Business 0450 · IGCSE · Enterprise, business growth and size
Enterprise, business growth and size — practice question
Nadia launched her successful hairdressing business 4 years ago. Keeping quality high has always been important to Nadia. She said: ‘I began with no experience of business plans, recruitment, cash flow or profit. I did not understand how economic issues such as inflation could influence a business. Now I have 5 hairdressing shops and 20 employees. Last year I earned a profit of $100 000.’ Nadia is intending to expand her business. One way she could do this is by selling franchises.
(a)[2]
Define the term ‘business plan’.
(b)[2]
Identify any two stages in the recruitment process.
(c)[4]
Outline one advantage and one disadvantage for Nadia’s business of selling franchises as a way to expand.
(d)[6]
Explain two possible effects of an increase in the rate of inflation on Nadia’s business.
(e)[6]
Do you think profit is more important for a growing business than cash flow? Justify your answer.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Written document that sets out the business’s aims/objectives together with key details of operations, finance and owners” …