Cambridge IGCSE™: Business Studies 0450/22 February/March 2022

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Cambridge IGCSE™
BUSINESS STUDIES 0450/22

Paper 2 Case Study February/March 2022
MARK SCHEME
Maximum Mark: 80
Published
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.
Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.
Cambridge International will not enter into discussions about these mark schemes.
Cambridge International is publishing the mark schemes for the February/March 2022 series for most
Cambridge IGCSE™, Cambridge International A and AS Level components and some Cambridge O Level
components.
This document consists of 21 printed pages.
© UCLES 2022 [Turn over

0450/22 www.dynamicpapers.com
Cambridge IGCSE – Mark Scheme February/March 2022
PUBLISHED
Generic Marking Principles
These general marking principles must be applied by all examiners when marking candidate answers.
They should be applied alongside the specific content of the mark scheme or generic level descriptors
for a question. Each question paper and mark scheme will also comply with these marking principles.
GENERIC MARKING PRINCIPLE 1:
Marks must be awarded in line with:
• the specific content of the mark scheme or the generic level descriptors for the question
• the specific skills defined in the mark scheme or in the generic level descriptors for the question
• the standard of response required by a candidate as exemplified by the standardisation scripts.
Marks awarded are always whole marks (not half marks, or other fractions).
Marks must be awarded positively:
• marks are awarded for correct/valid answers, as defined in the mark scheme. However, credit
is given for valid answers which go beyond the scope of the syllabus and mark scheme,
referring to your Team Leader as appropriate
• marks are awarded when candidates clearly demonstrate what they know and can do
• marks are not deducted for errors
• marks are not deducted for omissions
• answers should only be judged on the quality of spelling, punctuation and grammar when these
features are specifically assessed by the question as indicated by the mark scheme. The
meaning, however, should be unambiguous.
Rules must be applied consistently, e.g. in situations where candidates have not followed
instructions or in the application of generic level descriptors.
Marks should be awarded using the full range of marks defined in the mark scheme for the question
(however; the use of the full mark range may be limited according to the quality of the candidate
responses seen).
Marks awarded are based solely on the requirements as defined in the mark scheme. Marks should
not be awarded with grade thresholds or grade descriptors in mind.
© UCLES 2022 Page 2 of 21

PUBLISHED
Social Science-Specific Marking Principles

(for point-based marking)
1 Components using point-based marking:

• Point marking is often used to reward knowledge, understanding and application of skills.
We give credit where the candidate’s answer shows relevant knowledge, understanding
and application of skills in answering the question. We do not give credit where the answer
shows confusion.
From this it follows that we:
a DO credit answers which are worded differently from the mark scheme if they clearly
convey the same meaning (unless the mark scheme requires a specific term)
b DO credit alternative answers/examples which are not written in the mark scheme if they
are correct
c DO credit answers where candidates give more than one correct answer in one
prompt/numbered/scaffolded space where extended writing is required rather than list-type
answers. For example, questions that require n reasons (e.g. State two reasons …).
d DO NOT credit answers simply for using a ‘key term’ unless that is all that is required.
(Check for evidence it is understood and not used wrongly.)
e DO NOT credit answers which are obviously self-contradicting or trying to cover all
possibilities
f DO NOT give further credit for what is effectively repetition of a correct point already
credited unless the language itself is being tested. This applies equally to ‘mirror
statements’ (i.e. polluted/not polluted).
g DO NOT require spellings to be correct, unless this is part of the test. However spellings of
syllabus terms must allow for clear and unambiguous separation from other syllabus terms
with which they may be confused (e.g. Corrasion/Corrosion)
2 Presentation of mark scheme:

• Slashes (/) or the word ‘or’ separate alternative ways of making the same point.
• Semi colons (;) bullet points (•) or figures in brackets (1) separate different points.
• Content in the answer column in brackets is for examiner information/context to clarify the
marking but is not required to earn the mark (except Accounting syllabuses where they
indicate negative numbers).
3 Calculation questions:
• The mark scheme will show the steps in the most likely correct method(s), the mark for
each step, the correct answer(s) and the mark for each answer
• If working/explanation is considered essential for full credit, this will be indicated in the
question paper and in the mark scheme. In all other instances, the correct answer to a
calculation should be given full credit, even if no supporting working is shown.
• Where the candidate uses a valid method which is not covered by the mark scheme,
award equivalent marks for reaching equivalent stages.
• Where an answer makes use of a candidate’s own incorrect figure from previous working,
the ‘own figure rule’ applies: full marks will be given if a correct and complete method is
used. Further guidance will be included in the mark scheme where necessary and any
exceptions to this general principle will be noted.

