe, such as increasing brand awareness among 18 to 30 year olds in the region from 10 percent to 25 percent within two years | B1 |
| showing it is Specific, stating exactly what is being measured and among whom | B1 |
| showing it is Measurable, stating a percentage figure that can be tracked | B1 |
| showing it is Time-related, stating a two-year deadline | B1 |
| Final answer: A rewritten objective with a stated target and deadline, such as increasing regional brand awareness from 10 percent to 25 percent within two years, showing it is specific, measurable and time-related | |
| Question 10[4 marks] | |
|---|---|
| Answer or working | Marks |
| money kept via the marketplace = 4200 times 0.90 | M1 |
| 3780 pounds | A1 |
| comparing this with the 3000 pounds she currently keeps in full via her own website | B1 |
| a justified conclusion that switching is worthwhile, since she would keep more money overall despite the 10 percent commission | B1 |
| Final answer: Money kept via the marketplace = 3780 pounds, compared with 3000 pounds kept via her own website; switching is worthwhile since she keeps more overall | |
| Question 11[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 12[4 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a reason, such as the business now being established with a reliable, loyal customer base | B1 |
| developing it, such as being able to use stable income to invest in expansion, such as a second shop, rather than needing to focus on basic costs | B1 |
| identifying a second reason, such as growth increasing market share or bringing economies of scale | B1 |
| developing it, such as lowering the average cost per unit and increasing profit as ingredients are bought in greater bulk | B1 |
| Final answer: Two developed reasons, such as an established, reliable customer base allowing investment in expansion, and growth bringing economies of scale that lower average costs | |
| Question 13[5 marks] | |
|---|---|
| Answer or working | Marks |
| wallet value added = 52 minus 18 | M1 |
| 34 pounds | A1 |
| belt value added = 70 minus 30 | M1 |
| 40 pounds | A1 |
| correctly identifying that the belt creates more added value than the wallet | B1 |
| Final answer: Wallet value added = 34 pounds; belt value added = 40 pounds; the belt creates more added value | |
| Question 14[5 marks] | |
|---|---|
| Answer or working | Marks |
| July's net cash flow = 5200 minus 4700 | M1 |
| a July closing balance of 800 pounds | A1 |
| August's net cash flow = 4100 minus 5900 | M1 |
| an August closing balance of negative 1000 pounds | A1 |
| a valid preparatory action, such as arranging an overdraft or short-term loan in July before the shortfall occurs, or delaying a non-essential August outflow | B1 |
| Final answer: July closing balance = 800 pounds; August closing balance = negative 1000 pounds; the stallholder could arrange an overdraft or delay a non-essential payment in July to prepare for the shortfall | |
| Question 15[5 marks] | |
|---|---|
| Answer or working | Marks |
| current annual income = 120 times 15, times 12 | M1 |
| 21600 pounds | A1 |
| annual income at 240 members = 240 times 15, times 12 | M1 |
| 43200 pounds | A1 |
| correctly stating that annual income would need to grow by 21600 pounds to reach the new membership level | B1 |
| Final answer: Current annual income = 21600 pounds; income at 240 members = 43200 pounds; annual income would need to grow by 21600 pounds | |
| Question 16[5 marks] | |
|---|---|
| Answer or working | Marks |
| identifying a method, such as building up a cash reserve during the busy spring and summer months | B1 |
| developing it, such as keeping back some of the surplus rather than spending it all, so there is a buffer for quieter winter months | B1 |
| identifying a second method, such as taking deposits well in advance for future bookings | B1 |
| developing it, such as this bringing cash in earlier, smoothing out the gap during quiet months | B1 |
| a concluding link, such as combining reserves with earlier deposits helping the florist cope with the seasonal pattern | B1 |
| Final answer: Two developed methods, such as building a cash reserve during busy months, and taking deposits well in advance of bookings to bring cash in earlier, helping cope with the seasonal pattern | |
| Question 17[5 marks] | |
|---|---|
| Answer or working | Marks |
| flyer cost = 2000 times 0.20 | M1 |
| a flyer cost of 400 pounds | A1 |
| remaining budget = 800 minus 400 | M1 |
| a remaining budget of 400 pounds | A1 |
| a suitable further low-cost method, such as social media advertising or a launch discount, that could be funded from the remaining 400 pounds | B1 |
| Final answer: Flyer cost = 400 pounds; remaining budget = 400 pounds; a further low-cost method such as social media advertising could use the remaining budget | |
| Question 18[6 marks] | |
|---|---|
| Answer or working | Marks |
| a first method, such as reducing the amount of stock held and ordering paper and ink more frequently in smaller amounts | B1 |
| developing it, such as freeing up cash that was tied up in stock, which can then be used to pay suppliers on time | B1 |
| a second method, such as asking its own customers for a deposit or faster payment on large printing orders | B1 |
| developing it, such as bringing cash in sooner rather than waiting for the full amount after the job is finished | B1 |
| a further evaluative point, such as reducing stock risking running out of paper or ink during a busy period | B1 |
| a justified conclusion recommending one method, or a combination, with a reason tied to the business's situation | B1 |
