Higher Tier Monday 16 November 2009 Afternoon Time: 1 hour 30 minutes

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1 Centre No. Candidate No. Paper Reference H Surname Signature Paper Reference(s) 4330/2H Edexcel IGCSE Business Studies Unit 2H Higher Tier Monday 16 November 2009 Afternoon Time: 1 hour 30 minutes Initial(s) Examiner s use only Team Leader s use only Question Number Blank Materials required for examination Nil Items included with question papers Nil Instructions to Candidates In the boxes above, write your centre number, candidate number, your surname, initial(s) and signature. Check that you have the correct question paper. Answer ALL the questions. Write your answers in the spaces provided in this question paper. Do not use pencil. Use blue or black ink. Information for Candidates The marks for individual questions and the parts of questions are shown in round brackets: e.g. (2). There are 3 questions in this question paper. The total mark for this paper is 60. There are 12 pages in this question paper. Any pages are indicated. Advice to Candidates You will be assessed on your ability to organise and present information, ideas, descriptions and arguments clearly and logically, including your use of grammar, punctuation and spelling. This publication may be reproduced only in accordance with Edexcel Limited copyright policy Edexcel Limited. Printer s Log. No. M34879A W850/4330/ /6/6/4/ *M34879A0112* Total Turn over

2 Read this page, then answer the questions which follow. Context Tracey Scott and her partner John own and run Tracey s Cycles, a shop which sells and repairs bicycles (bikes). Much of Tracey s time is spent with customers or repairing bikes. Tracey s Cycles shop is located in Hiram, a small town in the north of England that is a popular holiday (vacation) destination. Hiram Council, the local governing body, wants to encourage more people to cycle to work rather than use their cars, to save resources and cut pollution. The Council has therefore recently created cycle lanes sections of roads where people can cycle in safety. Tracey hopes this will help her business by making cycling more popular. Tracey buys bikes from Parker plc. This company makes and sells bikes for everyday use. Parker plc has just started to manufacture the Kyrano, a racing bike for professional cyclists. This bike has a very advanced design, so the company is recruiting employees with specialist skills who will use modern materials and advanced electronic equipment to make the Kyrano. Parker plc is located in Creighton, a large town in the south of England. 2 *M34879A012*

3 Answer ALL the questions. Write your answers in the spaces provided. 1. Parker plc sets efficiency targets for lean production and productivity. (a) (i) What is meant by lean production? (2) (ii) What is meant by productivity? (2) (iii) Describe two ways in which a business such as Parker plc could increase its productivity. (4) *M34879A0312* 3 Turn over

4 The directors of Parker plc want to check if productivity is increasing. (b) Outline how an increase in productivity could be measured in a business such as Parker plc. (2) Parker plc has its own internet website. Tracey plans to set up a website for Tracey s Cycles. Tracey will put on the website pictures of the bikes for sale, their price and other information. (c) What would be one advantage and one disadvantage to Tracey s Cycles of using the internet to promote the business and the bikes it sells? (4) 4 *M34879A0412*

5 Tracey also advertises bikes for sale in the local newspaper. The advertisements list the prices of the bikes, their different styles and sizes, alongside pictures. Each advertisement has a 10% money off voucher to use in the shop. (d) Using the information above, give one example of (i) persuasive advertising. (1) (ii) informative advertising. (1) (e) Discuss why persuasive and informative advertising are both suitable for Tracey to use when selling bikes. (4) Q1 (Total 20 marks) *M34879A012* 5 Turn over

6 2. The business decisions that both Tracey and the directors of Parker plc make are influenced by technology and environmental factors. (a) (i) Using an example from the context on page 2, show one way in which technology has influenced a business decision. (2) (ii) Using an example from the context on page 2, show one way in which an environmental factor has influenced a business decision. (2) Two business objectives for Parker plc are Objective 1 To increase its share of the bike market in England from 12% to 15% Objective 2 To improve profitability. 6 *M34879A012*

7 (b) (i) Analyse how Parker plc might try to increase its share of the bike market in England. (4) (ii) To what extent will achieving Objective 1 stop Parker plc from achieving Objective 2? (6) *M34879A0712* 7 Turn over

8 The directors of Parker plc plan to recruit specialist workers externally, rather than internally, to make the specialist Kyrano racing bike. (c) Discuss the suitability of the directors recruitment plan. (6) Q2 (Total 20 marks) 8 *M34879A0812*

9 3. To increase sales, Tracey plans to set up Tracey s Bike Hire. The town of Hiram, where Tracey s Cycles is located, is popular for holidays (vacations). Tracey believes that people visiting Hiram on holiday will be prepared to pay for hiring (renting) bikes. Bike hire prices will vary depending on whether the bike is hired for an hour, a day or a week. (a) Analyse how break-even analysis can help Tracey when deciding the price to charge for bike hire. (4) *M34879A0912* 9 Turn over

10 John, Tracey s partner, has agreed to be in charge of Tracey s Bike Hire. John is a mechanic at Tracey s Cycles who repairs bikes and does not deal with customers. John realises that he will need training so he can deal with customers who want to hire bikes. (b) Assess whether off-the-job training is suitable for John in this situation. (6) Tracey needs to consider how she can finance new bikes for Tracey s Bike Hire. She has two options. Option 1 Option 2 Invest some of her own savings as extra capital Apply to her bank for a loan. (c) Evaluate which option Tracey should select. 10 *M34879A01012*

11 (10) Q3 END (Total 20 marks) Total for paper: 60 marks *M34879A01112* 11

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