0450 Business Studies November 2025 Question Paper 12

BEI is a multinational company. It manufactures aeroplanes. Quality assurance is important. BEI has 5000 employees. BEI’s directors have announced plans to reduce the size of its workforce 1 (downsize). The Human Resources Director is considering which employees to make redundant. Information about employee A can be found in Table 1.1. Table 1.1 Information about employee A • Worked at BEI for 1 year • Worked at another manufacturing business for 12 years • Able to use most of the machines at BEI • Often late for work • Popular with other employees • Left school with 2 IGCSEs Define ‘quality assurance’. (a) [2] Identify two reasons why a business might reduce the size of its workforce. (b) Reason 1: Reason 2: [2] , , Outline, with reference to BEI, the difference between redundancy and dismissal. (c) [4] Explain one advantage and one disadvantage of BEI making employee A redundant. (d) Advantage: Explanation: Disadvantage: Explanation: [6] , , Explain two possible benefits to a country of a multinational company locating there. Which benefit is likely to be the most important? Justify your answer. (e) [6] , ,

OTK is a small jewellery shop in the centre of Main City. The business does not currently use ecommerce. OTK buys its jewellery from local suppliers. It pays for the jewellery 30 days later. The 2 shop manager is analysing OTK’s cash flow forecast. She is concerned that the business might have a short-term cash flow problem. Define ‘cash flow forecast’. (a) [2] Identify two reasons why cash is important for a business. (b) Reason 1: Reason 2: [2] Identify four functions of management. (c) Function 1: Function 2: Function 3: Function 4: [4] , , Explain two ways OTK could overcome a short-term cash flow problem. (d) Way 1: Explanation: Way 2: Explanation: [6] Explain two threats to a business of using ecommerce. Which threat is likely to be the most important? Justify your answer. (e) [6] , ,

Miguel plans to start up a gym (sports club). It will offer a range of fitness classes including yoga. The business will be a partnership with his sister. Miguel thinks the size of the business will remain 3 small. Secondary market research will be used to help make decisions including which pricing method to use. Miguel knows it is important for a new business to select a suitable location. Define ‘partnership’. (a) [2] Identify two ways to measure the size of a business. (b) Way 1: Way 2: [2] Outline two pricing methods Miguel could use. (c) Method 1: Method 2: [4] , , Explain one advantage and one disadvantage to Miguel of using secondary market research. (d) Advantage: Explanation: Disadvantage: Explanation: [6] Do you think access to employees is the most important factor for a new business to consider when deciding on a suitable location? Justify your answer. (e) [6] , ,

DJU manufactures clothing including jeans and trousers. There are 90 employees working in its factory. DJU uses specialisation when making its products. The Managing Director is reviewing 4 DJU’s cost and output data. An extract is shown in Table 4.1. She wants to know how lower interest rates might affect the business. DJU’s directors are considering different ways a business could grow including taking over a competitor. Table 4.1 Extract from DJU’s cost and output data (per week) $400000 Fixed costs$595000 Total costs 85000 units Total output Define ‘fixed costs’. (a) [2] Calculate DJU’s average cost per unit per week. Show your working. (b) Working: Final answer: [2] Outline two ways lower interest rates might affect DJU. (c) Way 1: Way 2: [4] , , Explain one advantage and one disadvantage to DJU of using specialisation when making its products. (d) Advantage: Explanation: Disadvantage: Explanation: [6] Do you think the advantages of taking over a competitor are greater than the disadvantages? Justify your answer. (e) [6] , ,