0450_s13_qp_13
A paper of Business Studies, 0450
Questions:
5
Year:
2013
Paper:
1
Variant:
3
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1
For Examiner’s Use Akbar Metal is a private limited company. It manufactures parts for the bicycle industry. Workers are paid by piece rate. 60% of the company’s products are sold to one customer. Akbar Metal plans to introduce flow production to meet increased demand. ‘It’s a good idea’ says the Production manager. ‘We will need to buy new machinery. This should lead to cost savings. We need to decide which source of finance to use.’ What is meant by ‘piece rate’? Identify two possible cost savings for Akbar Metal of using new machinery. Cost saving 1: Cost saving 2: Identify and explain two possible advantages to Akbar Metal of selling 60% of its products to one customer. Advantage 1: Explanation: Advantage 2: Explanation: For Examiner’s Use Identify and explain three possible problems of flow production for businesses like Akbar Metal. Problem 1: Explanation: Problem 2: Explanation: Problem 3: Explanation: Explain two suitable sources of finance for the purchase of new machinery. Recommend which source Akbar Metal should use. Justify your answer. Source 1: Source 2: Recommendation:
4. Operations management  →  4.2. Costs, scale of production and break-even analysis
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2
For Examiner’s Use Walker Fashion makes handmade suits for men. It sells in a niche market. Each suit costs $300 to make and the company adds 40% to the total cost to calculate the selling price. Last year the company’s sales fell. The Finance Director is worried. He said: ‘We might have to make some skilled workers redundant if we can’t improve sales.’ What is meant by a ‘niche market’? Calculate the selling price of a suit. Identify and explain two benefits to Walker Fashion of having skilled workers. Benefit 1: Explanation: Benefit 2: Explanation: For Examiner’s Use Identify and explain two factors Walker Fashion needs to consider when setting a price for its suits. Factor 1: Explanation: Factor 2: Explanation: Explain two methods (other than pricing) that Walker Fashion could use to improve sales. Recommend which method Walker Fashion should use. Justify your answer. Method 1: Method 2: Recommendation:
3. Marketing  →  3.3. Marketing mix
4. Operations management  →  4.1. Production of goods and services
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3
For Examiner’s Use Kipta manufactures a range of cleaning products. All products are made using batch production. The safety of workers is important as chemicals are used to make the products. Revenue is falling due to increasing competition. The owner plans to develop new products. She believes that market research would be useful to the successful introduction of any new products. What is meant by ‘revenue’? Identify two features of batch production. Feature 1: Feature 2: Identify and explain two ways that Kipta could improve the safety of workers. Way 1: Explanation: Way 2: Explanation: For Examiner’s Use Identify and explain three benefits for consumers of increased competition. Benefit 1: Explanation: Benefit 2: Explanation: Benefit 3: Explanation: How important is market research to the successful introduction of a new product? Justify your answer.
3. Marketing  →  3.3. Marketing mix
3. Marketing  →  3.2. Market research
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4
For Examiner’s Use Bolton Hotel is a family-owned hotel. Most of its revenue is made in January and February. An extract of the hotel’s accounts is shown in Table 1. The Managing Director said: ‘I need to find ways to improve liquidity’. He is also concerned about the high level of staff turnover. He thinks that poor motivation might be the reason for many staff leaving their jobs. Table 1: Extract from Bolton Hotel’s balance sheet ($000s) Fixed assets Current assets: Stock Debtors Cash Current liabilities What is meant by a ‘balance sheet’? Calculate the acid test ratio for 2012. Identify and explain two problems for a business caused by many of its staff leaving. Problem 1: Explanation: Problem 2: Explanation: For Examiner’s Use Identify and explain three suitable ways to improve motivation of staff at Bolton Hotel. Way 1: Explanation: Way 2: Explanation: Way 3: Explanation: Explain two ways to improve the liquidity of the hotel. Recommend which way the Managing Director should use. Justify your answer. Way 1: Way 2: Recommendation:
5. Financial information and decisions  →  5.5. Analysis of accounts
2. People in business  →  2.3. Recruitment, selection and training of employees
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5
For Examiner’s Use Country G has a market economy. There are no employment laws and trade unions are not allowed. GreenStar is located in country G. It sells designer clothing to retailers in Asia and Europe. GreenStar’s Managing Director wants the business to grow. He is concerned that country G’s appreciating exchange rate will affect the competitiveness of the business. What is meant by a ‘market economy’? What is meant by a ‘trade union’? Explain the possible effect of an appreciation in country G’s exchange rate on the competitiveness of GreenStar. For Examiner’s Use Identify and explain three reasons why the Managing Director of GreenStar might want the business to grow. Reason 1: Explanation: Reason 2: Explanation: Reason 3: Explanation: Do you think it would benefit businesses in country G if there were employment laws? Justify your answer.
6. External influences on business activity  →  6.3. Business and the international economy
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