PUBLISHED
4 Annotation:
• For point marking, ticks can be used to indicate correct answers and crosses can be used
to indicate wrong answers. There is no direct relationship between ticks and marks. Ticks
have no defined meaning for levels of response marking.
• For levels of response marking, the level awarded should be annotated on the script.
• Other annotations will be used by examiners as agreed during standardisation, and the
meaning will be understood by all examiners who marked that paper.

PUBLISHED
Question Answer Marks
1(a) Explain four methods a business could use to communicate with its 8
employees.
Award 1 mark for each relevant method (maximum of four).

Award a maximum of 1 additional mark for each explanation.
There are no application marks available for this question.
Relevant methods might include:

• Memo – short written message that can be on paper or emailed
• Letter – when more of a formal document is required such as informing
an employee of dismissal
• Report – a detailed document about a particular issue or problem
• Notice/Poster – put on a board so that all employees can read the
detailed information on it
• Text message – can be quickly sent to employees’ mobile phones and
can be reread if necessary
• PowerPoint presentation – can give a lot of visual information in a
meeting with employees/managers
• Meeting with employees/briefing/video conferencing – can give
information to many employees at once and feedback is not necessary
• Face-to-face conversation - where the manager can discuss an issue with
an employee / can be two-way communication with an employee / give
instructions to an employee
• Telephone/mobile phone call – two-way communication which allows
discussion/explanation
• Email - can send detailed information which the employees can refer
back to in the future
• Tannoy/public address (PA) system
• Newsletter
• Social media
For example: Phone call using mobile phone (1) allows discussion of any
issues so questions can be answered straight away (1)

PUBLISHED
1(b) Consider the following three ways the internet could be used to improve 12
the promotion of MH. Which is the best way for Sadiq to choose? Justify
your answer.
• Improve its existing website.

• Advertise using social media.
• Email special offers to existing customers.
Level Description Marks
Sound application of knowledge and understanding

of relevant business concepts using appropriate
terminology.
Detailed discussion of two or more ways.

3 9–12
Well-justified recommendation.
Candidates discussing the three ways in detail, in

context and with a well-justified recommendation
including why the alternative ways were rejected
should be rewarded with the top marks in the band.

terminology.
Detailed discussion of at least one way.

2 5–8
Judgement with some justification / some evaluation
of choice made.
Candidates discussing two or more ways in detail

and applying them to the case should be rewarded
with the top marks in the band.
Limited application of knowledge and understanding

of relevant business concepts.
Limited ability to discuss the ways with little/no

explanation.
1 1–4
Simple judgement with limited justification / limited
evaluation of choice made.
Candidates outlining the three ways in context

0 No Creditable Response 0

PUBLISHED
1(b) Relevant points might include:
Advantages Disadvantages
• Makes the hotel • Increased costs of

information more paying for a
accessible to specialist to carry
potential customers out the website
searching for a hotel improvements
and make them • On-going costs of
more likely to book maintenance of the
a room website, e.g.
• The website now updating room
may look more prices
attractive as some • Search engines may
guests have said not bring up the
the current website hotel on the first
is boring so more page of a search
photographs may unless Sadiq pays
attract potential for this and can be
Improve its customers to book expensive
existing website • Have complete • Relies on people
control over the way finding the website /
the hotel is shown in may be relatively
the adverts unknown
• Room prices can be
quickly updated
• Can include
interactive adverts,
which are more
attractive than static
adverts in
magazines or
newspapers
• Website can be
used for exclusive
offers direct to
consumer

