Cambridge Assessment International Education

Cambridge International General Certificate of Secondary Education

BUSINESS STUDIES 0450/11

Paper 1 Short Answer/Structured Response October/November 2017
MARK SCHEME
Maximum Mark: 80

Published

This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.

Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.

Cambridge International will not enter into discussions about these mark schemes.

Cambridge International is publishing the mark schemes for the October/November 2017 series for most
Cambridge IGCSE®, Cambridge International A and AS Level components and some Cambridge O Level
components.

® IGCSE is a registered trademark.

This syllabus is approved for use in England, Wales and Northern Ireland as a Cambridge International Level 1/Level 2 Certificate.

This document consists of 12 printed pages.

© UCLES 2017 [Turn over

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

1(a) Identify two characteristics of a successful entrepreneur. 2 Award any reasonable answer.

Knowledge [2 × 1] – award 1 mark for each relevant characteristic

Points could include: risk taker, innovator, creative, self-confident, optimistic, hardworking,
independent, effective communicator, leadership, initiative, self-motivating/determined,
results driven, good at networking, multi-skilled

1(b) Identify two possible reasons why Ella plans to produce the lights in another 2
country

Application: [2 × 1] award 1 mark for each relevant reason

Points might include:

• lower costs
• no local factory or capacity to make it
• access to materials
• Fewer restrictions

1(c) Identify and explain two reasons why obtaining finance might be difficult for Ella’s 4 Application marks may be
business. awarded for appropriate use of
the following:
Knowledge [2 × 1] – award 1 mark for each relevant reason just left college, bicycle light,
Application [2 × 1] – award 1 mark for each explanation in context new business or product or
entrepreneur, produce in
Possible points might include: another country, correct use of
• No business experience [k] of making lights [app] numbers e.g. $8, $500, $750
• Seen as higher risk OR don’t trust her OR can’t repay [k] as just left college [app] and $300.
• Can offer no security [k]
• May not have a business plan OR documentation to support request for finance [k]
• Unproven product [k]

© UCLES 2017 Page 2 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

1(d) Identify and explain one advantage and one disadvantage to Ella of using price 6 Application marks may be
skimming. awarded for appropriate use of
the following:
Knowledge [2 × 1] award one mark for one advantage and one disadvantage just left college, light, new
Application [2 × 1] award one mark for each relevant reference to this business business, new product, new
Analysis [2 × 1] award one mark for each relevant explanation entrepreneur, produce in
another country, raising
Points might include: finance difficult, correct use of
Advantages: numbers, safety features
• Recover costs quicker [k] as need to sell fewer than 300 [app] to pay for
development [an] Note: be wary of ‘higher sales’/
• Gives the image of a quality product [k] which can attract wealthy customers [an] to ‘higher revenue’ as a K point. It
try out the new light [app] must be per unit
• Higher revenue per item[k]
• Break even at a lower output [k]

Disadvantages:
• Put off some potential customers [k] leading to lower sales [an]
• Only work in short term [k] as competitors could produce cheaper alternatives [an]

1(e) Recommend which promotion option Ella should choose. Justify your answer 6 Application marks may be
using the information in Table 1. awarded for appropriate use of
the following:
Knowledge [1] – award 1 mark for identification of relevant points (s) just left college, light, new
Application [1] – award 1 mark for relevant reference made to this business business, produce overseas,
Analysis [2] – award up to 2 marks for relevant development of point(s) raising finance difficult, price
Evaluation [2] – justified decision made as to which method of promotion Ella should use skimming, correct use of
numbers, magazine, website
Points might include: Either option is acceptable if
• Option 2 is cheaper [k] as is $200 less than option 1[app] + [an] justified.
• Ella can’t afford much advertising [k] as a new business [app] she can’t afford a Note: $250 is incorrect as
website [an] this is an incorrect calculation
• Specialist magazine reaches the target market [k] for bicycle lights [app] therefore of the difference between the
likely to sell more [an] cost of a website with and
• Website may not be required [k] already has an order for 300[app] without online ordering

