SECTION A

1 (a) Define the term ‘secondary research’. [2]

AO1 Knowledge and understanding • Collection of data from second-hand sources – not directly related to a firm’s needs. • Collection of data that already exists – compared to primary data. • Data from external sources – e.g. reports, census.

(b) Explain one advantage to a business of data collected using primary research methods. [3]

Follow the point-based marking guidance at the top of this mark scheme and use Table B to give marks for each candidate response. AO1 out of 1 mark. AO2 out of 2 marks. Indicative content Responses may include:

AO1 Knowledge and understanding • Primary research methods produce first-hand data directly related to the needs of a business. • Advantage of primary data which shows knowledge of the term. • Method of primary research which shows knowledge of the term.

AO2 Application • Primary research methods may produce data that will be more up-to-date than data from secondary sources – may therefore be more useful to a business. • Primary research methods may produce data that will be more relevant to a business than secondary sources – data will be collected for a specific business purpose. • A business has direct control as opposed to secondary sources – over what and how data is collected using primary research methods. • The data collected will be confidential unlike secondary sources – and can be hidden from competitors. Accept all valid responses

2 (a) Define the term ‘sustainability’. [2]

Follow the point-based marking guidance at the top of this mark scheme and use Table A to give marks for each candidate response. AO1 out of 2 marks. Indicative content Responses may include:

AO1 Knowledge and understanding • Production systems that prevent waste – by using the minimum of non-renewable resources. • Production levels that can be sustained in the future – by using renewable resources. • Production levels which have minimum impact on society – by creating minimum levels of waste.

(b) Explain one reason why a manufacturing business might take measures to improve the sustainability of its operations. [3]

Follow the point-based marking guidance at the top of this mark scheme and use Table B to give marks for each candidate response. AO1 out of 1 mark. AO2 out of 2 marks. Indicative content Responses may include:

AO1 Knowledge and understanding • The identification of one appropriate reason why a manufacturing business might take measures to improve the sustainability of its operations, e.g. to improve company image, to access new markets, happier workforce, avoid pressure group activity, responding to legal controls.

AO2 Application • To improve company image more people are becoming willing to value sustainable business activities – and to value and support eco-friendly practices, e.g. green consumerism. • To gain access to new markets where for example governments give preferential treatment to businesses –demonstrating sustainable practices, e.g. renewable energy. • A happier and more productive workforce and a potentially more productive one once a business has become greener and cleaner – using practices, e.g. responsible disposal of waste.

Accept all valid responses.

3 (a) Define the term ‘zero budgeting’. [2]

Follow the point-based marking guidance at the top of this mark scheme and use Table A to give marks for each candidate response. AO1 out of 2 marks. Indicative content Responses may include: AO1 Knowledge and understanding • An approach to budgeting that sets budgets to zero each year – not from the current year’s levels. • Requires budget holders to justify their budgets each year – in order to gain financial resources.

(b) Explain one benefit to a business of using budgets. [3]

Follow the point-based marking guidance at the top of this mark scheme and use Table B to give marks for each candidate response. AO1 out of 1 mark. AO2 out of 2 marks. Indicative content Responses may include: AO1 Knowledge and understanding • A budget is a detailed financial plan for the future. • Any benefit of using budgets, e.g. allocating resources, assessing performance, giving managers authority.

AO2 Application • Budgets are set for both sales revenue and business costs – allowing a business to create and monitor profit centres and cost centres. • Budgets require budget holders to consider their future financial requirements – and to set realistic financial targets. • A system of budgets facilitates financial performance measurement – and increases budget holder accountability. • Budgets require careful financial planning – that should lead to a more efficient allocation of resources. • Budgets may well serve to motivate budget/profit and cost centre managers – creating an incentive to perform. • Budgets throughout a business may encourage co-operation and co-ordination of business activities – helping to avoid conflict. • Budgets are a measure of control – and allow monitoring to provide financial discipline within a business. • Budgets may indicate the need for change – by signalling the unrealistic nature of financial plans in the light of changed situations. • Budgets allow for the use of variance analysis – which indicate major areas for management action.