Document page

Business Studies IGCSEPDF 168

SourcePortal capture, 9 Oct 2026

PDF 168

Page image rendered from the stored file at 110 dpi; it sharpens as you zoom. Outlines are placed from each region’s stored position on the page (612 × 792 pt).

no text layerread by OCR (tesseract5-eng@250dpi)

Source of this text: read by OCR. The better of the embedded text and OCR is kept.

0450/11 Cambridge IGCSE — Mark Scheme PUBLISHED May/June 2025 Question Answer Marks Guidance 4(e) Do you think the advantages of using retained profits to fund business expansion are greater than the disadvantages? Justify your answer. Award up to 2 marks for identification of relevant points. Award up to 2 marks for relevant development of points. Award up to 2 marks for a justified decision as to whether the advantages of using retained profits to fund business expansion are greater than the disadvantages. Points might include: Advantages: e No need to repay [k] so does not increase level of debt/liabilities [an] e No interest to pay [k] so no additional cash outflows/expenses [an] e — Easy/quick to obtain [k] Disadvantages: e Takes time to generate sufficient funds [k] which could delay the expansion [an] «May not have sufficient/any funds [k] so must limit the size of expansion [an] e (Keep more profit in the business) reduces payment/reward to owners [k] which may deter further investment [an] Other appropriate responses should be credited. This is a general question so there are no marks for application. Some analysis could apply to more than one point, but only award once. 0450/11 Cambridge IGCSE — Mark Scheme PUBLISHED May/June 2025 Question Answer Marks Guidance 4(e) Justification might include: An advantage is there is no interest to pay [k] so no additional cash outflows [an]. However, it may take time to generate these funds [k] delaying expansion [an]. The disadvantages are greater because expansion is likely to need a large amount of finance which the business may not have [eval]. Delay could mean the opportunity is missed [eval]. Question Answer Marks Guidance 2(a) Define ‘profit’. Award 2 marks for a full definition. Award 1 mark for a partial definition. e (Total) income of a business (revenue) less total cost [2] e (Total) revenue minus total costs [2] e Difference between revenue and total cost [2] e Gross profit - expenses [2] Partial definition e.g. e Revenue minus costs [1] Other appropriate responses should also be credited. Max 1 mark if refer to money rather than revenue/income.