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Ethical Concerns in Motorbike Manufacturing, Exercises of Organization and Business Administration

Mercer University Organization and Business Administration

The ethical issues surrounding the employment of children in motorbike manufacturing factories in country y. It highlights an investigation that uncovered this unethical practice and suggests that the company abc motorbikes should consider forming a joint venture with companies in foreign markets to manufacture and sell their products in an ethical manner. Insights into the importance of corporate social responsibility and the need for businesses to address ethical concerns in their operations, particularly when expanding into international markets.

Typology: Exercises

2023/2024

Available from 10/20/2024

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Second edition

421257_C01_Cam_IGCSE_Business_WB_BP_001-096.indd 1 13/04/18 8:29 AM

Partial preview of the text

Download Ethical Concerns in Motorbike Manufacturing and more Exercises Organization and Business Administration in PDF only on Docsity!

YEARS

Wor

kingforover aC bm rid ge Ass ess m entInternat

ion

alE

du

ca

tio

n

WITH

Cambridge

IGCSE

and O Level

Business

Studies

Second edition

YEARS

Wor

kingforover aC bm rid ge Ass ess m entInternat

ion

alE

du

ca

tio

n

WITH

Karen Borrington

Peter Stimpson

Cambridge

IGCSE

and O Level

Business

Studies

Second edition

Contents

SECTION 1 Understanding business activity

1 Business activity 4 2 Classification of business 7 3 Enterprise, business growth and size 9 4 Types of business organisation 12 5 Business objectives and stakeholder objectives 15 Case study

SECTION 2 People in business

6 Motivating employees 20 7 Organisation and management 23 8 Recruitment, selection and training of employees 26 9 Internal and external communication 29 Case study

SECTION 3 Marketing

10 Marketing, competition and the customer 34 11 Market research 37 12 The marketing mix: product 40 13 The marketing mix: price 42 14 The marketing mix: place 45 15 The marketing mix: promotion 47 16 Technology and the marketing mix 50 17 Marketing strategy 52 Case study

SECTION 4 Operations management

18 Production of goods and services 56 19 Costs, scale of production and break-even analysis 59 20 Achieving quality production 62 21 Location decisions 64 Case study

SECTION 5 Financial information and financial decisions

22 Business finance: needs and sources 69 23 Cash flow forecasting and working capital 72 24 Income statements 75 25 Statement of Financial Position 78 26 Analysis of accounts 80 Case study

SECTION 6 External influences on business issues

27 Economic issues 85 28 Environmental and ethical issues 88 29 Business and the international economy 91 Case study

1 Understanding business activity

Student’s Book Chapters 1–

1 Business activity

Farah opened her business, Farah’s Salon (FS) just after leaving school. She offers hairdressing and beauty services for women. She employs three workers who have quite different skills. One is a hair stylist, one is a beauty specialist and the other is a receptionist. This means that Farah is able to offer a very wide range of beauty and hairdressing services very efficiently. Shampoos, hair sprays and many other beauty products are bought in from several suppliers. Farah’s business is now very busy. Farah is planning to use some of FS’s capital to buy a computer to keep customer records of treatments they have received and to allow an accurate record of appointments to be kept. However, she is worried about the opportunity cost of this.

Farah is keen to increase the added value of her business. She has not yet decided on how to achieve this but she thinks that buying cheaper shampoos and other beauty products is probably the best way.

Farah needs to recruit another employee. She has to choose between one applicant who is an experienced and specialist hair stylist but who has no other beauty experience and the other applicant who has some experience of both hair and beauty but is not a specialist in either.

1 a Identify two different factors of production used by Farah. [2 marks]

...........................................................................................................................................

b Define ‘opportunity cost’. [2 marks]

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c Outline two ways in which specialisation of its employees could benefit FS. [4 marks]

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1 Understanding bUsiness activity

2 a Define ‘capital’. [2 marks]

...........................................................................................................................................

........................................................................................................................................... b Identify two pieces of equipment or furniture that Farah could purchase if she did not buy the computer. [2 marks]

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........................................................................................................................................... c Outline two ways in which the economic problem affects FS. [4 marks]

...........................................................................................................................................

........................................................................................................................................... d Do you think that Farah should employ the experienced and specialist hair stylist or the other applicant? Justify your answer. [6 marks]

...........................................................................................................................................

2 Classification of business

2 Classification of business

FS operates in country X. The business uses several suppliers to obtain all of the materials, furniture and other equipment it needs. FS is in the tertiary sector of industry and depends on other businesses in this sector for important services.

Country X industrialised over 100 years ago and used to have some major secondary sector businesses. Now, tertiary businesses employ more people and produce a higher value of output than manufacturing businesses. Average incomes are high in country X and the demand for important public sector services such as healthcare and public transport is growing.

The government of country X plans to increase the importance of the public sector by buying out some private sector businesses in transport and energy. Taxes might have to be increased to pay for these state purchases of other businesses (nationalisation).

1 a Define ‘tertiary sector’. [2 marks]

b Identify two examples of services provided by other businesses that FS needs. [2 marks]

c Outline the role of two secondary sector industries that supply products to FS. [4 marks]

3 Enterprise, business growth and size

3 Enterprise, business growth and size

Farah is very ambitious and she wants to expand her business quickly. She works long hours and her commitment as an entrepreneur is a good example to her employees. She likes taking important decisions by herself. Her many ideas for expanding the business include offering a wider range of services to male customers as well as female. FS now employs 10 workers. The average sized business in hairdressing and beauty employs five workers. The total value of FS sales this year increased by 15 per cent. Farah believes that FS has more advanced equipment – such as sunbeds and steam baths – than local competitors.

