JNK makes pottery including plates and bowls for the mass market, using batch production. Quality control is important. JNK has 30 unskilled employees, who are all paid the legal minimum wage. JNK uses job enrichment to keep workers motivated. Due to an increase in demand, JNK is planning to replace its old machines with new technology. The Managing Director thinks that some of the low cost materials purchased by JNK are produced using child labour. One of JNK’s competitors has recently introduced a new ethical policy. What is meant by ‘mass market’? What is meant by ‘job enrichment’? Identify and explain two ways in which employees at JNK could be affected by the introduction of new technology. Way 1: Explanation: Way 2: Explanation: 1 1 Identify and explain two ways (other than new technology) that JNK could use to increase output. Way 1: Explanation: Way 2: Explanation: Do you think JNK should become more ethical? Justify your answer. [ 1 1

7115_s19_qp_12

THEORY

2019

Paper 1, Variant 2

View

Natural Care is a company that makes soap. The business always acts in an ethical way. It follows fair trade principles by paying fair prices to its suppliers. It uses a cost plus pricing method when selling its products. Table 2 gives data about the company’s sales of soap and its share of the national market for soap. Table 2 Natural Care Market share of Year sales ($m) Natural Care (%) The Marketing Director of Natural Care wants to introduce a new competitive pricing strategy to help regain market share. She also wants the Board of Directors to think about changing its ethical policy. Calculate the total market sales of soap in 2012. Identify two possible reasons why Natural Care’s market share fell in 2014. Reason 1: Reason 2: Identify and explain two advantages to Natural Care of acting in an ethical way by paying fair prices to its suppliers. Advantage 1: Explanation: Advantage 2: Explanation: Identify and explain two ways in which Natural Care might be affected by changing to a competitive pricing strategy. Way 1: Explanation: Way 2: Explanation: Do you think that customers of products such as soap always benefit from an increase in competition? Justify your answer.

7115_w14_qp_11

THEORY

2014

Paper 1, Variant 1

View

General Auto is a large global business. The management of General Auto are looking for a country where they might open a factory. What is meant by a ‘global business’? Identify two factors that might influence General Auto’s choice of country in which to locate the factory. Factor 1: Factor 2: Multinational companies are not always welcome in a country because they might misuse their power. Explain how pressure groups might try and influence the behaviour of such companies. Movements in exchange rates can cause problems for any business that trades globally. General Auto’ s home country is the United States. Identify and explain three consequences for General Auto of a rise in the exchange rate of the United States dollar. Consequence 1: Explanation: Consequence 2: Explanation: Consequence 3: Explanation: By examining the advantages and disadvantages that multinational companies create, do you think that a Government should seek to attract these companies to their country? Justify your recommendation.

7115_s10_qp_11

THEORY

2010

Paper 1, Variant 1

View

AVC is a private limited company that makes fashion clothing. At the moment it sells all its products to customers in its own country. However, the management of AVC is thinking of exporting goods, although it knows there are problems of entering new markets. All the workers at AVC are members of a trade union. What is meant by a ‘private limited company’? Identify two advantages to AVC of exporting its clothing. Advantage 1: Advantage 2: Identify and explain two methods that the trade union could use to encourage the management of AVC to increase the wages of its workers. Method 1: Explanation: Method 2: Explanation: Identify and explain three problems that AVC might face if it exported its clothing to other countries. Problem 1: Explanation: Problem 2: Explanation: Problem 3: Explanation: AVC has recently received a takeover bid from a multinational clothing manufacturer. Do you think that the stakeholders in AVC would benefit if the takeover went ahead? Justify your answer.

7115_s10_qp_12

THEORY

2010

Paper 1, Variant 2

View

Zalpha is a multinational company. It manufactures agricultural machinery and employs a large number of people. Figure 1 shows a simplified organisation chart for the business. The business decision making is centralised and some employees complain of poor communications within the company. Figure 1 Board of Directors Managing Director Europe Division Managing Director Africa Division Managing Director Asia Division Factory A manager Warehouse manager Stock control manager Quality manager Factory B manager What is meant by a ‘multinational company’? Using only the information in Figure 1: Identify the span of control of the Managing Director of the Asia division. How many levels are there in the chain of command? Identify and explain two possible reasons why Zalpha has poor internal communications. Reason 1: Explanation: Reason 2: Explanation: Identify and explain two advantages to Zalpha of using centralised decision making. Advantage 1: Explanation: Advantage 2: Explanation: Do you think that multinational companies such as Zalpha benefit the countries in which they operate? Justify your answer.

