- Mark Scheme /

Question Answer Marks AO Element Notes Guidance

1 State two types of business 2

organisation.
Award 1 mark for each type of
business organisation.
Points might include:
• sole trader • private limited
company • public limited company
• franchise • social enterprise •
charity • public corporation •
partnership
Other appropriate responses should
also be credited.
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Question Answer Marks AO Element Notes Guidance

2 Outline two disadvantages of 4

BMT being a business
partnership.
Award 1 mark for each relevant
disadvantage.
Award 1 mark for each relevant
reference to this business.
Points might include:
• Unlimited liability/ each
responsible for debts of other [k] so
if business cannot pay its debts
there is risk to the personal assets
of each brother [app] • Fewer
sources of finance (than limited
company) [k] restricting plans to
expand the watch business [app] •
Possible disagreements/slower
decision making [k] such as
whether to import parts [app] •
Have to share profits [k]
Other appropriate responses should
also be credited.
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Question Answer Marks AO Element Notes Guidance

3 Explain one advantage and one 6 Analysis must explain

disadvantage to Gomez of being how it represents an
a sole trader. advantage/disadvantage.
Award one mark for identification
of each relevant Do not award quick/easy
advantage/disadvantage (max two). to set up as this is an
established business.
Award one mark for each relevant Application marks may
reference made to this business be awarded for
(max two). appropriate use of the
following:
Award one mark for each relevant
explanation (max two) • (Old) van
Points might include: • Borrowed from father
Advantage:
• Painting / decorating
• Keeps all the profit [k] so if
successful will make more • Customers are offices /
money/will encourage him to do shops
better [an] from painting business
• Customers given 3
[app]
months credit
• Own boss/has complete control
• Pay suppliers within 1
[k] so can make decisions more
month
quickly [an]
• Correct use of data from
• Does not have to give information
the table
about his business to anyone
else/secrecy in business matters [k]

• Has freedom to choose own

holidays/hours of work/prices to
charge [k] such as whether to offer
customers 3 months credit [app]
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Question Answer Marks AO Element Notes Guidance

• Has close contact with customers

[k] so able to respond quickly to
changes in demand [an]
Disadvantage:
• Unlimited liability [k] so if
business is not able to pay the
suppliers within 1 month [app]
could lose his personal possessions
[an]
• Limited sources of
finance/difficult to raise funds [k]
to buy new assets [an] such as the
van [app] • May have limited range
of skills [k] as only a small business
[app]
• No continuity/if ill who will take
control [k]
• Has to work long hours/difficult
to take holidays [k] otherwise may
lose out on potential sales/revenue
[an]
• No one to share the risks/losses
with [k]
• Not able to benefit from
economies of scale [k]
Other appropriate responses should
also be credited.
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

4 Do you think selling franchises is 6 Do not award answers

a better way for a retail business which refer to advantages
to expand than opening more of and/or disadvantages to
its own shops? Justify your franchisees.
answer.
Do not award more sales
Award up to two marks for as this would apply to
identification of relevant points. both options.
Award up to two marks for relevant For both evaluation
development of points. marks justification must
clearly relate to a retail
Award two marks for justified
business.
decision as to whether selling
franchises is a better way for a retail
business to expand than opening
more of its own shops.
Points might include:
Selling franchises:
• Franchisee pays fee to franchisor
to use the brand name [k] so
franchisor does not have to raise as
much capital [an]
• Can expand more quickly (than if
franchisor had to finance all new
outlets) [k]
• Franchisees are responsible for
day-to-day management [k] so
franchisor has time to focus on
more strategic objectives [an]
• Franchisee should have local
knowledge [k] which could help
increase sales/revenue [an]
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Question Answer Marks AO Element Notes Guidance

• Franchisor receives a percentage

of revenue/profits [k]
• Franchisor shares risks with
franchisee [k]
• Brand/customer awareness
increases [k]
• All products sold must be
obtained from the franchisor [k]
• Wrong decision or poor
management by one franchisee can
damage reputation for whole
business [k] reducing sales/revenue
[an]
• Franchisor may have to provide
training and support [k] which will
increase franchisors costs [an]
More of its own shops:
• Have total control over the
operations [k]
• Keep all the profits [k]
• Need to raise all the capital [k]
Justification might include:
• Franchisees will pay towards the
start-up costs [k] which will help
reduce the amount the business has
to raise [an]. However, the
franchisor may lose control [k]
which may damage their reputation
[an]. It might be better to sell
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

franchises, as it will reduce the

costs especially if it wants to open
a large number of shops quickly
[eval]. This can improve its chances
of being able to expand as much as
the retail business wants [eval].
Other appropriate responses should
also be credited.

