Cambridge Secondary 2

SYLLABUS
Cambridge O Level
Business Studies
7115
For examination in June and November 2016
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Cambridge International Examinations 2014
Changes to syllabus for 2016
This syllabus has been updated, but there are no significant changes.
Contents
1. Introduction .................................................................................................................... 2
1.1 Why choose Cambridge?
1.2 Why choose Cambridge O Level?
1.3 Why choose Cambridge O Level Business Studies?
1.4 How can I find out more?
2. Teacher support .............................................................................................................. 5
2.1 Support materials
2.2 Resource lists
2.3 Training
3. Syllabus content at a glance ........................................................................................... 6
4. Assessment at a glance ................................................................................................. 7
5. Syllabus aims and assessment objectives ..................................................................... 8
5.1 Syllabus aims
5.2 Assessment objectives
5.3 Relationship between assessment objectives and components
6. Syllabus content ........................................................................................................... 10
7. International accounting terminology ........................................................................... 21
8. Other information ......................................................................................................... 22
Introduction
2 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
1. Introduction
1.1 Why choose Cambridge?
Recognition
Cambridge International Examinations is the worlds largest provider of international education programmes
and qualifications for learners aged 5 to 19. We are part of Cambridge Assessment, a department of the
University of Cambridge, trusted for excellence in education. Our qualifications are recognised by the
worlds universities and employers.
Cambridge O Level is internationally recognised by schools, universities and employers as equivalent in
demand to Cambridge IGCSE

(International General Certificate of Secondary Education). Learn more at

www.cie.org.uk/recognition
Excellence in education
Our mission is to deliver world-class international education through the provision of high-quality curricula,
assessment and services.
More than 9000 schools are part of our Cambridge learning community. We support teachers in over 160
countries who offer their learners an international education based on our curricula and leading to our
qualifications. Every year, thousands of learners use Cambridge qualifications to gain places at universities
around the world.
Our syllabuses are reviewed and updated regularly so that they reflect the latest thinking of international
experts and practitioners and take account of the different national contexts in which they are taught.
Cambridge programmes and qualifications are designed to support learners in becoming:
confident in working with information and ideas their own and those of others
responsible for themselves, responsive to and respectful of others
reflective as learners, developing their ability to learn
innovative and equipped for new and future challenges
engaged intellectually and socially, ready to make a difference.
Support for teachers
A wide range of materials and resources is available to support teachers and learners in Cambridge schools.
Resources suit a variety of teaching methods in different international contexts. Through subject discussion
forums and training, teachers can access the expert advice they need for teaching our qualifications. More
details can be found in Section 2 of this syllabus and at www.cie.org.uk/teachers
Support for exams officers
Exams officers can trust in reliable, efficient administration of exams entries and excellent personal support
from our customer services. Learn more at www.cie.org.uk/examsofficers
Introduction
3 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
Not-for-profit, part of the University of Cambridge
We are a not-for-profit organisation where the needs of the teachers and learners are at the core of what we
do. We continually invest in educational research and respond to feedback from our customers in order to
improve our qualifications, products and services.
Our systems for managing the provision of international qualifications and education programmes
for learners aged 5 to 19 are certified as meeting the internationally recognised standard for quality
management, ISO 9001:2008. Learn more at www.cie.org.uk/ISO9001
1.2 Why choose Cambridge O Level?
Cambridge O Levels have been designed for an international audience and are sensitive to the needs of
different countries. These qualifications are designed for learners whose first language may not be English
and this is acknowledged throughout the examination process. The Cambridge O Level syllabus also allows
teaching to be placed in a localised context, making it relevant in varying regions.
Our aim is to balance knowledge, understanding and skills in our programmes and qualifications to enable
candidates to become effective learners and to provide a solid foundation for their continuing educational
journey.
Through our professional development courses and our support materials for Cambridge O Levels, we
provide the tools to enable teachers to prepare learners to the best of their ability and work with us in the
pursuit of excellence in education.
