Business 0450 · IGCSE · Production of goods and services
Production of goods and services — practice question
HGH manufactures truck (lorry) engines through batch production. Quality assurance is important. Profit fell by 30% last year. After considering the information in Table 1, the Managing Director has chosen to shut one of its two factories. He stated: ‘The difficulties are high energy costs and tougher competition from imports. The Government ought to bring in measures such as import quotas to protect firms like us. If it does not, then both factories may have to close’.
(a)[2]
What does ‘quality assurance’ mean?
(b)[2]
Calculate $X$ from Table 1.
(c)[4]
Identify and explain two ways the Government might help HGH become more competitive.
(d)[6]
Identify and explain one advantage and one disadvantage to HGH of using batch production.
(e)[6]
Recommend which factory HGH should close. Support your answer with the information in Table 1.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Quality standards checked throughout the production process” …