PUBLISHED
1(b)
• Can target specific • Can easily be

demographic groups ignored as there are
such as higher a lot of adverts on
income earners social media
• Viral marketing / • Can be expensive
share information for MH to pay for
with family and pop-ups to ensure
friends enables the hotel is seen by
recommendations to a large group of
be spread quickly people
and to a large group • Potential customers
of potential may not use social
customers who may media and therefore
Advertise using
want to book a room they will not be
social media
at the hotel aware of the hotel
• Potential customers • Bad reviews can
will see an advert for lead to fewer
the hotel when they bookings and the
go to sites such as bad reviews may be
Facebook, which unfair if only a small
increases proportion of reviews
awareness of the are bad
hotel
• Social media widely
used by consumers
– large scale
exposure
• Cheap way to get • Email may go into

information to a lot spam and so be
of existing hotel ignored
customers • No guarantee the
• Emails go direct to email address is
existing customers, correct and therefore
so it targets tourists will not be seen by
who are more likely tourists
to return to the hotel • Existing customers
Email special
• May reach tourists may see this as
offers to existing
that are in other annoying and get a
customers
countries and are negative view of the
difficult to reach in hotel
other ways • Only sent to existing
• Directs more traffic customers / some
to the website customers may not
have email so not
targeting new
customers / may be
less effective

PUBLISHED
1(b)
Justification might include:
• Updating the website is the best option to
choose as it can include a lot of information
about the hotel which the other two alternatives
do not. It can include interactive sections that
may be more attractive than those in an email or
social media advert which are likely to be more
limited.
• Social media is the best as the advert is more
likely to be seen than a website, which has to be
searched for and social media will appear
Recommendation immediately. Viral marketing means that people
using social media can more quickly spread
information than the website and emails to
thousands of people about the hotel especially if
these guests have had a good holiday there.
• Using emails is the best one to choose as the
alternatives require that people look for the
website or stop and read the social media advert
and they may ignore it. An email is less likely to
be ignored and targets people who have already
been a customer and therefore may be more
likely to read the email and return to the hotel.

PUBLISHED
2(a) Explain one advantage and one disadvantage to Sadiq of delegating 8

tasks to his employees.
Award 1 mark for each advantage/disadvantage (maximum of two marks).

Award a maximum of 3 additional marks for each explanation of the
advantage/disadvantage of delegating tasks – one of which must be
applied to this context.
Relevant advantages might include:

• Would allow Sadiq to give more time to other tasks - more time to make
better decisions as not rushed - improves the success of the hotel / less
likely to make mistakes
• Sadiq could keep more control of the whole business - if he has some
time to devote to checking on and communicating with his employees –
he will be more aware of what is happening in the business and if
anything needs changing
• Employees could be more motivated – as feel trusted to do additional
tasks / work is more interesting – increases efficiency
• May be able to monitor/measure success of employees more easily
• Employees may be more productive as their skills are developed
Relevant disadvantages might include:

• Sadiq could lose some control – as tasks are carried out by employees
who may not know what to do – employees may make the wrong
decisions
• Sadiq may need to train the employees – so that they know how to carry
out the delegated tasks – which will increase costs in the short-term
• Mistakes may be made by subordinates – this may lead to customer
complaints – bad reputation for the business
For example: Sadiq may have more time to spend carrying out his tasks
(1) such as marketing the hotel (app) so he will be able to concentrate on
these tasks and be less likely to make mistakes (1) improving the reputation
of the business and potentially increasing sales (1).
Application could include: Sadiq works 60 to 90 hours a week; reference to

employees listed in the organisational chart in Appendix 1; 40 employees;
hotel; sole trader.

PUBLISHED
2(b) Consider the following three ways Sadiq could achieve a high-quality 12
service at MH. Which is the most effective way? Justify your answer.
• Only buying food ingredients from suppliers that guarantee good

quality.
• The room cleaners made responsible for checking their own work.
• Chefs regularly sampling food before it is served to guests.

terminology.

3 9–12
Well-justified conclusion.
Candidates discussing all three ways in detail, in

context and with a well-justified conclusion including
why the alternative ways were rejected should be
rewarded with the top marks in the band.

terminology.