© UCLES 2017 Page 3 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

2(a) What is meant by ‘productivity’? 2

Clear understanding [2] e.g. a measure of the output of a business in relation to its inputs [2]
OR effective utilisation of resources in a time period [2]
Equation: output divided by Input [2]

Some understanding [1] e.g. output per worker OR measure of efficiency OR rate at
which they produce goods

2(b) Identify two reasons why a business might need working capital. 2

Knowledge [2 × 1] award one mark per reason

• Paying invoices/bills
• Day to day expenses
• Buying raw materials
• Paying wages
• Paying salaries
• Paying rent
• Re-payment of short term debts
• Paying utilities
• Use in an emergency
• Evidence to support requests for finance

2(c) Calculate the following values shown on the cash flow forecast. 4 Note: answers can be written
on the cash flow forecast or in
Application [4] award one mark per correct answer the space provided

W: 5 or 5000 Do not use OFR as no wage

X: 75 or 75 000 calculation is required.
Y: 5 or 5000
Z: (10) or (10 000)
Note: Z must be shown as a negative number to be credited.

© UCLES 2017 Page 4 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

2(d) Identify and explain one advantage and one disadvantage to NMBJ of having a low 6 Application marks may be
level of inventory. awarded for appropriate use of
the following:
Knowledge [2 × 1] – award 1 mark for one advantage and one disadvantage identified cookies/biscuits, related words
Application [2 × 1] – award 1 mark for each relevant reference made to this business such as ingredients or
Analysis [2 × 1] – award 1 mark for each relevant explanation examples, productivity, use of
numbers, batch production,
Possible points might include: $1.5 million.
Advantages:
• Lower inventory holding costs [k] help reduce variable costs [an] Note: Points can refer to raw
• Lower security OR rent costs OR insurance [k] as less space needed [an] for materials or finished goods.
ingredients [app]
• More flexible [k] as adapt to each different batch [app] to keep customers returning
[an]
• Help cash flow [k]
• Less risk of waste OR damage OR obsolescence [k] which could lower productivity
[app]

Disadvantages:
• Possible delays in production [k] as batches delayed [app] leading to lower output
[an]
• Few OR no purchasing economies of scale [k] which could help reduce cash
outflows [app]
• Not able to meet orders [k] for cookies [app] so could damage reputation [an]

© UCLES 2017 Page 5 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

2(e) Do you think paying higher wages is the best way for NMBJ to improve employee 6 Application marks may be
motivation? Justify your answer. awarded for appropriate use of
the following:
Knowledge [1] – award 1 mark for identification of relevant points (s) correct use of numbers, batch
Application [1] – award 1 mark for relevant reference made to this business production, cookies or related
Analysis [2] – award up to 2 marks for relevant development of point(s) words such as ingredients;
Evaluation [2] award up to 2 marks for justified decision as to whether paying higher wages workers leave, profits
is the best way for NMBJ to improve employee motivation increased, 1.5 million,
increased productivity
Points might include
• Only a short term incentive [k] have to pay, whatever the output [an] Candidates could calculate
• Money is the main motivator [k] value of wages per worker (to
• Other ways to motivate e.g. job rotation, enrichment, fringe benefits [k] show increase i.e. $200 to
• Help retain workers [k] so not as many people leave [app] leading to lower $250) App and AN
recruitment costs [an]
• This will increase costs for the business [k] by $15 000 per month [app] so output Note: The focus needs to be on
per worker would need to rise [an] the business for analysis to be
awarded.
e.g. ‘Job rotation is a better
motivator[k] so workers are not
bored’ is only awarded as
knowledge

Question Answer Marks Guidance

3(a) What is meant by ‘economies of scale’? 2 Do not award answers such as

'benefit of being big' as this
Clear understanding: [2] factors that lead to lower average costs as a business increases does not explain the term
in size.