5 What is meant by ‘public 2 Do not award answers

corporation’? that refer to public
companies
Clear understanding [2]: A business
that is owned and controlled by the
government/state
Some understanding [1]: E.g. run
by government/state
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

6 What is meant by ‘franchise’? 2 For both marks must

have idea of payment and
Clear understanding [2]: A business
using the name/products
based upon the use of the brand
of existing business
names, promotional logos and
trading methods of an existing Do not award
successful business. The franchisee examples
buys the licence to operate this
business from the franchisor.
A business system where
entrepreneurs buy the right to use
the name, logo and product of an
existing business.
Some understanding [1]: Using the
name or logo of another business
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

7 I dentify and explain one 6 Application marks may

advantage and one disadvantage be awarded for
to FGH of becoming a public appropriate use of the
limited company following:
Knowledge [2 × 1] – award 1 mark • book retailer
for each relevant advantage /
• 6500 shops
disadvantage
• 20 countries
Application [2 × 1] – award 1 mark
for each relevant reference made to • $300m
this business
• on the job training
Analysis [2 × 1] – award 1 mark for
each relevant explanation • $800m

Relevant points might include: • take over one its

competitors
Advantages
Do not award limited
• Better access to capital [k] i.e. liability or separate legal
raising share capital from existing identity as already has
and new investors [an] to pay for this as a private limited
the takeover [app] company
• Can give a company a more
prestigious profile OR status [k] so
more likely to be offered credit OR
better interest rates as seen as lower
risk [an] to raise capital to open
more bookshops [app]
• Shares tradeable on the stock
exchange [k]
Disadvantages:
• Cannot control who buys the
shares [k] so easier to be taken over
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Question Answer Marks AO Element Notes Guidance

[an] by other book retailers [app]

• Shareholder may expect dividends
to be paid [k]
• Accounts published [k] allowing
competitors to be able to see all
their results [an] so the business
FGH wants to take over might
reject its offer [app]
• Legal formalities need to be
followed [k]
• Divorce of ownership and control
[k]
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Question Answer Marks AO Element Notes Guidance

8 Identify and explain two possible 4 Application marks may

advantages to IBH of being a be awarded for
private limited company. appropriate use of the
following:
Award 1 mark for each advantage
identified • family (owned) • want
to expand • shoes or
Award 1 mark for each explanation
related words such as
in context
leather, children, women
Points might include: • competitive market •
needs finance • directors
• can control who buys shares [k]
so can keep control in this
competitive market [app] • easier Do not award private
to raise finance / able to sell shares limited company as
[k] as they want to expand [app] • application, as this is
seen as more creditworthy to stated in the question.
suppliers [k] so could be more
willing to supply leather [app]•
limited liability [k] this keeps
personal assets of family safe [app]
• incorporation / separate legal
identity [k] • no need to publish
accounts [k] • continuity [k]
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

9 I dentify and explain two 4 Application marks may

disadvantages to PShirts of being be awarded for
a private limited company. appropriate use of the
following:
Knowledge [2 × 1] – award 1 mark
for each relevant disadvantage (max • shirts • men and women
2) • priced lower than
competitors • sales have
Application (2 × 1) – award 1 mark
fallen • legal controls •
for each relevant explanation in
relevant use of financial
context.
data in table • selling in
Relevant points may include: other countries
• Can only sell shares to friends and
family [k] so may not raise
sufficient funds to expand into other
countries [app] • Shareholders may
expect dividends (k) from selling
shirts [app] • Have to publish
(some) financial accounts [k] •
Legal formalities to set up and run
[k]
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

10 Identify and explain one 6 Application marks may

advantage and one disadvantage be awarded for
of ZumGo being a business appropriate use of the
partnership. following:
Knowledge [2 × 1] – award 1 mark • Correct use of cash flow
for an advantage and a disadvantage numbers
identified [max 1] • $6000 (advertising)
Application [2 × 1] – award 1 mark • $28 000
for relevant reference to this • bus tours
business • extra buses OR looking
Analysis [2 × 1] – award 1 mark for to expand
each relevant explanation • leasing
Relevant points might include: • two successful years
Advantage: • all retained profit
• More ideas [k] about what type of • business plan or cash
tours to offer [app] can help flow forecast
increase business sales [an] • brothers
• Access to more capital (than sole
trader) [k] can help solve cash flow
problems [app] improving chance
of survival [an]
• Share workload OR decision
making [k] so making business
more efficient [an]
• More skills OR expertise OR can
specialise [k], Richie does the
finance [app] allowing time for
Justin to focus on his job [an]
• Share loss OR risk [k] so do not
have to carry all the financial
burden [an] especially if buy new
bus [app]
Disadvantage:
• Disagreements [k] about
expansion [app] leading to lost sales
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

