Five years ago, Alana set up a restaurant in the city centre. It serves plant-based meals made from a selection of vegetables. Alana carries out primary market research to help her spot changes in consumer spending patterns. Market research can also be used to divide a market into segments. The restaurant employs 16 workers. Each worker receives the legal minimum wage. In 2023, the business earned a profit of $80 000. Alana wants to find out how a rise in interest rates could affect her business.
(a)[2]
Define what is meant by ‘profit’.
(b)[2]
Identify two reasons why consumer spending patterns may change.
(c)[4]
Outline two primary market research methods that Alana could use.
(d)[6]
Explain two possible effects that an increase in interest rates could have on Alana’s business.
(e)[6]
Do you think income is the best way for a business to segment a market? 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: “Amount left when revenue is reduced by total costs” …