IGCSE Business Studies

Homework Book

Name…………………………………….
Class……………………………………

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 Unit 1: Understanding Business Activity
1.1 Business Activity Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example.

Key Term Definition

Needs

Wants

Scarcity

Opportunity Cost

Specialisation

Division of Labour

The Economic
Problem

Factors of Production
(CELL)
Added Value

What is added value?

The increased worth that a business creates for a product. It is the difference between what a
business pay for the product and the price that is able to charge for the product/service.

How can we increase added value?

1. _______________________
2. _______________________
3. _______________________
4. _______________________
5. _______________________
6. _______________________

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Identify two reasons why value added is important for a business?

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Explanation: ……………………………………………………………………………………………………
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Explanation: …………………………………………………………………………………………………..
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George’s Gourmet Burger:

George owns ‘George’s Gourmet Burger’;he is trying to work out his added value. George has
worked out the costs per burger (below), his selling price is £6,95.

75p beef

20p bun

5p cheese

5p lettuce

5p cucumber

5p tomato

What is his added value per burger (don’t forget to show your workings)? £...................

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1.2 Classification of Business Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example.

Key Term Definition

Primary Sector

Secondary Sector

Tertiary Sector

Public Sector

Private Sector

De-industrialisation

Mixed Economy

The main business sector in the UK is the Tertiary sector, can you think of a reason why?

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The main business sector in China is the Secondary sector, can you think of a reason why?

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Compare the differences between China and the UK;explain why these factors cause the individual
countries to specialise in certain sectors.

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Mind Map as many different public sector businesses as you can think of:

Mind Map as many different private sector business as you can think of:

The NHS should be privatised, to what extent do you agree?

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1.3 Enterprise, business growth and size Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example.

Key Term Definition

Entrepreneur

Enterprise

Business Plan

Business Size

Vertical growth

Horizontal growth

Conglomerate growth

Draw an entrepreneur: what do they look like, what are the skills they need and what are their
reasons for becoming an entrepreneur.

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Can you think of the five different stakeholder groups who are interested in business size?

1._______________________

2._______________________

3._______________________

4._______________________

5._______________________

Analyse the difference between internal and external growth

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1.4 Types of Business Organisation Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example.

Key Term Definition

Sole Trader

Partnership

Limited Liability
Partnership

Private Limited
Company

Public Limited
Company

Franchise

Limited Liability

Unlimited Liability

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Shares

Share Capital

For the following businesses, pair them to their correct type of organisational structure:

Tesco Sole Trader

New Look Public Limited Company
Costa Partnership
Barry’s Builders Limited Liability Partnership
Manjinder and Twinkles Beauty Salon Franchise
Dee and Dum’s Dentists Private Limited Company

Define unlimited liability……………………………………………………………………………………

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Define limited liability ……………………………………………………………………………………

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Now using the same businesses as before please state which type of liability the business has, then
explain one advantage and one disadvantage for the business

Business Limited or Advantage Disadvantage

Unlimited
Liability
Tesco

New Look

Costa

Barry’s Builders

Manjinder and
Twinkles Beauty
Salon

Dee and Dum’s

Dentists

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9
1.5 Business and Stakeholder Objectives Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example.

Key Term Definition

Objective

Business Objective

Stakeholder

Stakeholder
Objectives

Conflict of interest

It’s nearly the end of the first unit; let’s check we haven’t forgotten anything! Please do not look back
at previous work as you are only cheating yourself.

Key Term Definition

Opportunity Cost

Added Value

Limited Liability

Unlimited Liability

PLC

LTD

Use the section below to add in any key terms which you have found difficult or hard to remember

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Primark in Eastleigh

Press release
We would like to announce that Primark will be opening a new medium sized store in The Swan
Centre, Eastleigh, Southampton.

We aim to locate the store in the currently (mostly) vacant second floor of The Swan Centre, this
will be a really exciting time for both, Primark, The Swan Centre, Eastleigh residents and the loal
economy.

We would like to invite any interested to a meeting at Eastleigh Town Hall on 13th October at
7pm.