Cambridge O Levels are considered to be an excellent preparation for Cambridge International
AS and A Levels, the Cambridge AICE (Advanced International Certificate of Education) Group Award,
Cambridge Pre-U, and other education programmes, such as the US Advanced Placement program
and the International Baccalaureate Diploma programme. Learn more about Cambridge O Levels at
www.cie.org.uk/cambridgesecondary2
Guided learning hours
Cambridge O Level syllabuses are designed on the assumption that learners have about 130 guided
learning hours per subject over the duration of the course, but this is for guidance only. The number of
hours required to gain the qualification may vary according to local curricular practice and the learners prior
experience of the subject.
1.3 Why choose Cambridge O Level Business Studies?
Cambridge O Level Business Studies is accepted by universities and employers as proof of an understanding
of business concepts and techniques across a range of different types of businesses. Successful Cambridge
O Level Business Studies learners will be able to:
understand different forms of business organisations, the environments in which businesses operate
and business functions such as marketing, operations and finance
appreciate the role of people in business success.
Introduction
4 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
They will also gain lifelong skills, including:
the ability to calculate and interpret business data
communication skills needed to support arguments with reasons
the ability to analyse business situations and reach decisions or judgements.
Prior learning
Learners beginning this course are not expected to have studied Business Studies previously.
Progression
Cambridge O Levels are general qualifications that enable learners to progress directly to employment or to
proceed to further study.
Candidates who are awarded grades A* to C in Cambridge O Level Business Studies are well prepared to
follow courses leading to Cambridge International AS and A Level Business Studies, or the equivalent.
1.4 How can I find out more?
If you are already a Cambridge school
You can make entries for this qualification through your usual channels. If you have any questions, please
contact us at info@cie.org.uk
If you are not yet a Cambridge school
Learn about the benefits of becoming a Cambridge school at www.cie.org.uk/startcambridge. Email us at
info@cie.org.uk to find out how your organisation can register to become a Cambridge school.
Teacher support
5 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
2. Teacher support
2.1 Support materials
Cambridge syllabuses, past question papers and examiner reports to cover the last examination series are
on the Syllabus and Support Materials DVD, which we send to all Cambridge schools.
You can also go to our public website at www.cie.org.uk/olevel to download current and future syllabuses
together with specimen papers or past question papers and examiner reports from one series.
For teachers at registered Cambridge schools a range of additional support materials for specific
syllabuses is available online from Teacher Support, our secure online support for Cambridge teachers.
Go to http://teachers.cie.org.uk (username and password required).
2.2 Resource lists
We work with publishers providing a range of resources for our syllabuses including textbooks, websites,
CDs, etc. Any endorsed, recommended and suggested resources are listed on both our public website and
on Teacher Support.
The resource lists can be filtered to show all resources or just those which are endorsed or recommended
by Cambridge. Resources endorsed by Cambridge go through a detailed quality assurance process and are
written to align closely with the Cambridge syllabus they support.
2.3 Training
We offer a range of support activities for teachers to ensure they have the relevant knowledge and skills to
deliver our qualifications. See www.cie.org.uk/events for further information.
Syllabus content at a glance
6 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
3. Syllabus content at a glance
All candidates study the following topics.
Section Topics
1. Understanding business activity Business activity
Classification of businesses
Enterprise, business growth and size
Types of business organisation
Business objectives and stakeholder objectives
2. People in business Motivating workers
Organisation and management
Recruitment, selection and training of workers
Internal and external communication
3. Marketing Marketing, competition and the customer
Market research
Marketing mix
Marketing strategy
4. Operations management Production of goods and services
Costs, scale of production and break-even analysis
Achieving quality production
Location decisions
5. Financial information and
decisions
Business finance: needs and sources
Cash-flow forecasting and working capital
Income statements
Balance sheets
Analysis of accounts
6. External influences on business
activity
Government economic objectives and policies
Environmental and ethical issues
Business and the international economy
Assessment at a glance
7 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
4. Assessment at a glance
For Cambridge O Level Business Studies, candidates take two compulsory components, Paper 1
and Paper 2. Both question papers will draw on topics taken from the whole of the syllabus content.
