Business Studies Paper 2

2
The young enterprise company

A team of students from a private college in Dubai have set up their own company,
Contact2U, selling computer and mobile phone accessories. They buy the
accessories from a friend of one of their parents, who has a company based in
China, and then repackage them, using their own business name and logo. The
students add 30 per cent mark up to the cost of the accessories to calculate their
selling prices. The company also offers an installation service, for which a small fee
is charged. The company aims to sell as many products as possible, but also to raise
awareness of environmental concerns. They have pledged 75 per cent of all their
profits to local green organisations, which are trying to protect the areas natural
marine species from pollution caused by the Dubai building and development
programme. A combination of their low prices and charitable aims has led to very
high sales and the company is going from strength to strength.
1
Identify and explain TWO ways that Contact2U adds value to its products.
Method 1: ..
[1]
Explanation 1: ..
[1]
Method 2: ..
[1]
Explanation 2: ..
[1]
2
Identify and TWO possible objectives of the company and explain how this
helps the company build its stakeholders confidence.
Objective 1: ..
[1]
3
Explanation 1: ..
[1]
Objective 2: ..[1]
Explanation 2: ..
[1]
3
Analyse how Contact2Us charitable aims may have led to increased sales.
Clearly highlight the parts played by different parties in improving the sales
of Contact2U.
...
[4]
Identify and explain THREE ways in which the young enterprise company
adds value to its products.
Method 1: ..
[1]
Explanation 1: ..
[1]
4
Method 2: ..
[1]
Explanation 2: ..
[1]
Method 3: ..
[1]
Explanation 3: ..
[1]
5
This company cannot possibly have serious environmental aims, when

products are produced in and imported by air from China.
Do you agree with this opinion? Justify your answer.
...
[6]
The new malaria clinic

The new clinic in rural Uganda is being funded jointly by the government and
charitable organizations. The aim is to become a centre for the programme of
vaccination against malaria and also offer other support, such as supplying
mosquito nets for beds. Money raised by the charity in the US and Europe is sent
directly to the charity representative in the local area, and government officials
oversee the building and work of the clinic. Nurses at the clinic are mainly local, but
they are supported by charity volunteers, who also provide basic training in the use
of unfamiliar equipment.
6
Identify TWO not for profit organisations that are involved in the malaria clinic
project. Explain their roles/objectives in malaria vaccination in Uganda.
Organisation 1: ..[1]
Explanation 1: ..
[1]
Organisation 2: ..[1]
6
Explanation 2: ..
[1]
Idenitfy and explain ONE private benefit (to an individual) and ONE social
benefit (to the whole society) that will be provided by the malaria clinic.
Private: ...
[1]
Explanation: ..
[1]
Social: ....
[1]
Explanation: ..
[1]
Identify and explain TWO examples of opportunity cost for the organisations
providing funding for the clinic.
Example 1: ....
[1]
Example 2: ....
[1]
9
To what extent do malaria clinics help to provide sustainable development in

countries such as Uganda? Explain your answer.
...
[6]
10
Evaluate the view that clinics like these provide for an essential need, rather
than a want, and should therefore be fully funded by the government.
...
[6]
The seed money enterprise

Lydia and Abigail are two young women from rural Zambia, who have received
seed-money grants from the Camfed charity to start an enterprise in their village.
Seed money grants are usually given to small companies as a means to support a
business until it can generate income of its own. They are very excited by this
opportunity and have decided to lead a basket-making project, so that other women
in the village can also benefit. The initial grant has been used to buy essential
materials, such as dye, and they have found a way of selling the finished products
in the nearest big town. The girls take the baskets to market each month and pay
the women who make them 80 per cent of the selling price. The remaining 20 per
9
cent is used to pay a small wage to each of the girls and cover extras such as
transport.
11
Identify and explain TWO objectives of Lydia and Abigails enterprise.

Objective 1: ..
[1]
Explanation 1: ..
[1]
Objective 2: ..
[1]
Explanation 2: ..
[1]
12
Analyse ONE possible objective that the Camfed charity may be trying to
achieve with seed money grants.
...
[4]
13
The materials needed for each basket cost $1 and the basket sells for an
average of $3. Explain how Lydia and Abigails enterprise adds value in this
example.
10
...
[4]
14
Lydia and Abigail have used their grant to become entrepreneurs. Identify
and explain THREE reasons why their new business may be successful.
Reason 1: ...
[1]
Explanation 1:
...
...
[1]
Reason 2: ..
...
[1]
Explanation 2: ..
...
[1]
Reason 3: ...
...
[1]
11
Explanation 3:
...
...
[1]
15
Evaluate the view that seed-money enterprises like Lydia and Abigails will
make a major contribution to sustainable development in Africa.
...
[6]
12
Railways in Japan
In Japan, railways are the major form of passenger transport. Since 1987 the
railways have been privatized. Japan consists of a number of large and smaller
islands. There are six major rail companies that are part of the Japan Railways
Group operating about 70 per cent of all passenger transport as well as freight
(goods) transport. Most of the companies in the Japan Railway Group are fully
privatised and owned by shareholders. In addition there are many other smaller
private railway companies some of which run services on just one line while others
run services on a number of lines. Japanese trains are famous for punctuality and
between major cities there are bullet trains (shinkazen) running at 300km per hour.
Companies compete with each other with the objective of providing an efficient,
safe and comfortable service.
Railways in India
Indian Railways is the largest employer in India (over 1.6 million people) and
operates the second-largest railway system in the world. The objectives of Indian
railways are to provide a modern, reliable, safe, customer-led and customer-focused
service to the Indian nation. For a number of years, particularly between 2000 and
2005, the organisation made huge losses.
Railways in India were seen by the government as playing an important part in the
life of the nation. The railway system provided a means of transport to remote parts
of the country and an affordable means of transport to almost everyone. Trains
enabled millions of people to get to work every day. The rail service was particularly
important in times of national emergency, taking food to famine or flood victims. An
important objective of Indian Railways is therefore to provide a public service.
Problems for Indian Railways have included safety, timekeeping and huge losses
that had to be paid for by the government raising money from taxpayers. More
13
recently, the government has set profit goals for Indian Railways. Some of these
have been achieved by putting more carriages on trains and providing special
routes for carrying freight. The safety record has also improved.
16
Identify and explain THREE differences between Japan Railways Group and
Indian Railways.
Difference 1: ...
[1]
Explanation 1:
...
...
[1]
Difference 2: ..
...
[1]
Explanation 2: ..
...
[1]
Difference 3: ...
...
[1]
Explanation 3:
...
...
[1]
14
17
For each of the two companies, who takes the profits or pays for the losses?
Identify the type of sector these companies are in and comment on what their
possible objectives are.
...
[6]
15
18
Both companies have an objective of providing efficient, safe and

comfortable service.
How far is the above statement true? Is it possible that Japan Railways Group
and Indian Railways have similar objectives?
...
[6]
16
19
Identify THREE stakeholders in each company and explain the stake that each
of them hold in the company.
17
....
[10]

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2

The young enterprise company

This company cannot possibly have serious environmental aims, when

The new malaria clinic

To what extent do malaria clinics help to provide sustainable development in

The seed money enterprise

Identify and explain TWO objectives of Lydia and Abigails enterprise.

Both companies have an objective of providing efficient, safe and

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