OR low productivity [an]

• Unlimited liability OR each
responsible for debts of other [k] so
if cannot repay the $28 000 [app]
their personal belongings are at risk
as well [an]
• Have to share profits [k] with each
brother [app]
• Slower decision-making [k] on
whether to lease [app] so lose
competitive advantage [an]
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Question Answer Marks AO Element Notes Guidance

11 Identify and explain one 4 Application marks may

advantage and one disadvantage be awarded for
of CHONS being a public limited appropriate use of the
company. following: coal or mining
related words, correct use
Knowledge [2 × 1] award one mark
of data from table, no
for each advantage and
government support,
disadvantage
export, shareholders,
Application [2 × 1] award one mark suppliers, expansion
for each relevant reference to this plans.
business
Advantages:
• Able to sell shares on stock
market [k] so no limit to potential
number of shareholders [app]
• Access to more sources of finance
[k] so do not have to ask for support
from Government [app]
• Limited liability [k]
• Separate legal identity [k] of
mining business and owners [app]

• Better status OR seen as lower

risk [k] so suppliers more willing
to offer credit [app]
Disadvantages:
• Have to disclose accounts [k] so
less able to keep expansion plans
secret [app]
• Many legal
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

requirements/regulations [k]
• Selling shares expensive [k]
• Risk of loss of control [k] for the
original shareholders [app]
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

12 Do you think Manisha should 6 Application marks may

have a business partner? Justify be awarded for
your answer. appropriate use of the
following: correct use of
Knowledge [1]: award 1 mark for
numbers e.g. 500%,
identification of relevant point(s)
celebration cakes or
related words such as
Application [1]: award 1 mark for ingredients, shop or
a relevant reference to this business bakery, economic boom,3
employees, increase in
demand, sole trader,
Analysis [2]: award up to 2 marks work every day,
for relevant development of point(s) profitable (at last),
interest rates increased,
Evaluation [2]:award up to 2 marks friend (as business
for a justified decision made as to partner), started her
whether Manisha should have a business 5 years ago,
business partner product quality is
important.
Points might include: • Share
workload OR responsibility [k] so
does not have to work everyday
[app] which could reduce her own
stress OR allow her more free time
[an] • More ideas OR skills [k] from
her friend [app] which could make
the business more competitive [an]
• Extra source of finance [k] which
is important as interest rates high
[app] so less need to borrow money
[an] • Still has unlimited liability
status OR liability for debts [k] as
being a sole trader [app] but
possible losses can be shared [an]
• Loss of some control [k] over type
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

of cakes made [app] • Risk of

disagreements OR slow decision
making [k] so less responsive to
changes in customer demand [an] •
Have to share profits made [k]

13 Identify and explain two ways in 4 Application marks may

which legal controls on marketing be awarded for
might affect C&P. appropriate use of the
following:
Knowledge [2×1]: award 1 mark
for each way identified Jewellery and related
words such as necklaces
Application [2×1]: award 1 mark
and bracelets, Metals,
for each explanation in context
Correct use of data from
Points might include: table 2, Pay for materials
when ordered, Phoebe
• Cannot make false claims about works from home, Cory
what the product will do OR must manages the accounts
avoid misleading adverts OR and shop, Business
Advertising claims might have to partnership.
change to ensure compliance [k] •
Contents OR product must be
described accurately [k] so would
need to be handmade • Products
must be safe to use OR must offer
to repair or replace faulty goods [k]
e.g. if bracelet broken [app] • May
have to change how products made
[k] • Mistakes could lead to fines
OR damage reputation [k]
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Question Answer Marks AO Element Notes Guidance

