Business 0450 · IGCSE · Enterprise, business growth and size
Enterprise, business growth and size — practice question
Rosa is a prosperous entrepreneur. Her company produces beauty products that she makes, including hand and face creams. She employs 5 production workers, and Rosa likes to stay in charge of everything else, including design and marketing. Rosa advertises the business through social networks. She said: ‘Raising added value matters. I expect revenue to rise by 300% in 2018. At this pace of growth, I will need a larger factory. I would like to have customers in other countries, so I hope there are no import quotas!’ Rosa has to choose whether to keep expanding the business or leave it small.
(a)[2]
What does the term ‘import quota’ mean?
(b)[2]
Rosa’s revenue was $5000 in 2017. Calculate the rise in revenue she expects in 2018.
(c)[4]
Identify and explain two methods Rosa could use to raise added value.
(d)[6]
Identify and explain one advantage and one disadvantage for Rosa’s business of using social networks for promotion.
(e)[6]
Do you believe Rosa should carry on expanding her business? Support your answer with reasons.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Cap on how many goods may enter a country” …