(a)[8]
Identify and explain how the following four changes could influence the success of the new business. The economic cycle in country Z moves from boom into recession. Government in country Z lowers income tax. New legal controls so all packaging for takeaways must be able to be recycled. New legal controls that all menus must contain full information on the ingredients used.
(b)[12]
Consider the advantages and disadvantages of the three sources of finance shown in Appendix 3 for the new business. Recommend which source of finance Peter should choose. Justify your choice by comparing the cost of each option. Bank loan for 1 year. Bank loan for 3 years. Retained profit option.