Use the press release above to answer the following questions:

Explain the various stakeholder groups whom will be effected:……………………………………………

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Choose one stakeholder group and analyse how they will feel about the new Primark Store?

(It is very important that you explore both positive points and negative points, also don’t forget to write
a small conclusion)

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11
 Unit 2: People

2.1 Motivating Workers Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Motivation

Financial motivation

Non-financial
motivation

Taylor’s theory

Maslow’s theory

Herzberg’s theory

McGregor’s theory

Use the space below to draw and annotate Maslow’s Hierarchy of Needs:

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Theorist Theory Good points Bad Points In real businesses
how is this theory
applied
Taylor

Maslow

Herzberg

McGregor

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13
2.2 Organisational Structures Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example.

Key Term Definition

Workloads and Job
Allocation

Levels of Hierarchy

Spans of Control

Delegation

Communication
Flows

Centralised

Decentralised

Autocratic leadership

Democratic
leadership

Lassiez-Faire
leadership

For the following three businesses, decide which leadership style they are most likely to have
and explain your reasons why?
Google Tesco John Lewis

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To what extent do you agree that all businesses should motivate employees solely with financial
motivators?

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15
 Homework Set: Homework Due:
2.3 Recruitment, Selection and Training
For the following key terms write the definition and also give a real life business example

Key Term Definition

Recruitment

Application Form

Job Description

Person Specification

On the job training

Off the job training

Retention

In the space below draw the recruitment, selection and training process.

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“The recruitment process is the most important process for businesses to get right”, to what extent do
you agree with this statement?

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17
2.4Internal and External Communication Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Communication

Formal
communication

Informal
communication

External
communication

Internal
communication

One way
communication

Two way
communication

Draw all the different methods of communication:

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Analyse the importance of two way communication in a middle sized business

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19
 Unit 3: Marketing

3.1Marketing Competition and the Customer Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Marketing

Niche Market

Mass Market

Market Segment

Market Orientation

Product Orientation

Competition

Write down the five purposes of marketing:

1.

2.

3.

4.

5.

Explain the different ways in which businesses can segment the market:

1.

2.

3.

4.

5.

6.
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Which purpose of marketing do you believe to be the most important?

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Analyse the impact of marketing upon a consumer’s decision to buy a product or service.

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21
3.2Market Research Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Market Research

Primary Research

Secondary Research

Qualitative Research

Quantitative
Research

Research Methods

In the table below, list different methods of collecting primary and secondary research:

Primary Secondary

What are the three methods of measuring markets?

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For the following businesses, suggest whether they should use primary or secondary research,
include an analysis of the advantages and the disadvantages for each business.

1. Tony’s Fish and Chip Shop, Tony has been running the shop in Southampton Town Centre for
the 10 years. He has never changed the menu and feels that perhaps changing the menu
might help to boost falling sales, at present the menu simply offers; fish, chips and mushy
peas However he is unsure about the whole research process, he is hoping to spend £`1000
on the research
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2. Starbucks. Ola is planning on opening a new Starbucks in The Swan Centre, she has yet to
complete any market research and is unsure if she needs to complete any, all of the Starbucks
stores seem to be really successful so she doesn’t think she has anything to worry about. Ola
has saved £10,000 from the franchise fee, so she does have some money spare to spend if
you recommend her to conduct research.
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3.34P’s Homework Set: Homework Due: hi
The 4P’s Project

For this homework you are required to complete a project.

You are required to create a presentation to deliver to potential investors, the presentation should
include:

1. Introduction to the business

Business name, history, you as an entrepreneur, culture, leadership style, staffing……..
2. Product
Good/Service, purpose, specification, quality, manufacturing, product life cycle………...
3. Price
Selling price per unit, fixed costs, variable costs, break even, pricing strategy………..
4. Place
Sector of production, transportation of materials, suppliers, storage, location of outlet, online
sales, location of products in shop, location to competitors, infrastructure
5. Promotion
Promotional strategy, partnership working, offers, appropriate promotions, competitions…..
6. Use of technology
In operations, in marketing, in employment, in communications….

This list is not everything you could include, please feel free to add any other information.

