Question 1: Define the term 'business growth'. Explain two different ways a business can grow.

Answer: Business growth refers to an increase in the size or scale of a business, often measured by revenue, sales, or number of employees. Two ways a business can grow are: expanding its product range to attract more customers, and opening new branches in different locations.

Question 2: Identify and describe two internal methods a business might use to achieve growth.

Answer: Internal methods include: 1) Increasing sales through marketing and advertising to attract more customers; 2) Improving productivity or efficiency to produce more goods or services with the same resources.

Question 3: List two external methods of business growth and briefly explain each.

Answer: External methods include: 1) Mergers and acquisitions, where a business joins with or buys another business to expand quickly; 2) Franchising, where a business allows others to operate using its brand and systems to grow its presence.

Question 4: Describe one benefit and one drawback of business expansion through franchising.

Answer: Benefit: Franchising allows rapid expansion with less capital investment from the franchisor. Drawback: The franchisor may lose some control over how franchisees operate, which can affect brand reputation.

Question 5: Explain why a business might choose to expand by opening new branches rather than through a merger.

Answer: A business might prefer opening new branches to maintain full control over each location and to avoid potential integration problems associated with mergers.

Question 6: A local bakery wants to expand. Suggest two internal strategies it could use to grow and justify your choices.

Answer: The bakery could increase marketing efforts to attract more customers and introduce new products to boost sales. These strategies directly utilize existing resources and customer base to promote growth.

Question 7: Sketch a simple diagram showing a business expanding through vertical integration. Label the diagram clearly.

Answer: A correct sketch would show a business (e.g., a car manufacturer) acquiring or controlling a supplier (e.g., a tyre company) or a retailer (e.g., a dealership), with arrows indicating the integration process.

Question 8: Identify two risks associated with rapid business expansion.

Answer: Risks include overextending finances, which can lead to cash flow problems, and diluting the quality of products or services, which can damage reputation.

Question 9: Explain how technological advancements can support a business's growth strategy.

Answer: Technological advancements can improve efficiency, reduce costs, and enable businesses to reach more customers through online platforms, all of which support growth.

Question 10: Draw a flowchart illustrating the different stages a business might go through when expanding geographically.

Answer: A correct flowchart would start with 'Market Research', followed by 'Planning', then 'Pilot Opening', 'Evaluation', and finally 'Full Expansion'.