Business 9609 · AS & A Level · Location and scale

Location and scale — practice question

(a)[8]

Refer to Table 2. Calculate the gap between the annual cost of outsourcing the transport of fuel in country X and the current annual transport cost.

(b)[12]

Using your result to 2(a) and other relevant information, recommend to PGP’s directors whether the transport of fuel should be outsourced in country X. Justify your recommendation.

Worked solution & mark scheme

This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: Correct cost saving comes to 89 - 78 = $11m

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