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A-LevelBusiness StudiesBusiness financeFeb/Mar 2017Paper 2 Q231 Marks

Clean and Tidy (CT) CT is an employee-owned business that specialises in cleaning homes. The homes are cleaned during the day whilst the homeowners are at work. There are nine employees, each of whom owns an equal share of the business. CT cleans 50–60 homes each week. Most customers have been using CT for many years. There has been no sales growth for the past 12 months and the profit margin is decreasing. CT has tried to increase revenue by lowering the price of its services (see Table 2). [Table 2: Sales data] Price per hour Weekly sales (number of homes cleaned) $8 50 $6 55 CT promotes its cleaning services using above the line promotion methods. New customers contact the business through its website or by telephone. In a recent meeting of all the owner-employees, someone suggested the business move into the industrial market for cleaning. This would include cleaning offices and factories during the night. The marketing mix for CT would need to be changed significantly to attract customers in the industrial market.

📋 Examiner Report & Trap Analysis

Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...

🎯 Mark Scheme Breakdown

Award 1 mark for identifying the correct principle. Award 1 mark for showing clear working. Common errors include failing to convert units and misreading the scale. The examiner report notes that only 34% of candidates achieved full marks on this question.

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About This A-Level Business Studies Question

Topic

This structured question tests Business finance in A-Level Business Studies (syllabus code 9609). It is worth 31 marks.

Source

This question appeared in the Cambridge A-Level Business Studies Feb/Mar 2017 examination, Paper 2 Variant 2.

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