Edexcel GCSE Business: Enterprise and entrepreneurship (1BS0) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

This set practises Theme 1, Topic 1.1 Enterprise and entrepreneurship, items 1.1.1 to 1.1.3, from the Pearson Edexcel Level 1/Level 2 GCSE (9-1) in Business (1BS0) specification, Issue 2, July 2022. All businesses and figures are invented. Calculators may be used, and the specification says formulae are not provided in the examinations, so work from memory.

Course links: the Business hub and the printable checklist. Companion pages: the study guide and the revision notes.

Questions

1. Define the term “entrepreneur”. [2]

2. Which one of the following is an example of adapting an existing product? [1] A. A firm launches a device no one has sold before. B. A bakery adds a gluten-free version of its best-selling loaf. C. A shop closes for the summer. D. A firm reduces its staff.

3. Hollin Pottery sells 260 bowls a month at £18 each. Its total costs are £3,900 a month. (a) Calculate monthly revenue. [2] (b) Calculate monthly profit. [2]

4. Greylag Video Hire has seen the number of DVD rentals fall each year.

Year	2022	2023	2024	2025
Rentals	4,800	4,100	3,500	3,000

(a) Identify the year with the largest fall in rentals compared with the year before. [1] (b) Calculate the percentage change in rentals from 2022 to 2025. [2] (c) Explain one reason why DVD hire may be becoming obsolete. [2]

5. Give two reasons why new business ideas come about. [2]

6. Explain one risk and one reward of starting a small business. [4]

7. Tarn and Teal is launching a range of reusable water bottles in a market with many similar products. Analyse how branding could add value for Tarn and Teal. [6]

8. A bakery buys £0.62 of ingredients for each loaf and sells it for £4.20. (a) Calculate the difference between the selling price and the cost of ingredients. [1] (b) Express this difference as a percentage of the selling price, to 1 decimal place. [2] (c) Give one way, other than branding, that the bakery could add value. [1]

9. Tomasz rents a unit, hires two cooks and buys an oven. He chooses to add a vegan menu to his pizza takeaway and puts £15,000 of his own savings into the business. Analyse how Tomasz shows the three roles of an entrepreneur. [6]

10. Idris has two options and can pursue only one. Option A is an original idea, a sensor that tells owners when a houseplant needs water. Year 1 forecast: revenue £36,000, costs £44,000. Option B adapts an existing service by adding plant delivery to his flower shop. Year 1 forecast: revenue £30,000, costs £22,000. Justify which option Idris should choose. [6]

11. Maya earns a salary of £25,000 a year. She is thinking of leaving to run a coffee van. Her annual costs would be £34,000. If sales go well, revenue would be £48,000. If sales go badly, revenue would be £30,000. Evaluate whether Maya should leave her job to run the coffee van. [9]

Answers

1. An entrepreneur is a person who sets up and runs a business [1], organising resources, making business decisions and taking risks [1]. [2] Examiner insight: A definition gains from describing what the person does, rather than only saying they “own a business”.

2. B [1] Examiner insight: In a multiple-choice item, check each option against the term. Option A is an original idea, which is the contrast.

3. (a) Revenue = price × quantity [1] = 18 × 260 = £4,680 [1] (b) Profit = revenue − total costs [1] = 4,680 − 3,900 = £780 [1] Examiner insight: Show the formula and the substitution. Working lets the marker follow your method even if the arithmetic slips.

4. (a) 2023 (a fall of 700, compared with 600 in 2024 and 500 in 2025) [1] (b) (3,000 − 4,800) ÷ 4,800 × 100 [1] = −37.5%, a fall of 37.5% [1] (c) Streaming and downloads let customers watch films at home without visiting a shop [1], so fewer people want DVDs and demand for hire falls [1]. Examiner insight: Divide by the starting figure, and say whether the change is a rise or a fall. For (c), a reason linked to what customers now do is stronger than the word “technology” alone.

5. Changes in technology [1]; changes in what consumers want (or products and services becoming obsolete) [1]. Examiner insight: “Give” asks for recall, so no development is needed. Two different reasons, not one reason in two forms, are expected.

6. Risk: financial loss, because costs may exceed revenue [1], so the owner could lose the money invested [1]. Reward: independence, because the owner chooses how to work [1], so they have no boss to answer to and can shape the business [1]. Examiner insight: Each point is stronger with a short expansion. A bare label such as “profit” gives less to reward.