Some understanding:[1] benefit of increasing in size

© UCLES 2017 Page 6 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

3(b) What is meant by ‘autocratic leadership style’? 2

Clear understanding: [2] managers expect to be in charge of business and expect their
orders to be followed
OR managers make decisions without consulting workers [2]

Some understanding: [1] workers have no say in decisions OR decisions made by

managers [1]

3(c) Identify and explain one advantage and one disadvantage of GDC’s organisational 4 Application marks may be
structure. awarded for appropriate use of
the following:
Knowledge [2 × 1] award 1 mark for one advantage and one disadvantage identified competitive market, expand to
Application [2 × 1] award 1 mark for each explanation in context other countries, correct use of
numbers, business customers,
Advantages good reputation, delivery,
• Employees have a clearly defined role [k] so know where they fit into delivery parcels, many levels of
process [app] hierarchy, long chain of
• Clear chain of command OR know their manager [k] so know who to ask for help if command, 5000 employees,
problem with a parcel [app] autocratic.
• Employees have a clear career structure [k] so can see how to progress from driver
[app]
• Specialists can be employed [k]

Disadvantages
• Slow communication [k] due to many number of levels [app]
• Heavy workload for managers [k] so do they have time to focus on expansion [app]
• Communication between departments can be difficult [k] which could damage its
good reputation [app]
• Can create rivalry between departments [k]
• Workers can feel isolated [k]

© UCLES 2017 Page 7 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

3(d) Identify and explain two reasons why a good reputation might be important to 6 Application marks may be
GDC. awarded for appropriate use of
the following:
Knowledge [2 × 1] award one mark for each reason competitive market, expand to
Application [2 × 1] award one mark for each relevant reference to this business other countries, use of
Analysis [2 × 1] award one mark for each relevant explanation numbers, business customers,
delivery, parcels, many levels
Points might include: of hierarchy, long chain of
• Build trust OR loyalty [k] so customers want to use their delivery services [app] and command
keep purchasing from them [an]
• Attract new customers [k] and therefore sales will increase [an]
• Easier to raise finance [k] which could help growth plans [app]
• Way to attract OR retain employees [k] so able to offer a good service [an]
• Can charge higher prices [k] for each delivery [app] helping it increase revenue per
unit [an]
• Create brand awareness [k] so customers do not buy from competitors [an] in this
competitive market [app]
• Word of mouth promotion [k]

3(e) Recommend the most suitable way for GDC to expand its business to another 6 Application marks may be
country. Justify your answer. awarded for appropriate use of
the following:
Knowledge [1] – award 1 mark for identification of relevant points (s) competitive market, correct
Application [1] – award 1 mark for relevant reference made to this business use of numbers, business
Analysis [2] – award up to 2 marks for relevant development of point(s) customers, good reputation,
Evaluation [2] award up to two marks for justified decision regards to the most suitable delivery, parcels, many levels
way for GDC to expand. of hierarchy, long chain of
command, delivery vehicles,
Relevant points might include: economies of scale, logistics
• Joint venture [k] with a local delivery business [app] you share the risks of expansion
[an] Note: Do not award marketing
• Merger/takeover [k] they will benefit from local expertise [an] methods e.g. e-commerce or
• Franchise [k] they will receive a license fee [an] hiring an agent.
• Set up own operations [k] they will keep control [an] however this is an expensive
way [an]

© UCLES 2017 Page 8 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

4(a) What is meant by a ‘stakeholder group’? 2 Do not award examples.

Clear understanding [2]: any person or people with a direct interest in the performance
and activities of a business

Some understanding [1]: someone affected by what a business does

4(b) Identify two ways (other than legal controls) that a government might use to 2
influence business decisions.

