Lesson 1.4.2b

1.4.2b Impact of the internet on location decisions Quiz: Pearson Edexcel Business, Unit 4

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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Lesson 1.4.2b, Impact of the internet on location decisions: 20 multiple choice questions for the Pearson Edexcel GCSE Business (1BS0), Unit 4: Making the business effective, written with Revision Ninja.

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The 20 questions

  1. How has the internet affected location decisions for many businesses?

    • It has removed all reasons for locating near customers or suppliers
    • It forces all businesses to locate in the same rural area near the server farms
    • It means every business must now be located in a city centre to be seen
    • It allows some businesses to trade without fixed premises, using e-commerce

  2. Which business is most likely to choose a location with no shop premises at all?

    • An e-commerce retailer selling clothes through its website
    • A hairdresser that needs customers to visit a salon in person for every appointment
    • A high-street jeweller that relies on walk-in trade from shoppers passing its shop window
    • A restaurant that needs a dining room where customers can eat and socialise together

  3. Which of these is an advantage of e-commerce for a business that is choosing its location?

    • It removes the need to be near suppliers or any transport network at all
    • It means the business never needs to deliver products to customers
    • It means the business can avoid all competition from other online sellers
    • It can reduce rent costs because it does not need a shop in a busy street

  4. Which of these is a disadvantage of e-commerce for a business that has no physical premises?

    • The business must pay high rent for a shop in a busy high street to stay visible
    • The business has to hire staff to answer the phone in every town it serves across the country
    • Customers may not be able to examine products in person, which can reduce confidence
    • Customers can see and touch the products before they buy them, which reduces returns

  5. A business uses a fixed premises on a busy shopping street. Which location factor does this decision best address?

    • Proximity to a stock exchange, so that the business can list its shares
    • Proximity to the internet, so that customers can order online
    • Proximity to the owner's home, so the owner can manage the business
    • Proximity to the market, so that passing customers can visit the shop

  6. A company selling software decides to base itself in a rural location with cheap rent and good broadband. Why is this decision sensible?

    • Because the government requires all software companies to locate in rural areas by law
    • Because it can serve customers worldwide online, so physical closeness to customers matters less
    • Because software businesses must always be located near the sea for shipping their products
    • Because software can only be sold in villages with no internet access at all in the area

  7. How does the internet affect the importance of 'proximity to market' for a bookseller?

    • It means the bookseller must locate next to its printing company only
    • It makes proximity to market more important because customers are always local
    • It can make proximity to market less important when customers buy online
    • It makes proximity to market irrelevant for every type of business in every case

  8. Which of these shows a business is using fixed premises as well as e-commerce?

    • A shop that sells goods in its store and also takes orders on its website
    • A business that operates only from a home office with no customers at all
    • A firm that has only a postal address with no staff or stock
    • A company that has no bank account and sells everything for cash on the street

  9. Why might an e-commerce business still need a warehouse near a motorway?

    • To store and dispatch goods quickly to customers across the country
    • To allow customers to visit the warehouse to collect goods in person
    • To avoid paying tax on goods that are stored there
    • To meet the requirement that all online businesses hold stock on premises

  10. Which of these location decisions is least likely to be affected by the internet?

    • A business that sells books and clothes entirely through its website to customers nationwide
    • A business that must serve customers who visit a local premises in person
    • A business that provides consultancy services by video call to clients in several countries
    • A business that sells mainly digital music downloads to customers across the whole world

  11. A small business is deciding between a city-centre shop and an online-only operation. Which is the strongest reason to choose online-only?

    • Online-only trade guarantees the business will never face any competition
    • Online-only trade often has lower premises costs and can reach a wider market
    • Online-only trade removes the need for any stock, delivery or customer service
    • Online-only trade means the owner never has to deal with any payment

  12. Which of these is an effect of the internet on a traditional shop's location?

    • The shop can ignore its local area because the internet covers everywhere equally
    • The shop must locate in a rural area to be near the internet servers
    • The shop may need to attract customers in person, since some sales move online
    • The shop no longer needs any customers because they all buy online

  13. A business that relies on e-commerce has most reason to consider which location factor?

    • Proximity to the local council chamber, so that the business can avoid paying any tax on its online sales
    • Proximity to the internet's physical infrastructure, such as reliable broadband and fast delivery routes
    • Proximity to the owner's favourite restaurant, so that the owner can meet clients over lunch each day
    • Proximity to the head office of the government department that approves websites and online trading licences

  14. Which statement about e-commerce and location is correct?

    • E-commerce removes every location factor, so all businesses can locate anywhere
    • E-commerce means businesses no longer pay any rent or business rates at all
    • E-commerce means businesses must always locate in the same city as their owners
    • E-commerce changes the importance of some location factors but not all of them

  15. A clothing business moves its entire operation online and closes its shop. What is the most likely effect on its location costs?

    • Its taxes rise to match the cost of its former shop premises
    • All location costs disappear, because online businesses never need a warehouse
    • Rent and premises costs fall, but delivery and warehousing costs may rise
    • Rent and premises costs rise sharply, because online firms must buy expensive shops

  16. Why might a business choose fixed premises rather than e-commerce?

    • Fixed premises remove the need to deal with payment processing or customer service queries
    • Customers may value seeing and trying products, and some services need an in-person location
    • Fixed premises are cheaper than any online business in every case, whatever the sector
    • E-commerce businesses are not allowed to sell to customers in the same town as the shop

  17. Which of these is most likely to be an impact of the internet on business location in the future?

    • More businesses may choose low-cost locations and serve customers remotely
    • Businesses will need to be located in the same region as their suppliers only
    • Businesses will only ever use a single location for all their operations
    • Businesses will be required to locate near the head office of their bank

  18. Which of these is an example of a business that needs fixed premises?

    • A hairdresser that serves customers at a salon
    • A website that sells digital e-books to global customers
    • An app developer who sells software through an app store
    • A consultant who advises clients by email only

  19. A business is comparing two sites: one has a busy shop front, the other has cheap rent with a strong broadband link. Which statement is most accurate?

    • The site with cheap rent is always the better choice, whatever the business sells
    • Neither site matters, because all businesses now operate entirely from the internet
    • The best site depends on whether customers need to visit in person or buy online
    • The busy shop front is always the better choice, whatever the business sells

  20. Which statement about the impact of e-commerce is correct?

    • E-commerce means businesses no longer need suppliers or transport networks to move their goods around
    • E-commerce allows a business to reach customers far from its premises, so distance matters less
    • E-commerce means customers always need to visit a business in person before they are able to buy goods
    • E-commerce means businesses can ignore all competition from other sellers because online markets are closed

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