CAIE IGCSE Business Studies 3.4 Legal Controls Questions
Practise how marketing laws affect promotion, pricing, packaging and product safety decisions in business case studies.
- Syllabus
- 2027–2029
- Course
- Business 0264
Exam points
- identify ways legal controls can change adverts, prices, packaging or product safety claims
- judge which marketing control has the greatest impact using the business product and customer risk
Covered syllabus points
Question 1
[Maximum number: 2]
CFG is a social enterprise. It buys cocoa beans from local farmers and then uses the beans to make chocolate. Being ethical is important to the business. CFG has developed a new chocolate bar. The Marketing Manager plans to use skimming as its pricing method, and retailers as its distribution channel for the new product. He knows there are many legal controls over marketing that might affect a business.
Identify two ways legal controls over marketing might affect a business.
Way 1:
Way 2:
Award 1 mark per way (max 2).
Points might include:
- No misleading promotion/advertising
- No price fixing/charging very high prices where there is little or no competition
- No selling faulty/dangerous goods/certain ingredients
- Ensure products are fit for purpose
- Price reductions must be genuine
- Increased costs to meet the legal controls/pay fines
- Spend longer time ensuring they meet the legal controls
- May need to alter packaging
- Restrictions on advertising certain products to some age groups/places.
Other appropriate responses should also be credited.
Only award the first two responses given.
Question 2
[Maximum number: 2]
Viktor is starting up a business as a photographer. He will be a sole trader. Quality control will be important. Viktor plans to use sampling when carrying out market research. There are legal controls which could affect his marketing strategy. Viktor will employ 5 photographers. He knows there are many ways to motivate employees.
Identify two ways legal controls could affect marketing strategy.
Way 1:
Way 2 :
Award 1 mark for each relevant way (max 2).
Points may include:
- Cannot make misleading/false claims in advertisements / may have to change/withdraw/restrict how or where advertise/promote
- Increase costs/time (spent on marketing)
- May have to change what is written on packaging / make sure product description is accurate/not misleading on packaging
- Could lead to restrictions about where they can sell it
- Cannot sell underweight goods
- Goods must be fit for purpose
- Cannot charge less than minimum price set / cannot charge more than maximum price set / cannot fix prices (with competitors)
Other appropriate responses should also be credited.
Only award the first two responses given.
Question 3
[Maximum number: 2]
Caleb wants to be an entrepreneur. He plans to start up a business selling handmade furniture including tables and chairs. He will sell his products to a niche market. Having a good brand image will be important. Caleb knows there are many legal controls that can impact his marketing strategy. He is considering selling his products using e-commerce. Caleb also has to decide on a suitable location for the business.
Identify two impacts of legal controls on marketing strategy.
Impact 1:
Impact 2:
Award 1 mark per impact (max 2).
Points might include:
- Cannot make misleading / false claims in advertisements / adverts may have to be changed or withdrawn / influence where / when / who it can be advertised
- Increase costs / time spent on marketing
- May have to change what is written on packaging / ensure product description is accurate on packaging / make sure information promotion / packaging is not misleading
- Cannot sell underweight goods
- Cannot charge less than minimum price set / cannot charge more than maximum price set / cannot fix prices (with competitors)
Other appropriate responses should also be credited.
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