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 4: Operations

4.1Production of Goods and Services Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Operations

Operations
department

CELL

The Transformation
Process

Productivity

Labour Productivity

Stock

Lean Production

Kaizen

JIT

Cell production

Job Production

Batch Production

Flow Production

Automation

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Mechanisation

CAD

CAM

EPOS

EFTPOS

Draw the transformation process:

Productivity- If a business’s inputs are £5,000 for January and their outputs equate to 2,000 units sold
at 50pence per unit, what is their productivity? (Show your workings and clearly show the answer)

Labour Productivity- Using the information from above and bear in mind the company has 100
employees during January, what is their labour productivity?(Show your workings and clearly show
the answer)

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4.2Marketing Competition and the Customer Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Fixed Cost

Variable Cost

Total Cost

Economies of Scale

Diseconomies of
Scale

Unit Contribution

Total Contribution

Breakeven Point

Breakeven Analysis

Margin of Safety

Using the information below, fill in the table on the next page and calculate the average cost at each level
of output. Note- Selling price for the cushions is £15

Item Cost Fixed or variable

Rent on premises £450 per week

Hire of machinery £150 per week

Heating and lighting £100 per week

Repayment of bank loan £300 per week

Materials £7 per cushion

Packaging £1 per cushion

Labour £2 per cushion

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N.B. Show all your calculations in the spaces provided.

Units made per

week Total Fixed costs Total Variable costs Total costs Profit/Loss

100

200

300

400

500

600

700

800

900

1000

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Now draw a breakeven chart for the data above:

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29
4.3Quality Assurance and Quality Control Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Quality

Quality Targets

Quality Control

Quality Assurance

Total Quality
Management

Quality Standards

Why is quality important, explore four reasons why quality is important?

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For both terms, please explore the advantages and disadvantages of the two methods:

Quality Control Quality Assurance

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31
4.4Manufacturing Location Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Manufacturing

Manufacturing
location

Suppliers

Proximity to suppliers

Legislation in other
countries

Logistics

Infrastructure

Complete the mind map:

Factors affecting the location

of a manufacturing business

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Complete the mind map:

Factors affecting the location

of a service sector business

To what extent do you agree that Amazon’s success is solely due to its location?

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 Unit 5: Finance

5.1Sources of Finance Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Source of finance

Working capital

Internal source of
finance

External source of
finance

Finance Department

Interest

Interest Rates

Return on investment

Share

Share Capital

Use this section to describe the difference types of internal and external sources of finance.

Internal External

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For the following businesses recommend the best source of finance and justify your choice:

1. A Paper Company (PLC) wishes to raise finance in order to fund an expansion to a new
country, what is the best source of finance to enable them to expand?
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2. A builder (sole trader), needs a specific tool for a two week job, he does not normally need this
tool, what is the best source of finance for this tool?
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3. A Earthmoving Company (LTD) is really struggling to receive payment from a debtor, the debt
owed is £1000, what is the best method of ensuring this finance is secured?
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4. A Hairdressers (partnership), has identified that at the end of the month they will have no
money in their account, however they need to purchase £200 worth of stock urgently, what is
the best method of source of finance?
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Small start-up businesses should always source finance from their family and friends. To what
extent do you agree with this?
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5.2Cash Flow Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Cash Flow

Cash Flow Forecast

Revenue

Costs

Cash

Profit

Opportunity Cost

Added Value

LTD

PLC

Franchise

Debt Factoring

Hire Purchase

Sale and Leaseback

Overdraft

Trade Credit

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What are the most common causes of cash-flow problems?

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5.3Income Statements Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Income Statement

Gross Profit

Net Profit

Retained Profit

Accounts

Financial Accounts

Accountants

Recording
accounting
transactions

Profit

Cash

Depreciation

What is the difference between profit and cash?

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Identify three ways in which a business could improve their profit?

