EDEXCEL GCSE BUSINESS · PAPER 1
Exam Practice: The Dynamic Nature of Business
The dynamic nature of business · Enterprise and entrepreneurship · Lesson 1 of 3 · 9 marks · 20 minutes
Name Date
Answer all questions. Use the context of the business in the question where one is given.
Question 1 DEFINE [1 mark]
Define the term 'obsolete'.
Question 2 STATE [1 mark]
State one reason why new business ideas come about.
Question 3 OUTLINE [2 marks]
Outline one reason why new business ideas come about.
Question 4 OUTLINE [2 marks]
Outline one way an entrepreneur can come up with a new business idea.
Question 5 EXPLAIN [3 marks]
Explain one risk to a business of its product becoming obsolete.
Answers
Check your answer only once you have written one.
Question 1 [1 mark]
A product or service that is out of date and no longer wanted by customers, usually because something better has replaced it.
▸ Out of date / no longer wanted or used 1 mark
Question 2 [1 mark]
Changes in technology.
▸ Any one of: changes in technology; changes in consumer wants; products or services becoming obsolete 1 mark
Question 3 [2 marks]
Changes in technology create new business ideas (1) because they make new products and services possible, for example smartphones made app-based food delivery services such as Deliveroo possible (1).
▸ A reason identified, e.g. changes in technology / consumer wants / products becoming obsolete 1 mark
▸ Developed: why this leads to a new business idea 1 mark
Question 4 [2 marks]
An entrepreneur can adapt an existing product (1). Observing existing products can lead to ideas about how they might be improved, so the entrepreneur can innovate an existing product rather than start from nothing (1).
▸ A way identified: an original idea / adapting an existing product, service or idea 1 mark
▸ Developed: how this produces a business idea 1 mark
Question 5 [3 marks]
Its sales could fall sharply (1) because customers will switch to the newer product that has replaced it (1). As a result the business's revenue falls, and if it cannot adapt quickly enough it may be forced to close, as Blockbuster's UK stores did when streaming replaced DVD rental (1).
▸ A risk identified, e.g. falling sales / revenue / business failure 1 mark
▸ First linked point of explanation 1 mark
▸ Second linked point of explanation 1 mark