Knowledge [2 × 1] award one mark per way

Points might include:

• cheaper rents
• loans OR grants OR subsidies
• training
• interest rates
• taxation
• build infrastructure

© UCLES 2017 Page 9 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

4(c) Identify and explain one advantage and one disadvantage of CHONS being a public 4 Application marks may be
limited company. awarded for appropriate use of
the following: coal or mining
Knowledge [2 × 1] award one mark for each advantage and disadvantage related words, correct use of
Application [2 × 1] award one mark for each relevant reference to this business data from table, no
government support, export,
Advantages: shareholders, suppliers,
• Able to sell shares on stock market [k] so no limit to potential number of expansion plans.
shareholders [app]
• Access to more sources of finance [k] so do not have to ask for support from
Government [app]
• Limited liability [k]
• Separate legal identity [k] of mining business and owners [app]
• Better status OR seen as lower risk [k] so suppliers more willing to offer credit [app]

Disadvantages:
• Have to disclose accounts [k] so less able to keep expansion plans secret [app]
• Many legal requirements/regulations [k]
• Selling shares expensive [k]
• Risk of loss of control [k] for the original shareholders [app]

© UCLES 2017 Page 10 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

4(d) Identify and explain two ways in which legal controls might affect CHONS. 6 Application marks may be
awarded for appropriate use of
Knowledge [2 × 1] award one mark for each way identified the following:
Application [2 × 1] award one mark for each relevant reference to this business coal or mining related words,
Analysis [2 × 1] award one mark for each relevant explanation no government support,
correct use of data from table,
Points might include: export, government permission
• Need to provide safety equipment [k] such as helmets for miners [app] increasing to open mine, environment,
costs [an] shareholders, creating jobs,
• Limit working hours [k] so cannot obtain 50 m tonnes [app] 10 000
• Minimum wages [k] so cannot afford to create 10 000 jobs [app]
• Pollution restrictions/permits [k] as coal burning could damage environment [app] so
stakeholders become unhappy [an]
• Where business is located [k] as need Government to allow mine to be built [app]
without it they cannot start operations [an]
• Restrictions on what OR how much can be produced [k]
• Increase costs [k]
• Banning/restricting exports [k] CHONS would not be able to operate because they
are planning to export [an] coal [app]
• Banning/restricting imports [k]

© UCLES 2017 Page 11 of 12

0450/11 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017
Question Answer Marks Guidance

4(e) Do you think the Government should allow CHONS to open the coal mine? Justify 6 Application marks may be
your answer using the information in Table 3. awarded for appropriate use of
the following:
Knowledge [1] – award 1 mark for identification of relevant issue(s) no government support,
Application [1] – award 1 mark for relevant reference made to this business correct use of data from table,
Analysis [2] – award up to 2 marks for relevant development of point(s) export, high unemployment,
Evaluation [2] award up to 2 marks for justified decision as to whether the Government protect the environment, PLC,
should allow CHONS to open the coal mine suppliers, shareholders, traffic
Either viewpoint is acceptable
Points might include:
• Jobs created [k] for 10 000 people [app] so more money to spend in community [an] Do not award reference to coal
• Use up local coal [k] as plan to export it all [app] mine as application as stated
• Impact on environment [k] in question.
• Traffic problems created [k] which could discourage people OR other businesses
setting up in area [an]
• Other businesses will benefit [k] e.g. Suppliers [app]

© UCLES 2017 Page 12 of 12

 Cambridge Assessment International Education
Cambridge International General Certificate of Secondary Education

BUSINESS STUDIES 0450/21

Paper 2 Case Study October/November 2017
MARK SCHEME
Maximum Mark: 80

Published

This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.

Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.

Cambridge International will not enter into discussions about these mark schemes.

Cambridge International is publishing the mark schemes for the October/November 2017 series for most
Cambridge IGCSE®, Cambridge International A and AS Level components and some Cambridge O Level
components.

® IGCSE is a registered trademark.

This syllabus is approved for use in England, Wales and Northern Ireland as a Cambridge International Level 1/Level 2 Certificate.