Farah is considering both internal growth and external growth for FS. She could open a new hair and beauty salon in another part of the city. She also knows about two other businesses for sale. Business A is a men’s hairdressing salon that has been trading for many years. The owner is retiring and wants to sell quickly. Business B is a specialist producer of hand-made organic cosmetics. FS uses some of these in the salon and they are very popular. The owner is ill and no longer wants the stress of harvesting natural products and meeting production deadlines. Farah wants to draw up a new Business Plan to help guide her through the next expansion stage of FS.

1 a Define ‘entrepreneur’. [2 marks]

b Identify two important characteristics that allow Farah to be a successful entrepreneur. [2 marks]

c Outline two ways the size of FS could be compared to similar businesses. [4 marks]

1 Understanding bUsiness activity

d Explain two ways the Business Plan drawn up by Farah will help when she expands the business. [6 marks]

e Do you think Farah should use internal growth or external growth for FS? Justify your answer. [6 marks]

1 Understanding bUsiness activity

4 Types of business organisation

Farah set up FS as a sole trader. She financed the start-up with her own savings and loans from parents and her bank. As she is planning further growth for the business, she has been advised to take at least one partner. Alternatively, she could convert the business to a private limited company in which the shareholders would benefit from limited liability. A friend has some savings he has offered to invest and become a partner in FS. He has no business experience and is often on holiday. A business consultant who advises Farah has suggested that his wife could become a partner in FS. He told Farah: ‘She has savings to invest, is an experienced business person and likes being in control.’

FS has contracts with many suppliers. Electricity and water are supplied to FS by public corporations. Furniture for the salon is supplied by a large private limited company. It is owned by a wealthy family who converted their business into a public limited company three years ago. The family regretted its decision because of the limitations of this form of business organisation.

Farah has been asked by a large national chain of beauty salons – called Spa Town – if she is interested in buying its franchise. It would give FS national advertising coverage but Spa Town would insist on changes to the way Farah operates her business. Farah has rejected this offer.

1 a Define ‘sole trader’. [2 marks]

b Identify two drawbacks of being a sole trader. [2 marks]

c Outline two advantages to Farah of remaining a sole trader. [4 marks]

4 Types of business organisation

d Explain two reasons why forming a public limited company would not be suitable for FS at the present time. [6 marks]

e Do you think Farah should form a partnership? Justify your answer. [6 marks]

5 Business objectives and stakeholder objectives

5 Business objectives and stakeholder objectives

Farah’s business objective has changed since she started FS several years ago. It is now a private limited company which means that FS must keep the owners satisfied with a return on their investment.

FS now owns several salons in the capital city. Farah plans to completely redevelop one of these sites. She wants to remove the existing building and construct a large apartment block in its place. The lower level will contain a newly equipped beauty salon and a gymnasium. The gymnasium will allow FS to enter the fitness market for the first time and will appeal to men and women. There will be many new job opportunities. The redevelopment will take six months. Local residents are not happy about the plans. Some FS customers think that prices will be higher to make sure a profit is made. Farah told some senior managers: ‘All stakeholders will benefit from the expansion of FS.’ Farah’s plans for business growth will be expensive and some shareholders are worried about the cost. They would prefer Farah to concentrate on making the existing salons more profitable.

Recent increases in the costs of electricity and water are worrying Farah. The public corporations that supply these utilities claim that the price rises are necessary to meet their objectives.

1 a Define ‘shareholders’. [2 marks]

b Identify two objectives of shareholders. [2 marks]

c Outline two reasons why Farah’s business objectives for FS have changed. [4 marks]

1 Understanding bUsiness activity

d Explain two ways in which one stakeholder group, apart from employees, might be affected by plans to redevelop one of the salons. [6 marks]

e Do you think Farah is right when she says that ‘all stakeholders will benefit from the expansion of FS’? Justify your answer. [6 marks]

1 Understanding bUsiness activity

Understanding business activity: end of section case study

Use all the information at the start of Chapters 1, 2, 3, 4 and 5 to help you answer the following question.

1 a Explain two advantages and two disadvantages for FS of continued growth of the business. [8 marks]

b Farah wants to expand FS. Explain the advantages of each of the following methods of expansion. Recommend which one she should choose. Justify your recommendation. [12 marks]

i Redevelop existing salon including a new gymnasium.

ii Sell FS franchise licences to other businesses.

iii Take over another hairdressing and beauty salon business.

a ......................................................................................................................................

...........................................................................................................................................

b i .................................................................................................................................

...........................................................................................................................................

Understanding business activity: end of section case study

ii .................................................................................................................................

...........................................................................................................................................

iii .................................................................................................................................

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Ethical Concerns in Motorbike Manufacturing, Exercises of Organization and Business Administration

Related documents

Partial preview of the text

Download Ethical Concerns in Motorbike Manufacturing and more Exercises Organization and Business Administration in PDF only on Docsity!

Karen Borrington

Peter Stimpson

SECTION 1 Understanding business activity

SECTION 2 People in business

SECTION 3 Marketing

SECTION 4 Operations management

SECTION 5 Financial information and financial decisions

SECTION 6 External influences on business issues

1 Understanding business activity

Student’s Book Chapters 1–