All candidates are eligible for grades A* to E.
Components Weighting
Paper 1 1 hour 30 minutes
50%
Written examination consisting of four questions requiring a mixture of short
answers and structured data responses.
Candidates answer all questions.
80 marks.
Externally assessed.
Paper 2 1 hour 30 minutes
50%
Written examination consisting of four questions based on a case study, provided
as an Insert with the paper.
Candidates answer all questions.
80 marks.
Externally assessed.
Availability
This syllabus is examined in the June and November examination series.
This syllabus is available to private candidates.
Detailed timetables are available from www.cie.org.uk/examsofficers
Cambridge O Levels are available to Centres in Administrative Zones 3, 4 and 5. Centres in Administrative
Zones 1, 2 or 6 wishing to enter candidates for Cambridge O Level examinations should contact Cambridge
Customer Services.
Combining this with other syllabuses
Candidates can combine this syllabus in an examination series with any other Cambridge syllabus, except
syllabuses with the same title at the same level.
Please note that Cambridge O Level, Cambridge IGCSE and Cambridge International Level 1/Level 2
Certificate syllabuses are at the same level.
Syllabus aims and assessment objectives
8 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
5. Syllabus aims and assessment objectives
5.1 Syllabus aims
The aims, which are not listed in order of priority, are to enable candidates to:
1 make effective use of relevant terminology, concepts and methods, and recognise the strengths and
limitations of the ideas used in business
2 apply their knowledge and critical understanding to current issues and problems in a wide range of
business contexts
3 distinguish between facts and opinions, and evaluate qualitative and quantitative data in order to help
build arguments and make informed judgements
4 appreciate the perspectives of a range of stakeholders in relation to the business environment,
individuals, society, government and enterprise
5 develop knowledge and understanding of the major groups and organisations within and outside
business, and consider ways in which they are able to influence objectives, decisions and activities
6 develop knowledge and understanding of how the main types of businesses are organised, financed and
operated, and how their relations with other organisations, consumers, employees, owners and society
are regulated
7 develop skills of numeracy, literacy, enquiry, selection and use of relevant sources of information,
presentation and interpretation
8 develop an awareness of the nature and significance of innovation and change within the context of
business activities.
Teachers should note that not all of the above aims are necessarily subject to formal assessment.
Syllabus aims and assessment objectives
9 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
5.2 Assessment objectives
The four assessment objectives in Cambridge O Level Business Studies are:
AO1: Knowledge and understanding
AO2: Application
AO3: Analysis
AO4: Evaluation
AO1: Knowledge and understanding
Candidates should be able to:
demonstrate knowledge and understanding of facts, terms, concepts, conventions, theories and
techniques commonly applied to or used as part of business behaviour.
AO2: Application
Candidates should be able to:
apply their knowledge and understanding of facts, terms, concepts, conventions, theories and
techniques.
AO3: Analysis
Candidates should be able to:
distinguish between evidence and opinion in a business context
order, analyse and interpret information in narrative, numerical and graphical forms, using appropriate
techniques.
AO4: Evaluation
Candidates should be able to:
present reasoned explanations, develop arguments, understand implications and draw inferences
make judgements, recommendations and decisions.
5.3 Relationship between assessment objectives and components
The approximate weightings allocated to each of the assessment objectives are summarised below.
Assessment objective Paper 1 Paper 2 Weighting for qualification
AO1: Knowledge and understanding 40% 20% 30%
AO2: Application 30% 30% 30%
AO3: Analysis 15% 25% 20%
AO4: Evaluation 15% 25% 20%
Syllabus content
10 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
6. Syllabus content
In all of the following, candidates are required to apply their understanding to a variety of simple business
situations. Candidates should be able to make simple decisions based upon the analysis and evaluation of
information provided.