2 5–8
of choice made.
Candidates discussing at least two ways in detail

and applying them to the case should be rewarded
with the top marks in the band.


explanation.
1 1–4
Candidates outlining all three ways in context should

be rewarded with the top marks in the band.
0 No creditable response. 0

PUBLISHED

• Ensures the meals • Costs of ingredients

are of high quality if are likely to be
the ingredients are higher and therefore
of a good standard menu prices may
• Less likely to have to have to rise or
throw away poor profits reduced
quality food so these • May limit some of
costs are reduced the types of
Only buying food ingredients used to
ingredients from only those that are
suppliers that supplied by these
guarantee good businesses –
quality reduces menu
options
• May increase costs
if need to find new
supplier
• Quality may be
lower for other
reasons such as low
skill of the chef
• Can remove the • The standard may

need for a fall as cleaners of
supervisor the hotel rooms may
• This is a type of not realise the
quality assurance standard required
and can motivate unless trained –
room cleaners at the relies on cleaners
hotel as they will being committed to
feel trusted the job
The room • Should eliminate • Training costs are
cleaners made poor quality room likely to rise as the
responsible for cleaning and reduce cleaners will require
checking their the number of training on how to
own work complaints produce the high-
quality service
required
• Cleaners may want
higher wages as
more responsibility
• Efficiency may
reduce if take longer
to clean the rooms

PUBLISHED
2(b)
• Should ensure every • Wasteful of time for

meal is of a the chefs when they
consistent standard could be getting on
and no bad meals with cooking the
are served. It is a next meals
Chefs regularly form of quality • Expensive if the
sampling food control meal has to be
before it is served • Fewer customer scrapped – better to
to guests complaints about the find the problem
restaurant leading earlier in the process
to recommendations • Identifies the poor-
and possibly higher quality meal but
sales does not identity
where the fault lies
Conclusion Justification might include:

• Having good quality ingredients is the most
important even if the costs are slightly higher as
this should ensure the meal is of good quality
and will not need to be regularly checked by the
chef as they will know it is of good quality
without having to check. The room cleaning is
less important as it can still be checked by
supervisors to ensure they are reasonably clean
but poor-quality food in the restaurant will lead
to a poor reputation and possibly lost sales.
• Having clean rooms is the most important. Hotel
guests may not eat at the hotel restaurant, but
they will stay in the rooms so if the rooms are
not cleaned well, then the hotel will get a bad
reputation and will lose guests to competitors.
• Chefs regularly sampling meals should ensure
that the restaurant will not receive customer
complaints and even if slightly lower quality
ingredients are purchased then a good chef may
still be able to cook a good meal. Hotel guests
may spend very little time in their hotel room and
therefore the quality of the cleaning may be of
less importance to them.

PUBLISHED
3(a) Explain four advantages to Sadiq of changing his business to a 8

partnership.
Award 1 mark for each relevant advantage (maximum of four).

Award a maximum of 1 additional mark for each explanation in context.
Relevant advantages might include:

• Able to raise more capital from partners – needs $10 000 for each room
for redecoration if chooses Option 2
• Responsibilities/decisions can be shared
• More ideas from new partners – could offer advice about what new
facilities could be provided for hotel guests
• Partners can specialise in particular tasks where they have specific skills
– such as take over the financial decisions as Sadiq has few financial
skills
• Other partner can cover if absent or ill – Sadiq could take time off and not
work 60–90 hours each week
• Share costs and risk
For example: Partners can specialise in a particular task (1) because Sadiq
currently carries out finance tasks and he is not very skilled at doing this
(app).
Application could include: Sadiq works 60 to 90 hours a week; reference to

employees listed in the organisational chart in Appendix 1; 40 employees;
needs $10 000 for each room; redecoration of rooms; hotel guests; wants to
increase revenue; sole trader; improve quality of customer service; no
savings; improve cash flow.

PUBLISHED
3(b) Consider the two options for Sadiq to increase MH’s revenue. Which 12
option should he choose? Justify your answer using suitable
calculations.

terminology.
Detailed discussion of both options.

3 9–12
Well-justified recommendation.
Candidates discussing both options in detail, in

context and with a well-justified recommendation
including why the alternative option was rejected

terminology.
Detailed discussion of at least one option.

2 5–8
of choice made.
Candidates discussing at least one option in detail

and applying it to the case should be rewarded with
the top marks in the band.

