Business

1. 1.

   Fictional case: a restaurant opens another branch rather than buying a rival. Distinguish organic growth from external growth.

   [3 marks] · no calculator

   Answer explanation

   Draft walkthroughs are based on marking guidance, not independently verified derivations.

   1. Classify the route by how capacity is added, not by how fast growth occurs. A new owned branch is built internally even if financed by an outside lender.

   Marking points

   • Organic growth expands the firm's own operations.
   • External growth combines with or acquires another business.
   • Opening the branch is organic; buying a rival would be external.

   Examiner tip: External finance does not turn organic expansion into external growth.

2. 2.

   Fictional case: a clothes retailer sells an existing range to a new overseas market. Identify the product-market growth route and one risk.

   [2 marks] · no calculator

   Answer explanation

   Draft walkthroughs are based on marking guidance, not independently verified derivations.

   1. Neither a new product nor a completely unrelated business is specified. The risk comes from learning a new market even though the product is familiar to the retailer.

   Marking points

   • This is market development: existing products in a new market.
   • Different preferences, distribution or regulation can weaken demand or raise entry costs.

   Examiner tip: Classify both product novelty and market novelty.

3. 3.

   Fictional case: a delivery firm lists its skilled dispatch team as an opportunity and a rival's new depot as a weakness. Correct the SWOT categories and explain why the distinction matters.

   [4 marks] · no calculator

   Answer explanation

   Draft walkthroughs are based on marking guidance, not independently verified derivations.

   1. Ask whether the factor belongs to the firm or its environment. A SWOT list is useful only when categories guide an actionable response, such as using dispatch skills to counter faster rival delivery.

   Marking points

   • The skilled internal team is a strength.
   • The rival's depot is an external threat if it improves rival service.
   • Strengths and weaknesses concern internal capabilities; opportunities and threats concern external conditions.
   • Correct categories help distinguish capabilities to develop from external changes to respond to.

   Examiner tip: Classification alone is not a strategy; explain the action it informs.

4. 4.

   Fictional case: a merger combines two firms using incompatible order systems and different pay scales. Analyse two integration problems and a response to each.

   [4 marks] · no calculator

   Answer explanation

   Draft walkthroughs are based on marking guidance, not independently verified derivations.

   1. Merger synergies depend on combining operations successfully. Technical integration and employee acceptance require different tools; a rushed rollout can destroy the savings the merger promised.

   Marking points

   • Incompatible systems can cause lost orders or duplicate records.
   • Phased migration with testing can reduce operational disruption.
   • Different pay scales can create perceived unfairness and turnover.
   • Transparent consultation and a planned pay framework can address that concern.

   Examiner tip: Match each response to its specific integration problem.

5. 5.

   Fictional case: a successful bakery considers buying an unrelated mobile-game studio to diversify. Evaluate the acquisition rather than expanding its bakery range.

   [4 marks] · no calculator

   Answer explanation

   Draft walkthroughs are based on marking guidance, not independently verified derivations.

   1. A different industry does not automatically reduce risk if poor information causes overpayment or mismanagement. Related expansion may offer clearer synergies; unrelated diversification needs credible specialist management.

   Marking points

   • Indicative: unrelated revenue can reduce dependence on one market.
   • The bakery may lack gaming knowledge and integration capability.
   • Expanding the range uses existing capabilities but retains food-market exposure.
   • A justified choice considers management competence, acquisition price and realistic risk diversification.

   Examiner tip: Assess the firm's capabilities, not only the appeal of the new market.

6. 6.

   Fictional case: a bank plans a rapid move to digital-only service. Older customers rely on branches and staff fear job losses. Evaluate the proposed pace of change.

   [4 marks] · no calculator

   Answer explanation

   Draft walkthroughs are based on marking guidance, not independently verified derivations.

   1. A staged rollout may preserve trust and allow testing while still moving toward lower-cost delivery. If competitive pressure is urgent, prioritise essential support rather than assuming all stakeholders can adapt immediately.

   Marking points

   • Indicative: rapid change can reduce duplicate-channel costs and respond to digital competition.
   • Excluding branch-dependent customers can cause lost business and reputational harm.
   • Staff resistance can disrupt delivery unless training and redeployment are credible.
   • A justified recommendation compares phased transition, customer support and urgency of competitive pressure.

   Examiner tip: Evaluate speed of implementation separately from the desirability of digital service.

Original, unofficial practice questions from SubjectScout — not official past-paper questions.