Premlal C R
Assessment
overview
All
candidates take two papers. Candidates will be eligible for grades A* to
G.
Paper 1- 1 hour 30 minutes
Short Answer and Data Response 50%
80 marks
Four questions requiring a mixture of short answers and structured data
responses
Candidates answer all questions
Externally assessed
Paper 2 -1 hour 30 minutes
Case Study
50%
80 marks
Four questions based on a case study, provided as an insert with the paper.
Candidates answer all questions
Externally assessed
Unit-1
Understanding business activity
This topic
introduces key business concepts, including the nature of business activity and
economic sectors. Enterprise and entrepreneurship, measuring business size, and
why some businesses grow while others remain small, are also important issues.
Types of business organisation, business objectives and stakeholder objectives,
and the role of stakeholder groups are also considered.
|
1.1 |
Business activity |
|
1.1.1 |
T he nature
of business activity • factors
of production: land, labour, capital and enterprise • concept
of adding value and how added value can be
increased •
concept of opportunity cost |
|
1.2 |
Economic sectors |
|
1.2.1 |
Types of
economic sector • primary,
secondary and tertiary sectors • private
and public sectors |
|
1.3 |
Enterprise, business growth and size |
1.3.1
Enterprise and entrepreneurship
• characteristics
of successful entrepreneurs
• purpose
and key elements of a business plan: overview/summary, objectives, resources,
market research, marketing, finance, people, operations
• the
importance of having a business plan
• why
governments support business start-ups
how governments
support business start-ups, e.g. grants, advice, low-cost loans, training
schemes
|
1.3 |
Enterprise, business growth and size continued |
|
1.3.2 |
The methods
and problems of measuring business size • methods
of measuring business size, e.g. number of people employed, value of
output/sales, volume of output/sales, capital employed (profit is not a
method of measuring business size) •
problems when measuring business size |
|
1.3.3 |
Why some
businesses grow and others remain small • why
the owners of a business may want to grow the business • how
and why businesses can grow internally, e.g. develop new products, develop
new markets • how
and why businesses can grow externally: mergers and takeovers, including
horizontal integration, vertical integration • advantages
and disadvantages of methods of growth • problems
linked to business growth • why
some businesses remain small |
|
1.3.4 |
Why some
businesses succeed and others fail •
reasons why businesses succeed or fail, e.g. management skills, availability
of finance, suitability of product, demand for products, changes in the
economy, level of competition |
|
1.4 |
Types of business organisation |
|
1.4.1 |
Different
types of business organisation • sole
traders, partnerships, private limited companies and public limited companies • advantages
and disadvantages of different types of business organisation • recommend
and justify a suitable type of business organisation to owners/management for
a given situation • different
forms of business organisation: franchises, joint ventures, social
enterprises • advantages
and disadvantages of franchises for the franchisor and
franchisee • advantages and
disadvantages of joint ventures |
|
1.5 |
Business objectives and stakeholder objectives |
1.5.1 Business
objectives
• businesses
can have several objectives, e.g. survival, growth, profit, market share
• the
importance of business objectives
1.5.2 The role
of stakeholder groups
• internal
stakeholder groups: owners (sole traders, partnerships, shareholders),
managers, employees
• external
stakeholder groups: customers, suppliers, lenders/banks, government, local
community
• objectives
of different stakeholder groups
• how
these objectives may conflict with each other
Unit- 2 People in business
This topic
focuses on human resource management and includes recruiting and selecting
employees, employment contracts and legal controls, and training. How
businesses are organised, managed and leadership styles are considered as well
as the reasons why reducing a workforce may be necessary. Also included are
methods of communication and examples of communication barriers in business.
Finally, this topic covers the importance of having a well-motivated workforce
and methods of motivation.