14 Identify and explain one 6 Application marks may

advantage and one disadvantage be awarded for
to Cory and Phoebe of being in a appropriate use of the
business partnership. following:
Knowledge [2 × 1]: award one mark Jewellery and related
for a relevant advantage and words such as necklaces
disadvantage identified and bracelets, Metals,
Correct use of data from
Application [2 × 1]: award 1 mark
the table, Pay for
for each relevant reference made to
materials when ordered,
this business
Phoebe works from
Analysis [2 × 1]: award 1 mark for home, Cory manages the
each relevant explanation accounts and shop,
Business partnership.
Points might include:
Advantage:
• More ideas [k] which could make
business more competitive [an] •
More capital (than sole trader) [k]
which may help solve cash flow
problems [app] so less need to
borrow money [an] • Share
responsibilities OR workload OR
Specialisation OR more skills [k]
so have time to focus on what they
are good at [an] as Corey focuses
on finance [app] • Share risk OR
losses [k]
Disadvantage:
• Different objectives [k] such as
Phoebe wants to keep current
supplier [app] leading to
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

disagreements [an] • Have

unlimited liability [k] Phoebe could
lose her home [app] as personal
belongings at risk if business fails
[an] • Have to share profits [k] so
each person makes less than if it’s
a sole trader [an] • Do not have
separate legal identify [k] • Slow
decision making OR risk of
disagreements [k] as takes times to
resolve differences [an]

15 What is meant by a joint venture? 2 Do not accept answers

which describe a
takeover or merger.
Clear understanding [2]: when two
or more businesses agree to start a
(new) project together so share risks
OR capital OR profits OR
resources.
Some understanding [1]: two
business agree to work together (on
a project).
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Question Answer Marks AO Element Notes Guidance

16 Identify and explain two 4 Application marks may

advantages to WSS of selling its be awarded for
franchise appropriate use of the
following:
Knowledge [2 × 1] : award 1 mark
for each advantage identified References to food such
as soup, hot drinks,
Application [2 × 1] : award 1 mark
curries and cakes, ethical,
for each explanation in context
logo, 10, extend product
Points might include: • Cheaper range, promotion, 30,
way to expand [k] the 10 shops.
franchisees pay some costs [app] •
Each franchisee pays money [k] so
may be able to open more shops in
future [app] • Can expand more
quickly [k] • Widen brand
awareness [k] as logo is seen in
more places [app] • Franchisees
responsible for day to day
management [k] WSS has time to
focus on extending its product
range [app] • Retain control of the
image [k] so it can ensure the
business remains ethical [app]]
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Question Answer Marks AO Element Notes Guidance

17 Identify and explain two 4 Application marks may

advantages to BGN of being a be awarded for
private limited company. appropriate use of the
following: furniture or
Knowledge [2 × 1] – award 1 mark
similar references such as
for each advantage identified
tables, 10 shops, different
Application [2 × 1] – award 1 mark cities, (increase in)
for each explanation in context customer complaints,
decisions over
Points might include: recruitment and / or
• Limited liability [k] compared to inventory, started as a
when it was a partnership [app] • partnership, expanded
Easier to raise money / capital [k] quickly
as business is expanding quickly
[app] • More credibility with
suppliers [k] could get better terms
when buying furniture [app] •
Continuity [k] • No need to publish
(detailed) accounts [k] of its 10
shops [app] • Separate legal
identity/ incorporated [k] • Control
over who can buy shares/ less risk
of takeover [k]

18 Calculate the percentage (%) of 2

businesses in country R which are
partnerships.
Good application [2] 10%
Some application [1], e.g. number
of partnerships/total number of
businesses OR 0.5m/5m
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Question Answer Marks AO Element Notes Guidance

19 Id entify and explain two 4

advantages to Moeen and Ali of
forming a private limited
company.
Knowledge [2 × 1] – award 1 mark
for each relevant advantage
Application [2 × 1] – award 1 mark
for each explanation in context
Relevant points might include: •
Access to more capital [k] which
could help increase their budget/so
can afford to create luxury image
[app] • Benefit from limited liability
[k] if new business fails [app] •
Continuity of existence [k] if
anything happens to one of them
will not have to close hotel [app] •
Separate legal identity [k] • Control
over who buys shares [k]
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