| Final answer: A justified recommendation such as combining lower stock levels with deposits from customers, weighing the risk of running short of materials against the need to free up cash and pay suppliers on time | |
| Question 19[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour of growth, such as opening two branches at once building market presence and revenue more quickly than opening one at a time | B1 |
| developing it, such as this potentially bringing greater brand recognition and economies of scale sooner | B1 |
| a point against, such as using most of its cash reserves leaving little buffer if the new branches are slower to become profitable than expected | B1 |
| developing it, such as this risking a cash flow crisis that could threaten even the original, successful branch | B1 |
| a further factor, such as whether a slower, one-branch-at-a-time approach could achieve similar growth with much less risk | B1 |
| a justified conclusion on whether the growth objective is worth the risk to the business's cash position and survival | B1 |
| Final answer: A justified judgement weighing the faster growth and market presence from opening two branches at once against the cash flow risk of using most reserves, and whether a more cautious approach could achieve similar growth more safely | |
| Question 20[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour, such as letting customers see and touch large, expensive items like furniture before committing to buy | B1 |
| developing it, such as this building trust and potentially increasing online sales, including from customers outside the city who research in person then buy online | B1 |
| a point against, such as the high fixed cost of renting and staffing a showroom in a major city | B1 |
| developing it, such as this adding a large ongoing cost the brand has never had to cover before | B1 |
| a further factor, such as whether a smaller-scale option, like a temporary pop-up showroom, could achieve a similar benefit at lower cost and risk | B1 |
| a justified conclusion weighing the trust and sales benefit of a physical showroom against its high ongoing cost | B1 |
| Final answer: A justified judgement weighing the trust and sales benefit of letting customers see furniture in person against the high ongoing cost of a showroom, and whether a smaller-scale option such as a pop-up could achieve a similar benefit at lower risk | |
| Question 21[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour of selling online, such as reaching many more potential customers beyond those who visit the market | B1 |
| developing it, such as being able to sell at any time of day rather than only during market hours | B1 |
| a point against, such as the cost and time needed to build and maintain a website or social media presence | B1 |
| developing it, such as this being a significant burden for a brand-new, one-person business with limited time and money | B1 |
| a further factor, such as whether handmade cards benefit from being seen and touched in person, which selling online cannot replicate | B1 |
| a justified conclusion on whether the extra reach from selling online is likely to outweigh the extra cost and time, related to the entrepreneur's resources | B1 |
| Final answer: A justified judgement weighing the wider reach and flexibility of selling online against the cost, time and loss of the in-person experience, related to the entrepreneur's limited resources as a new, one-person business | |
| Question 22[6 marks] | |
|---|---|
| Answer or working | Marks |
| a point in favour, such as receiving most of the cash immediately rather than waiting 60 days | B1 |
| developing it, such as being able to use that cash straight away to pay for materials, wages or new contracts | B1 |
| a point against, such as giving up 10 percent of the invoice's value in fees, reducing overall profit on every job factored | B1 |
| developing it, such as this becoming a large ongoing cost if used on every invoice, compared with simply waiting to be paid in full | B1 |
| a further factor, such as whether the firm only needs to factor its largest, slowest-paying clients rather than every invoice | B1 |
| a justified conclusion weighing the faster access to cash against the ongoing cost of the factoring fee, related to how urgently the firm needs cash | B1 |
| Final answer: A justified judgement weighing the faster access to cash from factoring against the ongoing cost of its fee, related to how urgently the firm needs cash | |
| Question 23[6 marks] | |
|---|---|
| Answer or working | Marks |
| identifying the shareholders' interest, such as wanting higher profit and dividends | B1 |
| developing it, such as cutting 15 percent of the workforce reducing wage costs and increasing profit available for dividends | B1 |
| identifying the employees' interest, such as wanting job security and fair treatment | B1 |
| developing it, such as the cuts directly threatening the jobs and income of affected staff and harming the morale of remaining staff | B1 |
| a further point, such as the effect on other stakeholders, or the long-term risk to shareholders if lower morale reduces productivity or quality | B1 |
| a justified conclusion on whether the short-term shareholder gain is likely to outweigh the employee and wider stakeholder cost | B1 |
| Final answer: A justified judgement weighing shareholders' short-term profit gain against employees' job security and morale, and the wider knock-on effects on stakeholders such as customers or the local community | |