Cambridge International AS & A Level: Business 9609/22 October/November 2020

Cambridge International AS & A Level
BUSINESS 9609/22
Paper 2 Data Response October/November 2020
MARK SCHEME
Maximum Mark: 60
Published
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.
Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.
Cambridge International will not enter into discussions about these mark schemes.
Cambridge International is publishing the mark schemes for the October/November 2020 series for most
Cambridge IGCSE™, Cambridge International A and AS Level and Cambridge Pre-U components, and some
Cambridge O Level components.
This document consists of 20 printed pages.
© UCLES 2020 [Turn over

9609/22 Cambridge International AS & A Level – Mark Scheme October/November
PUBLISHED 2020
Generic Marking Principles
These general marking principles must be applied by all examiners when marking candidate answers.
They should be applied alongside the specific content of the mark scheme or generic level descriptors
for a question. Each question paper and mark scheme will also comply with these marking principles.
GENERIC MARKING PRINCIPLE 1:
Marks must be awarded in line with:
• the specific content of the mark scheme or the generic level descriptors for the question
• the specific skills defined in the mark scheme or in the generic level descriptors for the question
• the standard of response required by a candidate as exemplified by the standardisation scripts.
Marks awarded are always whole marks (not half marks, or other fractions).
Marks must be awarded positively:
• marks are awarded for correct/valid answers, as defined in the mark scheme. However, credit
is given for valid answers which go beyond the scope of the syllabus and mark scheme,
referring to your Team Leader as appropriate
• marks are awarded when candidates clearly demonstrate what they know and can do
• marks are not deducted for errors
• marks are not deducted for omissions
• answers should only be judged on the quality of spelling, punctuation and grammar when these
features are specifically assessed by the question as indicated by the mark scheme. The
meaning, however, should be unambiguous.
Rules must be applied consistently, e.g. in situations where candidates have not followed
instructions or in the application of generic level descriptors.
Marks should be awarded using the full range of marks defined in the mark scheme for the question
(however; the use of the full mark range may be limited according to the quality of the candidate
responses seen).
Marks awarded are based solely on the requirements as defined in the mark scheme. Marks should
not be awarded with grade thresholds or grade descriptors in mind.
© UCLES 2020 Page 2 of 20

PUBLISHED 2020
Question Answer Marks
1(a)(i) Define the term ‘revenue’ (line 2). 2
Knowledge Marks
A correct definition 2
A partial, vague or unfocused definition 1
No creditable content 0
Content
A correct definition should include the following elements (allow one mark
for each element):
• Revenue is the money received (by a business)
• for selling its products and services.
Alternatively, a candidate can gain BOTH marks for a correct formula:

• Price × quantity sold (2)
Exemplar Mark Rationale
Revenue is the money a firm gets 2 Both elements

from sales
Price × Quantity 2 Valid formula
The income of a firm 1 First element only
Revenue is the profit of a firm 0 Incorrect
1(a)(ii) Explain the term ‘unit costs’ (line 6). 3
Award one mark for each point of explanation:
Rationale Marks
C Example or some other way of showing good 1

understanding – only if both A and B marks have
been gained
B An understanding of unit – must be an idea of a 1

single product/good
A An understanding of costs – must be an idea that a 1

cost is something paid by a business or incurred
from production

PUBLISHED 2020
1(a)(ii) Content
Exemplar Marks Rationale
The amount that a business must pay 3 All three marks

out (A) to produce a single item (B).
For example, this may be what ES
has to pay out to produce a single unit
of energy.
How much a business pays (A) to 2 Both A and B marks

make a single produce (B).
Total costs/output. 2 Both A and B marks
Costs are incurred by a business by 1 A mark only

production.
The total costs, which include fixed 1 Clear understanding of

and variable costs of products divided a single unit, but no
by the number of products (B). explanation of what a
cost is.
What it costs for a unit (B). 1 ‘…a unit’ is enough for

the B mark.
The cost of one (B) unit of a good. An 1 A clear idea of a single

example would be the cost of one can unit. However,
of cola. example mark cannot
be given without A and
B marks awarded.
The cost of units. 0 Neither unit or cost is

explained.

