Business 7115 · O Level · Production of goods and services
Production of goods and services — practice question
Saltan produces a variety of cars. Inventory levels are too high, so the company intends to cut output at its factory. Staff were informed that, because competition is rising, the business must shrink the size of its workforce. The trade union is unhappy that 360 of the 1200 skilled full time employees at Saltan will become redundant. A trade union spokeswoman said: ‘Saltan ought to shorten the hours of all employees instead of cutting jobs.’ Saltan’s Operations Director is weighing up methods of improving efficiency in the factory.
(a)[2]
What does the term ‘trade union’ mean?
(b)[2]
Identify two situations, apart from increasing competition, when a business may need to shrink its workforce.
Situation 1:
Situation 2:
(c)[4]
Identify and explain two possible problems for Saltan that could arise from holding a high level of inventory.
Problem 1:
Explanation:
Problem 2:
Explanation:
(d)[6]
Identify and explain two ways Saltan could raise efficiency.
Way 1:
Explanation:
Way 2:
Explanation:
(e)[6]
Do you think Saltan should cut the working hours of every employee instead of cutting the number of jobs? 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 group of workers who come together so that their interests are safeguarded” …