Paper 1: the pre-released case study
🎯What this page covers
- The structure, timing and weighting of Paper 1.
- How to prepare the pre-released statement in the three months before the exam.
- How short-answer questions and the 10-mark extended response are marked.
- A practice case study with questions and a markscheme.
📚The paper
1 hour 30 minutes plus 5 minutes’ reading. 30 marks. Same paper for SL and HL; questions come from Units 1 to 5 but not from HL-only topics or HL extensions.
SL 35%; HL 25%.
answer all the structured questions on the case study: definitions, short explanations and some minor calculations. Marked with an analytic markscheme.
answer one of two extended-response questions on the case study. Marked with a markscheme and markbands.
The pre-released statement
About three months before the exam, the IB releases a statement with two parts:
- A few context topics to research for about five hours. They are contemporary business issues that build on the syllabus but are not syllabus topics themselves (for example, a new technology or trend in an industry).
- The first 200 words or so of the case study, introducing the business. In the exam, the full case study is about 800 to 1000 words.
How to use the three months:
- Read the opening closely. Identify the type of business entity, its stakeholders, objectives, industry and any numbers.
- Research each context topic: definitions, how it works, real businesses that use it, its advantages, disadvantages and ethical issues.
- Map the syllabus onto the case: for each unit, which topics could the examiners ask about? Write a SWOT and STEEPLE for the business.
- Practise 10-mark answers on likely issues (growth, finance, marketing, HR changes) using the case context.
- Do not memorize an essay: the full case in the exam will add new information, and the question may take an unexpected angle.
Section A: the structured questions
- Define (2 marks): a precise definition in your own words gets 2; a partly correct one gets 1. No examples needed.
- Outline, describe (2 marks each point): a brief account with a link to the case.
- Explain (usually 4 or 6 marks): for each point, identify it, develop the cause and effect, and apply it to the business in the case. Generic answers that could be about any business lose marks.
- Calculate: show working and units.
Section B: the 10-mark extended response
Command terms are AO3: discuss, evaluate, examine, justify, recommend, to what extent. The markbands reward, at the top level (9–10):
- a clear focus on the demands of the question;
- relevant, accurate use of business management tools and theories (from the toolkit and the units);
- relevant information from the case study integrated to support the argument (not just the business’s name);
- substantiated and balanced arguments, with an explanation of the limitations of the case study information.
A one-sided answer, however good, is capped in the middle band. Structure: brief definitions; arguments for and against, each backed by case evidence and a tool; a judgment that answers the question; and a note of what extra information would help.
Timing: about 55 minutes for Section A (roughly 2.5 minutes a mark) and 30 to 35 minutes for Section B, including a few minutes to plan.
✏️Worked example: a practice case study
Pre-released context topics: refill and reuse systems; the use of social media influencers; tourism and plastic waste.
Tirta Kita
In 2023, Made Wirawan and Sarah Lim set up Tirta Kita as a partnership in Bali. The business installs water refill stations in hotels, cafés and co-working spaces. Each station filters and chills tap water; customers refill their own bottles by paying with an app. Tirta Kita earns revenue from app payments and a monthly fee from each host business. Its mission is “to end single-use plastic bottles in Bali’s tourism industry”. It is a for-profit social enterprise.
Growth was fast. The number of stations rose from 40 in 2024 to 75 in 2025 and 130 in 2026. In 2025 the partners converted the business into a private limited company and sold 20% of the shares to a Jakarta investor.
Tirta Kita promotes itself almost entirely through Instagram and TikTok, working with local surf and travel influencers. Its posts show how many bottles each hotel has saved. Some hotels complain that the influencers target young backpackers rather than their older guests.
Tirta Kita now has 12 employees: technicians who install and maintain stations, and two app developers. Made makes most decisions himself and visits every new site. Staff say he is inspiring but that they have little say. Two technicians left in 2026 for better-paid jobs in hotels.
The investor wants Tirta Kita to expand to Java. Two options are being considered:
- Option 1: franchising. Local entrepreneurs would buy the right to install Tirta Kita stations in their city, paying an initial fee and a share of revenue.
- Option 2: opening company-owned stations in Jakarta and Surabaya, financed by a bank loan of Rp 3 billion.
Sarah worries that franchisees may not maintain stations properly; one dirty station could go viral. Made worries about the loan: interest rates have risen, and hotel demand in Java is less certain than in Bali.
