Business Activity & Classification of Businesses

1. (a) What is meant by ‘added value’? (2 Marks) CIE 2018 Oct-Nov (Unit 1)

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(b) Identify two advantages of specialization. (2 Marks) CIE 2017 Oct-Nov (Unit 1)

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(c) What is meant by ‘tertiary sector’? (2 Marks) CIE 2017 Oct-Nov (Unit 2)

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(d) Identify two features of a private sector business. (2 Marks)

CIE 2016 Feb-March (Unit 2)

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Question Paper (Set A)
 Business Activity & Classification of Businesses

(e) What is meant by ‘opportunity cost’? (2 Marks) CIE 2016 Oct-Nov (Unit 1)

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(f) Fill out the table as the example shows. (4 Marks)

Edexcel Syllabus Question (Unit 8)

Sector Examples of goods/services provided

Secondary sector Production of cakes and bread
Advertising, insurance, banking, shops to sell the bread and
Tertiary sector
cakes

Fast Food restaurant

Sector Examples of goods/services provided

Secondary sector

Tertiary sector

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Question Paper (Set A)
 Business Activity & Classification of Businesses

2. For each of the following businesses identify the factors of production used in the
production process, state whether the business is capital-intensive or labor-intensive
and explain your answer: Edexcel Syllabus Question (Unit 7)
(a) A café serving coffee, tea and snacks (5 Marks)

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(b) An advertising company (5 Marks)

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Question Paper (Set A)
 Business Activity & Classification of Businesses

3. ABC Company produces fashion clothes for women. Do you think that ABC’s
business will be able to sell all of the clothes that it makes? Justify your answer. (6
Marks)
CIE Textbook Material (Unit 1)

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Question Paper (Set A)
 Business Activity & Classification of Businesses

4. Company X Is a manufacturer of pottery products, such as plates and bowls, which

are mainly sold to hotels and restaurants. The company employs 50 workers. Each
worker receives a good wage and this helps them to meet their needs. Production is
broken down into nine processes. Workers specialize in just one process. The
Marketing Manager of Company X has been asked by the directors to look at ways
of adding value to the company's products.
CIE Textbook Material (Mark Fisher) (Unit 1)

(a) Identify two factors of production. (2 Marks)

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(b) What is meant by 'needs'? (2 Marks)

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(c) Using the information in the case study, explain the meaning of
'specialization'. (4 Marks)
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Question Paper (Set A)
 Business Activity & Classification of Businesses

(d) Identify and explain two stages of Company X's production process. (6 Marks)

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(e) Suggest two ways the marketing manager might increase Company X's
added value. Justify your answer. (6 Marks)

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Question Paper (Set A)