Cambridge International Examinations: Business 9609/22 May/June 2017
Cambridge International Examinations: Business 9609/22 May/June 2017
Cambridge International Examinations: Business 9609/22 May/June 2017
BUSINESS 9609/22
Paper 2 Data Response May/June 2017
MARK SCHEME
Maximum Mark: 60
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 will not enter into discussions about these mark schemes.
Cambridge is publishing the mark schemes for the May/June 2017 series for most Cambridge IGCSE®,
Cambridge International A and AS Level and Cambridge Pre-U components, and some Cambridge O Level
components.
1(a)(i) Define the term ‘long term sources of finance’ (lines 18–19). 2
1(a)(ii) Briefly explain the term ‘diversity and equality’ (line 14). 3
1(b)(i) Refer to Figure 1. The total value of market sales in country A was 3
$50m. Calculate the total value of sales for the three largest
businesses.
Mark Rationale
Correct calculation the total value of sales for the three largest
businesses (with or without working or $ or m)
3 OR
Correct calculation of all three companies value of sales ($14m,
$11m and $10m) (with or without working or $ or m)
Correct calculation of two of the top three companies value of
2
sales (with or without working or $ or m)
Correct formula or correct calculation of % share of top three
companies (70%- with or without working or %)
1 OR
Correct calculation one of the top three companies value of
sales (with or without working or $ or m)
0 No creditable content
1(b)(ii) Explain two appropriate methods (other than market share) that could 3
be used to measure the size of PP.
1(c) Analyse two factors Paul should consider when selecting a restaurant 8
manager.
Examples of
Examples of Examples of possible
factors of
application/context analysis
selection
Any relevant restaurant
management
Better qualified manager
qualifications, customer
→ improved customer
Qualifications service qualifications,
service → more sales →
inventory management
more profit
etc
Diversity and equality
Lives near restaurant →
Local town in country A –
more likely to be on time
Location will need to live here or
to work → better staff
can relocate.
management
Good inventory
Customer service, management → less
Skills supervising employees, wastage in the restaurant
inventory management. → lower costs →
increased profit
In other (pizza)
restaurants, one of the
Worked in another PP
competitors, other PP
restaurant → knows the
restaurants.
Experience procedures → less training
Experience in customer
needed → lower costs →
service, supervising
increased profit
employees, inventory
management.
Cost
1(d) Evaluate whether Paul should enter into a franchise agreement with 11
PP.
Context/content:
Advantages
• less risk to Paul as he benefits from the expertise and reputation of PP
brand
• Assistance from PP so Paul makes less mistakes in his business-
decisions such as the policies for diversity and equality;
• Access to local marketing and the PP website will help generate sales;
Disadvantages
• Up-front costs to purchase the franchise ($40 000);
• The royalty fee of 5% may be a drain on his cash flow
• Clash of ideas as Paul will have to follow the criteria set out in his
franchise agreement – this may limit his freedom to make decisions.
ANAN
K APP AN EVAL
(one sided)
Which increases Overall Paul
the costs of should enter into
starting up a a franchise
An independent
Which increases restaurant to agreement
restaurant would
the costs of Paul and may because the
cost $25 000
staring up a make it harder to extra sales are
whereas a PP
restaurant to break even or likely to cover the
franchise is
Paul. (AN) survive in his first extra costs.
$40 000. (APP)
year of trading. (EVAL –
(ANAN – one statement)
sided)
However he
should do some
market research
It is expensive to
to see just how
set up a
much more the
franchise. (K) However the sales would be in
reputation of PP a PP franchise.
National above may gain more (EVAL –
the line Which is likely to sales in the first developed)
promotion will be increase sales in year making it
provided within the first year. more likely that If the extra sales
the setup cost. (AN) he would break did not cover the
(APP) even and extra costs then
survive. (ANAN – he would
two sided) probably be
better opening
the independent
restaurant.
(EVAL – justified)
2(b)(i) Refer to Table 1. Calculate the gross profit margin for 2016. 3
Mark Rationale
Correct calculation of gross profit margin (with or without
3
working or %)
2 Correct formula and correct calculation* of gross profit
1 Correct formula or correct calculation* of gross profit
0 No creditable content
Formula can be implied through the correct use of figures
*working required or explicit identification
Gross profit
× 100
Revenue
= 240 – 80 = 160
160
= × 100 = 66.67% (accept 66.7% and 67%)
240
• Allow an answer of 66% or 66.6% or 66.66% as a TWO mark
answer with or without working as the candidate has made one
mistake in not rounding correctly.
• Also allow an answer of 0.67 as a TWO mark answer with or
without working as the candidate has made one mistake by not
calculating a percentage
Profitability is the margin between cost per unit and selling price (or the
margin between total revenue and total cost). This is in contrast to profit
which is the amount (i.e. not margin) made.
2(c) Analyse one advantage and one disadvantage to the other owner- 8
workers of Iqbal’s leadership style.
Advantages:
• More ideas taken into account
• Better communication
• Improved motivation
• Shared objectives/vision
• Reduced employee turnover
Disadvantages:
• Decisions may be discussed but the leader still makes the
decisions – could demotivate
• Time wasted in discussion
• Employees may not have the ‘full picture’
Examples of
features of Examples of Examples of possible
democratic application/context analysis
leadership
Better decisions →
The other nine revenue to continue to
More ideas –
owner/workers can add increase → profits for the
advantage
their ideas owner/workers to
continue to increase
Lower cost of production
More efficient production → less cost of sales →
Better motivation
of bags, cases and higher gross profit →
– advantage
wallets more return for the
owner workers
Increased cost of
Wasted time in Less time for production production → higher cost
discussion – of bags, cases and of sales → lower gross
disadvantage wallets profit → less return for
the owner workers
Choose wrong option →
Other owner/workers
Expansion does not
Poor decision may not understand the
increase value of QL →
making data about the two
profits for the
options for expansion.
owner/workers reduce
ARA
Context/content:
ANAN
K APP AN EVAL
(one sided)
Overall QL is
more likely to be
interested in
having a small
share of a large
Option A would Which is likely to
market, so
allow QL to lead to a more
should choose
expand into a successful
A bigger market Option A. (EVAL
market with a expansion and
may lead to more – statement)
value of $2m. more profit for
sales for QL.
This is bigger the
(AN) However it
than the market owner/workers.
depends upon
for Option B. (ANAN – Option
how high the
(APP) A)
level of
competition is
Expansion is and how much
when a business QL would need
grows, for to spend on the
example by marketing to
selling a new establish
product range.. themselves in the
(K) shoe market.
(EVAL –
Which is likely to developed)
lead to a higher
However Option Less competition
chance of As long as the
B only has a is likely to mean
success in the potential revenue
medium level of that QL will find it
Low priced outweighs the
competition as easier to
leather belt costs of Option A
opposed to a establish their
market and more then the larger
high level for brand in the
sales and profit market will allow
Option A. (APP) market. (AN)
over time. (ANAN much more
– Option B) growth than
Option B and is
therefore the
better option.
(EVAL – justified)