1. Understanding business activity
1.1 Business
activity
1.1.1 The purpose and nature of business activity:
Concepts of needs, wants, scarcity and opportunity cost
Importance of specialisation
Purpose of business activity
The concept of adding value and how added value can be
increased
1.2 Classification of
businesses
1.2.1 Business activity in terms of primary, secondary and tertiary sectors:
Basis of business classification, e.g. by using examples
Reasons for the changing importance of business classification,
e.g. in developed and developing economies
1.2.2 Classify business enterprises between private sector and public
sector in a mixed economy
1.3 Enterprise,
business growth
and size
1.3.1 Enterprise and entrepreneurship:
Characteristics of successful entrepreneurs
Contents of a business plan and how business plans assist
entrepreneurs
Why and how governments support business start-ups, e.g.
grants, training
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, capital employed (profit is not a
method of measuring business size)
Limitations of methods of measuring business size
1.3.3 Why some businesses grow and others remain small:
Why the owners of a business may want to expand the business
Different ways in which businesses can grow
Problems linked to business growth and how these might be
overcome
Why some businesses remain small
Syllabus content
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1.3.4 Why some (new or established) businesses fail:
Causes of business failure, e.g. lack of management skills,
changes in the business environment
Why new businesses are at a greater risk of failing
1.4 Types of
business
organisation
1.4.1 The main features of different forms of business organisation:
Sole traders, partnerships, private and public limited companies,
franchises and joint ventures
Differences between unincorporated businesses and limited
companies
Concepts of risk, ownership and limited liability
Recommend and justify a suitable form of business organisation
to owners/management in a given situation
Business organisations in the public sector, e.g. public
corporations
1.5 Business
objectives and
stakeholder
objectives
1.5.1 Businesses can have several objectives and the importance of
these can change:
Need for business objectives and the importance of them
Different business objectives, e.g. survival, growth, profit and
market share
Objectives of social enterprises
1.5.2 The role of stakeholder groups involved in business activity:
Main internal and external stakeholder groups
Objectives of different stakeholder groups
Use examples to illustrate these objectives and how they might
conflict
1.5.3 Demonstrate an awareness of the differences in the aims and
objectives of private sector and public sector enterprises
Syllabus content
12 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
2. People in business
2.1 Motivating
workers
2.1.1 The importance of a well-motivated workforce:
Why people work and what motivation means
The concept of human needs Maslows hierarchy
Key motivational theories: Taylor and Herzberg
2.1.2 Methods of motivation:
Financial and non-financial rewards and methods
Recommend and justify appropriate method(s) of motivation in
given circumstances
2.2 Organisation
and
management
2.2.1 Draw, interpret and understand simple organisational charts:
Simple hierarchical structures: span of control, hierarchy, chain of
command and delegation
Roles, responsibilities and inter-relationships between people in
organisations
2.2.2 The role of management:
Functions of management planning, organising, co-ordinating,
commanding and controlling
Importance of delegation; trust versus control
2.2.3 Leadership styles:
Features of the main leadership styles autocratic, democratic
and laissez-faire
Recommend and justify an appropriate leadership style in given
circumstances
2.2.4 Trade unions:
What a trade union is and the benefits of workers being union
members
Syllabus content
13 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
2.3 Recruitment,
selection and
training of
workers
2.3.1 The methods of recruiting and selecting workers:
Recruitment and selection
Difference between internal and external recruitment
Main stages in recruitment and selection of staff
Benefits and limitations of part-time and full-time workers
2.3.2 The importance of training and the methods of training:
Importance of training to a business and workers
Benefits and limitations of induction training, on-the-job training
and off-the-job training
2.3.3 Why reducing the size of the workforce might be necessary:
Difference between dismissal and redundancy with examples to
illustrate the difference
Understand situations in which downsizing the workforce might
be necessary, e.g. automation or reduced demand for products
Recommend and justify which workers to recruit/make redundant
in given circumstances
2.3.4 Legal controls over employment issues and their impact on
employers and employees:
Legal controls over employment contracts, unfair dismissal,
discrimination, health and safety, legal minimum wage
2.4 Internal and
external
communication
2.4.1 Why effective communication is important and the methods used to
achieve it:
Effective communication and its importance to business
Benefits and limitations of different communication methods