20 Identify and explain two benefits 6 Application marks may

to Alex of having a business be awarded for
partner. appropriate use of the
following: unlimited
Knowledge [2 × 1] – identification
liability (as key feature
of relevant benefit [max 2].
of partnership), use of
Application [2 × 1] – award 1 mark data in the table, bicycles
if relevant reference made to this (or relevant examples
business. such as bike parts, tyres,
saddles, gears, tools),
Analysis [2 × 1] – award 1 mark for Raul does repairs, Alex
each relevant explanation. does accounts, not given
Relevant points might include: bank loan, own savings,
want to expand, friends,
• Injection of more capital [k] to small profit.
fund expansion [app] so don’t have
to borrow as much/reduce the cost Accept benefits to Alex
of interest [an] • Share work or partnership.
load/decision making [k] so Raul
does the repairs [app] so Alex is
able to focus on his job [an] •
New/more ideas [k] so can help
business increase sales [an] •
Greater range of
expertise/skills/specialisation [k] so
can offer a better service [an] •
Share risk/losses [k] as have
unlimited liability [app] would have
someone to share financial burden
[an].
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Question Answer Marks AO Element Notes Guidance

21 Do you agree with Luis’s decision 6 For decision, either

not to become a franchisee? viewpoint is acceptable.
Justify your answer. Application marks may
be awarded for
Knowledge [1] – award 1 mark for
appropriate use of the
identification of relevant issue(s)
following: bank,
[max 1].
competitive market, new
Application [1] – award 1 mark if business, primary
relevant reference made to this research, break even, use
business. of numbers, phones or
associated words such as
Analysis [2] – award up to 2 marks models, repairs,
for relevant development of competitive market.
point(s).
Evaluation [2] – justified decision
made as to whether you agree with
Luis decision not to become a
franchisee.
Relevant points might include:
• Cost [k] have to pay for $4500
franchise [app] which is nearly all
of his savings [an] • Pay royalties
[an] so need more than 15
customers [app] if he just wants to
break even [an] • Support [k] as it’s
a new business [app] can get help
with marketing to increase sales
[an] • Control [k] he can make all
the decisions [an] and be
independent [app] • Knowledge [k]
as he worked for a bank [app] he
might already know how to manage
a business [an] • Level of
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

competition [k] as it’s a competitive

market [app] he might find it
difficult to get customers [an] •
Risk [k] as franchise already has an
established image that might attract
customers [an].

22 What is meant by a ‘sole trader’? 2 Do not accept ‘features’.

Clear understanding [2] e.g.

ownership of business in the hands
of one individual/person.
Some understanding [1] e.g.
run/operated by one person.
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

23 Do you think that buy a FIXIT 6

franchise is the best way for Tebo
to start his business? Justify your
answer.
Knowledge [1] – award 1 mark for
identification of relevant point (s)
[max 1]
Application [1] – award 1 mark if
relevant reference made to
Tebo/FIXIT business
Analysis [2] – award up to 2 marks
for relevant development of
point(s)
Evaluation [2] – justified decision
as to whether buying a FIXIT
franchise is the best way for Tebo
to start his business
Points might include:
• Less chance of business failure [k]
if he set up his own business, it
would take time to build a
reputation [an] • Training provided
[k] as he has no management
experience [app] • Lower
advertising/training costs [k] as he
has used all his savings to buy the
franchise [app] so he may not be
able to afford advertising/training
[an] • Supplies from central source
[k] so less suppliers to deal with
[an] so has more time to do repairs
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Question Answer Marks AO Element Notes Guidance

[app] • Banks more likely to lend

to franchisee [k] the $15000 needed
[app] as seen as lower risk [an] •
Recognition [k] FIXIT already has
36 franchisees [app] • Lack of
control [k] as FIXIT will have a say
in many decisions [an] • Problem
at one franchise affects all others
[k] of the 36 [app] might lower his
revenue [an] • Less profits as only
received a percentage [k] so if
successful, it will not maximise
profits [an] • Does Tebo want the
responsibility? [k]
Application marks may be awarded
for appropriate use of the following:
36 (franchisees), car repair, no
management experience, $15000/all
his savings, cash flow important.

Note: Candidate’s final decision

can be either for or against the
statement.
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

24 What is meant by a ‘private 2

limited company’?
Clear understanding [2] e.g. a
business whose shares cannot be
sold to the general public [2] Or
shares only sold to family and
friends [2]
Some understanding [1] e.g.
outlines general features of limited
companies e.g. have limited
liability/separate legal identity from
owners/can sell shares/incorporated

Do not accept in private sector/no

Government involvement as generic
statement also applies to unlimited
businesses.
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

25 What is meant by a ‘private 2

limited company’?
Clear understanding [2] e.g. a
business whose shares cannot be
sold to the general public [2] OR
shares only sold to family and
friends [2]
Some understanding [1] e.g.
outlines general features of limited
companies e.g. have limited
liability/separate legal identity from
owners/can sell shares/incorporated

Do NOT accept in private sector/no

Government involvement as generic
statement also applies to unlimited
businesses.