PUBLISHED 2020
1(b)(i) Refer to Table 1.1. Calculate the difference in dollars received by each 3
director and each manager from the profit-sharing scheme.
Rationale Marks
Correct answer with or without correct working or $ 3
Correct calculation of Directors share and Managers share 2
Correct calculation of Directors share or Managers share 1
Content
• Directors share of the profit = 0.25% = 0.25% of $12 m = $30 000
($0.03 m)
• Managers share of the profit = 0.1% = 0.1% of $12 m = $12 000
($0.012 m)
• $30 000 – $12 000 = $18 000
Answer = $18 000 ($0.018 m)

OFR – award for the answer if there is clear working shown for the two
earlier numbers (even if both of these numbers are wrong)
Common answers
Answer Mark Rationale
18 000 3 Correct answer – does not need $
$12 m 1 Candidate has inverted the profit-

0.25 = $48 m sharing formula for both Directors and
Managers, which are not creditable.
$12 m However, the candidate then
0.1 = $120 m completes the last stage correctly and
based on their own figure (OFR)
$48 m + $120 m = should be awarded one mark.
$168 m
*OFR means the use of the own figure rule – this aims to reward a
candidate for the stages of a calculation that are correct, even if an earlier
stage or figure used is incorrect. An early mistake, for example, would
create all following calculations to have wrong answers, but these are still
rewardable (if correct when using a candidate’s own figures) Therefore the
candidate cannot gain marks for the stage that was incorrect, but can gain
all the subsequent marks.

PUBLISHED 2020
1(b)(ii) Explain one disadvantage to ES of using a profit-sharing scheme. 3
Level Knowledge and Application Marks
2b (APP) Explanation of one disadvantage to ES of a profit- 3

sharing scheme in context
2a (K+K) Explanation of one disadvantage to a business of 2

a profit-sharing scheme
1a (K) Identification of one disadvantage to a business of 1

a profit-sharing scheme
0 No creditable content 0
Content
• ES might not have enough retained profit to invest in the new licenses
for fracking.
• ES shareholders might sell their shares because of low dividends
leading to the company being taken over.
• Increases the costs of the business and therefore could make ES less
competitive (many competitors in the market).
• May cause employer/employee issues because of the different shares
gained (use of previous answers – OFR).
Example of how responses should be marked

Identification of a Explanation Possible context
disadvantage
The owners get less Which may lead to Because ES is a public

profit them selling their limited company
shares
There is less retained Which may lead to Which might stop their
profit for ES lower growth for ES expansion into future
fracking sites

PUBLISHED 2020
1(c) Analyse one internal source of finance and one external source of 8
finance that ES could use to purchase a fracking license.
Level Knowledge and Marks Analysis Marks

Application (4 marks) (4 marks)
2b Shows understanding 4 Good analysis of one 4

of one internal and one internal and one
external source of external source of
finance in context finance in context
2a Shows understanding 3 Good analysis of one 3

of one internal or one internal or one
finance in context finance in context
1b Shows knowledge of 2 Limited analysis of 2

one internal and one one internal and one
finance finance
1a Shows knowledge of 1 Limited analysis of 1

one internal or one one internal or one
finance finance
Content
Internal
• Retained earnings – ES made $12m profit in 2018, so likely to have
some retained earnings to use as a source of finance
• Sale of assets – ES owns some old coalmines – could these be sold to
raise finance for the licenses.
External
• Selling shares – plc so able to raise funds in this way – profitable and
may be able to sell on the basis of publicity that profits will increase
• Government grants – government of country X is very supportive of
fracking, so may be willing to give a grant to ES
• Bank loans – profitable business, promising future returns
Allow a rights issue (to current shareholders) as an internal source of

finance. However, simply selling shares (with no explicit reference to selling
to current shareholders) is an external source of finance.

PUBLISHED 2020
1(c)
Example of an Examples of Examples of possible
internal source of application/context analysis (AN + DEV)
finance (K) (APP)
Retained profit (K) ES had $12m retained Does not need to be

profit in 2019 (APP) repaid (AN) but there
is an opportunity cost
(DEV)
Example of an Examples of Examples of possible

external source of application/context analysis (AN + DEV)
finance (K) (APP)
Sell shares (K) ES is a Public Limited So, by selling shares

Company (APP) this can release cash
to finance the
purchase of the
fracking license (AN),
however, this may lead
to a loss of control by
the current owners
(DEV)

PUBLISHED 2020
1(d) Evaluate how two external stakeholders of ES might be affected by the 11

company continuing to use the fracking process.
Knowledge and Marks Analysis and Evaluation Marks

Justified evaluation based 7

on arguments in context
Developed evaluation 6
based on arguments in
context
An evaluative statement 5
based on arguments in
context
Shows understanding of 4 Arguments based on the 4

two external stakeholders effect on two external
in context stakeholders in context
Shows understanding of 3 Arguments based on the 3

one external stakeholder effect on one external
in context stakeholder in context
2 Limited analysis of the 2