7115_w14_qp_11

THEORY

2014

Paper 1, Variant 1

View

AHP is a multinational company. It makes mobile phones in Europe in country X. 80% of its sales are in Europe. Some people are concerned about AHP’s impact on the environment. The Operations Director said: ‘AHP always tries to ensure it meets all legal controls. Globalisation has created many opportunities for AHP and its stakeholders. The Operations Director is planning to relocate its factories to a low-cost country in Asia. Raw materials would need to be transported an extra 4000kms. Interest rates are likely to increase across Europe. What is meant by ‘multinational company’? Identify two advantages to AHP of being a multinational company. Advantage 1: Advantage 2: Identify and explain two ways in which AHP might have an impact on the environment. Way 1: Explanation: Way 2: Explanation: 1 1 Identify and explain two ways in which an increase in interest rates might affect AHP. Way 1: Explanation: Way 2: Explanation: Do you think AHP should relocate its factories to a low-cost country in Asia? Justify your answer. 1 1

7115_w18_qp_11

THEORY

2018

Paper 1, Variant 1

View

VVA is a business based in country X. It manufactures school backpacks . VVA uses retailers as its channel of distribution. The Managing Director knows there are many factors that can affect demand including the stage of the business cycle and how competitive the market is. VVA imports 45% of its raw materials. The Managing Director is worried that the introduction of import tariffs and import quotas, as well as an appreciation in country X’s exchange rate, will affect VVA. Define ‘import tariff’. Identify two reasons why some markets can become more competitive. Reason 1: Reason 2: State the four stages of the business cycle. 1: 2: 3: 4: [ 1 3 Explain one possible effect of the following changes on VVA when importing raw materials: Introduction of import quotas in country X: Explanation: Appreciation of country X’s exchange rate: Explanation: Do you think retailers are the best channel of distribution for a manufacturing business to use? Justify your answer. 1 3

7115_s23_qp_12

THEORY

2023

Paper 1, Variant 2

View

Alkin is a multinational company. It manufactures breakfast food products including many leading brands of cereal. Alkin plans to start selling in country Z, which is a fast-growing market. Alkin plans to form a joint venture with a local business, based in country Z. ‘Effective communication will be important to our success but I think there are many advantages in expanding this way’ said Alkin’s Managing Director. The Government of country Z is worried about the effect of multinational companies like Alkin on consumers. What is meant by a ‘multinational company’? What is meant by a ‘brand’? Identify and explain two reasons why effective communication might be important for Alkin. Reason 1: Explanation: Reason 2: Explanation: Identify and explain two advantages to Alkin of using a joint venture to expand into country Z. Advantage 1: Explanation: Advantage 2 Explanation: Do you think that the Government in country Z is right to be worried about the effect of multinational companies such as Alkin on consumers? Justify your answer.

7115_s15_qp_12

THEORY

2015

Paper 1, Variant 2

View

BMT is a business partnership owned by 2 brothers. The brothers received government support when they started BMT 6 years ago. BMT now has 30 employees who make high quality watches. The business tries to achieve lean production. Demand has increased each year and in 2019 BMT sold 8000 watches. BMT makes some parts for watches and all the other parts are imported. BMT had to consider a number of factors, including exchange rates, when deciding whether to import parts for watches. Identify two reasons why a government might support business start-ups. Reason 1: Reason 2: State two types of business organisation (other than partnership). Type 1: Type 2: Outline two disadvantages of BMT being a business partnership. Disadvantage 1: Disadvantage 2: 1 4 Explain two ways BMT could achieve lean production. Way 1: Explanation: Way 2: Explanation: Do you think the exchange rate is the most important factor for a business to consider when deciding whether to import parts for a high quality product? Justify your answer. 1 4

7115_s20_qp_11

THEORY

2020

Paper 1, Variant 1

View

The Government of country B plans to build a new airport. A Government spokesperson said: ‘There will be external costs, but I think there will be more benefits for the local community. We have to support businesses such as airlines in the private sector’. RU Air is one of the world’s most profitable airlines. RU has announced plans on its website that it will operate flights to and from country B in the future. RU is a public limited company. What is meant by the ‘private sector’? Identify two ways the Government might support RU Air and other private sector business activity (other than by building a new airport). Way 1: Way 2: Identify and explain two benefits to RU Air of high profits. Benefit 1: Explanation: Benefit 2: Explanation: Identify and explain two benefits for RU Air of having a website. Benefit 1: Explanation: Benefit 2: Explanation: Do you agree that there are likely to be more advantages for the local community from the new airport than disadvantages? Justify your answer.

7115_s14_qp_12

THEORY

2014

Paper 1, Variant 2

View

---