Lesson 1.5.5a

1.5.5a Business responses to changes in technology, legislation and the economy Quiz: Pearson Edexcel Business, Unit 5

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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Lesson 1.5.5a, Business responses to changes in technology, legislation and the economy: 20 multiple choice questions for the Pearson Edexcel GCSE Business (1BS0), Unit 5: Understanding external influences on business, written with Revision Ninja.

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The 20 questions

  1. What is one way a business can respond to a change in technology?

    • Ignoring the change and continuing with old methods regardless
    • Stopping all communication with customers until the change has passed
    • Closing the business immediately to avoid the cost of change
    • Investing in new equipment or software to keep up with competitors

  2. A government changes employment law. How might a business respond?

    • By updating its policies and training managers on the new requirements
    • By firing all staff so that the law no longer applies to the business
    • By moving all its operations to a country with no employment law
    • By ignoring the new law because it does not affect its staff

  3. A recession reduces consumer demand. Which response would best protect a business's sales?

    • Raising prices sharply to make up for lost revenue from fewer customers
    • Closing stores in the areas where customers are most likely to buy
    • Stopping all advertising to reduce costs in the economy
    • Offering lower-priced ranges and focusing on value for money

  4. Which of these is a business response to a rise in interest rates?

    • Reducing borrowing or paying off debt to lower interest costs
    • Taking on more variable-rate debt to benefit from the rise
    • Demanding that the bank lower its rates for the business by law
    • Ignoring the rate change, since interest rates never affect business

  5. A business responds to technological change by training its staff in digital skills. What is the main benefit?

    • Staff no longer need to work at the business
    • Staff are able to set the business's prices without management approval
    • Staff are paid less because they have new skills
    • Staff can use new systems effectively, which supports productivity

  6. Which of these is a possible response to a fall in consumer income?

    • Developing cheaper product lines to appeal to customers with less money
    • Increasing the number of luxury products the business sells in its stores
    • Stopping all marketing activity for the rest of the year to save costs
    • Raising prices sharply on all products to protect profit for the owners

  7. A business responds to a new environmental law by changing its production process. Which element of the marketing mix might be affected?

    • Place only
    • Promotion only
    • Price only
    • Product

  8. Why might a business respond to a change in legislation by reviewing its supplier contracts?

    • New rules may change the supplier's obligations or costs
    • Suppliers are exempt from all legislation so contracts need not change
    • Contracts can only be changed by the government, not by businesses
    • Legislation always requires businesses to stop buying from suppliers

  9. Which response best shows a business adapting to a change in technology?

    • Waiting for competitors to fail before making any changes to its methods
    • Removing its website and relying only on printed catalogues sent by post
    • Redesigning its website to allow mobile ordering and online payments
    • Refusing to change because technology is always too expensive for small firms

  10. A business faces higher costs from inflation. Which response would most help protect its profit?

    • Reviewing costs and passing on some increase through prices where possible
    • Stopping all sales until the inflation rate falls to zero
    • Cutting all staff to avoid any cost increase at all
    • Ignoring the costs, because inflation is always temporary and never matters

  11. Which of these is an example of a business responding to a change in the economic climate?

    • Insisting that customers buy its products at higher prices only
    • Ignoring the economic climate because it is outside its control
    • Adjusting its product range to suit customers with lower incomes
    • Keeping its prices fixed for ever regardless of costs

  12. How might a business respond to new consumer law on refunds?

    • Refusing all returns from customers from now on, whatever the reason for them
    • Charging customers a fee for every item they return to the store each time
    • Ignoring the new law because it only applies to large businesses in the sector
    • Updating its returns policy and training staff to follow the new rules

  13. A business responds to a rise in the pound's value by sourcing more goods from home suppliers. What is the aim?

    • To increase its exposure to exchange rate changes on imports
    • To stop selling its products to any overseas customers
    • To make its costs rise with no effect on profit
    • To reduce its exposure to exchange rate changes on imports

  14. Which of these shows a business responding to a change in legislation on packaging?

    • Adding extra packaging that hides the product from customers on the shelf
    • Ignoring the law and hoping that no inspector visits the business this year
    • Redesigning packaging to show the required information on each product
    • Stopping all packaging, even where the law requires it on the product

  15. Why might a business review its response to economic change regularly?

    • Because the government requires businesses to review every year without fail
    • Because the economy never changes once a response has been chosen
    • Because a response cannot be changed once it has been made
    • Because economic conditions can change again, so the response may need updating

  16. A business expects a rise in demand for its product because of a new trend. Which response is most suitable?

    • Refusing all new orders until the trend has ended completely in the market
    • Cutting production to avoid any risk of a sudden shortage in its supply
    • Increasing production capacity or stock to meet the expected demand
    • Closing its website, which would reduce the number of customers placing orders

  17. Which of these is most likely to be a response to a change in technology that affects a business's costs?

    • Refusing to use any equipment, to avoid the cost of technology
    • Hiring more staff to do tasks that the new technology now automates
    • Increasing the price of every product by 50% in response
    • Negotiating better terms with suppliers of the new equipment

  18. A business expects its costs to rise after a new tax. Which response is most likely?

    • Ignoring the tax and hoping it will be repealed
    • Reviewing spending and seeking efficiency savings
    • Increasing wages so that workers pay the tax
    • Closing its accounts department to avoid paying tax

  19. Which of these responses shows a business adapting to changing consumer tastes?

    • Raising prices on the old range by 50% to recover costs from lost customers
    • Launching a new range of products aimed at health-conscious buyers
    • Keeping the same range and stopping all marketing to save money for the year
    • Removing all customer feedback channels from its website to cut admin costs

  20. How might a business respond to a rise in the cost of imported materials caused by a weaker pound?

    • Stopping all production until the pound returns to its old value
    • Finding cheaper domestic suppliers or passing some costs on to customers
    • Ignoring the cost rise because exchange rates do not affect purchases
    • Buying materials only in bulk from the same overseas supplier

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