Shows knowledge of two
effect on two external
external stakeholders
stakeholders
1 Limited analysis of the 1

Shows knowledge of one
effect on one external
external stakeholder
stakeholder

PUBLISHED 2020
1(d) Content
• Local community/society – devaluation of houses, earthquakes,
pollution
• Activists/environmentalists/pressure groups – damage to the natural
environment, pollution etc.
• Potential investors – attracted to future profit but could be put off by bad
publicity (not current shareholders)
• Potential employees – Growth in jobs
• Customers – cheaper energy, cost of living
• Suppliers – increased demand because of ES growing
• Lenders – risk of bad publicity or government changing mind at a later
date
• Government – increase energy self-sufficiency, increased tax revenue,
economic growth
• Competitors – May lead them to having to purchase a fracking license
and increasing costs to compete
Analysis should be focussed on the effect on each stakeholder (not the

business).
Evaluation is most likely to be demonstrated by:

• The relative level of effect on each stakeholder
• Which stakeholder is likely to be most affected
• Whether the effect on each stakeholder is likely to be all bad or all good
• How external stakeholder’s effects might be mitigated

PUBLISHED 2020
1(d) Examples of how an answer could develop and how it should be annotated.
K APP AN DEV EVAL
Government Gain money Allows the Which may The local

(K). from selling government increase community
the licenses to invest in the welfare are likely to
(APP). infrastructure of the be most
(AN). citizens of affected
country X (EVAL)
(DEV). because
they also
have to
suffer from
earthquakes
Local Who live This means Which whereas the
community near a their houses might government
(K). fracking site are worth less mean they will get the
may see a (AN) get less money from
reduction in money if the licenses
the price of they sell no matter
their home their home what
(APP). (DEV). (EVAL).
However,
this depends
on whether
the people
keep voting
for the
government
(EVAL).

PUBLISHED 2020
1(d)
K APP AN DEV EVAL
Customers May get Which And have The

(K). cheaper means the more money customers
energy customers to spend on are likely to
through ES have to pay household only benefit
growing less for their goods from ES
(APP). energy (AN). (DEV). continuing to
use the
Competitors May find Which And may fracking
(K) more increases reduce their process
competition their costs profit (DEV). (EVAL)
for fracking (AN). because
licenses increased
(APP). competition
may lead to
even lower
prices
(EVAL).
However,
this depends
on whether
ES and their
competitors
reduce their
prices
(EVAL).

PUBLISHED 2020
2(a)(i) Define the term ‘cost-based pricing’ (line 14). 2
Knowledge Marks
A correct definition 2
A partial, vague or unfocused definition 1
Content
A correct definition should include the following elements (allow one mark
for each element):
• An amount is added on to give the amount the customer must pay (1)
• Based on the cost to produce a product (1)
The business works out how much it 2 Both elements.

costs to make a product and then
adds on a set percentage.
Adding on to the costs. 1 Second element only.
Cost-based pricing means pricing a 1 First element only –

product based on the costs of based on the costs of
production. production is good
enough.
Cost-based pricing means pricing 0 Tautology

based on the costs.

PUBLISHED 2020
2(a)(ii) Explain the difference between ‘cash’ (line 15) and ‘profit’ (line 15). 3
Award one mark for each point of explanation:
Rationale Marks
C Explanation of the difference between cash and profit 1
B Understanding of profit 1
A Understanding of cash 1
Content
• Cash is the liquidity of a firm – the money available to pay
debts/bills/everyday costs
• Profit is the difference between cost and revenue.
• Cash is required and will come from revenue, but not all cash is profit
as costs need to be paid.
• Cash is an asset of the business.
• Cash is required to run a business, whereas profit is something to aim
for.
• A business is unlikely to operate without cash but can operate without
profit.
A business is unlikely to 3 A difference shown, so all three

operate without cash but marks gained – the candidate
can operate without profit does not need to show
(C). understanding of cash or profit if
a valid difference has been
explained.
Cash can be used to pay 3 Clear understanding of both cash

the business costs (A) and profit, the word ‘whereas’
whereas profit is the shows a difference.
difference between costs
and revenue (B).
Cash can be used to pay 2 Two statements but no attempt

the business costs (A). to compare them, so only two
Profit is the difference marks.
between costs and revenue
(B).

