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Question Answer Marks AO Element Notes Guidance

1 Do you think offering financial 6 This is a general question

help, such as grants, is the best so there are no marks for
way for a government to support application.
business start-ups? Justify your
For evaluation to be
answer.
awarded justification will
Award up to 2 marks for usually follow on from
identification of relevant points. relevant analysis of
points.
Award up to 2 marks for relevant
development of points.
Award 2 marks for a justified
decision as to whether offering
financial help, such as grants, is the
best way for a government to
support business start-ups.
Points might include:
Financial support/grants:
• Needs funds to buy assets [k]
without which it cannot
operate [an]
• Start-up business is likely to
have access to fewer sources
of finance [k]
Other options might include:
• Information / support / advice
/ mentors [k] as a new
entrepreneur may lack
experience (of running a
business) [an] so helps them
make better decisions / fewer
mistakes [an]
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Question Answer Marks AO Element Notes Guidance

• Interest free / low cost loans

[k] which will reduce cash
outflows [an]
• Lower taxes [k] so lower costs
[an]
• Free/low cost training
schemes [k]
• Low rent areas [k]
Other appropriate answers should
also be credited.
Justification might include:
A start-up business needs to have
enough money to pay creditors [k]
as without it could lead to cash flow
problems [an]. Another way is to
provide a mentor [k] as a new
entrepreneur may not have
experience of running a business
[an]. I think financial help is better
due to the limited sources of finance
available and banks may be less
willing to take the risk of lending
money to a start-up business [eval]
and without this there is no business
[eval].
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Question Answer Marks AO Element Notes Guidance

2 Outline one advantage and one 4 Note: To use words from

disadvantage to KTF of taking the stem as application,
over the other business. the reference must be
appropriate (i.e. make
Award 1 mark for each
sense) in relation to the
advantage/disadvantage.
point being made.
Award 1 mark for each relevant
The following words are
reference to this business.
likely to be appropriate
Points might include: for this question:
Advantages: • Building
materials/cement and
• Reduces competition/increased bricks • $25bn • Started
market share [k] as this is one of its 60years ago • Main
main competitors [app] • Possible competitors • Combined
economies of scale [k] reducing the sales of $40bn/raise of
unit costs of bricks [app] • Possible $15bn • Business cycle •
cost savings [k] which could be one Interest rates • Legal
of its objectives [app] • Buying an controls • Protecting the
existing brand can be cheaper than environment •
internal growth [k] • Access to new Stakeholder groups
skills or expertise [k].
Other appropriate
Disadvantages: examples in context can
• Clash of culture and leadership still be credited.
styles/objectives [k] for a business
started 60 years ago [app] • Possible
legal action (as gain too much
market power) [k] so could face the
risk of new legal controls to protect
environment [app] • Possible
diseconomies of scale or examples
e.g. control/ communication
problems [k] • Over reliant on one
market [k] especially when enter
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Question Answer Marks AO Element Notes Guidance

different stages of business cycle

[app] • Pressure groups could
oppose [k] • Cost of redundancies
[k] • Expensive to buy the firm [k].

Other appropriate responses should

also be credited.

[Total: 10]