including those based on information technology (IT)
Recommend and justify which communication method to use in
given circumstances
2.4.2 Demonstrate an awareness of communication barriers:
How communication barriers arise and problems of ineffective
communication; how communication barriers can be reduced or
removed
Syllabus content
14 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
3. Marketing
3.1 Marketing,
competition and
the customer
3.1.1 The role of marketing:
Identifying customer needs
Satisfying customer needs
Maintaining customer loyalty; building customer relationships
3.1.2 Market changes:
Why customer/consumer spending patterns may change
The power and importance of changing customer needs
Why some markets have become more competitive
How business can respond to changing spending patterns and
increased competition
3.1.3 Concepts of niche marketing and mass marketing:
Benefits and limitations of each approach to marketing
3.1.4 How and why market segmentation is undertaken:
How markets can be segmented, e.g. according to age,
socio-economic grouping, location, gender
Potential benefits of segmentation to business
Recommend and justify an appropriate method of segmentation
in given circumstances
3.2 Market research 3.2.1 The role of market research and methods used:
Market-oriented businesses (uses of market research information
to a business)
Primary research and secondary research (benefits and limitations
of each)
Methods of primary research, e.g. postal questionnaire, online
survey, interviews, focus groups; the need for sampling
Factors influencing the accuracy of market research data
3.2.2 Presentation and use of market research results:
Analyse market research data shown in the form of graphs,
charts and diagrams: draw simple conclusions from such data
Syllabus content
15 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
3.3 Marketing mix 3.3.1 Product:
The costs and benefits of developing new products
Brand image impact on sales and customer loyalty
The role of packaging
The product life cycle: main stages and extension strategies;
draw and interpret a product life cycle diagram
How stages of the product life cycle can influence marketing
decisions, e.g. promotion and pricing decisions
3.3.2 Price:
Pricing methods: cost plus, competitive, penetration, skimming
and promotional; their benefits and limitations
Recommend and justify an appropriate pricing method in given
circumstances
Understand the significance of price elasticity: difference
between price elastic demand and price inelastic demand;
importance of the concept in pricing decisions (knowledge of the
formula and calculations of PED will not be examined)
3.3.3 Place distribution channels:
Advantages and disadvantages of different channels
Recommend and justify an appropriate distribution channel in
given circumstances
3.3.4 Promotion:
The aims of promotion
Different forms of promotion and how they influence sales,
e.g. advertising, sales promotion
The importance of the marketing budget in making promotion
decisions; need for cost effectiveness in spending the marketing
budget
3.3.5 Technology and the marketing mix:
Define and explain the concept of e-commerce
The opportunities and threats of e-commerce to business and
consumers
Use of the internet and social networks for promotion
Syllabus content
16 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
3.4 Marketing
strategy
3.4.1 Justify marketing strategies appropriate to a given situation:
Importance of different elements of the marketing mix in
influencing consumer decisions in given circumstances
Recommend and justify an appropriate marketing strategy in
given circumstances
3.4.2 The nature and impact of legal controls related to marketing:
Impact of legal controls on marketing strategy, e.g. misleading
promotion, faulty and dangerous goods
3.4.3 The opportunities and problems of entering new markets abroad:
Growth potential of new markets in other countries
Problems of entering foreign markets, e.g. cultural differences
and lack of knowledge
Benefits and limitations of methods to overcome such problems,
e.g. joint ventures
4. Operations management
4.1 Production
of goods and
services
4.1.1 The meaning of production:
Managing resources effectively to produce goods and services
Difference between production and productivity
Benefits of increasing efficiency and how to increase it,
e.g. increasing productivity by automation and technology,
improved labour skills
Why businesses hold inventories (stocks)
Concept of lean production; how to achieve it, e.g. just-in-time
inventory control and Kaizen; benefits of lean production
4.1.2 The main methods of production:
Features, benefits and limitations of job, batch and flow
production
Recommend and justify an appropriate production method for a
given situation
4.1.3 How technology has changed production methods, e.g. using
computers in manufacturing and design
Syllabus content
17 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
4.2 Costs, scale
of production
and break-even
analysis
4.2.1 Identify and classify costs:
Classifying costs fixed, variable, average, total; use examples to
illustrate these
Use cost data to help make simple cost-based decisions, e.g. to
stop production or continue
4.2.2 Economies and diseconomies of scale:
The concepts of economies and diseconomies of scale; examples
of both
4.2.3 Explain, interpret and use a simple break-even chart:
The concept of break even
Construct, complete or amend a simple break-even chart
Interpret a given chart and use it to analyse a situation
Use a chart to help make simple decisions, e.g. impact of higher
price
Understand the limitations of break-even charts
4.3 Achieving
quality
production
4.3.1 Why quality is important and how quality production might be
achieved:
What quality means; why it is important for all businesses
Concept of quality control and how businesses implement quality
control
The concept of quality assurance
4.4 Location
decisions
4.4.1 The main factors influencing the location and relocation decisions of a
business:
Factors relevant to the location decision of manufacturing
businesses and service businesses
Factors that a business could consider when deciding which
country to locate operations in
The role of legal controls on location decisions
Recommend and justify an appropriate location for a business in
given circumstances
Syllabus content
18 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
5. Financial information and decisions
5.1 Business
finance: needs
and sources
5.1.1 The need for business finance:
The main reasons why businesses need finance, e.g. start-up
capital, capital for expansion and additional working capital
Understand the difference between short-term and long-term
finance needs
5.1.2 The main sources of capital:
Internal sources and external sources with examples
Short-term and long-term sources with examples, e.g. debt or
equity for long-term finance
Importance of micro-finance in developing economies
The main factors considered in making the financial choice, e.g.
size and legal form of business, amount required, length of time,
existing loans
Recommend and justify appropriate source(s) of finance in given
circumstances
5.2 Cash flow
forecasting and
working capital
5.2.1 The importance of cash and of cash-flow forecasting:
Why cash is important to a business
What a cash-flow forecast is, how a simple one is constructed
and the importance of it
Amend or complete a simple cash-flow forecast
How to interpret a simple cash-flow forecast
How a short-term cash-flow problem might be overcome, e.g.
increasing loans, delaying payments, asking debtors to pay more
quickly
5.2.2 Working capital:
The concept and importance of working capital
5.3 Income
statements
5.3.1 What profit is and why it is important:
How a profit is made
Importance of profit to private sector businesses, e.g. reward for
risk taking/enterprise, source of finance
Difference between profit and cash
5.3.2 Income statements:
Main features of an income statement, e.g. revenue, cost of
sales, gross profit, profit (profit was known as net profit in the
2014 and previous syllabuses) and retained profit
Use simple income statements in decision making based on
profit calculations (constructing income statements will not be
examined)
Syllabus content
19 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
5.4 Balance sheets 5.4.1 The main elements of a balance sheet:
The main classifications of assets and liabilities
Examples to illustrate these classifications
5.4.2 Interpret a simple balance sheet and make deductions from it,
e.g. how a business is financing its activities and what assets it
owns, sale of inventories to raise finance (constructing balance
sheets will not be examined)
5.5 Analysis of
accounts
5.5.1 How to interpret financial statements by calculating and analysing
accounting ratios:
Gross profit margin
Profit margin (profit margin was known as net profit margin in
the 2014 and previous syllabuses)
Return on Capital Employed
Current ratio
Acid test ratio
5.5.2 Liquidity:
The concept and importance of liquidity
5.5.3 Why and how accounts are used:
Needs of different users of accounts and ratio analysis
How users of accounts and ratio results might use information
to help make decisions, e.g. whether to lend to or invest in the
business
6. External influences on business activity
6.1 Government
economic
objectives and
policies
6.1.1 How government control over the economy affects business activity:
Government economic objectives, e.g. increasing Gross
Domestic Product (GDP)
Main stages of the business cycle; growth, boom, recession,
slump
How changes in taxes and government spending can affect
business activity
How changes in interest rates can affect business activity
How businesses might respond to these changes
Syllabus content
20 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
6.2 Environmental
and ethical
issues
6.2.1 Environmental concerns and ethical issues as both opportunities and
constraints for businesses:
How business activity can impact on the environment, e.g. global
warming
The concept of externalities; possible external costs and external
benefits of business decisions
Sustainable development how business activity can contribute
to this
How/why business might respond to environmental pressures
and opportunities; pressure groups
The role of legal controls over business activity affecting the
environment, e.g. pollution controls
Ethical issues a business might face; conflicts between profits
and ethics
How business might react and respond to ethical issues, e.g.
