● Level 1 — Knowledge
State
1–2 marks
What it means
Give a fact, figure, or piece of information. One sentence is usually enough. No explanation needed.
What to do
- Write one clear, direct sentence
- Give the specific fact asked for
- Don't waste time explaining — just state it
⚠️ Common mistake
Adding an explanation when none is asked for. "State" means state — stop there.
Identify
1–2 marks
What it means
Pick out a relevant point, feature, or factor from the information given — often from a source or case study.
What to do
- Name the specific thing asked for
- Look at the source material — it's often there
- Be precise — vague answers get no marks
⚠️ Common mistake
Identifying something irrelevant. Read the question carefully — it tells you what category of thing to find.
Define
2 marks
What it means
Give the precise meaning of a term. Usually 1–2 sentences. You're showing you know what the word means in a business context.
What to do
- Write a clear, complete definition
- Use business terminology accurately
- Don't use the word in its own definition
⚠️ Common mistake
"Contribution is when you contribute." That's circular. Define it properly: "the selling price minus the variable cost per unit."
● Level 2 — Application
Calculate
2–4 marks
What it means
Work out a numerical answer using the figures provided. Marks are usually split between method and the final answer — so show every step.
What to do
- Write the formula first
- Substitute the numbers in
- Show all working — even if you make an error
- State the units (£, %, units) in your answer
- Don't just write the final answer with no working
⚠️ Common mistake
Writing only "£200" with no working. If you get it wrong with no working shown, you get zero. With working shown, you can still get method marks.
Show
2–4 marks
What it means
Demonstrate a result by working through it step by step. Similar to Calculate — the answer is often given to you and you must prove it.
What to do
- Set out each step clearly and in order
- Make the logic visible — don't skip steps
- If the answer is given to you, work toward it systematically
⚠️ Common mistake
Jumping to the final number. "Show" means prove it through steps. The examiner wants to see the reasoning, not just the destination.
Key formulas for Calculate questions
Contribution / unit
Selling Price − Variable Cost
Break-Even (units)
Fixed Costs ÷ Contribution / unit
Margin of Safety
Actual Output − Break-Even Output
Profit
Total Revenue − Total Costs
Gross Profit Margin %
(Gross Profit ÷ Revenue) × 100
Market Share %
(Business Sales ÷ Total Market) × 100
● Level 3 — Understanding
Explain
3–6 marks
What it means
Make something clear by giving reasons, causes, or effects. You must show the link between a point and its consequence — not just state the point.
What to do
- State the point
- Give the reason — use "because" or "this means"
- Show the consequence — "therefore" or "as a result"
- Link back to the business in the question
⚠️ Common mistake
Just describing what something is instead of explaining why it matters. "The business has high fixed costs" is description. "Because fixed costs are high, the business needs to sell more units to break even, putting pressure on sales targets" is explanation.
Outline
2–4 marks
What it means
Give the main points without going into deep detail. Broader than Explain — you're sketching the picture, not painting it.
What to do
- Identify the key points clearly
- Give brief reasons for each
- Don't go as deep as a full Explain answer
⚠️ Common mistake
Treating it like a full Evaluate question. Outline = efficient overview. You're not being asked for a full argument.
The Explain Formula — use this every time
Point
State the relevant fact or idea
Because
Give the reason it's true or relevant
Therefore
Show the consequence for the business
Example: "Apple's variable costs are low per unit (point) because it manufactures at huge scale in China where labour costs are around £2/hour (because), therefore its contribution per iPhone is very high, giving it a large profit margin even at a competitive price (therefore)."
● Level 4 — Analysis
Analyse
6–9 marks
What it means
Break down a topic, situation, or decision and examine it in detail. Show how and why things happen — follow the chain of consequences. Use the context of the business.
What to do
- Make a point and explain it fully (Point → Because → Therefore)
- Follow the consequence chain — what happens next?
- Apply it specifically to the business in the question
- Consider multiple factors or causes
- Don't just list points — develop each one
⚠️ Common mistake
Writing a list of points with no development. Analyse means going deeper — one well-developed point is worth more than five bullet points.
The Consequence Chain — this is what Analyse looks like
State the point
Tariffs on imported goods have increased.
↓
Explain why this matters
This means the cost of importing components from China rises, increasing the variable cost per unit.
↓
Follow the consequence
As a result, contribution per unit falls, meaning the break-even point rises — the business must sell more units just to cover its costs.
↓
Apply to the specific business
For a small UK manufacturer with tight margins, this could make their pricing uncompetitive against rivals who source domestically.
● Level 5 — Evaluation
Evaluate
12–20 marks
What it means
Make a supported judgement. Weigh up arguments on both sides, consider the context, and reach a clear, reasoned conclusion. This is the highest level skill.
What to do
- Argue one side (with analysis)
- Argue the other side (with analysis)
- Consider the context — what depends on what?
- Reach a clear conclusion — don't sit on the fence
- Justify your conclusion — "because" and "therefore"
⚠️ Common mistake
Listing pros and cons with no judgement at the end. "On the other hand..." with no conclusion is not evaluation. You must make a decision and defend it.
Discuss
8–12 marks
What it means
Consider different perspectives or sides of an argument. Similar to Evaluate but the conclusion is sometimes less essential — the balance of argument matters more.
What to do
- Present the case for and against
- Develop each point fully — not just list them
- Use evidence or examples to support each side
- Still try to reach a conclusion — it shows higher-level thinking
Justify
4–9 marks
What it means
Give reasons to support a decision or recommendation. You're defending a position — usually one that's been given to you — by showing why it makes sense.
What to do
- State the decision clearly
- Give strong, specific reasons for it
- Acknowledge a counter-argument briefly
- Conclude by restating why the decision is correct
Evaluate Structure — every high-mark answer needs this shape
FOR
Argue one side with analysis
AGAINST
Argue the other side
CONTEXT
"It depends on..."
JUDGE
Pick a side. Defend it.
Useful phrases for conclusions: "On balance..." · "Given that [X factor], the most significant impact is..." · "Ultimately, the evidence suggests..." · "While [counter-argument] is valid, it is outweighed by..."
Quick Reference
All command words at a glance. Use this as a reminder before answering — always check what the question is actually asking you to do.
| Command Word | What it wants | Typical marks | Key tip |
|---|---|---|---|
| State | One clear fact or point | 1–2 | One sentence. Stop there. |
| Identify | Pick out a specific thing — often from a source | 1–2 | Look at the data / case study first. |
| Define | Give the precise meaning of a term | 2 | No circular definitions. Use business language. |
| Calculate | Work out a number using given data | 2–4 | Formula → numbers → answer + units. Always show working. |
| Show | Prove a result through working | 2–4 | Step by step. The journey matters as much as the answer. |
| Explain | Give reasons for something — Point → Because → Therefore | 3–6 | Don't just describe — show cause and effect. |
| Outline | Give the main points without deep detail | 2–4 | Efficient overview — don't over-explain. |
| Analyse | Examine in detail — follow the consequence chain | 6–9 | Develop each point fully. Apply to the specific business. |
| Evaluate | Weigh up both sides and reach a justified conclusion | 12–20 | For → Against → Context → Judge. Don't sit on the fence. |
| Discuss | Explore different perspectives in depth | 8–12 | Balance of argument + conclusion = top marks. |
| Justify | Give reasons to support a given decision | 4–9 | Pick the side, defend it, acknowledge the counter. |