|
2.1 |
Human resource management (HRM) |
|
2.1.1 |
Recruiting
and selecting employees • stages
in the recruitment process: job descriptions, person specifications, job
advertisements (including employment agencies and online recruitment) • selection
methods, e.g. curriculum vitae (CV)/resumé, application forms,
references, testing/assessment centres, interviews • advantages
and disadvantages of internal and external recruitment • recommend
and justify who to employ in a given situation |
|
2.1.2 |
Employment
contracts and legal controls over employment issues • the
main contents of an employment contract: duties and responsibilities, working
hours, holiday entitlement, sick pay • the
benefits of employment contracts for employers and employees • legal
controls over employment issues: unfair dismissal, discrimination, health and
safety, legal minimum wage • effects
of legal controls over employment issues on employers and employees |
|
2.1.3 |
Training • importance
of training to a business and to employees • types
of training: induction training, on-the-job training and off-the-job training • advantages
and disadvantages of the three types of training |
|
2.2 |
Organisation and management |
2.2.1 Simple
organisational structures
• the
main functional areas of a business, e.g. operations, marketing, finance, human
resources
• simple
hierarchical structures: tall and flat levels of hierarchy, long and short
chains of command, wide and narrow spans of control
• interpret
simple organisational charts
• different
ways of flexible working, e.g. home working and flexible hours
• advantages
and disadvantages of part-time employees and full-time employees
2.2.2 The
functions of management planning, organising, coordinating, commanding and
controlling • advantages and disadvantages of delegation
|
2.2 |
Organisation and management continued |
|
2.2.3 |
Leadership
styles • the
main leadership styles: autocratic, democratic and laissez-faire • advantages
and disadvantages of the main leadership styles • recommend
and justify an appropriate leadership style for a given situation |
|
2.2.4 |
Why reducing
the size of the workforce may be necessary • concept
of downsizing • reasons
for reducing the size of the workforce, e.g. automation, reduced demand for
products, need to lower costs • concept
of redundancy • recommend
and justify which employee(s) to make redundant in a given situation |
|
2.2.5 |
The role of
trade unions • what
a trade union is • benefits
to employees of being a trade union member |
|
2.3 |
Methods of communication |
2.3.1 Why
communication is important
• why
communication is important for a business
• methods
of communication, e.g. meetings (face-to-face or virtual), email, text
messages, social media, phone calls (including mobile calls), letters, posters
and noticeboards
• advantages
and disadvantages of different methods of communication
• internal
and external communication
• recommend
and justify which method of communication to use in a given situation
2.3.2
Communication barriers
• examples
of communication barriers
• reasons
for communication barriers
• problems
caused by communication barriers
• how
communication barriers can be reduced or removed
|
2.4 |
Motivating employees |
2.4.1 The
importance of a well-motivated workforce
• why
people work
• the
benefits of a well-motivated workforce: improved labour productivity, reduced
absenteeism, lower labour turnover and greater willingness to accept change /
new methods of working • main motivational theories: Maslow, Taylor,
Herzberg
|
2.4 |
Motivating employees continued |
2.4.2 Methods
of motivation
• financial
methods of motivation, e.g. time-based, piece-rate, salary, bonus, commission,
profit sharing, fringe benefits
• non-financial
methods of motivation, e.g. job enrichment, job rotation, training,
opportunities for promotion, praise, employee of the month
• recommend
and justify an appropriate method of motivation for a given situation
Unit 3 Marketing
This topic
covers marketing and the market, including niche markets and mass markets, why
markets change and the use of market segmentation. Market research and the
marketing mix, including the four Ps, are covered as is marketing strategy,
including entering new markets in other countries. Examples of ecommerce and
its advantages and disadvantages are considered as is the purpose of legal
controls related to marketing.