child labour
6.3 Business and
the international
economy
6.3.1 The importance of globalisation:
The concept of globalisation and the reasons for it
Opportunities and threats of globalisation for businesses
Why some governments might introduce import tariffs and
quotas
6.3.2 Reasons for the importance and growth of multinational companies
(MNCs):
Benefits to a business of becoming a multinational
Potential benefits to a country and/or economy where a MNC is
located, e.g. jobs, exports, increased choice, investment
Potential drawbacks to a country and/or economy where a MNC
is located, e.g. reduced sales of local businesses, repatriation of
profits
6.3.3 The impact of exchange rate changes:
Depreciation and appreciation of an exchange rate
How exchange rate changes can affect businesses as importers
and exporters of products, e.g. prices, competitiveness,
profitability (exchange rate calculations will not be examined)
International accounting terminology
21 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
7. International accounting terminology
International usage
(used by Cambridge from 2015)
UK usage
(used by Cambridge before 2015 examinations)
Balance sheet Balance sheet
Bank loans Loans repayable after 12 months
Bank overdrafts Loans repayable within 12 months
Capital or shareholders equity Capital
Cash Bank and cash
Cost of sales Cost of goods sold
Current assets Current assets
Current liabilities Current liabilities / Creditors: amounts due within
12 months
Finance costs Interest payable
Financial statements Final accounts
Gross profit Gross profit
Income statement Trading and profit and loss account
Inventory Stock
Non-current assets Fixed assets
Non-current liabilities Long-term liabilities / Creditors: amounts falling due after
more than one year
Profit Net profit
Raw materials Purchases
Revenue Sales
Share capital Share capital
Trade payables Creditors
Trade receivables Debtors
Work in progress Work in progress
Other information
22 Cambridge O Level Business Studies 7115. Syllabus for examination in 2016.
8. Other information
Equality and inclusion
Cambridge International Examinations has taken great care in the preparation of this syllabus and
assessment materials to avoid bias of any kind. To comply with the UK Equality Act (2010), Cambridge has
designed this qualification with the aim of avoiding direct and indirect discrimination.
The standard assessment arrangements may present unnecessary barriers for candidates with disabilities
or learning difficulties. Arrangements can be put in place for these candidates to enable them to access the
assessments and receive recognition of their attainment. Access arrangements will not be agreed if they
give candidates an unfair advantage over others or if they compromise the standards being assessed.
Candidates who are unable to access the assessment of any component may be eligible to receive an
award based on the parts of the assessment they have taken.
Information on access arrangements is found in the Cambridge Handbook which can be downloaded from
the website www.cie.org.uk/examsofficer
Language
This syllabus and the associated assessment materials are available in English only.
Grading and reporting
Cambridge O Level results are shown by one of the grades A*, A, B, C, D or E, indicating the standard
achieved, A* being the highest and E the lowest. Ungraded indicates that the candidates performance fell
short of the standard required for grade E. Ungraded will be reported on the statement of results but not
on the certificate. The letters Q (result pending), X (no results) and Y (to be issued) may also appear on the
statement of results but not on the certificate.
Entry codes
To ma intain the security of our examinations, we produce question papers for different areas of the world,
known as administrative zones. Where the component entry code has two digits, the first digit is the
component number given in the syllabus. The second digit is the location code, specific to an administrative
zone. Information about entry codes can be found in the Cambridge Guide to Making Entries.
Cambridge International Examinations
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Cambridge International Examinations 2014
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