PUBLISHED 2020
2(b)(i) Refer to Table 2.1 and any other relevant information. Calculate the 3
revenue GT will receive from all the performances of ‘A Summer
Dream’ in January 2021.
Rationale Marks
Correct answer with or without correct working or $ 3
Correct calculation of TR 2
Correct use of numbers 1
Content
Formula: $40 × (250 tickets × 9 performances)
$40 × 2250
= $90 000 (TR)
50% of revenue to GT = $90 000 / 2 = $45 000
Answer = $45 000
OFR
Common incorrect answers
Answer Mark Rationale
45 000 3 Correct answer – does not

need $
$40 × 9 = $360 2 Candidate has missed out the

$360 / 2 = £180 number of seats – however, all
the other stages of the
calculation have been
completed correctly (OFR).
$180 (no working) 0 Do not reward incorrect

answers without working to
show correct stages of the
calculation.
$40 × 250 = 10 000 2 Candidate has missed out the

50% of 10 000 = $5000 number of performances –
however, all the other stages
of the calculation have been
completed correctly (OFR).
$5000 (no working) 0 Do not reward incorrect

answers without working to
show correct stages of the
calculation.

PUBLISHED 2020
2(b)(ii) Explain one possible advantage to GT, other than increased revenue, 3
of renting the theatre to visiting groups.
Level Knowledge and Application Marks
2 (APP) Explanation of an advantage of renting the theatre 3

to visiting groups
2 (K + K) Explanation of an advantage of renting a capital 2

item
1 (K) Identification of an advantage of renting a capital 1

item
Content
• Reduces the risk of operating the theatre
• Reduces the average cost of productions (fixed costs are spread over
more performances)
• May advertise GT performances at a visiting group
• Makes use of a redundant resource/capital item
• Increases GT’s usage of the theatre
• Increases GT’s cashflow
ARA
Identification of a Explanation Possible context

difficulty
Advertises the theatre. Which may bring in For example, GT can

more customers to a advertise Wise Owl
GT show. during the
performances of A
Summer Dream.
Spreads fixed costs. Because the extra Such as upkeep of the

performances can be building.
allocated some of the
fixed costs.

PUBLISHED 2020
2(c) Analyse two factors which might affect the demand for the 8
performances at GT’s theatre.
Level Knowledge and Marks Analysis (4 marks)

Marks
Application (4 marks)
2b Shows understanding 4 Good analysis of

of two factors affecting two factors affecting 4
demand in context demand in context
2a Shows understanding 3 Good analysis of

of one factor affecting one factor affecting 3
demand in context demand in context
1b Shows knowledge of 2 Limited analysis of

two factors affecting two factors affecting 2
demand demand
1a Shows knowledge of 1 Limited analysis of

one factor affecting one factor affecting 1
demand demand
Content
Candidates may choose to analyse the demand from consumers or the
demand from visiting theatre groups
• Changes in income – being a normal/luxury product, consumers are
likely to increase spending on GT performances based on increasing
income.
• Fashions/trends/tastes/preferences – going to the theatre may become
fashionable, or may become a new trend
• Advertising – if GT spend on advertising, then it is likely to increase
demand for their performances
• Brand awareness
• Price of substitutes/complements
• Availability of substitutes/compliments (for example Netflix, Amazon,
other theatres)
• Population size
• Quality
• Uniqueness (USP)
• Price – likely to be an increase in QD if price falls and vice versa.

PUBLISHED 2020
2(c)
Example of a Examples of Examples of possible
factor (K) application/context analysis (AN + DEV)
(APP)
Tastes of Customers obviously Which means that more

customers (K) prefer A Summer Dream tickets were sold for A
to La Poeme Ballet (APP) Summer Dream (AN) and
this gains GT more profit
(DEV)
Income (K) Theatre tickets are likely to Which means that the
be a luxury good (APP) higher the income the
more tickets GT will sell
(AN) and the more profit
GT will make (DEV)

PUBLISHED 2020
2(d) Recommend whether GT should employ Nick or Portia for the position 11
of Theatre Manager. Justify your recommendation.
Knowledge and Marks Analysis and Evaluation Marks

Justified recommendation
7
based on argument in context
Developed recommendation
6
based on argument in context
A recommendation /
evaluative statement based on 5
argument in context
Shows understanding Argument based on factor(s)

of two factors of 4 affecting the selection of Nick 4
selection in context and Portia
Shows understanding Argument based on factor(s)

of one factor of 3 affecting the selection of Nick 3
selection in context or Portia
Limited analysis of factor(s)

