Edexcel GCSE Business: Globalisation, ethics and the environment (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.

These questions cover Theme 2: Building a business, topic 2.1, items 2.1.3 and 2.1.4, in the Pearson Edexcel Level 1/Level 2 GCSE (9-1) in Business (1BS0) specification, Issue 2, July 2022. Read the study guide and revision notes first if you need them. Course links: the Edexcel GCSE Business hub, the printable checklist and the free diagnostics. Every business here is invented. The specification does not define terms such as multinational, tariff, trade bloc, e-commerce or pressure group, so the answers use their standard meanings. Show your working in calculations.

Questions

1. Define the term multinational. [2]

2. Give two barriers to international trade. [2]

3. Vantage Cycles buys 120 bike frames from an overseas supplier at £185 each. A tariff of 9% of the value applies. A UK supplier quotes £24,500 for 120 frames.

(a) Calculate the total cost from the overseas supplier, including the tariff. [3] (b) Calculate how much cheaper the overseas frames are than the UK quote. [1]

4. Pennine Preserves, a small jam maker, had sales revenue of £350,000, of which £49,000 came from exports. Export sales rose to £61,250 the next year.

(a) Calculate the share of sales revenue from exports. [2] (b) Calculate the percentage increase in export sales. [2]

5. Pennine Preserves wants to sell to customers in other countries. Outline one way it could use the internet to compete internationally. [2]

6. Ashgrove Bakes is a small independent bakery. A multinational supermarket chain starts selling cheap imported cakes in the same town. Analyse one effect of this on Ashgrove Bakes. [6]

7. Mercer Toys makes 90,000 toys a year in the UK. Each takes 0.6 hours of labour at £13.20 an hour. An overseas site would pay £4.10 an hour, and extra transport would cost £0.95 a toy.

(a) Calculate the net annual saving from moving production overseas. [4] (b) Explain one drawback of a business moving production overseas. [3]

8. Explain one way in which membership of a trade bloc could help a business that exports. [3]

9. Greenfield Beverages sells 60,000 cases a year at £14.00. Each case costs £9.50 to make. It plans to buy ingredients from suppliers who treat workers better, adding £0.70 to the cost of each case. It expects sales to rise by 10%.

(a) Calculate its profit before the change. [2] (b) Calculate its profit after the change and sales rise. [3] (c) Analyse one possible trade-off between ethics and profit for Greenfield. [4]

10. Dunmore Candles sells 45,000 candles a year at a profit of £2.40 each. Using recycled glass adds £0.30 to the cost of every candle and wins 8,000 extra sales.

(a) Calculate the change in annual profit. [4] (b) Analyse one benefit of this change, other than profit. [4]

11. Calder Crisps sells 2,000,000 packs a year at a profit of £0.30 a pack. A pressure group campaigns against its plastic packs. A retailer that buys 25% of the packs says it will stop stocking them unless the packaging changes. Option 1: paper packs, adding £0.04 to the cost of every pack. Option 2: keep plastic and spend £50,000 on advertising to defend the packs. Justify which option Calder Crisps should choose. [9]

Answers

1. A business that has operations such as factories, shops or offices [1] in more than one country [1]. Examiner insight: A definition tends to be stronger when it names the key feature (more than one country) rather than just saying the business is large.

2. Tariffs [1]; trade blocs [1]. Examiner insight: Two named barriers are enough; adding detail does not add credit to a give question.

3. (a) Value 120 x 185 = £22,200 [1]; tariff 9% x 22,200 = £1,998 [1]; total £24,198 [1]. (b) 24,500 - 24,198 = £302 [1]. Examiner insight: Showing each step makes your method clear; the tariff is a percentage of the value, then added to it.

4. (a) 49,000 / 350,000 x 100 [1] = 14% [1]. (b) (61,250 - 49,000) / 49,000 x 100 [1] = 25% [1]. Examiner insight: Divide by the starting figure for change but by the total for share; mixing them is a common slip.

5. It could sell through a website to overseas customers [1], so it reaches buyers without opening shops abroad, which keeps costs low [1]. Examiner insight: An outline needs two linked points; a second point that restates the first earns less than one that follows from it.

