UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS General Certificate of Education Advanced Subsidiary Level and Advanced Level BUSINESS STUDIES Paper 1 Short Answer and Essay Additional Materials: *2535146710* 9707/01 May/June 2009 1 hour 15 minutes Answer Booklet/Paper READ THESE INSTRUCTIONS FIRST If you have been given an Answer Booklet, follow the instructions on the front cover of the Booklet. Write your Centre number, index number and name on all the work you hand in. Write in dark blue or black pen. Do not use staples, paper clips, highlighters, glue or correction fluid.

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Section A Answer all questions. Section B Answer one question. You are advised to spend no more than 35 minutes on Section A. At the end of the examination, fasten all your work securely together. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 2 printed pages. SP (NH) T76661/1 © UCLES 2009 [Turn over 2 Section A (Short Answer) Answer all questions. 1 (a) State the main difference between a skimming pricing strategy and a penetration pricing strategy. [2] (b) Briefly explain why a business might choose to use a skimming pricing strategy. 3] 2 (a) Define ‘capital expenditure’. [2] (b) Describe two external sources of finance that might be used to fund the capital expenditure of a business. [3] 3 Explain one advantage and one disadvantage a multi-national company might bring to a developing country. [5] 4 (a) Define the term ‘corporate culture’. (b) Briefly explain one factor that determines the culture of a business. [2] [3] Section B (Essay) Answer one question only. 5 (a) Explain why effective stock control is important for a large retail business. [8] b) Discuss the advantages and disadvantages of using a JIT (just-in-time) approach to stock control for a large retail business. [12] 6 Discuss the usefulness to managers of any two motivation theories when trying to improve worker motivation. [20] 7 (a) Discuss the problems a new business might experience in its first year of trading. [8] (b) Explain how market research might be used to reduce some of the problems faced by a new start-up business. [12] Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible.

Every reasonable effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the publisher will be pleased to make amends at the earliest possible opportunity. University of Cambridge International Examinations is part of the Cambridge Assessment Group. Cambridge Assessment is the brand name of University of Cambridge Local Examinations Syndicate (UCLES), which is itself a department of the University of Cambridge. © UCLES 2009 9707/01/M/J/09

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