Shows knowledge of
2 affecting the selection of Nick 2
two factors of selection
and Portia
Limited analysis of factor(s)

Shows knowledge of
1 affecting the selection of Nick 1
one factor of selection
or Portia
Content
Nick
• Experience in the sector (three years for a similar business)
• A-Level in Business – helps with the admin
• Organised and efficient – helps with the admin
• No management experience – so will he be able to do the job?
• May not stay for long
Portia
• Eight years of experience in a bank – helps with finance
• Good sense of humour – likely to help in job
• Likely to stay for a long time
• No formal qualifications – but is this made up for by the bank
experience?
• Late for the interview – does this suggest she is disorganised –
however worked for the bank for eight years

PUBLISHED 2020
2(d) Examples of how an answer could develop
K APP AN DEV EVAL
Experience Nick has That could Leading to a Nick is the

(K). appropriate mean that better better person
theatre GT has to chance for to employ
experience, pay less GT to make (EVAL)
which training profit (DEV) because
means he costs if they experience in
knows what hire Nick a theatre is
to do (APP). (AN). more
important
than
personality in
a job that
requires
administration
and
accounting
Personality Portia has a Which may Which may (EVAL).
(K) good sense mean that lead to an However, this
of humour GT attracts increase in might depend
making her more visiting revenue for on how
easier to theatre GT (DEV). complex the
work with companies accounting is
(APP). (AN). as Portia’s
banking
experience
might make
her the better
employee
(EVAL).

Cambridge International AS & A Level: Business 9609/22 October/November 2020

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Cambridge International AS & A Level: Business 9609/22 October/November 2020

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Cambridge International AS & A Level

This document consists of 20 printed pages.

© UCLES 2020 [Turn over

Generic Marking Principles

GENERIC MARKING PRINCIPLE 1:

Marks must be awarded in line with:

GENERIC MARKING PRINCIPLE 2:

GENERIC MARKING PRINCIPLE 3:

Marks must be awarded positively:

GENERIC MARKING PRINCIPLE 4:

GENERIC MARKING PRINCIPLE 5:

GENERIC MARKING PRINCIPLE 6:

© UCLES 2020 Page 2 of 20

Question Answer Marks

1(a)(i) Define the term ‘revenue’ (line 2). 2

A partial, vague or unfocused definition 1

Alternatively, a candidate can gain BOTH marks for a correct formula:

Exemplar Mark Rationale

Revenue is the money a firm gets 2 Both elements

Price × Quantity 2 Valid formula

The income of a firm 1 First element only

Revenue is the profit of a firm 0 Incorrect

1(a)(ii) Explain the term ‘unit costs’ (line 6). 3

Award one mark for each point of explanation:

C Example or some other way of showing good 1

B An understanding of unit – must be an idea of a 1

A An understanding of costs – must be an idea that a 1

© UCLES 2020 Page 3 of 20

Question Answer Marks

Exemplar Marks Rationale

The amount that a business must pay 3 All three marks

How much a business pays (A) to 2 Both A and B marks

Total costs/output. 2 Both A and B marks

Costs are incurred by a business by 1 A mark only

The total costs, which include fixed 1 Clear understanding of

What it costs for a unit (B). 1 ‘…a unit’ is enough for

The cost of one (B) unit of a good. An 1 A clear idea of a single

The cost of units. 0 Neither unit or cost is

© UCLES 2020 Page 4 of 20

Question Answer Marks

Correct answer with or without correct working or $ 3

Correct calculation of Directors share and Managers share 2

Correct calculation of Directors share or Managers share 1

Answer = $18 000 ($0.018 m)

Answer Mark Rationale

18 000 3 Correct answer – does not need $

$12 m 1 Candidate has inverted the profit-

© UCLES 2020 Page 5 of 20

Question Answer Marks

1(b)(ii) Explain one disadvantage to ES of using a profit-sharing scheme. 3

Level Knowledge and Application Marks

2b (APP) Explanation of one disadvantage to ES of a profit- 3

2a (K+K) Explanation of one disadvantage to a business of 2

1a (K) Identification of one disadvantage to a business of 1

Example of how responses should be marked

The owners get less Which may lead to Because ES is a public

© UCLES 2020 Page 6 of 20

Question Answer Marks

Level Knowledge and Marks Analysis Marks

2b Shows understanding 4 Good analysis of one 4

2a Shows understanding 3 Good analysis of one 3

1b Shows knowledge of 2 Limited analysis of 2

1a Shows knowledge of 1 Limited analysis of 1