Section A (answer all questions)
- (a) Define the term private limited company. [2]
(b) Outline two reasons why Made and Sarah converted Tirta Kita from a partnership into a private limited company. [4]
(c) Explain one advantage and one disadvantage for Tirta Kita of using social media influencers as its main promotion. [4] - (a) Define the term mission statement. [2]
(b) Calculate the percentage increase in the number of stations from 2024 to 2026. [2]
(c) Analyse two possible conflicts between Tirta Kita’s stakeholders if it expands to Java. [6]
Section B (answer one question)
- Recommend whether Tirta Kita should expand to Java through Option 1 or Option 2. [10]
- Discuss whether Made should change his leadership style as Tirta Kita grows. [10]
Markscheme
1(a) A business owned by shareholders, with limited liability, whose shares are not sold to the general public on a stock exchange (sold privately, with the agreement of existing owners). 1 mark for each element, up to 2.
1(b) 2 marks per reason (1 for the reason, 1 for applying it): limited liability protects Made and Sarah’s personal assets as the business grows and takes on more risk; raising finance by selling shares, as shown by the 20% sold to the Jakarta investor; also continuity and credibility with hotel clients.
1(c) 2 + 2. Advantage: cheap, targeted reach to young, eco-conscious tourists; posts showing bottles saved reinforce the mission. Disadvantage: influencers target backpackers, not the older guests of many host hotels, so hotels may see less value; also dependence on the influencers’ reputations.
2(a) A statement of the purpose of the organization, what it does and for whom, now, often reflecting its values. 2 marks for a full answer.
2(b) (130 − 40) ÷ 40 × 100 = 225%. 1 mark for working, 1 for the answer.
2(c) Up to 3 marks per conflict: identify the two stakeholder groups, explain why their interests differ, and apply it to the case. Examples: the investor wants fast growth and returns, while Sarah (an owner) prioritizes quality and the brand; employees may want better pay (two technicians left) while the investor wants costs controlled to fund expansion; franchisees want profit and may cut maintenance, conflicting with customers and the mission.
3 Markbands (10 marks). Relevant content:
fast, low-cost growth; franchisees provide finance and local knowledge; less risk if Java demand is weak; revenue share and fees. But: less control of quality (Sarah’s viral risk), profits shared, finding good franchisees, protecting the brand and app.
full control of quality and brand; all profits kept; builds its own team. But: Rp 3 billion debt at rising interest rates, raising gearing and cash-flow risk; uncertain demand; slower; stretches a 12-person team and Made’s hands-on style.
Tools: Ansoff (market development), sources of finance, gearing, decision tree if probabilities were known, SWOT. Judgment example: franchising with strict standards (training, app-based monitoring of each station, the right to end contracts) fits the investor’s wish for growth while limiting financial risk; a pilot of a few company-owned stations could come first. Limitations: no data on costs, fees, expected revenue in Java or the loan’s interest rate. Top band needs both options weighed with case evidence and a justified recommendation.
4 Markbands. Current style: largely autocratic/paternalistic (makes most decisions, visits every site; inspiring, but staff have little say). Arguments to change: growth means Made cannot manage every site; demotivation and labour turnover; democratic or situational leadership and delegation would use app developers’ and technicians’ expertise. Arguments against: clear direction protects quality during rapid growth; his vision drives the mission. A good judgment: move towards a situational style, delegating day-to-day decisions while keeping control of standards.
📝Practise
More questions on the same case. Work through them, then reveal the answer.
1. [2 marks] Define the term social enterprise.
2. [4 marks] Explain two sources of revenue for Tirta Kita.
3. [4 marks] Explain two reasons why labour turnover may be a problem for Tirta Kita.
4. [4 marks] Using STEEPLE, explain two external factors that could affect Tirta Kita’s expansion to Java.
5. [6 marks] Analyse how a pre-released context topic, “tourism and plastic waste”, could be used in answers about Tirta Kita’s marketing.
6. [10 marks] Discuss whether Tirta Kita can remain a social enterprise after selling shares to an outside investor.
Yes: the investor’s finance funds more stations, meaning more plastic saved; many impact investors support social missions; profits and purpose can align (each station earns and saves bottles).
Risks: the investor may push for short-term profit (higher prices, cheaper maintenance) or expansion where demand is profitable rather than where plastic waste is worst; mission drift; owners’ control diluted.
Judgment: possible if the mission is protected (shareholder agreement, impact targets reported alongside profit), but the evidence on the investor’s aims is limited.
🔗Go deeper — other people’s work
These are external resources, not mine. If one stops working, tell me and everything above it on this page still stands.
- Your teacher and the IB programme resource centre — the current pre-released statement and specimen papers.
- The IB Business management guide (first assessment 2024) — the markbands and command terms in full.
- Reputable business news (Reuters, the Jakarta Post, The Economist) — for researching the context topics.