Limited ability to discuss the options with little/no

explanation.
1 1–4
Candidates outlining both options in context should


PUBLISHED

Option 1 • A reduction in price • Revenue per night

to $50 could lead to will fall by $500 if no
an increase in extra guests come to
revenue to $3750 the hotel
per night
• An increase in • A lower price may

revenue of $750 per lead to lower profits
night with no for Sadiq if 50%
additional capital more guests not
cost attracted
• Target market • This does not

remains unchanged address the
so easier to attract complaints about
customers as the poor quality of
understand this some rooms – so
market may not attract 50%
more guests
• Lower price may
give image of lower
quality
• Increasing the price • High redecoration

by 50% will lead to cost of $800 000 in
$1500 extra revenue total plus downtime
per night if 50 whilst rooms are out
rooms remain of action means lost
occupied each night revenue in the short
• This is $750 higher term
than the extra • However, Sadiq may
revenue per night need to improve
from Option 1 other facilities at the
• Higher income hotel as the high-
tourists may be income guests may
willing to pay for expect more from
Option 2
improved room the rest of the hotel
• May calculate that as well as the room
using projected upgrades – may
figures it would take increase costs even
534 nights to recoup more
the cost of the • Marketing may need
upgrades. to change as it is
$800 000/1500 (the new target customer
extra income) = 534 MH is less familiar
nights. with how to attract
them
• May lose existing
customers

PUBLISHED
3(b)
Recommendation Justification might include:
• Option 1 is better as it is less risky as MH would
not have to spend $10 000 upgrading each
room when there is no guarantee guests will
use them. Because Sadiq is already familiar with
the requirements of existing customers and with
the lower price he may be more successful in
attracting the increased number of customers
than the new target market for Option 2.
• Option 2 is better as it targets a new segment of
the market and therefore MH can increase room
prices leading to a higher increase in revenue of
$750 more per night than Option 1 and no
additional guests are needed.

PUBLISHED
4(a) Referring to Appendix 2 and other information, explain how the 8

following two new legal controls could affect MH.
• Restaurant menus must list all ingredients in the food served.

• Single-use plastic bottles cannot be used.
Award up to 1 mark for how each legal control could affect MH (maximum of
two marks).
Award a maximum of 3 additional marks for each explanation of how the
legal control affects the business – one of which must be applied to this
context.
Relevant answers might include:

Restaurant menus must list all ingredients in the food served:
• Costs may be increased – may need to reprint menus / may now need to
source other supplies or ingredients – may need to increase prices
• Improved consumer knowledge may increase demand – customer needs
are being met/allergies – so more likely to eat at the hotel restaurant
which increases revenue
• Competitors have access to information about ingredients used in meals
Single-use plastic bottles cannot be used:

• May need to find alternative products to plastic – glass bottles may be
more expensive in the short-term – but in the long term they will be
cheaper as they can be recycled
• Less litter in surrounding area to MH – as no plastic waste littering the
area – improved reputation of the hotel
For example: The costs for MH might increase (1) because the hotel
restaurant (app) will need new menus and these will have to be printed with
the old ones thrown away (1) which may lead to lower profits in the short-term
(1).
Application could include: 4 chefs will need to change ingredients; waiters

and kitchen assistants may need additional training; reference to information
in Appendix 2; glass bottles; may get better reviews /so do not get bad
reviews.

PUBLISHED
4(b) Consider the following three ways Sadiq could improve MH’s cash flow. 12
• Arrange a bank loan.

• Ask customers to pay a deposit of 20% when they book a room.
• Ask for trade credit from food suppliers.
Which would be the most effective way for MH to improve its cash flow?
Justify your answer.
Sound application of knowledge and understanding of

relevant business concepts using appropriate
terminology.

3 9–12
Well-justified conclusion.
Candidates discussing all three ways in detail, in

context and with a well-justified conclusion including
why the alternative ways were rejected should be
rewarded with the top marks in the band.
Sound application of knowledge and understanding of

relevant business concepts using appropriate
terminology.

