CAIE IGCSE Business Studies 3.1.2 understanding market changes
Practise market-change questions by explaining causes, applying effects to profit or marketing and judging the strongest impact.
- Syllabus
- 2027–2029
- Course
- Business 0264
Exam points
- Explain how changes in spending patterns or competition affect products, sales or profit.
- Apply responses such as new products, healthier menus or stronger promotion to the case.
- Justify which market change has the greatest effect after comparing business evidence.
3.1.2—Understanding market changes question 1
[Maximum number: 2]
NSL is a business based in country X．It manufactures food products including bread and breakfast cereals．NSL uses lean production in its factory．Maintaining quality is important．NSL imports 15% of its raw materials．Changes in country X＇s exchange rate can affect businesses which import raw materials．NSL＇s Marketing Manager knows the business should respond to changes in consumer spending patterns．She is aware that market research can be used to help make business decisions．
（b）Identify two reasons why consumer spending patterns might change．
Reason 1：
Reason 2：
Identify two reasons why consumer spending patterns might change.
Award 1 mark for each reason (max 2).
Points might include changes in:
- Price of product
- Price of competitors products/increased competition
- Incomes/wages/unemployment/business cycle or examples
- Population size/structure/life stage of consumers
- Taste/fashion/preferences
- Advertising/promotion
- Technology
- Taxation
- Interest rates
- Exchange rates
- Weather/season
Other appropriate responses should be credited.
Only award the first two responses given.
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