1.

a) Added value is the difference between the cost of buying the materials used and the
price the final goods are sold for. This can be calculated.
b) Primary research conducts first-hand data. This data is directy relevant to a specific
business. This means that the business can identify customer wants for a specific
product/service. This leads to increased sales of said products as they are to consumer
tastes. As a result, the business will have a lower break-even point.

2. a) Mission statements motivate employees and gain interest from pressure groups.
b)Mission statements are condensed and communicated to represent the business’ core
aims. This means that venture capitalists are more likely to invest finance into the
business, if they agree with the business’ aims. This leads to more finance to be
invested in new products.
If communicated effectively, they also motivate employees. This means the overall
productivity of the business will increase. As a result, the business will increase it's
output and thus increase the quantity produced.

3. Samples are used as a method to effectively represent the target population. This means
that the data gathered from market research in a sample will be relatively accurate and
reliable if there is no bias. This leads to better informed business decisions about
aspects like packaging. As a result, the business will increase customer satisfaction in
the target population.
Samples are also beneficial as they are time effective. The marketing department can
condense the whole target population into a smaller sample size, and use methods such
as random sampling to obtain data. This means that by saving time, the business can
achieve their objectives quicker. This leads to increased efficiency of the business. As a
result, the production output will increase.

5. a) Market orientated business have an outward-looking approach which finds a suitable

market and then produces products based on market research. Product orientated businesses
have an inward-looking approach where they produce a product and then find a suitable market
for the product. Take a tech company for example.

Sometimes consumers do not know what they want, so a product orientated business may be
suitable. A couple decades ago, consumers were not aware of smart phones and other
telecommunication devices, so companies like nokia and samsung started producing these
phones and then found it's market. This means that businesses can generate sales of a product
without market research. This leads to an increase in revenue. Therefore the tech companies
will have more retained profits to invest in more technological advancements. As a result, the
global economy will grow due to advances in technology, and living standards will be better.

However, market orientated companies will have reduced risks of failure. Nowadays, the tech
market is so large that with the right technology, a business can be greatly successful, because
they know that market conditions are suitable for tem. This means that modern tech business
will have a larger target population, as technology is so commonplace now. This leads to a
higher sales potential. Therefore, the business can benefit from a higher market share, if their
technology is more advanced e.g. their interface is more efficient than samsung’s. As a result,
they can benefit from a competitive advantage.

b) Corporate social responsibility (CSR) is the concept that businesses should take into
accounts the effects of their activity on society. These responsibilities go beyond that of legal
obligations.

Businesses operating in the public sector may wish to add CSR to their objectives as over time
it can reduce the businesses costs. Take coca cola for example, they produce a lot of waste,
and much of it affects the lives of people in the local community. This means that coca cola will
reduce the costs of lawsuits if they maintain social responsibilities. This leads to increased
profits over time. Therefore, these profits can be invested to maximise the reduction of coca
cola’s effect on the environment, e.g. more recycling plants. As a result, coca cola will receive
better publicity and look better to the public and potential consumers, for being more ethical.

However, in smaller businesses, such as a new sole trader bakery, it is best to maximise profits
in the first 10 years. Smaller businesses will need retained profits in order to expand, and so the
bakery will need to hire more pastry chefs and invest in more baking equipment like mixers. This
means that by maximising profits and trying to expand, this creates new job opportunities. This
leads to satisfying social objectives, many of which can be of CSR objectives. Therefore, local
communities and pressure groups may advocate for the business as they are benefiting from
the bakeries activity. As a result, word of mouth will spread in the local community, and the
bakery can gain more sales from it.

I believe that businesses operating in the private sector should focus more on maximising
profits, because equally businesses operating in the public sector will play their shares on social
responsibility. This depends on if there are many businesses in the public sector, in which case
if there are few, private sector businesses should take on some CSR. In the long term,
multinational businesses like the coca cola should include CSR in their objectives, as they can
face heavy backlash from their vast number of employees. In the short term, businesses should
maximise their profits as they may have sudden increased costs like overheads, which need to
paid for with retained profits.