7. Branding means the name, logo and image by which customers know and trust a product [1]. In a crowded market, a well-known brand helps Tarn and Teal stand out from similar bottles [1]. Customers who trust the brand may be willing to pay a higher price for the same bottle [1], which raises revenue per sale [1]. A recognisable brand can also bring repeat purchases and recommendations [1], which helps a new firm grow even with little advertising money. This adds value because the product is worth more to the customer than the unbranded alternative [1]. Examiner insight: “Analyse” asks you to place the answer in the case. Refer to the reusable bottles and the crowded market, not to branding in general.

8. (a) 4.20 − 0.62 = £3.58 [1] (b) 3.58 ÷ 4.20 × 100 [1] = 85.2% [1] (c) Quality (for example better ingredients), convenience (delivery), design (distinctive shape) or a unique selling point [1] (any one). Examiner insight: The difference is not profit, because wages and rent still need paying. Avoid calling it profit. Give the percentage to the accuracy requested.

9. Organising resources: renting the unit, hiring two cooks and buying the oven bring premises, labour and equipment together [1]. This is needed for the takeaway to produce pizza [1]. Making decisions: choosing to add a vegan menu is a decision about the product range [1], which may attract customers who want plant-based food [1]. Taking risks: using £15,000 of his own savings means that money could be lost if sales are weak [1], so he has no guarantee of getting it back [1]. Examiner insight: Pair each role with a detail from the case and add a consequence. Listing the three roles without the case detail leaves the answer undeveloped.

10. Option A forecasts a loss of 36,000 − 44,000 = £8,000 [1]. It is original, so there may be no rivals, but demand is untested and the loss shows the cost of developing it [1]. Option B forecasts a profit of 30,000 − 22,000 = £8,000 [1]. It adapts what the shop already does, so demand from existing customers is more likely [1]. I recommend Option B [1], because a forecast profit lowers the risk of financial loss and failure for a business that is already running, while A could still pay off later if the sensor sold well [1]. Examiner insight: “Justify” asks for a recommendation of one of the two options, so commit to one and use the figures. Mentioning what is risky about the other option strengthens it.

11. Best case: profit = 48,000 − 34,000 = £14,000 [1]. Poor case: 30,000 − 34,000 = a loss of £4,000 [1]. Reward: independence and the chance of building a successful business [1]. Even the best-case profit is £11,000 less than her current salary of £25,000 [1]. Risk: a poor year gives a financial loss and no guaranteed income, which is a lack of security [1]. Continued losses could lead to business failure [1]. Which outcome is likelier is not stated, so the forecasts should be tested, for example through market research [1]. Judgement: on these figures, Maya should not leave yet [1], because the best profit is below her salary and the downside is a loss. She could try the van part-time first, or leave if independence matters more to her than income and she can afford to lose £4,000 [1]. Examiner insight: An evaluation answer that weighs both sides and then decides, with a reason, tends to score better than a list. Using the figures from the case is important.

Where marks are usually lost

• Writing “profit” as a reward with no explanation of why it matters to the owner.
• Mixing up revenue and profit, or forgetting to subtract total costs.
• Using the new figure rather than the starting figure as the divisor in a percentage change.
• Describing an obsolete product as one that is broken or unpopular rather than out of date and replaced.
• Listing the three roles of an entrepreneur without a detail from the case.
• Treating value added as the same as profit.
• Describing branding in general terms without tying it to the firm named in the question.
• Stopping an “evaluate” or “justify” answer before reaching a decision.

Next steps

• Re-read the study guide for any part you missed.
• Use the revision notes for recall.
• Tick off progress on the checklist or return to the Business hub.
• Find weak spots with the free diagnostics.
• Book a free trial class: /trial/.

Frequently asked questions

What topics do these enterprise and entrepreneurship questions cover? They cover Theme 1, Topic 1.1 of Pearson Edexcel GCSE Business (1BS0): why and how new business ideas come about, the risks and rewards of enterprise, the purpose of business activity, adding value and the role of an entrepreneur.

Where do students lose marks on enterprise and entrepreneurship questions? Common slips include mixing up revenue and profit, describing an obsolete product as broken rather than out of date, treating value added as profit, and listing the entrepreneur’s roles without a detail from the case.

How do you calculate a percentage change in Edexcel GCSE Business? Subtract the old figure from the new one, divide by the old (starting) figure and multiply by 100. Dividing by the new figure is a frequent mistake.

How should you finish an Evaluate or Justify answer? Reach a clear decision supported by evidence from the case, and show why the other side is weaker. Stopping before giving a decision limits the marks available.

Official syllabus

Pearson Edexcel Level 1/Level 2 GCSE (9-1) in Business (1BS0), Specification, Issue 2, July 2022, published by Pearson Education Limited. Theme 1: Investigating small business, Topic 1.1 Enterprise and entrepreneurship, items 1.1.1 to 1.1.3.