26 What is meant by a 2
‘partnership’?
Clear understanding [2] – 2 [or
more] people who agree to own and
run a business together [2]
Some understanding [1] – e.g. 2 or
more people run a business
Do not accept features
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

27 Consider the advantages and 6

disadvantages for All Active of
being converted to a public
limited company? Do you think
All Active should become a public
limited company? Justify your
answer.
Knowledge [1] – award 1 mark for
identification of relevant issue(s).
Positive or negative points allowed
[max 1]
Application [1] – award 1 mark if
relevant reference made to All
Active’s business
Analysis [2] – award up to 2 marks
for relevant development of point(s)

Evaluation [2] – justified decision

made as to whether All Active
should become a public limited
company. Candidate’s final
decision can be either for or against
the statement.
Relevant points might include:
Advantages:
• Access to greater sources of
finance [k] so help fund expansion
[an] of 5 more clubs [app] • Greater
prestige/status [k] so might be able
to attract better
managers/employees [an]
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

Disadvantages:
• More legal requirements to meet
[k] • Already have limited liability
[k] as private limited company
[app] so is there much benefit [eval]
• business is already successful [k]
as profits have increased [app] so
might have funds for expansion
already [an] • Greater Risk of
takeover [k] Application marks may
be awarded for appropriate use of
the following: 5 more clubs, private
limited company, fitness, 20 clubs,
increasing profits
 - Mark Scheme /

Question Answer Marks AO Element Notes Guidance

28 Do you think it would be better 6

for Gowri to have a business
partner rather than be a sole
trader? Justify your answer.
Knowledge [1] – award 1 mark for
identification of relevant point(s)
[max 1]
Application [1] – award 1 mark if
relevant reference made to Gowri’s
business
Analysis [2] – award up to 2 marks
for relevant development of point(s)

Evaluation [2] – justified decision

made as to whether Gowri would
be better with a business partner
Relevant points might include:
• Keeps all the profit [k] so if
successful she will make more
money [an] • Total control if sole
trader [k] always wanted to start her
own business [app] • Aware of what
she needs to do [k] as identified
finance, marketing as areas [app] •
Partner will still mean unlimited
liability [k]so could still lose her
personal assets if business does not
work [an] • Partner could bring in
more skills [k] as Gowri might lack
experience [app] • Unlimited
liability [k] could help share risk
for Gowri [an] • Additional funds
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Question Answer Marks AO Element Notes Guidance

[k] so might not need microfinance

[app] so able to spend more on
creating interest [an] • Possible
Conflict / arguments [k] • Share
work / ideas [k] so able to create /
make more goods [app] leading to
more revenue [an]
Application marks may be awarded
for appropriate use of the following:
‘lot to do’ new start up,
microfinance, bags or associated
words such as leather, sewing;
government help, own business
Note: Candidate’s final decision
can be either for or against the
statement.

29 Identify two advantages to Cutter 2

of being a private limited
company.
Application [2 × 1] – award one
mark per advantage.
Advantages could include: no need
to publish (detailed) accounts,
limited liability, control over who
can buy shares, easier to raise
money, more credibility with
suppliers, separate legal identity,
continuity after death of owners.
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Question Answer Marks AO Element Notes Guidance

30 Identify and explain two 6

disadvantages to Anouk to having
a business partner.
Knowledge [2 × 1] – award 1 mark
for each disadvantage identified
Application [2 × 1] – award 1 mark
if relevant reference made to Anouk

Analysis [2 × 1] – award 1 mark for

each relevant explanation
Note: For each reason maximum 3
marks [1k + 1app + 1an].
Relevant points might include:
• Have to share profits [k] so she
might earn less [an] than if she were
a sole trader [app] • Share
workload: [k] Anouk enjoys doing
both designing and selling [app]
sharing could lead to conflict [an]
• Unlimited liability [k] just like a
sole trader [app] Anouk’s personal
assets are still at risk [an] • Slower
decision making [k] as she has to
discuss decisions such the
marketing budget [app] which could
mean she misses sales[an] • They
might have different objectives [k]
the partner might not want to just
sell at markets [app] this could lead
to disagreements[an] • Partnership
agreements cost time and money
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Question Answer Marks AO Element Notes Guidance

[k].

[Total: 124]