North Quay Bakery makes standard celebration cakes. A new supermarket nearby sells cheaper cakes. Customer interviews suggest that some buyers want personalised cakes, while others value higher-quality ingredients.
Option 1: Offer hand-painted designs, adding £9 to the input cost of each cake; some customers say they would pay up to £18 more
Option 2: Use higher-quality ingredients, adding £5 to the input cost of each cake; some customers say they would pay up to £8 more
Justify which one of these two options North Quay Bakery should choose to add value.
37 exam-style questions on Edexcel GCSE Business 1.1 Enterprise and entrepreneurship, covering 1.1.1a Why new business ideas come about: technology and consumers, 1.1.1b Why new business ideas come about: obsolescence, 1.1.1c How new business ideas come about, 1.1.2a Risk in business activity, 1.1.2b Reward in business activity, 1.1.3a The role and purpose of business activity, 1.1.3b Adding value, and 1.1.3c The role of entrepreneurship. Each one has a worked solution and a mark scheme showing where the marks go.