This document consists of 12 printed pages.

© UCLES 2017 [Turn over

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

1(a) Identify two ways the size of AH can be measured. Explain the 8
limitations of each of these measures.

Knowledge [2 × 1] – award one mark for each way

Analysis [2 × 1] – award one mark for a relevant explanation for each way
Application [2 × 2] – award two application marks for each way

Award one mark for each way (maximum of two), such as:
• Capital employed
• Number of employees
• Sales revenue/revenue/income
• Output/quantity of services/number of customers

Do not accept profit

Award a maximum of three additional marks for each explanation – 2 of

which must be applied to this context – of the way

Indicative response:

The number of employees (K) as the more employees a business has the
larger the business. However, some businesses may use a lot of technology
and therefore have fewer employees. (an) AH is a small business because it
only has18 employees (ap) and it is also a service sector business as it
looks after animals for their owners and therefore they do not use much
technology. (ap)

Possible application marks: Animals; dogs; cats; pets; pet owners; washing
and brushing animals; $10 000 from grandfather; $10 000 from bank loan;
12 adults and 6 children workers; information from Appendix 3 on the costs
and revenue of AH.

There may be other examples in context that have not been included here.

© UCLES 2017 Page 2 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

1(b) Consider three methods of market research Elsie could use to find out 12
the number and types of customers for the proposed locations.
Recommend the best method for Elsie to use. Justify your answer.

Relevant points might include:

Advantages Disadvantages
Questionnaires Quantitative data – Expensive to collect
(L1) estimate size of market May not have expertise to
collect accurate information
Interviews Qualitative information– Interviewer bias possible
(L1) specific information on Expensive to collect
customer needs
Focus groups Qualitative information Answers may be influenced
(L1) by other group members.
Time taken to set up
Business Cheap to collect May be out of date
reports/govern Wide range of data Gathered for another
ment statistics available purpose
(L1) May not be able to May not be valid/accurate
collect this information
themselves

Note: Also reward – Survey; Observation; Newspapers; Internet/online

data; Government statistics.

Knowledge/Analysis/Evaluation – award up to 10 marks using the levels-

based mark scheme below.

Knowledge/Analysis/Evaluation
Level 3 At least 2 × Level 2 +
9–10 marks for well justified recommendation of which
method to choose for the proposed location and why not
the alternative methods.

7–8 marks for limited recommendation of which method to

choose.
Level 2 4–6 marks
Discussion of the method used to find out the number and
types of customers and/or
Detailed discussion of advantages and/or disadvantages of
each method.
Level 1 1–3 marks
Name of a suitable method of research stated or outlined
Advantage and/or disadvantage of the method of research
stated

© UCLES 2017 Page 3 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

1(b) Level 1 – 1 mark for each L1 statement (max of 3 marks)

e.g. Government statistics are cheap to collect.

Level 2 – 1 × L2 explanation can gain 4 marks and a further mark can be

awarded for each additional L2 explanation (max 6 marks)
e.g. Government statistics are cheap to collect and can be obtained quickly.
However, the information may have been gathered for another purpose and
may be of little use when trying to predict the pet owner requirements at the
different locations. Level 2 – 4 marks plus one application mark for referring
to the pet owners at the new locations)

Level 3 – For L3 to be awarded there needs to be at least two L2 marks

awarded and then a recommendation of which method to choose.

Award up to 2 additional marks for relevant application.

Possible application marks: Animals; dogs; cats; pets; pet owners; washing
and brushing animals; New City; expand and move to larger site;
information on the three sites; information from Appendix 1 on the AH
advert; complaint on the social media message; information from Appendix
3 on the costs and revenue of AH.

There may be other examples in context that have not been included here.

Question Answer Marks

2(a)(i) Calculate the profit per day for AH using the information in 4
Appendix 3.