|
3.1 |
Marketing and the market |
3.1.1 The
role of marketing
• identifying
customer needs
• satisfying
customer needs
• maintaining
customer loyalty
• building
customer relationships
• anticipating
changes in customer needs
3.1.2
Understanding market changes
• why
consumer spending patterns may change
• why
some markets are becoming more competitive
• how
businesses can respond to changing spending patterns and increased competition
• calculate
market share
3.1.3 Mass
markets and niche markets
• concepts
of mass markets and niche markets
• advantages
and disadvantages of mass markets and niche markets
3.1.4 Market
segmentation
• how
markets can be segmented according to: age, income, location, gender, lifestyle
• advantages
and disadvantages of market segmentation
|
3.2 |
Market research |
|
3.2.1 |
Methods of
market research • why
businesses use market research • primary
research methods, e.g. questionnaires or surveys, interviews, focus groups,
observation • the
concept of sampling and why it is useful to businesses • advantages
and disadvantages of primary market research methods • secondary
research methods, e.g. competitor websites, government sources, market
reports, trade magazines • advantages
and disadvantages of secondary market research methods • factors
influencing the accuracy of market research data • analyse
simple market research data |
|
3.3 |
Marketing mix |
3.3.1 Product
• the
importance of brand image
• the
role of packaging
• advantages
and disadvantages of developing new products
• the
main stages of the product life cycle: introduction, growth, maturity, decline
• interpret
a product life cycle diagram
• extension
strategies a business could use: new markets, new uses for a product, adapting
the product or packaging, increased advertising / sales promotion
• advantages
and disadvantages of different extension strategies
• recommend
and justify an extension strategy to use in a given situation
3.3.2 Price
• pricing
methods: cost-plus, competitive, penetration, skimming, dynamic
• advantages
and disadvantages of different pricing methods
• recommend
and justify an appropriate pricing method for a given situation
3.3.3 Place
• advantages
and disadvantages of different distribution channels: direct to customers,
through retailers, wholesalers, agents
• recommend
and justify an appropriate distribution channel for a given situation
3.3.4 Promotion
• reasons
for promotion
• methods
of sales promotion, e.g. vouchers, reward schemes, competitions, special offers
/ discounts
• methods
of advertising, e.g. social media, direct/targeted emails, leaflets, billboards
• recommend
and justify which method of sales promotion to use in a given
situation • recommend and
justify which method of advertising to use in a given situation
|
3.3 |
Marketing mix continued |
3.3.5 Ecommerce
• examples
of ecommerce, e.g. mobile phone / internet banking, online shopping, online
ticketing
• advantages
and disadvantages of ecommerce for businesses
• advantages
and disadvantages of ecommerce for customers
3.3.6 Marketing
strategy
• importance
of the different elements in the marketing mix
• recommend
and justify an appropriate marketing mix for a given situation
3.3.7 Entering
new markets in other countries as a method of growth
• advantages
of entering new markets in other countries, e.g. increase sales, spread risk
• disadvantages
of entering new markets in other countries, e.g. cultural differences, lack of
knowledge, legal requirements
|
3.4 |
Legal controls |
3.4.1 Legal
controls related to marketing
• the
purpose of legal controls to protect customers: misleading promotion, faulty
goods
• the
effects of legal controls on marketing
Unit
4 Operations management
This topic
focuses on the production of goods and services and includes the main methods
of production, the role of technology and the importance of sustainable
production. Costs, the scale of production, as well as break-even analysis are
included alongside economies of scale and quality production. This topic
concludes with the main factors which influence location decisions.
|
4.1 |
Production of goods and services |
4.1.1 Production
processes
• calculate
labour productivity
• why
efficiency is important for a business
• how
to increase efficiency, e.g. increasing automation and technology, improving
labour skills
• concept
of lean production and how to achieve it: just-in-time (JIT) inventory control
and Kaizen
• advantages
and disadvantages of lean production methods
• why
businesses hold inventory
• factors
affecting how much inventory businesses hold
4.1.2 The main
methods of production
• job,
batch and flow production
• advantages
and disadvantages of job, batch and flow production
• recommend
and justify an appropriate production method for a given situation
|
4.2 |
Technology and production of goods and services |
|
4.2.1 |
The use of
technology in the production of goods and services • how
technology is changing production methods through automation and
mechanisation, e.g. Computer-Aided Manufacture (CAM) and 3D Printing • how
technology is improving productivity in the service sector, e.g. contactless
payments • advantages
and disadvantages of changes in technology for businesses and employees |
|
4.3 |
Sustainable production of goods and services |
|
4.3.1 |
Methods of
sustainable production of goods and services • how
businesses can be more sustainable: using renewable energy, using fewer
resources / less waste, reusing, recycling, developing environmentally
friendly products, using environmentally friendly packaging • advantages
and disadvantages of businesses becoming more sustainable |
|
4.4 |
Costs, scale of production and break-even analysis |
4.4.1 Identify
and classify costs
• classify
and calculate costs using examples, e.g. fixed, variable, average and total
• use
cost data to help make simple decisions, e.g. which product to produce, whether
to continue or stop production, what price to set, help choose suppliers
4.4.2 Economies
and diseconomies of scale
• concept
of economies of scale: purchasing, marketing, financial, managerial, technical
• concept
of diseconomies of scale: poor communication, lack of commitment or loyalty
from employees, weak coordination, lack of control
4.4.3
Break-even analysis
• concept
of break-even
• complete
or amend a simple break-even chart
• interpret
a break-even chart
• calculate
break-even output
• define,
calculate and interpret the margin of safety
• use
break-even analysis to help make decisions: effect of changes in price, changes
in fixed costs, changes in variable cost per unit
• limitations
of break-even analysis
|
4.5 |
Quality of goods and services |
|
4.5.1 |
Why quality
is important and how quality may be achieved • what
quality means and why it is important for businesses • concept
of quality control • concept
of quality assurance • advantages
and disadvantages of quality control and quality assurance • recommend
and justify whether to use quality control or quality assurance in a given
situation |
|
4.6 |
Location decisions |
4.6.1 Main
factors which influence location decisions
• factors
which influence the location decisions of a manufacturing business
• factors
which influence the location decisions of a service business
• factors
that a business could consider when deciding which country to locate its
operations in
• recommend
and justify an appropriate location for a business in a given situation
Unit
5 Financial information and decisions
This topic
considers the need for, and sources of, business finance, the importance of
working capital and the use of cash flow forecasts. The main features of a
statement of profit or loss are covered as well as statements of financial
position. Finally, this topic includes analysis of accounts, profitability and
liquidity, and different users of accounts.
