The Government of country B plans to build a new airport. A Government spokesperson said: 'There will be external costs, but I think there will be more benefits for the local community. We have to support businesses such as airlines in the private sector'. RU Air is one of the world's most profitable airlines. RU has announced plans on its website that it will operate flights to and from country B in the future. RU is a public limited company.

Mark scheme

Marking points from the official mark scheme (May/June 2014). The mark or mark type is shown in brackets.

1. [2] (a) Good knowledge [2]: e.g. when business activities are owned by individuals/groups of individuals.
2. [1] Some knowledge [1]: not government controlled/controlled or run by individuals/owned by shareholders.
3. [2] For two marks, must have idea of ownership and by whom.
4. [0] Do not accept 'privately owned' as does not explain term OR ‘owned by the people’ as it is too vague.
5. [2] (b) Application [2 × 1] – award 1 mark per reason.
6. [4] (c) Knowledge [2 × 1] – award 1 mark for each benefit.
7. [2] Application [2 × 1] – award 1 mark for each relevant explanation in context.
8. [0] Do not accept 'expansion' or example of it on own as many types of finance allow this.
9. [0] Do not accept 'decreasing prices' as too vague.
10. [0] Do not accept use profits to 'pay bills'; 'give wage rises'; ‘buy stock'; 'pay debts'.
11. [6] (d) Knowledge [2 × 1] - award 1 mark for each relevant benefit identified.
12. [2] Application [2 × 1] - award 1 mark if relevant reference made to RU Air.
13. [2] Analysis [2 × 1] - award 1 mark for each relevant explanation.
14. [3] For each reason: maximum 3 marks [1k + 1ap + 1an].
15. [0] Note: Points must be advantages to business, not customers.
16. [6] (e) Knowledge [2] – award up to 2 marks for identification of relevant issue(s).
17. [1] Application [1] – award 1 mark if relevant reference made to effect/impact of airport.
18. [1] Analysis [1] – award 1 mark for relevant development of point(s).
19. [2] Evaluation [2] – justified decision made as to whether there are more advantages or disadvantages for the local community.