Revenue per day = (25 × $5) + (25 × $10) (1) = $375 (1)
(Award 1 mark for method of calculating revenue but incorrect answer)

$375 – $325 (1)

(Award 1 mark for method of calculating profit but incorrect answer)

Profit per day = $50 (1)

If $50 with no working shown then award 4 marks.

© UCLES 2017 Page 4 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

2(a)(ii) Identify and explain one way AH could use to increase profit from the 4
existing site.

Knowledge – 1 mark for correctly identifying one way profit can be

increased.

Possible ways:
• Increase revenue (1) e.g. by increasing prices/advertising
more/introducing a new service (1)
• Reduce costs/expenses (1) e.g. by finding cheaper
suppliers/improving efficiency (1)

Analysis award up to 3 marks – 2 of which must be applied to this

context – for a relevant explanation of one way AH could increase profit.

Indicative response:

Elsie could increase her revenue (1) by promoting her existing services to
attract more customers.(1) This will lead to more pet owners using her
services and paying for their animals to be washed and groomed. (1)
If costs increase by less than the increase in revenue then profit will
increase. (1)

Possible application marks: Animals; dogs; cats; pets; pet owners; washing
and brushing animals; qualified animal nurse; set up 2 years ago; $10 000
from grandfather; $10 000 from bank loan; 12 adults and 6 children workers;
paid legal minimum wage; shampoo and brushes purchased from
wholesaler; expand and move to larger site; needs to recruit a new
manager; information on the three sites; information from Appendix 1 on the
AH advert; complaint on the social media message; information from
Appendix 3 on the costs and revenue of AH.

There may be other examples in context that have not been included here

2(b) Consider why a cash flow forecast, an income statement and a balance 12
sheet are important to AH. Which one of these do you think is most
important to Elsie’s decision about how to finance the new site?
Justify your answer.

Relevant points might include:

Cash flow forecast – predicts cash in-flows and outflows – to avoid liquidity
problem – is there sufficient working capital for the larger premises?
Income statement – records revenue and costs or shows profit and loss –
profit available to reinvest into the new premises – indicator of success of
the business – will there be sufficient revenue from larger premises to make
profit?

Balance sheet – records assets and liabilities – liquidity ratios – stability of

the business – amount of liabilities – value of the existing business – assets
to sell if necessary

© UCLES 2017 Page 5 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

2(b) Knowledge/Analysis/Evaluation – award up to 10 marks using the levels-

based mark scheme below.

Knowledge/Analysis/Evaluation
Level 3 At least 2 × Level 2 +
9–10 marks for well justified recommendation as to which is
most important to the decision about how to finance the new
site.

7–8 marks for some limited judgement shown in

recommendation as to which is most important in its general
usefulness to the business.
Level 2 4–6 marks
Discussion of each financial statement, how it can be used and
why it is important.
Level 1 1–3 marks
Outline of what each financial statement shows.

Level 1 – 1 mark for each L1 statement (max of 3 marks)

e.g. A balance sheet shows the value of the business.

Level 2 – 1 × L2 explanation can gain 4 marks and a further mark can be

awarded for each additional L2 explanation (max 6 marks)
e.g. A balance sheet shows the value of the business. If Elsie wants to take
out a bank loan then she will need to take the balance sheet to show the
bank manager the value of the assets of the business that can be used as
security for the loan. (4 marks for level 2)

Level 3 – For L3 to be awarded there needs to be at least two L2 marks

awarded and then a recommendation which is most important to the
decision.

Award up to 2 additional marks for relevant application.

Possible application marks: Animals; dogs; cats; pets; pet owners; washing
and brushing animals; set up 2 years ago; $10 000 from grandfather; $10
000 from bank loan; 12 adults and 6 children workers; paid legal minimum
wage; shampoo and brushes purchased from wholesaler; expand and move
to larger site; needs to recruit a new manager; information on the three
sites; information from Appendix 1 on the AH advert; information from
Appendix 3 on the costs and revenue of AH.

There may be other examples in context that have not been included here.

