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Business Studies · May / June 2026 · Paper 22 · Question 2

0450

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  • 2(a)[8]

    Explain four roles of packaging for a product. Award 1 mark for each role of packaging (max 4). Award a maximum of 1 additional mark for each explanation. There are no application marks available for this question. Relevant answers might include:

    Protects the product – as the products could be broken or damaged / could perish
    Reinforces the brand image of the product – such as the colour and logo on the packaging
    Makes the product eye-catching – to attract customers
    Information about the product can be written on the packaging – such as instructions on how to use the product / legal requirements such as ingredients or allergens
    Makes it easy to open and use the product
    Is suitable for the product to fit in easily
    Makes it easier to transport the product Notes:
    Do not award added value on its own. For example: Protects the product (1)

    from getting damaged as the products could be broken when being transported to the customer or retailer (1).

  • 2(b)[12]

    Using Appendix 1 and other information, consider the following two possible locations for KE’s second factory. Which location should KE choose? Justify your answer.

    location A
    location B Level Description Sound application of knowledge and understanding of relevant business concepts using appropriate terminology. Detailed discussion of both locations. Well-justified recommendation. Candidates discussing both locations in detail, in context and with a well-justified recommendation about why this would be a suitable location and why the alternative location was less suitable should be rewarded with the top marks in the band. 9–12 Sound application of knowledge and understanding of relevant business concepts using appropriate terminology. Detailed discussion of at least one location. Judgement with some justification / some evaluation of choice made. Candidates discussing one or more locations in detail and applying them to the case should be rewarded with the top marks in the band. 5–8 Limited application of knowledge and understanding of relevant business concepts. Limited ability to discuss the locations with little/no explanation. Simple judgement with limited justification / limited evaluation of choice made. Candidates outlining both locations in context should be rewarded with the top marks in the band. 1–4 No Creditable Response Notes:
    Do not accept the assumption that KE has lots of money because it is a Public Limited Company. Relevant points might include: Advantages Disadvantages Location A
    Is much cheaper to buy than Location B as it costs $100 000 instead of $300 000
    Unemployment is higher – so it may be easier to recruit the labour for the new factory
    As unemployment is higher at 10% then wages paid may be lower – leading to lower costs – may be able to lower prices or increase profits
    Much nearer to raw material supplier – reducing transport costs of delivery – making deliveries quicker if raw materials are needed urgently
    Is further way from the main market at 80 km – which is 70 km further than location B – is likely to increase distribution costs
    Regularly has power cuts so production is likely to be interrupted – causing output to be lower – unable to meet orders Location B
    Unemployment is lower at 5% – so may mean that people in the area have higher incomes and will be more likely to buy KE’s products – higher sales locally
    Is much closer to the main markets – so lower distribution costs – may make deliveries of cooking equipment quicker
    Never has a problem with power cuts – so production can continue and not be interrupted – meaning orders should be fulfilled on time
    Much higher cost to buy the land at $300 000 – this is a high initial cost to build the factory
    Raw materials are much further away at 100 km – which is 80 km further to go than location A – higher transport costs – increasing total costs on a regular basis and not just initial costs
    The distance is not ideal when they are considering lean production – as this relies on quick replenishment by suppliers Recommendation Justification might include:
    Location A should be chosen as it is much cheaper to buy the land and then transport costs for raw materials will be lower as it is 80 km closer to suppliers than location B. Also wage costs are likely to be lower at A than B as unemployment is at 10% instead of 5% and it should be easier to recruit employees for the new factory.
    Location B should be chosen as it is closer to the main market by 70km making distribution costs for the kitchen equipment lower and production should never be interrupted by power cuts.
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