Fig. 1 shows an advertisement for electrical goods. KUMAR WHOLESALERS The Largest Cash and Carry Warehouse in the Area End of Season Sale Many cookers, washing machines, dishwashers, microwaves, freezers and refrigerators to be cleared at reduced prices. The lowest prices for electrical goods anywhere. Hurry while stocks last! Payment: cash and debit card only Fig. 1 Use the advertisement in Fig. 1 to answer the following questions.

Mark scheme

Marking points from the official mark scheme (May/June 2010). The mark or mark type is shown in brackets.

1. [1] (a) 'the lowest prices for electrical goods anywhere'; 'the largest cash and carry warehouse in the area'
2. [1] (b)(i) Any one benefit × 1 mark – May not have sufficient cash to make the purchase; Avoids the danger of being robbed of cash; Saves time visiting the bank; Saves carrying cash; Any other relevant benefit
3. [2] (b)(ii) Any one reason explained × 2 marks – Because it is a cash and carry warehouse and so does not give credit; Wants immediate payment so that there are no debts to collect; Does not want to pay the commission payable to credit card companies; Can use the cash to pay its own debts to suppliers; Any other relevant reason
4. [2] (c) Any two ways × 1 mark each – Does not deliver the goods; Does not give credit; May admit members of the public; May deal in smaller quantities; Self service; Any other relevant difference; NB does not have to comment on traditional wholesaler
5. [2] (d) Any two points × 1 mark or one developed point × 2 marks – To make room for new stock; So that old stock is sold and not wasted or left to go out of date; May want to improve cash flow; May want to provide stock for end of season sale; May be closing down; Any other relevant point
6. [6] (e) Any three purposes in context × 2 marks each – Storage of electrical goods so that they can be displayed to attract customers; Protection of electrical goods against damage or theft; Enabling a variety of electrical goods to be on offer in one place; Enabling Kumar Wholesalers to purchase from many manufacturers and so clear their production lines; Enabling purchasing ahead of demand so that supply of electrical goods is guaranteed; To have stock readily available; Packing electrical goods; Any other relevant purpose
7. [6] (f) Level 2 (4-6 marks) Has made a judgement based on reasoning about the survival of wholesale businesses. Many wholesale businesses have survived in the face of competition from large-scale retailers because they cater for the needs of the small-scale retailer, they offer cash and carry services and may be the wholesaler running a voluntary chain to which many small-scale retailers belong. They are able to offer personalised services to their retail customers and may also allow members of the public to purchase. They may also specialise in particular products such as electrical appliances or furniture. On the other hand many wholesale businesses have closed because large-scale retailers have the capital to purchase direct from manufacturers and to perform wholesale services themselves. They can therefore cut costs. Level 1 (1-3 marks) Has made some comment on the survival of wholesale businesses with or without a judgement and with little or no reasoning. Many wholesale businesses survive in many parts of the world where there are small-scale retailers. They give good service. They supply retailers and allow credit to their customers.