|
5.1 |
Business finance |
5.1.1 The
need for business finance
• the
main reasons why businesses need finance: start-up capital, capital for
expansion/growth, replacing existing non-current assets, investing in new
technology, working capital
• short-term
and long-term finance needs of a business
• concept
and importance of working capital
5.1.2 The main
sources of finance
• internal
sources of finance: owners’ investment, retained profit, sale of unwanted
assets, working capital
• external
sources of finance: share capital or issuing shares, venture capital, bank
overdrafts, leasing, hire purchase, bank loans, trade credit, government
grants, crowdfunding
• advantages
and disadvantages of internal and external sources of finance
• the
main factors to consider when selecting a source of finance: size of business,
legal form of business, amount required, length of time, existing loans, cost,
purpose
• recommend
and justify an appropriate source of finance for a given situation
|
5.2 |
Cash flow forecast |
5.2.1 The
importance of cash and cash flow forecasts
• why
cash is important to a business
• what
a cash flow forecast is and why it is important
• main
features of a cash flow forecast: cash inflow, cash outflow, net cash flow,
opening balance, closing balance
• amend
or complete a simple cash flow forecast
• interpret
a simple cash flow forecast
• how
a short-term cash flow problem may be overcome: overdraft, delaying supplier
payments, asking customers to pay more quickly, delay purchase of non-current
assets
Note: candidates
will not be assessed on constructing a cash flow forecast.
|
5.3 |
Profit and loss |
5.3.1 What is
profit and why it is important
• what
profit is
• importance
of profit to private sector businesses: reward for risk-taking, source of
finance, measure of success, attract investors
5.3.2 Statement
of profit or loss
• main
features of a statement of profit or loss: revenue, cost of sales, gross
profit, expenses, profit
• make
simple calculations based on a statement of profit or loss: revenue, cost of
sales, gross profit, expenses, profit
• make
decisions based on simple statements of profit or loss
Note:
candidates will not be assessed on constructing statements of profit or loss.
|
5.4 |
Statement of financial position |
5.4.1 The main
elements of a statement of financial position
• non-current
assets, e.g. property (land and buildings), machinery
• current
assets, e.g. inventory, trade receivables, cash
• non-current
liabilities, e.g. bank loans
• current
liabilities, e.g. trade payables, overdraft
• concept
of capital employed
• make
simple calculations based on statements of financial position: total assets,
total liabilities, working capital
• make
decisions based on simple statements of financial position
Note: candidates
will not be assessed on constructing statements of financial position.
|
5.5 |
Analysis of accounts |
5.5.1
Profitability
• concept
of profitability
• calculate
and interpret the following profitability ratios:
– gross
profit margin
– profit
margin
– return
on capital employed (ROCE)
5.5.2 Liquidity
• concept
of liquidity
• calculate
and interpret the following liquidity ratios:
– current
ratio
– acid
test ratio
5.5.3 Users of
accounts
• users
of accounts and ratio analysis: internal, e.g. owners (sole traders,
partnerships, shareholders), managers, employees
• users
of accounts and ratio analysis: external, e.g. suppliers, government,
lenders/banks
• how
users of accounts may use financial information to help make decisions, e.g.
