Business 0450 · IGCSE · Production of goods and services
Production of goods and services — practice question
SNT is an ethical business. It makes a range of soft drinks through batch production. In 2023, SNT produced 300 000 bottles of soft drinks each week. Many factors influence the amount of inventory the business ought to keep. The directors of SNT plan to grow the business into new overseas markets by setting up a joint venture. They are also thinking about licensing as another method to help deal with the possible difficulties of entering these new markets.
(a)[2]
Define the term ‘licensing’.
(b)[2]
Identify two factors that could influence how much inventory a business should hold.
(c)[4]
Outline two advantages to SNT of using batch production.
(d)[6]
Explain one advantage and one disadvantage to SNT of forming a joint venture when entering new markets in other countries.
(e)[6]
Do you think that the advantages to a business of being ethical outweigh the disadvantages? Justify your answer.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A business allows another business to produce branded/patented products under licence” …