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Paper 2 (Predominantly Quantitative)
Paper 2 (Predominantly Quantitative)
Paper 2 Format
Paper 2 Format
Exam Date: May 1, 2024, Morning Session
1 hours 45 minutes
50 Marks
Predominantly a quantitative paper
Assesses all 5 topics of syllabus
30% of IB Mark
Calculator required
All answers written in answer booklet
Answers must be written within the answer boxes provided
2 Sections: A, B
A: 30 marks
B: 20 marks
Total: 50 marks
Paper 2 Overview from the IB
Paper 2 will be based on stimulus material. SL and HL students will sit different examinations, but these will be similar in intent and form. The aim of the examination is to assess students’ knowledge of the business management syllabus. Most questions will be quantitative, though some questions may not have a quantitative element. Students will receive an examination booklet with questions based on the stimulus material seen for the first time during the examination. The stimulus material will be presented in parts. Each part has a question; students will read each part and answer the question before reading the next part and answering the question, and so on. The stimulus material will be a combination of written and diagrammatic stimulus such as charts and infographics. For SL only, one of the stimulus options in section B of the examination may be on a social enterprise. HL students will be assessed on a social enterprise in paper 3. Section A will be assessed against AO1, AO2 and AO4 levels whereas Section B will be assessed against all four levels including AO3.
Paper 2 Section A (30 marks)
Paper 2 Section A (30 marks)
Answer all three structured questions based on the case study / stimulus material.
Maximum score is 30 marks (3 × 10 marks).
All 5 units of the syllabus can be assessed, including HL only topics.
Section A Paper 2 - Example
Paper 2 Section B (10 mark question)
Paper 2 Section B (10 mark question)
Answer 1 out of 2 structured questions (10 marks) and an extended response question (10 marks) (HL only) based on the stimulus material.
The maximum score is 20 marks (2 × 10 marks).
The extended response question uses an AO3 command term, such as "Recommend".
All 5 units of the syllabus can be assessed, including HL only topics.
Section B Paper 2 - Example
Extended Response Question (approx 2 pages of writing)
Paper 2 Time Management
Paper 2 Time Management
Approximately 2 minutes per mark
Time: 1 hour 45 min = 105 min
50 marks
Section A = 30 marks
Suggested: 60 minutes
20 minutes per question
Section B = 20 marks
Suggested: 40 minutes
10 Mark Question Mark Scheme Criteria - Paper 1 - 2.pdfUnit 3 Final Exam Review
Unit 3 Final Exam Review
IB Formula Sheet 2024.pdfDay 1: 3.1-3.2 Intro to Finance + Sources of Finance
Day 1: 3.1-3.2 Intro to Finance + Sources of Finance
Role of finance for businesses (AO2):
Capital expenditure
Revenue expenditure
The following internal sources of finance (AO2):
Personal funds (for sole traders)
Retained profit
Sale of assets
The following external sources of finance (AO2):
Share capital
Loan capital
Overdraft
Trade credit
Crowdfunding
Leasing
Microfinance providers
Business angels
Appropriateness of short- or long-term sources of finance for a given situation (AO3)
Or
Day 2-3: 3.3 + 5.5 Costs and Revenue, Break Even Analysis, Decision Tree
Day 2-3: 3.3 + 5.5 Costs and Revenue, Break Even Analysis, Decision Tree
The following types of cost, using examples (AO2):
fixed
variable
direct
indirect (overhead)
Total revenue and revenue streams, using examples (AO2)
Total contribution versus contribution per unit (AO2)
A break-even chart and the following aspects of break-even analysis. (AO2, AO4)
Break-even quantity/point
Profit or loss
Margin of safety
Target profit output
Target profit
Target price
The effects of changes in price or cost on the break-even quantity, profit and margin of safety, using graphical and quantitative methods (AO2, AO4)
Limitations of break-even as a decision-making tool (AO3)
Break Even Analysis
Decision Tree with two decision nodes
Day 3-4: 3.4 Final Accounts
Day 3-4: 3.4 Final Accounts
The purpose of accounts to different stakeholders (AO2)
Final accounts (AO2, AO4):
• Profit and loss account
• Balance sheet
Different types of intangible assets (AO2)
Depreciation using the following methods (HL only) (AO2, AO4):
• Straight line method
• Units of production methodAppropriateness of each depreciation method (HL only) (AO3)
Practice:
Profit and Loss Accounts + Balance Sheet
8. The Carolina Fire Museum (CFM) (Questions C, E, F)
OR
11. RaceWear Questions (A, D, F)
Depreciation
Case Study: 12. Crispy Collin’s Chicken and Waffles
Questions D, E, F
Statement of Profit or Loss: Profit-Making Entity
(Income Statement)
Statement of Profit or Loss: Non-Profit Entity
(Income Statement)
Statement of Profit or Loss / Income Statement (Lewinski)