2 5–8
Judgement with some justification / some evaluation of
choice made.
Candidates discussing two or more ways in detail and

applying it to the case should be rewarded with the top
marks in the band.
Limited application of knowledge and understanding of

relevant business concepts.

explanation.
1 1–4
Candidates outlining all three ways in context should


PUBLISHED

• Provides a cash • Interest payable on

injection into the bank loan
business - provides • Interest and
working capital to repayment of the
enable the hotel to loan will be an
keep trading outflow each month
• Provides a large - may make MH’s
Arrange a bank cash inflow at one cash flow worse in
loan time – possibly the long run
removing a • May take time if
negative flow in the bank requests
cash flow documents to
• May be quick to support the
arrange and receive application for the
the cash inflow loan
quite quickly
• Improves the cash • May lose some

inflows as deposit is tourists who prefer
received when the to book and pay no
tourist books a deposit
room • Existing customers
• Helps to reduce the may not return to
chance of guests the hotel as not
Ask customers cancelling if deposit happy about the
to pay a deposit is not refundable, deposit being
of 20% when which improves the introduced when
they book a cash inflow they have not had
room • It is a lower deposit to pay this in the
than other hotels in past
the local area that
charge 30%
deposit – so may
still attract more
guests - improving
the cash inflow

PUBLISHED
4(b)
• Reduces cash • Some suppliers

outflows may be unwilling to
• Hotel may have offer trade credit so
received payment MH may have to
for restaurant meals find new suppliers
before payment to of ingredients
suppliers of • Trade suppliers
ingredients is may offer lower
Ask for trade
required discounts which
credit from food
would increase
suppliers
cash outflows in the
longer term
• It takes time to
arrange for trade
credit and Sadiq
works long hours
each week and may
not have time
Conclusion Justification might include:

• Arranging a bank loan is the best method to
choose as it will not upset any hotel guests by
asking for a deposit which would reduce cash
inflows and will not take time for Sadiq to make
trade credit agreements. The business has
been running successfully and so it is likely the
bank will grant the loan.
• Asking for a deposit will be best as it will
increase the cash inflows and may help to pay
for the redecoration instead of Sadiq needing
to take on a partner and losing some control or
applying for a bank loan and having to pay
interest.
• Trade credit will be best as it delays the cash
outflows. This is the better long-term solution
to improve MH’s cash flow as revenue from the
restaurant may be obtained before
ingredients are paid for and it will not lead to
potential loss of customers which the deposit
option may do.

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BUSINESS STUDIES 0450/22

This document consists of 21 printed pages.

© UCLES 2022 [Turn over

Generic Marking Principles

GENERIC MARKING PRINCIPLE 1:

Marks must be awarded in line with:

GENERIC MARKING PRINCIPLE 2:

GENERIC MARKING PRINCIPLE 3:

Marks must be awarded positively:

GENERIC MARKING PRINCIPLE 4:

GENERIC MARKING PRINCIPLE 5:

GENERIC MARKING PRINCIPLE 6:

© UCLES 2022 Page 2 of 21

Social Science-Specific Marking Principles

1 Components using point-based marking:

From this it follows that we:

2 Presentation of mark scheme:

© UCLES 2022 Page 3 of 21

© UCLES 2022 Page 4 of 21

Question Answer Marks

Award 1 mark for each relevant method (maximum of four).

There are no application marks available for this question.

Relevant methods might include:

© UCLES 2022 Page 5 of 21

Question Answer Marks

• Improve its existing website.

Level Description Marks

Sound application of knowledge and understanding

Detailed discussion of two or more ways.

Candidates discussing the three ways in detail, in

Sound application of knowledge and understanding

Detailed discussion of at least one way.

Candidates discussing two or more ways in detail

Limited application of knowledge and understanding

Limited ability to discuss the ways with little/no

Candidates outlining the three ways in context

© UCLES 2022 Page 6 of 21

Question Answer Marks

1(b) Relevant points might include:

• Makes the hotel • Increased costs of

© UCLES 2022 Page 7 of 21

Question Answer Marks

• Can target specific • Can easily be

• Cheap way to get • Email may go into

© UCLES 2022 Page 8 of 21

Question Answer Marks

© UCLES 2022 Page 9 of 21

Question Answer Marks

2(a) Explain one advantage and one disadvantage to Sadiq of delegating 8

Award 1 mark for each advantage/disadvantage (maximum of two marks).

Relevant advantages might include:

Relevant disadvantages might include:

Application could include: Sadiq works 60 to 90 hours a week; reference to

© UCLES 2022 Page 10 of 21

Question Answer Marks

• Only buying food ingredients from suppliers that guarantee good