O Level Business Studies 7115 · Topic 1

Understanding business activity: past paper questions

88 real questionsasked in 10 of the last 10 exam series2019–2025usually: Explain, Identify, Define, Justify, Outline

Real questions on understanding business activity

The newest 20 of 88 written questions. Open one to see it on the real paper.

7115/11 · October/November 2025 · Q1b[2]
Define ‘secondary sector’.
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7115/11 · October/November 2025 · Q1c[4]
Identify four reasons why a business might remain small. Reason 1: Reason 3: Reason 4: Reason 2:
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7115/12 · October/November 2025 · Q3a[2]
Define ‘partnership’.
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7115/12 · October/November 2025 · Q3b[2]
Identify two ways to measure the size of a business. Way 1: Way 2:
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7115/21 · October/November 2025 · Q1a[8]
Explain two advantages and two disadvantages of a business being a private limited company. Advantage 1: Advantage 2: Disadvantage 1: Disadvantage 2:
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7115/11 · May/June 2025 · Q1a[2]
Define ‘business partnership’.
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7115/12 · May/June 2025 · Q3a[2]
Define ‘private sector’.
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7115/12 · May/June 2025 · Q3b[2]
Identify two reasons why new businesses are at a greater risk of failure. Reason 1: Reason 2:
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7115/12 · May/June 2025 · Q3c[4]
Identify four stakeholder groups a business might have. Stakeholder 1: Stakeholder 2: Stakeholder 4: Stakeholder 3:
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7115/12 · May/June 2025 · Q3d[6]
Explain two characteristics Hal will need to become a successful entrepreneur. Characteristic 1: Explanation: Characteristic 2: Explanation:
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7115/21 · May/June 2025 · Q1a[8]
Explain two advantages and two disadvantages to Philip of changing PF from a sole trader business to a private limited company. Advantage 1: Advantage 2: Disadvantage 1: Disadvantage 2:
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7115/22 · May/June 2025 · Q2a[8]
Explain one objective each of the following TSE stakeholder groups might have. Shareholders: Suppliers: Employees: Customers:
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7115/11 · October/November 2024 · Q2a[2]
Define ‘entrepreneur’.
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7115/11 · October/November 2024 · Q2b[2]
Define ‘business plan’.
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7115/11 · October/November 2024 · Q4b[2]
Identify one objective each of the following stakeholder groups might have: Employees: Customers:
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7115/12 · October/November 2024 · Q1a[2]
Identify two features of a private sector business. Feature 1: Feature 2:
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7115/12 · October/November 2024 · Q1b[2]
Identify two reasons why a business might remain small. Reason 1: Reason 2:
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7115/21 · October/November 2024 · Q1a[8]
Explain four reasons why a business might remain small. Reason 1: Reason 2: Reason 3: Reason 4:
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7115/22 · October/November 2024 · Q1a[8]
Explain two advantages and two disadvantages of BB being a public limited company. Advantage 1: Advantage 2: Disadvantage 1: Disadvantage 2:
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7115/22 · October/November 2024 · Q3a[8]
Explain one way each of the following stakeholder groups might be affected by a business becoming a multinational company. Effect on shareholders: Effect on employees: Effect on suppliers: Effect on the government:
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What examiners said

This term was not well understood by the majority of candidates. A mark of one was common as many responses offered a feature of unincorporated businesses such as unlimited liability. Weaker responses confused this with a sole trader enterprise and gained zero marks.
— Examiner report, October/November 2023, 7115/11 Q1(a) (Cambridge)

This question was well answered by many candidates with a range of suitable objectives being suggested. A small number of candidates confused objectives with barriers. Such candidates thought that objectives prohibited success.
— Examiner report, October/November 2023, 7115/11 Q1(b) (Cambridge)

This part (c) question required no application to the business stated in the stem. A wide variety of different characteristics were correctly stated. Many responses achieved full marks. Responses which did not gain full marks often stated that entrepreneurs must be charismatic or skilled. Such answers were too vague to be credited.
— Examiner report, October/November 2023, 7115/11 Q1(c) (Cambridge)

Practise this topic

Answer these questions online and get each one marked against the official mark scheme, with what you missed and how to fix it.

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In the syllabus

1.1.1 The purpose and nature of business activity: • Concepts of needs, wants, scarcity and

Importance of specialisation
Purpose of business activity
The concept of adding value and how added value can be increased

1.2.1 Economic sectors in terms of primary, • Basis of business classification, using examples to

Reasons for the changing importance of business classification, e.g. in developed and developing economies

1.3.1 Enterprise and entrepreneurship: • Characteristics of successful entrepreneurs

Contents of a business plan and how business plans assist entrepreneurs
Why and how governments support business start-ups, e.g. grants, training schemes

1.3.2 The methods and problems of measuring • Methods of measuring business size, e.g. number

Limitations of methods of measuring business size

1.3.3 Why some businesses grow and others remain • Why the owners of a business may want to

Different ways in which businesses can grow e.g. internal/external
Problems linked to business growth and how these might be overcome
Why some businesses remain small

1.3.4 Why some (new or established) businesses fail: • Causes of business failure, e.g. lack of

Why new businesses are at a greater risk of failing

1.4.1 The main features of different forms of • Sole traders, partnerships, private and public

Differences between unincorporated businesses and limited companies
Concepts of risk, ownership and limited liability
Recommend and justify a suitable form of business organisation to owners/management in a given situation
Business organisations in the public sector, e.g. public corporations

1.5.1 Businesses can have several objectives and the • Need for business objectives and the importance

Different business objectives, e.g. survival, growth, profit and market share
Objectives of social enterprises

1.5.2 The role of stakeholder groups involved in • Main internal and external stakeholder groups

How these objectives might conflict with each other, use examples

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