Statement of Financial Position: Profit-Making Entity
(Balance Sheet)
Statement of Financial Position: Non-profit Entity
(Balance Sheet)
Statement of Financial Position / Balance sheet (Lewinski)
Straight-line Method of Depreciation
Units of production method of Depreciation
Day 5: 3.5-3.6 Profitability, Liquidity, Efficiency Ratio Analysis
Day 5: 3.5-3.6 Profitability, Liquidity, Efficiency Ratio Analysis
3.5 Profitability and Liquidity Ratio Analysis
The following profitability ratios (AO2, AO4):
• Gross profit margin (GPM)
• Profit margin
• Return on capital employed (ROCE)
Possible strategies to improve these profitability ratios (AO3)
The following liquidity ratios (AO2, AO4):
• Current ratio
• Acid-test / quick ratioPossible strategies to improve these liquidity ratios (AO3)
Practice:
3.5 Case Study - 14. Cedar Hill Books (CHB)
The following further efficiency ratios (AO2, AO4):
Stock turnover
Debtor days
Creditor days
Gearing ratio
Possible strategies to improve these ratios (AO3)
Insolvency versus bankruptcy (AO2)
3.5-3.6 Case Study - 17. Spielgeist Games
Profitability Ratios
Liquidity Ratios
Efficiency Ratios
Investment Appraisal
Payback period (not in Formula Booklet)
Day 6: 3.7 Cash Flow
Day 6: 3.7 Cash Flow
The difference between profit and cash flow (AO2)
Working capital (AO2, AO4)
Liquidity position (AO2)
Cash flow forecasts (AO2, AO4)
The relationship between investment, profit, and cash flow (AO2)
Strategies for dealing with cash flow problems (AO3)
3.7 Case Study - 21. The Downriver Adventure Company (DAC)
Complete Question B after which complete the remaining questions A-G
Cash Flow Forecast: Profit and Non-Profit Entity
Cash Flow Forecast: Profit and Non-Profit Entity (from Lewwinski)
Day 7: 3.8 Investment Appraisal
Day 7: 3.8 Investment Appraisal
Investment opportunities using payback period (AO3 and AO4)
Investment opportunities using average rate of return (ARR) (AO3 and AO4)
Investment opportunities using net present value (HL only) (AO3 and AO4)
3.8 Case Study - 25. On Air Sports (OAS)
Questions: B, C, D
ARR (Average Rate of Return)
ARR = (total returns – capital costs) ÷ years of use ÷ capital costs ⨉ 100
Payback period (not in Formula Booklet)
NPV (Net Present Value)
NPV = Sum of present values – Original cost
Discount Table
Day 8: 3.9 Budgets
Day 8: 3.9 Budgets
The difference between cost and profit centres (AO2)
The roles of cost and profit centres (AO2)
Constructing a budget (AO2, AO4)*
Variances (variance analysis) (AO2, AO4)
The importance of budgets and variances in decision-making (AO2)
3.9 Case Study - 27. Jupiter Doors
Questions: A-G
Budget: Profit and Non-Profit Entity
OR
Critical Path Analysis Diagram
Critical Path Analysis Diagram
Question 4: Identify the Critical Path
Question 5: Calculate the Float (Slack) time of activity B
Question 6: Calculate the Float time of activity D
Total Float Time Formula
Critical Path Analysis Answers
Question 4: Identify the Critical Path
(ACEFG)
Question 5: Calculate the Float (Slack) time of activity B
7-1-1 = 5
Question 6: Calculate the Float time of activity D
10-3-2 = 5
Free Float Time Formula
Free Float = EST of next Activity - Earliest finish of this activity*
Earliest finish = Earliest start +time to complete
Critical Path Analysis Hard Example:
Complete the rest of the Critical Path Diagram
Identify the Critical Path
Calculate the Total Float time for L
Calculate the Total Float time for K
Calculate the Free Float time for C
Hard Example Answers:
Complete the rest of the Critical Path Diagram
X = 2+4 = 6
Y = 22 - 5 = 17
Identify the Critical Path
F, H, J, K
Calculate the Total Float time for L
Total Float = LFT - Duration - EST
22 - 5 - 12 = 5
Calculate the Total Float time for K
Total Float = LFT - Duration - EST
22 - 8 - 14 = 0
Calculate the Free Float time for C
Free Float = EST of next Activity - Earliest finish of this activity*
Earliest finish = Earliest start + time to complete
12-6+4
Paper 2 Practice
Paper 2 Practice
Check out the HL Paper 2 Specimen paper
Paper 2 Specimen paper.pdfStudent Samples with Mark Schemes - HL Paper 2 Specimen Paper
Check out the SL Paper 2 Specimen paper
SL Paper 2 Specimen Paper.pdfStudent Samples with Mark Schemes - SL Paper 2 Specimen Paper
Paper 2 Practice Section A
Paper 2 Practice Section A
Paper 2 Practice Section B
Paper 2 Practice Section B
More Paper 2 Practice - Old Exams
More Paper 2 Practice - Old Exams
I also recommend practicing old Paper 2 Exams, however remember that the format is different. There is also no 20 mark question in your exam, however during COVID they had taken this out so some exams also don't have the 20 mark question.
OLD SYLLABUS IB Textbook with comments on how to score well on exam questions - Thank you Loykie!
Textbook 2019 Loykie - Oxford IB Diploma Programme IB Prepared_ Business Management.pdfIB Formula Sheet 2024.pdfPage updated
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