© UCLES 2017 Page 6 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

3(a) Identify and explain two possible ethical issues that AH should 8
consider.

Knowledge [2 × 1] – award one mark for each ethical issue (‘Doing the right
thing’)
Analysis [2 × 1] – award one mark for a relevant explanation for each ethical
issue
Application [2 × 2] – award two application marks for each ethical issue

Award one mark for each ethical issue (maximum of two), such as:
• Types of animals looked after – all legal?
• Welfare of animals/danger to animals
• Working conditions
• Child labour employed
• Fair pay/paying minimum wage
• Disposal of waste in a responsible manner

Award a maximum of three additional marks for each explanation – 2 of

which must be applied to this context – of the ethical issue

Indicative response:

AH employs children (K) and then pays them below the legal minimum
wage. (ap) This keeps costs low but will give AH a bad reputation leading to
a lower number of customers. (an) This will make it more difficult for Elsie to
expand the business to a larger site as there may be insufficient number of
customers to make this worthwhile. (ap)

Possible application marks: Animals; dogs; cats; pets; pet owners; washing
and brushing animals; 12 adults and 6 children workers; paid legal minimum
wage; complaint on the social media message; cage; rare animal

There may be other examples in context that have not been included here.

© UCLES 2017 Page 7 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

3(b) Consider the advantages and disadvantages of the three sites Elsie is 12
considering. Recommend which site is the best one for AH to choose.
Justify your answer.

Relevant points might include:

Advantages Disadvantages
Site X Lowest cost Small farm buildings = not big
Plenty of room for large enough
kennels – owners will like this Needs converting and a long
Room to expand in the future way from customers – would
so will not need to relocate they travel that far?
again soon Additional costs of $10 000 to
repair.
Serving fewer customers than
they have already = 25 per day
Site Y Larger area – more demand Additional costs of $5 000 to
Buildings in good repair so convert the building.
less required to convert them A lot fewer customers served
Serve twice as many than Site Z
customers as Site X and more
customers than existing site
Site Z Existing customers – large High cost – most expensive of
demand – serve the most the three sites
customers Busy area – hard to park
Near to many potential Limited space – small cages –
customers as in centre of city – not able to expand in the future
convenient for customers – may need to move again in
the future
Cramped space may lead to
bad reputation – lower quality
services

Knowledge/Analysis/Evaluation – award up to 10 marks using the levels-

based mark scheme below.

Knowledge/Analysis/Evaluation
Level 3 At least 2 × Level 2 +
9–10 marks for well justified recommendation as to best site to
choose and why not the other sites.
7–8 marks for some limited judgement shown in
recommendation as to best site to choose.
Level 2 4–6 marks
Detailed advantages and/or disadvantages of each site or
explanation of the impact of the site on the business
Level 1 1–3 marks
Outline advantages and/or disadvantages of each site or
simple comparative statement

© UCLES 2017 Page 8 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

3(b) Level 1 – 1 mark for each L1 statement (max of 3 marks)

e.g. Site X is the cheapest of the three sites.

Level 2 – 1 × L2 explanation can gain 4 marks and a further mark can be

awarded for each additional L2 explanation (max 6 marks)
e.g. Site X is the cheapest of the three sites and this will reduce the amount
of finance required to purchase the site. However, it is a long way from
customers who are in the city centre and this may mean she has to reduce
prices. (L2 = 4 marks plus one application mark for using the information in
case)

Level 3 – For L3 to be awarded there needs to be at least two L2 marks

awarded and then a recommendation which justifies the best site to choose.

Award up to 2 additional marks for relevant application.

Possible application marks: Animals; dogs; cats; pets; pet owners; ;washing
and brushing animals; set up 2 years ago; $10 000 from grandfather; $10
000 from bank loan; 12 adults and 6 children workers; shampoo and
brushes purchased from wholesaler; needs to recruit a new manager;
information on the three sites; information from Appendix 1 on the AH
advert; information from Appendix 3 on the costs and revenue of AH.