whether to lend to or invest in a business
• limitations
of using accounts and ratio analysis
Unit
6 External influences on business activity
This topic
focuses on the business cycle and on the effects of changes in government
policy, including taxes, interest rates and exchange rates. The importance of
globalisation is recognised as well as the advantages and disadvantages of
multinational companies (MNCs). Environmental issues and ethical issues are
considered along with the role of pressure groups.
|
6.1 |
Economic issues |
6.1.1 Business
cycle
• main
stages of the business cycle: growth, boom, recession, slump
• how
each stage of the business cycle may affect a business
• effects
of changes in the levels of employment, inflation and economic growth on a
business
6.1.2 Effects
of government policy
• effects
of changes in taxes on business profit
• effects
of changes in taxes on people’s income
• effects
of changes in government spending
• effects
of changes in interest rates
• how
businesses may respond to changes in taxes and interest rates
|
6.2 |
Business and the international economy |
6.2.1 The
importance of globalisation
• reasons
for globalisation: improved transport links, technological change including
communication, free trade agreements, newly industrialised countries
• opportunities
and threats of globalisation for businesses
• import
tariffs and import quotas
• effects
of import tariffs and import quotas on businesses
6.2.2
Multinational companies (MNCs)
• advantages
to a business of becoming an MNC
• advantages
for the country where an MNC is located, e.g. jobs, exports, increased choice,
investment
• disadvantages
for the country where an MNC is located, e.g. increased competition,
environmental damage, exploitation of natural resources, repatriation of
profits
6.2.3 External
costs and benefits
• external
costs and external benefits of business decisions
6.2.4 Exchange
rates
• appreciation
and depreciation of an exchange rate
• how
changes in exchange rates can affect businesses which import and export
products and services, e.g. price, costs, competitiveness
Note: candidates
will not be assessed on exchange rate calculations.
|
6.3 |
Business and the environment |
|
6.3.1 |
Environmental
issues • how
business activity can negatively affect the environment, e.g. pollution,
depletion of resources • why
businesses may respond to environmental issues, e.g. improved reputation,
increased sales • how
businesses may respond to environmental issues • effects
of legal controls over business activity affecting the environment: how, what
and where to produce or sell, influence on costs |
|
6.4 |
Business and ethical issues |
|
6.4.1 |
Ethical
issues • ethical
issues which may affect businesses, e.g. child labour, paying fair wages to
employees, paying fair prices to suppliers, using suppliers who do not damage
the environment • how
businesses may respond to ethical issues • advantages
and disadvantages of a business being ethical |
|
6.5 |
Pressure groups |
6.5.1 The role
of pressure groups
• how
pressure groups can influence business decisions
Changes to
this syllabus for 2027, 2028 and 2029
The syllabus
has been reviewed and revised for first examination in 2027.
You must read
the whole syllabus before planning your teaching programme.
Changes to
syllabus
code • The
syllabus name has been changed
Changes to
syllabus content
• 
There is a new syllabus code 0264.
• The
syllabus aims have been updated.
• We
have included a description of how the syllabus can support students to develop
as Cambridge Learners.
Subject content
• The
subject content has been revised and updated.
• The
order of some content has changed and wording has been updated to improve
clarity.
• Some
topics have been reorganised and reduced in size.
• New
topics have been added – 4.2 Technology and production of goods and services
and 4.3 Sustainable production of goods and services. Digital methods of
communication have been included in Topic 2 People in business.
• Some
content has been removed.
• An
introductory explanation for each of the topics has been added.
• Terminology
has been updated to reflect current practice.
• A
list of formulas and ratios have been added to the subject content.
|
Changes to
assessment (including changes to specimen papers) |
Assessment
objectives • The
wording of the assessment objectives have been updated. The newly worded
assessment objectives test the same knowledge and skills as in the previous
syllabus. • The
weightings for the assessment have changed. The weighting of AO2 Application
has increased. The weightings for AO1 Knowledge and understanding, AO3
Analysis and AO4 Evaluation have decreased. Paper 1 • Each
question now has four parts instead of five. The breakdown of marks has
changed. Paper 2 • All
part (a) questions are now applied questions. • The
wording of the Paper 2 mark scheme has changed. Overall, the marking criteria
remains largely the same. |
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