Cambridge IGCSE Business Studies MCQ Practice

Cambridge (CIE) IGCSE Business Studies MCQ Practice

Answer all 20 questions. Choose the most appropriate answer for each question.

  1. Which of the following is typically a non-financial objective for a business?

    • A. Maximising profit
    • B. Increasing market share
    • C. Providing good customer service
    • D. Reducing costs

  2. A business owned and controlled by a single individual who takes all profits and bears all losses is known as a:

    • A. Partnership
    • B. Private limited company
    • C. Sole trader
    • D. Public limited company

  3. The 'product' element of the marketing mix includes decisions about:

    • A. Price discounts
    • B. Advertising channels
    • C. Packaging and design
    • D. Distribution networks

  4. Which stage of the recruitment process involves selecting the best candidate from a shortlist?

    • A. Job analysis
    • B. Job advertisement
    • C. Interviewing
    • D. Training

  5. Which of these is an example of an internal source of finance for a business?

    • A. Bank loan
    • B. Retained profits
    • C. Issuing new shares
    • D. Government grant

  6. Mass production is most suitable for products that are:

    • A. Custom-made
    • B. Produced in small batches
    • C. Standardised with high demand
    • D. Highly complex and unique

  7. What is meant by 'organic growth' of a business?

    • A. Merging with another company
    • B. Taking over a competitor
    • C. Expanding internally, e.g., by increasing sales
    • D. Selling off unprofitable divisions

  8. Primary market research involves:

    • A. Analysing government statistics
    • B. Reading industry reports
    • C. Conducting surveys and interviews
    • D. Reviewing competitors' financial statements

  9. According to Maslow's Hierarchy of Needs, 'job security' is an example of which level of need?

    • A. Self-actualisation
    • B. Esteem
    • C. Safety
    • D. Social

  10. An increase in interest rates would most likely lead to:

    • A. Increased consumer spending
    • B. Lower borrowing costs for businesses
    • C. Reduced investment by businesses
    • D. Higher demand for goods and services

  11. A business demonstrating corporate social responsibility might:

    • A. Aim to maximise shareholder dividends
    • B. Focus solely on cost reduction
    • C. Use environmentally friendly production methods
    • D. Engage in aggressive advertising campaigns

  12. Penetration pricing is a strategy where a business:

    • A. Sets a high price for a new product to recover development costs quickly
    • B. Sets a low price for a new product to gain market share
    • C. Matches competitor prices
    • D. Offers different prices to different customer segments

  13. Which stakeholder group is primarily interested in job security and fair wages?

    • A. Shareholders
    • B. Customers
    • C. Employees
    • D. Government

  14. Holding too much inventory can lead to:

    • A. Lower storage costs
    • B. Increased risk of obsolescence
    • C. Faster production times
    • D. Improved cash flow

  15. A formal written report is an example of which type of communication?

    • A. Informal, verbal
    • B. Formal, verbal
    • C. Informal, written
    • D. Formal, written

  16. Which of the following is a fixed cost for a business?

    • A. Raw material costs
    • B. Electricity bills (variable part)
    • C. Rent for the factory
    • D. Sales commission

  17. A 'public limited company' (PLC) can raise capital by:

    • A. Only using retained profits
    • B. Selling shares to the general public
    • C. Only selling shares to family and friends
    • D. Relying solely on bank loans

  18. Branding helps a business to:

    • A. Reduce its product range
    • B. Differentiate its products from competitors
    • C. Decrease advertising expenditure
    • D. Avoid the need for market research

  19. Gross profit is calculated by:

    • A. Revenue - Cost of goods sold
    • B. Revenue - All expenses
    • C. Net profit + Expenses
    • D. Sales revenue - Operating expenses

  20. How can technology impact a business's production process?

    • A. It always increases the need for manual labor.
    • B. It can lead to more efficient and automated production.
    • C. It reduces the need for quality control.
    • D. It makes businesses less reliant on skilled workers.

Answer Key

  1. C
  2. C
  3. C
  4. C
  5. B
  6. C
  7. C
  8. C
  9. C
  10. C
  11. C
  12. B
  13. C
  14. B
  15. D
  16. C
  17. B
  18. B
  19. A
  20. B
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