© UCLES 2017 Page 9 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

4(a) Identify and explain one advantage and one disadvantage of using 8
social media networks for the promotion of AH.

Knowledge [2 × 1] – award one mark for each advantage/disadvantage.

Analysis [2 × 1] – award one mark for a relevant explanation for each
advantage/disadvantage.
Application [2 × 2] – award two application marks for each
advantage/disadvantage.

Award one mark for each advantage/disadvantage (maximum of two), such

as:
Advantages
• Cheap to advertise the business
• Will be seen by many people
• Covers a wide area
• Easy to update
• Target specific customers
• Cheap way to gain customer feedback

Disadvantages
• One unhappy customer can give the business a bad reputation
quickly
• Message lost amongst many messages on social media
• Quickly forgotten and no hard copy to remind customers of the
services provided
• Not all customers have access to internet/social media

Award a maximum of three additional marks for each explanation – 2 of

which must be applied to this context – of the advantage/disadvantage.

Indicative response:

Using social media is very cheap (k) and will quickly get the message to a
lot of people about the services provided by AH. (an) Many of these people
may own animals and need help looking after them. (ap) The message will
raise awareness of AH and make potential customers think about contacting
them to have their animals washed and groomed therefore increasing sales.
(ap)

Possible application marks: Animals; dogs; cats; pets; rare animals; small
cage; washing and brushing animals; animals cared for overnight; pet
owners; business set up 2 years ago; shampoo and brushes; expand and
move to larger site; complaint on the social media message

There may be other examples in context that have not been included here.

© UCLES 2017 Page 10 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

4(b) Consider the advantages of internal and external recruitment for the 12
new manager. Recommend which method of recruitment is best for AH
to use. Justify your answer.

Relevant points might include:

Advantages
Internal Lower recruitment costs
recruitment Motivating for employees – increased chance of
promotion – work hard
Already know the business and processes – no induction
training
Suitability of applicants already known by the business
External New ideas
recruitment New skills/experience
Less training needed

Knowledge/Analysis/Evaluation – award up to 10 marks using the levels-

based mark scheme below.

Knowledge/Analysis/Evaluation
Level 3 At least 2 × Level 2 +
9–10 marks for well justified recommendation as to whether to
use internal or external recruitment and why not the alternative.

7–8 marks for some limited recommendation as to whether to

use internal or external recruitment.
Level 2 4–6 marks
Detailed discussion of the advantages of internal and/or
external recruitment.
Level 1 1–3 marks
Outline of the advantages of internal and/or external
recruitment.

Level 1 – 1 mark for each L1 statement (max of 3 marks)

e.g. Internal recruitment is cheaper than external.

Level 2 – one L2 explanation can gain 4 marks and a further mark can be
awarded for each additional L2 explanation (max 6 marks)
e.g. Internal recruitment is cheaper than external as it is carried out by
existing employees. They are used to the ways of working at AH and can tell
the new manager how things are done with the animals. The existing
employees can show the manager how the grooming and brushing is
carried out so that customers do not see anything new and are happy with
the way their animals are looked after. (4 marks for L2 explanation plus one
application mark for referring to the grooming and brushing of animals)

Level 3 – For L3 to be awarded there needs to be at least two L2 marks

awarded and then a recommendation whether to use internal or external
recruitment..

© UCLES 2017 Page 11 of 12

0450/21 Cambridge IGCSE – Mark Scheme October/November
PUBLISHED 2017

Question Answer Marks

4(b) Award up to 2 additional marks for relevant application.

Possible application marks: Animals; unskilled workers; dogs; cats; pets;

washing and brushing animals; qualified animal nurse;12 adults and 6
children workers; information from Appendix 1 on the AH advert; complaint
on the social media message;

There may be other examples in context that have not been included here

© UCLES 2017 Page 12 of 12