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Harry Jones Ltd

Sales - £400,000

Purchases (100% mark-up)

Opening stock £30,000

Equipment - £50,000

Closing stock £35,000

Pre-payments £2,000 Use this data to construct an Income

Creditors - £14,000 statement for the year ended
31/12/2011. Please use Excel to
Advertising - £18,000 create an Income Statement. You will
then need to print it and attach it to
Cash £1,500
your homework book.
Rent - £8,000

Bank loan (9 months to run) - £4,000

Vehicles - £40,000

Stock – £12,000

Debtors - £18,000

Bank loan (38 months to run) - £25,000

Administration - £12,000

Student Feedback:

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39
5.4 Balance Statements Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Balance Statement

Assets

Liabilities

Current Asset

Non-current asset

Current liability

Non-current liability

Shareholder

Total Equity

Working Capital

Capital Employed

Describe three advantages of using a balance statement?

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Describe three disadvantages of using a balance statement?

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Harry Jones Ltd

Sales - £400,000

Purchases (100% mark-up)

Opening stock £30,000

Equipment - £50,000

Closing stock £35,000

Pre-payments £2,000 Use this data to construct a balance

Creditors - £14,000 statement for the year ended
31/12/2011. Please use Excel to
Advertising - £18,000 create a Balance Statement. You will
then need to print it and attach it to
Cash £1,500
your homework book.
Rent - £8,000

Bank loan (9 months to run) - £4,000

Vehicles - £40,000

Stock – £12,000

Debtors - £18,000

Bank loan (38 months to run) - £25,000

Administration - £12,000

Student Feedback:

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41
5.5 Ratios Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Ratios

ROCE

Gross Profit Margin

Net Profit Margin

Current Ratio

Acid Test

Liquidity Ratios

Profitability Ratios

Analyse the advantages and disadvantages of managers using ratios to make financial decisions?

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Harry Jones Ltd

Sales - £400,000

Purchases (100% mark-up)

Opening stock £30,000 Use the data gained to interpret the

financial position of Harry Jones Ltd
Equipment - £50,000
as of 31/12/2011.
Closing stock £35,000
Calculate the following ratios:
Pre-payments £2,000
ROCE
Creditors - £14,000
Gross profit Margin
Advertising - £18,000
Net Profit Margin
Cash £1,500
Working Capital
Rent - £8,000
Current Ratio
Bank loan (9 months to run) - £4,000
Acid test
Vehicles - £40,000

Stock – £12,000

Debtors - £18,000

Bank loan (38 months to run) - £25,000

Administration - £12,000

Student Feedback:

Teacher Feedback

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43
 Unit 6: External Influences
Homework Set:
6.1 Government economic objectives and policies
Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Inflation

Economic growth

Low unemployment

High unemployment

Balance of payments

GDP

Business cycle

Fiscal policy

Monetary policy

Supply side policies

Interest rates

Privatisation

NEET

Monopoly Share

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Use the space below to draw and annotate the business cycle:

Use the space below to draw and annotate the redistribution of wealth:

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6.2 Environmental and Ethical Issues Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Environment

Environmental Issues

Ethics

Ethical Issues

Business Ethics

Corporate Social
Responsibility

Globalisation

Fair Trade

Corruption

Child Labour

Outsourcing to LEDC

Health and Safety

Minimum Wage

Working Conditions

Employing illegal
workers

Whistle-blowing
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John Lewis is planning on opening a new retail park on the outskirts of Eastleigh, John Lewis plan to
build and develop the entire site, occupy the largest building and then rent out the other buildings.
The site is currently woodland and is home to alarge variety wildlife, including the rare Red Squirrel.
The site is close to the motorway and will be one of the only John Lewis stores on the north side of
Southampton; therefore it will be very popular. John Lewis currently has no policy to check the
documentation of workers.

Use the information above to identify any environmental and ethical issues which John Lewis may
encounter in their development of the new site.

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6.3 Business and the Internal Economy Homework Set: Homework Due:

For the following key terms write the definition and also give a real life business example

Key Term Definition

Globalisation

Infrastructure

Quota

Tariff

Multinational
businesses

Exchange Rates

Interest Rates

Government
Investment

Investment Spending

Consumer Spending

Identify four factors which have enabled globalisation to occur.

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Using the internet find out the currency and current exchange rate for 10 countries:

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Now using two of the exchange rates, compare which currency is stronger and identify the reasons
for this?

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