6. Cheap imports could lower the price customers expect [1]. Ashgrove Bakes may lose customers to the chain [1], so its sales revenue falls [1]. With fixed costs such as rent unchanged, profit falls faster [1]. It could respond by stressing freshness and quality [1], which might hold loyal customers at higher prices [1]. Examiner insight: Analysis gains credit when each step follows from the last and refers to a small independent bakery, not any business.

7. (a) UK labour per toy 0.6 x 13.20 = £7.92 [1]; overseas 0.6 x 4.10 = £2.46 [1]; net saving per toy 7.92 - 2.46 - 0.95 = £4.51 [1]; x 90,000 = £405,900 [1]. (b) For example, redundancy payments to UK workers [1] would cost money in the first year [1], which could cancel part of the saving [1]. Examiner insight: Explain questions carry no context, so give a general drawback of the move with two expansion points.

8. Tariffs between members are low or absent [1], so the exporter’s goods cost less in member countries [1], which can raise sales there [1]. Examiner insight: Three-step explanations tend to do best when the last step links to sales, costs or profit.

9. (a) (14.00 - 9.50) x 60,000 [1] = £270,000 [1]. (b) Profit per case 14.00 - 9.50 - 0.70 = £3.80 [1]; cases 66,000 [1]; profit 3.80 x 66,000 = £250,800 [1]. (c) Higher cost per case lowers profit per case [1]; even with higher sales profit falls by £19,200 [1]; a better reputation could attract customers who value fair treatment of workers [1]; this may repay the cost over time, so the trade-off is short-run profit against long-run gain [1]. Examiner insight: A trade-off is usually shown by setting a cost against a benefit and using the figures given.

10. (a) New units 53,000 [1]; new profit per candle 2.40 - 0.30 = £2.10 [1]; 53,000 x 2.10 = £111,300 [1]; before 45,000 x 2.40 = £108,000, so a £3,300 increase [1]. (b) The candles use recycled glass, so less new glass is needed [1], which cuts waste [1]. A business that shows this can support a claim of sustainability [1], which may attract customers who care about it [1]. Examiner insight: A benefit other than profit must be separate from the sums; repeating the profit rise does not meet the question.

11. Option 1 costs 2,000,000 x 0.04 = £80,000 a year [1]. If the retailer leaves, Calder loses 500,000 packs (25% of the total) [1], a profit of 500,000 x 0.30 = £150,000 [1]. Option 2 costs £50,000 [1] but does not remove the cause of the complaint [1], so the retailer may still delist and the loss could reach £200,000 [1]. Against this, paper packs also respond to the pressure group, which might protect the brand beyond this retailer [1], though the £80,000 would repeat every year [1]. Judgement: Option 1 is the better choice, because the certain £80,000 is lower than the likely loss, and it protects the brand [1]. Examiner insight: A justify answer should pick one option, use figures from both, and say why the other is weaker.

Where marks are usually lost

• Adding the tariff rate to the price instead of calculating a percentage of the value.
• Giving a general effect without naming the business in the question.
• Writing “profit” when the answer needs revenue or cost.
• Missing the final comparison step in a calculation question.
• Describing an environmental action but not saying what it costs or saves.
• Listing marketing mix elements with no link to the pressure group.
• Stopping at “it depends” instead of giving a reasoned judgement.

Next steps

Revisit the revision notes and the study guide, check the hub and checklist, take all free 10-minute diagnostics, or book a free trial class.

Frequently asked questions

How do you calculate the effect of a tariff on a price? Find the tariff as a percentage of the good’s value and add it on, rather than adding the rate itself to the price. A 12% tariff on a £25 mug is £3.00, so the mug costs £28.00 if the whole tariff is passed on.

What do these globalisation and ethics practice questions cover? They follow Theme 2 items 2.1.3 and 2.1.4 of Pearson Edexcel GCSE Business (1BS0): imports, exports, changing locations, multinationals, tariffs and trade blocs, competing internationally, ethics, the environment and pressure groups.

What are common mistakes on pressure group questions? Listing marketing mix elements with no link to the pressure group’s campaign, or describing an environmental action without saying what it costs or saves. Answers should name the business in the question.

Can you answer an Evaluate question with “it depends”? Not on its own. Give a reasoned judgement and say what the decision depends on, using evidence from the case.

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 2: Building a business, Topic 2.1 Growing the business, items 2.1.3 and 2.1.4.